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Low RRSP savings ‘reinforce’ need for pension reform: Ontario’s Wynne

Watch: Ontario Premier Kathleen Wynne tells reporters the province is moving forward on its own pension plan. 

The numbers show it: Ontarians aren’t saving enough and the province must act, and fast, Premier Kathleen Wynne says.

“I believe this is a critical issue for the people in the province and the RRSP statistics just reinforce that,” the premier said this week when asked about new data published by Global News showing low contribution levels among tax-filers in the province.

“The fact that there are large swaths of the population that can’t afford or don’t contribute to RRSPs [registered retirement savings plan] lends credence to the notion that people aren’t saving enough – they don’t have the capacity to save enough and their retirement is not necessarily secure,” Wynne told reporters in London, Ont.
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The Liberals intend to introduce a new pension scheme in this spring’s budget designed to boost income for retirees in their golden years, a controversial move that could well see payroll taxes rise and hit take-home pay for many if not all workers.

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Ontario and other provinces such as Prince Edward Island have implored the federal Conservatives to make “enhancements” to the Canada Pension Plan to address headwinds they say retiring workers are facing.

But Ottawa has rejected tinkering with the CPP, saying the economy is too fragile to contemplate shaving another slice off household incomes to boost the fund and allow it to generate bigger payments down the road.

READ MORE: New pension rules will be unveiled this spring, Wynne says 

Changes to the CPP would be her “first choice,” Wynne said, but cooperation from Ottawa is not going to happen anytime soon.

“There does not seem to be at this moment an appetite to do that on the part of the federal government. So we have committed to bringing forward an Ontario pension plan for the spring in our budget,” she said.

The province has appointed former Prime Minister Paul Martin as an adviser for the new fund, and has enlisted the aid of others, including Royal Bank of Canada corporate director David Denison, Healthcare of Ontario Pension Plan president and CEO Jim Keohane and Ontario Teachers’ Pension Plan vice-president Melissa Kennedy, among others.

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Data published by Global News this week showed that in most neighbourhoods across major cities like Toronto less than 30 per cent of tax-filers contribute to a registered retirement savings plan.

And among those tax-filers, a majority only saved between 2 to 4 per cent of their income.

RRSP contributions: Toronto »

RRSP contributions: Toronto

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