Alberta is the only province opposed to the plan, and Finance Minister Ted Morton maintains that putting more money into CPP won't fix the pension problem.
In an open letter to federal and provincial finance ministers meeting in Kananaskis next week, the federation on Wednesday urged the ministers to disregard Alberta's objections and expand the CPP.
"Ted Morton and the Conservative government do not speak for Albertans," federation president Gil McGowan said. "It's clear that Albertans are at least as supportive of CPP expansion as other Canadians."
McGowan points as proof to a recent Environics poll that showed two in three Albertans support increasing Canada Pension Plan benefits through a gradual increase in contributions by both employees and employers. Across Canada, 78 per cent of respondents said they support increasing government pension benefits.
In addition, Edmonton's city council on Nov. 26 voted to send a letter to Premier Ed Stelmach and Finance Minister Ted Morton in support of expansion.
Morton said the federal government's own studies show the system is working for high- and low-income Canadians, because the wealthy fund their own retirements and low-income Canadians have access to CPP, Old Age Security pension and the Guaranteed Income Supplement.
"In the middle-income bracket there is a problem," he said. "Our position is that the solution should be tailored to fit the problem. The solution is not across-the-board CPP hikes. ... It doesn't address the problem."
Morton said increasing CPP contributions prevents working Albertans from investing their money elsewhere and that increasing employer CPP contributions is a "payroll tax" and prevents businesses from hiring new workers.
Further, he said the federal government's plan will not benefit those who are retired or over 50 years old.
The solution, he said, is to improve Albertans' access to pension plans through their employers, which Alberta has been working on for more than three years.
"Alberta will proceed with private-sector pension reform regardless of whether there's a change in CPP or not," he said. He said Albertans can expect to see changes in 18 to 36 months, depending on how fast the economy recovers.
McGowan said Alberta has the lowest pension coverage in Canada with only one in five private sector employees with access to a pension plan through their work, according to a federation study.
In addition, he said most Albertans are not saving enough for retirement: in 2008, 38 per cent of Albertans contributed to their RRSPs, and the average contribution was $3,200.
Edmonton Journal, Wed Dec 15 2010
Byline: Karen Kleiss