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Increasing CPP Would Hurt Economy

Increasing Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) benefits would hurt the Canadian economy and result in significant job losses, says a report from the Canadian Federation of Independent Business (CFIB). The ‘Forced Savings’ report looks at the so-called 10-10-10 proposal that would phase in CPP/QPP increases over 10 years. Among the findings are that employees would pay up to $1,100 more per year in CPP/QPP premiums and employers would pay up to $1,100 more per year, per employee. However, it contends that these higher labour costs would lead to 700,000 person years of lost work and the federal and provincial governments' debt-to-GDP ratios would increase by two and 1.2 per cent respectively. "There's been lots of talk about increasing benefits, with very little mention of the cost," says Ted Mallett, CFIB’s vice-president and chief economist. "The short-term impacts are substantial, yet benefits could take decades to be fully implemented." In June, the nation's finance ministers will discuss increasing CPP and QPP.

Courtesy of Benefits and Pensions Monitor website News Alerts

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