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CPP Expansion Helps Economy

Expanding the Canada Pension Plan would benefit Canada’s economy and this expanded economy would make an improved CPP affordable, says a CBC news report. An internal federal finance document from last December obtained by the Canadian Press suggests that higher savings will lead to higher income in the future and higher consumption possibilities for seniors. As well, it says CPP improvements phased in over a period of time could be absorbed by more robust economy. It looked at the phase-in of premium hikes from 1997 to 2003 that boosted contributions and made the plan more financially sustainable for the period when the baby-boom generation is retiring, saying if an increase is implemented during a time of robust economic growth, as was the case in the late ’90s, the impact of increased contributions would be offset by the strength of the economy. The current CPP annual benefit is $12,150. With Old Age Security and Guaranteed Income Supplement (GIS), the pension benefit can add up to just over $16,000.

Courtesy of Benefits and Pensions Monitor website News Alerts 

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