CPP deal is ‘devastating move,’ businesses warn

Theglobeandmail.com
June 21, 2016
By Bertrand Marotte

The proposed expansion of the Canada Pension Plan represents a significant threat to a business sector that is trying to cope with the fallout from a still-shaky economy, top business lobby groups say.

“The announced agreement to expand the CPP will basically be a form of payroll tax which, when it is in full force, will put further financial strain on Canada’s already struggling businesses and on the middle class,” Perrin Beatty, president and chief executive of the Canadian Chamber of Commerce, said in a news release.

The new plan, agreed to late Monday by Federal Finance Minister Bill Morneau and all the provinces’ finance ministers except for Quebec and Manitoba, will require workers and their employers to pay higher contributions.

But Ottawa has so far not disclosed how much the move from a payout of 25 per cent of earnings to 33 per cent will cost, the Chamber of Commerce said.

“When a government promises big increases in benefits without telling us how much it will cost or who will pay for it, we know there’s a big bill coming,” Mr. Beatty said.

“Employers may have to halt job creation in order to pay for this CPP increase, or delay important investments.”

The Canadian Federation of Independent Business said the proposed CPP expansion is “a devastating move for Canadian workers and the economy in general.”

“It is tremendously disappointing to see that finance ministers are putting Canadian wages, hours and jobs in jeopardy and willfully moving to make an already shaky economy even worse,” CFIB president Dan Kelly said.