The Honourable Ted Menzies, Minister of State (Finance), today delivered the keynote opening speech at the World Pension Summit in Amsterdam. His address focused on why Canada’s finance ministers decided to introduce a framework for Pooled Registered Pension Plans (PRPPs) as the most effective and appropriate way to bridge existing gaps in the country’s retirement income system.
“Canada’s retirement income system is recognized around the world by expert groups such as the Organization for Economic Co-operation and Development as a model that succeeds in reducing poverty among Canadian seniors and in providing high levels of income replacement to retired workers,” said Minister Menzies. “Our work with the provinces found, however, that some modest- and middle-income households may be at risk of under saving for retirement.”
“We opted to prioritize the PRPP framework because it was considered the most effective and appropriate way to target those individuals who may not be saving enough for retirement—in particular, the millions of Canadians who do not currently have access to a workplace pension plan,” said Minister Menzies.
“PRPPs will allow small business owners and their employees to have access to an accessible, large-scale, low-cost defined contribution pension plan for the very first time—with professional administrators working to ensure that funds are invested in the best interests of plan members,” said Minister Menzies. “And by pooling pension savings, we will allow Canadians greater purchasing power. Basically, Canadians will be able to buy in bulk so that more money is left in their pocket when they retire.”
While Canada’s retirement income system has received increased international attention as a model to emulate, Minister Menzies noted that a healthy system is one that is regularly reviewed to ensure that it serves Canadians as effectively as possible. “That is why we will be tabling PRPP legislation in the near future.”