The Burnaby Board of Trade is joining a chorus of business groups concerned an imminent increase to the Canadian Pension Plan could have unintended negative consequences.
In a statement released this week, the local board of trade called on members to provide their thoughts about the changes to the Canadian Pension Plan (CPP), which were approved in principle by Federal Finance Minister Bill Morneau and a majority of provinces, including British Columbia.
The changes would see CPP payouts increased from 25 per cent of a person’s income to 33 per cent, so someone earning $50,000 a year would receive $16,000 rather than $12,000. To pay for this increase, contributions would be upped by two per cent, with employers and employees each paying an additional one per cent more than they’re paying now. This change is expected to be rolled out over a seven-year period beginning in January 2019, but nothing has been set in stone yet – it’s still unclear exactly how the increase will be implemented.
“In the coming weeks, while we wait for the specific details to be released by the federal government, we’ll be looking at this issue from all sides and listening to our members to see what impact the CPP changes may have on Burnaby businesses and what can be done to mitigate any negative effects,” said Paul Holden, president and CEO of the Burnaby Board of Trade.
The board of trade isn’t the only group raising concerns over the pending changes. The Canadian Chamber of Commerce, of which the Burnaby board is a member, has also expressed concerns about the impact the increased payroll costs will have on the bottom lines of Canadian businesses, according to a press release from the Burnaby Board of Trade.
Holden said while he agrees it’s important people have enough money for retirement, increases to CPP could affect more than bottom lines; it could affect job creation and consumer spending.
As the board of trade awaits further information from the federal government regarding the changes to the pension plan, it’s asking members to contact Cory Redekop, manager of policy and events at the board, with any concerns or comments they may have. Redekop can be reached at [email protected].
