Pension changes to save $2.6B over 5 years

Written By Unknown on Kamis, 18 Oktober 2012 | 22.40

The Conservative government today tabled a 443-page bill, the second one to implement the federal budget, that includes changes to MP pensions.

Bill C-45, the jobs and growth act, would extend a popular small business hiring credit, Finance Minister Jim Flaherty said Thursday morning at the Ottawa bike shop Joe Mamma.

New Democrat MPs will respond to the tabling of the bill at 11:30 a.m. ET.

It also includes changes to MP and public-sector pensions, Flaherty said, to increase the amount MPs pay into their pensions. That change will start as early as Jan. 1, 2013.

Treasury Board president Tony Clement says the changes will save $2.6 billion over the next five years.

Asked whether he'd be willing to split the massive bill so MPs can vote separately on pension reform from the other measures, Flaherty said no.

"We have an economic plan for the country. We did a budget in March and if anyone, including the opposition, want to read it, I welcome them to read it," he said.

"There's no surprise there for anyone who bothers to inform themselves about what's in the budget. So I hear the opposition say that [they want it split] but it's really quite self-serving and it shows, it seems to me, a lack of diligence in actually studying what's in the budget. there are no surprises here."

Flaherty also took time in his speech to repeat the party's attack on the NDP's plan for a carbon tax.

Pension changes coming

Starting in 2016, MPs will have to contribute 50 per cent of the payments into their pensions. Flaherty says the move will bring them into line with the public-sector changes and closer to the private sector.

"This is a major change and it's vitally important," he said.

MPs will also have to wait until age 65 to start collecting their pensions, or be penalized if they start at age 55.

The precise date for MP pension changes is Jan. 1, 2016. There will be no change to the current eligibility for MP pensions of six years of service.

Another change expected in the budget is a rise in the retirement age, from 60 to 65 years, for new federal workers.

More to come

C 45 Jobs and Growth Act 2012 (PDF)
C 45 Jobs and Growth Act 2012 (Text)


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