Ontarioâs associate finance minister is calling Prime Minister Stephen Harperâs attempt to block a proposed Ontario pension plan âsilliness.â
Speaking to CTVâs Power Play, Mitzie Hunter rejected Harperâs characterization of the newly proposed provincial pension plan as a tax hike.
âI think that what Mr. Harper is saying is just silliness,â said Hunter. âYou wouldnât call a group RSP (retirement savings plan) or a TFSA (tax-free savings account) a tax, so a pension is not a tax. A pension is part of peopleâs compensation.â
Ontario Premier Kathleen Wynne presented her plans to establish the Ontario Retirement Pension Plan (ORPP) Tuesday in Toronto. The announcement came after the province passed legislation in April to create the plan for the more than 3.5 million Ontarians who do not have a workplace pension. There is currently no mandatory provincial pension plan in Ontario.
Harper said he was âdelightedâ to see that the federal Conservativesâ refusal to co-operate with the proposed plan was making it more difficult for the Ontario government to proceed. He vowed to continue to fight it.
While Hunter said Ontario would have appreciated the federal governmentâs support, via the Canada Revenue Agency (CRA), in its creation of the ORPP, they are prepared to explore other options for the administration of the plan.
âWe had wanted to work with the CRA on the administration,â said Hunter.
âIt was actually the Harper government that responded saying that they want to stand in the way of a pension plan here in Ontario and not co-operate with us, which is highly disappointing given that there is infrastructure in place already for the CPP (Canada Pension Plan) that could have been an efficient and simple way to do this.â
Hunter did not provide any further details on those other administrative options.
Wynne said Tuesday that while the government doesnât know how much the plan will cost Ontario, it would be less complicated if it had federal support.
The ORPP would force companies to pay premiums of 1.9 per cent of each employeeâs salary, up to $1,643 a year, with workers paying an equal amount. In 2017 it would start phasing in for employers with more than 500 employees and no pension, followed by medium-sized employers on Jan. 1, 2018. Companies with 50 or less workers would be ushered into program on Jan. 1, 2019.
Hunter said the Ontario government is aiming to ensure that all Ontario workers have a pension through the ORPP or a workplace pension plan by 2020.
The Harper and Wynne spat is just the latest in a recent battle between the provinces and federal government. Last week, Harper blasted Wynneâs pension plan and Alberta NDP Premier Rachel Notleyâs decision to raise corporate and income taxes, prompting a very public fight between him and the premiers.
With files from the Canadian Press