For strategic brilliance and tactical cunning, look no further than the Conservative Government of Canada. In an election year, these are the days that try the souls of federal Liberals and New Democrats, alike.
Against their own advice of only a year ago, the Harper Tories have executed a stunning reversal of policy in announcing that they will, after all, allow individuals to top-up their Canada Pension Plans (just in time, naturally, for the fall general election).
Said Finance Minister Joe Oliver last week: “To build on our current world-class system, we intend to consult with experts and stakeholders during the summer on options for allowing voluntary contributions to the Canadian Pension Plan.”
“However,” he added, “our government will not force Canadians into a mandatory, job-killing, economy-destabilizing, pension-tax hike on employees and employers. We believe that Canadians are best placed to decide how to save for their retirement with voluntary options, rather than have tax hikes imposed on them.”
That said, messing with the CPP – an arrangement between the feds and the provinces – would be a remarkable example of progressive politics for a party that has despised all such connotations in everything it has done to date.
And if this is not simply another vote-getting ploy – but an actual commitment should the Tories win another majority in October – it could amount to one of the biggest advances in social policy since Tommy Douglas tread the fair earth of western Canada so many decades ago.
Now, to be clear, a “voluntary” codicil to the current fed-prov agreement is a far cry from a “mandatory” requirement that employees and employers dig deeper into their pockets to fund old-age retirement benefits. It is not, for example, even close to the system that the UK currently enjoys – a system that tops up the state-benefit program with an ancillary fund that effectively raises the post-retirement incomes of low-wage earners to 40 per cent of the median, national average.
Still, it’s a start, and not a moment too soon.
Canada is facing a demographic crisis that all evidence suggests is leading the largest population cohort (those between the ages of 53 and 55) into structural poverty within 15 years.
Late-blooming equity accounts, overspending, debt restructuring, falling wage levels, winnowing economic opportunities for adult children, the various predations on retirement savings of capital markets – all have conspired to make a minefield of a future that once looked like the Elysian Fields.
Still, not everyone is convinced of the federal government’s good intentions. According to a Globe and Mail story, the NDP’s finance critic called the move a “deathbed conversion.” Indeed, he said, “you can tell when the government’s serious about something: They ram it through an omnibus bill. When they’re not serious about it, they launch a series of consultations.”
That’s fair enough. But what if – just this time – the Tories are serious about this thing of theirs; this entirely uncharacteristic overture to protect the future of the nation’s citizenry from the neglect and impotence that present-day capital markets promise routinely?
Even the remote hope that average wage-earners might obtain a measure of control over their retirement savings by plugging into a virtually fool-proof, government-guaranteed vehicle – as opposed to a predatory, capricious financial sector where certain public administrations actually pay criminally liable investment banks to stay afloat – is a genuine comfort to those who don’t occupy the one-per cent of the income population.
That’s why, of course, Mr. Oliver’s modest proposal is also masterful politics, timed like a bank vault on Canadian election time.