An agreement in principle has been reached on a revamping of the Canadian Pension Plan.
The plan would see a gradual increase in premiums of seven dollars a month starting in 2019, to be paid by the worker and the employer. By 2023 the premium would increase by another 34 dollars.
Critics have warned that expanding the CPP would squeeze workers and employers for more money, and hurt the fragile economy. But most of the country’s finance ministers disagree with that view and say boosting premiums now would ensure better benefits later.
Any change to the CPP needed a minimum of seven of the ten provinces. Manitoba and Quebec voted against the plan, but are willing to take part in discussions moving forward. Manitoba wants to study the issue further, and Quebec has its own pension plan.
Maximum annual retirement benefits would eventually increase by about one-third to $17,478.
The agreement is set to be finalized by the provinces on July 15th.