Entries in Ontario Retirement Pension Plan (3)


Greater Peterborough Chamber of Commerce and province wide employer coalition urge government to protect the economy and local jobs under new pension plan

The Peterborough Chamber of Commerce in partnership with the Ontario Chamber of Commerce (OCC), and a coalition of major Ontario employers are calling on the provincial government to broaden its definition of a comparable pension plan under the Ontario Retirement Pension Plan (ORPP), to be implemented in 2017.  

A letter to Premier Kathleen Wynne was signed by 58 chambers of commerce & boards of trade, 92 employers and 17 assocations. For the full letter and signatories click here.

This move would ensure that companies in Peterborough that have an existing pension plan for their employees would not be forced to incur this new cost of doing business.  

“Ontario’s business community is sympathetic to the retirement savings challenge facing many in this province, so it is important that we get the solution right,” said Stuart Harrison, President & CEO of the Peterborough Chamber of Commerce. “The Chamber Network and major employers in the province have come together to advocate for a solution that will protect vulnerable Ontarians while ensuring that we sustain a business climate that fosters growth and job creation. From diverse sectors including insurance, automotive, manufacturing, tourism, retail, and entertainment, we believe there is strong support for our message both here in Peterborough and across Ontario.”


June 2, 2015

Hon. Kathleen Wynne
Premier of Ontario
Legislative Building
Queen’s Park
Toronto ON M7A 1A1

Dear Premier Wynne,

Thank you for your continued engagement with Ontario employers as you move forward with the design of the Ontario Retirement Pension Plan (ORPP). As you know, many employers are concerned with your government’s proposed approach to tackle challenges related to retirement savings. We, the Ontario Chamber of Commerce (OCC), and our members and partners, believe the ORPP will have unintended negative consequences for the province’s economy. A recent survey of OCC members found that only 26 percent of employers in the province believe they can shoulder the financial burden associated with the ORPP.

As such, we applaud your government for recently committing to conduct a cost-benefit analysis of the ORPP, as the OCC had requested. This is a good first step in determining the impact that the ORPP will have on Ontario’s economy.

This pending cost-benefit analysis notwithstanding, Ontario employers remain concerned that the ORPP will harm Ontario’s economy and will penalize employers and employees that are contributing to a secure retirement future.

We, the Ontario employer community, are sending you this letter at a pivotal moment in the development of the ORPP. In May, your government passed ORPP enacting legislation. Over the coming months, your government will design the final parameters of the plan. As such, we are writing to express our serious concerns over the proposed definition of pension plan ‘comparability’ as outlined in your Ontario Retirement Pension Plan consultation document from December 2014.

Set for introduction in 2017, the ORPP will see employees and employers contribute 1.9 percent each (3.8 percent combined) on an employee’s annual earnings up to $90,000. There are some indications that only certain workplace pension plans will be considered ‘comparable’ to the ORPP, namely Defined Benefit and Target Benefit Multi-Employer Pension Plans. Employers who offer ‘comparable’ workplace savings plans will be exempt from contributing to the ORPP.

We support the government’s policy objective—to tackle the undersaving challenge and help all Ontario workers save for retirement. However, we do not believe the ORPP is the right tool to solve the problem. Further, a narrow definition of comparability would have serious consequences for the retirement savings landscape and savings in Ontario.

First, the ORPP penalizes employers who are already investing in their employees’ retirement savings. Many employers already contribute to their employees’ retirement savings through a variety of plans, which include Defined Contribution (DC) plans, group Registered Retirement Savings Plans (group RRSPs), and group Tax Free Savings Accounts (group TFSAs), among others. These plans often involve contribution levels above those stipulated for the ORPP; for example, the average company contribution rates to DC plans and group RRSPs in Canada are 5.2 percent and 4.3 percent, respectively.

Second, by adding costs to employers that already contribute to robust workplace retirement savings plans, the government will counteract its desired goal of increasing Ontarians’ retirement savings. For example, employers who offer non-comparable retirement savings plans might choose to reduce the contributions in these plans to offset the new costs incurred by the ORPP. In fact, according to a survey conducted by Environics Research, 66 percent of Ontario companies may consider eliminating their existing DC or group RRSP plans if the ORPP is introduced. The same survey found that 78 percent of companies are likely to reduce contributions to their workplace retirement plan.

Third, the ORPP could erode the three pillars approach to the retirement income system in Canada by replacing private with public savings. Most of the workplace retirement savings plans made available to Ontarians by the private sector are non-comparable under the government’s preferred definition. In fact, over 2.4 million Ontarians are covered by plans that the government has deemed non-comparable. Reduced demand for these savings plans brought on by the ORPP could disrupt the balance of public-private savings in the province.

Given these concerns, we strongly urge your government to expand its definition of pension plan comparability to include capital accumulation plans, including (but not limited to) Defined Contribution plans.

As currently designed, the ORPP would take a universal, rather than a targeted approach, to what is a narrow undersaving problem. According to recent analyses by the federal Working Group on Retirement Income Adequacy and McKinsey & Company, a large majority of Canadians and Ontarians are on-track to maintain their standard of living in retirement. In a comprehensive survey of Canadian households, McKinsey estimates that 83 percent of households in 2014 are on track to maintain or exceed their level of consumption in retirement. The ORPP is a blanket solution to a narrow undersaving problem, a problem that many employers have addressed by offering workplace pension plans.

Expanding the definition of comparability would help to mitigate the impacts that the ORPP will have on employers who are already investing in the retirement savings of their employees. As you will see, the Ontario Chamber of Commerce has reached beyond its membership for co-signatories to this letter. The number and diversity of co-signatories reflects the widespread concerns of Ontario’s employer community.

We look forward to working constructively with you over the coming weeks and months as you continue to define the parameters of the ORPP.


Allan O’Dette
President & Chief Executive Officer
Ontario Chamber of Commerce

Hon. Mitzie Hunter, Associate Minister of Finance (Ontario Retirement Pension Plan)
Hon. Charles Sousa, Minister of Finance

Source: Ontario Retirement Pension Plan: Key Design Questions

The image to the right is the government's current stance on plans considered comparable to ORPP. The current recommendation is to only consider Defined Benefit (DB) Plans and Target Benefit Multi-Employer Pension Plans (TB MEPP) as comparable.  

 Comment through the "Peterborough Chamber" group of LinkedIn. 


Federal government considers voluntary expansion to CPP

Photo courtesy: Ontario Chamber of CommerceInteresting news from Federal Finance Minister Joe Oliver today. He says government will consider voluntary expansion of CPP contributions.  Over the summer, a committee will meeting with stakeholder groups to discuss the option.  

The Ontario government has said that one of the reasons for bringing in the Ontario Retirement Pension Plan (ORPP) was because the federal government refused to make changes to CPP.  

Currently the provincial government is working on building the ORPP program.  Earlier today, they approved legislation to allow Pooled Registered Pension Plans (PRPPs) in Ontario.

More here on the federal announcement: 

Globe and Mail: http://trib.al/erYAW24 

CBC.ca: http://cbc.ca/1.3087896 

Links to Voice of Business Blog articles on ORPP: bit.ly/1CZOrfW


Peterborough Businesses: Help shape the next provincial budget


Help shape Ontario's 2015 Budget and add your voice to Canada's most credible survey of business opinion. The Ontario Chamber of Commerce is asking members of Chambers of Commerce across the province to have their say:


  • What are the critical issues impacting your bottom line?
  • Can you afford the proposed Ontario Retirement Pension Plan?
  • How is your business being affected by Ontario’s skills gap?


By taking a moment to complete this short survey, you will be entered into a draw to win two round-trip tickets to any Air Canada flight destination in Canada and the continental United States.


Please note that this survey closes on February 13 at 5pm (EST) and that only the prize winner will be contacted. Promotional consideration for this survey has been provided by Air Canada.