The Manitoba Chambers of Commerce is concerned that a new mandatory Manitoba Pension Plan proposed by one of the NDP Leadership candidates, if implemented, would make the Manitoba business climate even less competitive.
Over the weekend, one of the three leadership candidates announced their intentions to develop and implement a pension plan for Manitoba residents who do not have a pension plan through their employer. The so-called “Manitoba Pension Plan”, would be similar to one proposed in Ontario, which would be paid through contributions from employers and employees.
Manitobans are already asked to stretch their paycheques to the brink for everyday necessities. Manitoba Chambers of Commerce President and CEO Chuck Davidson believes the proposed, new pension plan option would force Manitobans to live on less, while jeopardizing our economic competitiveness with neighbouring provinces.
“Simply put, when you’re saying to employers that you shall put in place a mandatory pension plan with employees, that’s an additional cost”, said Davidson. “Anytime you have an additional cost to business that makes Manitoba less competitive. This is not a cost that government is taking on. This is a cost that would be passed on to business to say, ‘you’re going to pay for this, employees are going to pay for this, whether or not they want it.”
In Ontario, where the issue of provincially run pensions continues to be a hot button topic, the Ontario Chambers of Commerce estimates that a business that employs 10 people who earn $45,000 each, the employer will be obligated to pay almost $8,000 per year in additional pension contributions. For smaller to medium businesses, that extra money could impact their ability to run an effective operation. For non-profit organizations, it could affect their ability to properly carry out the work they do.
Even more mind boggling is the fact that employees already have the option of CPP, opening RRSP’s or a Tax Free Savings Account to prepare for their future. Also troubling for Davidson and the Chambers of Commerce is why this plan would be floated before proper consultation was done with businesses.
“Before we can have a proper debate on the plans merits, we need all the details”, added Davidson. “Announcing a plan that would impact so many without a full detail of how it works or consultation makes little sense. Although it’s not the first time this government has arbitrarily taken more money out our pockets without consultation.”