The truth about the UCP's Alberta Pension Plan

Danielle Smith is lying to us.

When the UCP came into power they had Morneau Shepell (later known as LifeWorks) - prepare a report on the value of the CPP for Albertans. Kenney commissioned this sometime in March of 2020. Kenney was going to release it in March of 2021. Smith instructed Alberta’s Finance Minister Toews to continue working on the file. LifeWorks acquired Morneau Shepell on May 17, 2021, and was listed on the TSX. It was acquired by Telus on Sept. 1, 2022. They were paid 1.8 million to produce this report. Lifeworks was delisted on the TSX on Sept. 2, 2022, one day after Telus acquired it. On Sept. 21, 2023, the UCP released the report over a year after the https://www.livingwaters.ab.ca/apps/news/article/825296 company was delisted.

In the report, there is no mention of Morneau Shepell. So I wonder who wrote this report and what were their credentials? There are no names, addresses, academic credentials, professional affiliations, or contact information of any kind. They expect Albertans to put their trust in an unknown entity.

There is a former cabinet minister who stands by this report. “The former cabinet minister who holds this report up to be the truth and should not be questioned by anyone goes on to opine that LifeWorks valued Alberta’s contribution to the CPP to be 53% of the fund's assets.” David notes here that it did not start at 53% but rather at a whopping 117% of CPP assets. How did they come up with that figure you may ask?

Let’s explore:

“A literal reading of the legislation (Section 113(2) of the CPP Act) as written implies that investment returns should only be applied to CPP contributions, and not to benefit payments and CPP administration costs. Applying this literal reading of the CPP Act would result in an unrealistically large Base asset transfer figure of $637 billion as of December 31, 2021 (117% of Base CPP assets as of that date), which our model projects to grow to approximately $747 billion (118% of Base CPP assets) as of January 1, 2027.

An alternate and reasonable interpretation is to apply investment returns to the net cash flows of contributions less benefit payments and CPP administration costs.”5

Which is where Alberta is entitled to 53% of CPP assets comes from.

The difficulty with this, is there are provinces with much larger populations and they too have been contributing to the CPP. The CPP relies on employees and employers putting in 5.95% of their gross wages up to a maximum of $66,600 - basic exemption of $3500 so $63,100. 6 Everybody who works in Canada except Quebec contributes the same amount to the CPP.

Alberta’s current population is 4,849,906. Ontario’s population is 15,996,989 - over three times as large. Does it seem reasonable to you that 4.8 million people would contribute more than 16 million people? Remember the CPP is funded by working Canadians and their employers.

The alternative to the CPP if we did end up with an APP is Aimco. Aimco does not have a great track record at all. Ask any teacher or government employee who has been forced to have Aimco manage their pension. Over 10 years, CPP has outperformed LAPP, an AIMCO pension plan. The ATRF has also outperformed AIMCO which is why teachers are so upset about having the province unilaterally force them over to AIMCO.

Many Albertans have already let the UCP know they don’t want an Alberta Pension Plan, but she isn’t listening. Section 114 of the CPP Act amendment requires the consent of two-thirds of the participating provinces representing two-thirds of the population. Accordingly, the transfer to Alberta’s jurisdiction will be in the range of $100 billion.

What the UCP are doing is trying to wear us down.Trusting the UCP with a pension plan is like trusting them to be able to buy, package, and sell Turkish Tylenol. That fiasco cost Albertans $80 million. Transferring CPP to Alberta is at least 10 times more of a gamble. Let the UCP know, “HANDS OFF MY PENSION.” We have to be loud and we have to be clear, so they start to listen. This is a call to action. What can each one of us do to make a difference? Call and write your MLA’s. Write letters to your newspaper. Go on Social Media and share the facts. To Get Her we must each do our part, Together we can make a difference. Are you ready to take on the challenge?

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