hi-pension

Canada's largest private sector union has given P.E.I. Finance Minister Wes Sheridan's Canada Pension Plan suggestion the thumbs up. His proposal would see a doubling of CPP premiums paid by workers and employers, from $2356.20 to $4,681.20 in 2016.

Prince Edward Island’s Finance Minister Wes Sheridan is heading to Ottawa this weekend in an attempt to convince other finance ministers that increasing the Canadian Pension Plan would benefit Canadians.

Sheridan recently overhauled the public sector pension plans on P.E.I.

The CPP replaces 25 per cent of a person's income when they retire, and the annual CPP benefit after retirement caps out at $12,500.

Sheridan wants to increase maximum earnings after retirement to $22,000.

Sheridan said he wants to fund that by raising CPP rates by an extra three per cent, split between employers and employees.

Sheridan's plan would also double the maximum insurable earnings, from the $50,000 maximum income now to $100,000.

“At the $100,000, you would double your benefits. After 40 years, and we’re talking about something far out into the future, we're talking about people who would just be starting their employment career now that have 30 to 40 years of extra payments, would see a doubling of their benefits,” he said.

But Opposition Leader Steven Myers said Canadians shouldn't be looking to Sheridan for meaningful reforms.

“He has a horrible financial track record in this province, everything he touches falls apart,” he said.

“I don't know why he's travelling around the country trying to sell CPP changes when he’s got a huge mess on the Island that needs to be fixed.”

For the idea to pass, two-thirds of the provinces representing two-thirds of Canadians have to support the plan. Sheridan said he's hoping to get that this weekend.

“It’s going to be a very interesting 48 hours,” he said.

Sheridan said he feels he can get enough support, but federal Finance Minister Jim Flaherty ​has said now is not the time to change the CPP.

CPP increase not supported by most Canadians: poll

A new poll commissioned by the Canadian Federation of Independent businesses found that only 18 percent of working Canadians support raising the CPP.

The survey asked 1,600 working Canadians what they thought about increasing the CPP.

According to the poll, 65 per cent said they can't afford to pay more. Many responded saying if the increase is mandatory it would eat into paying for things like food and rent and would force them to cut back on other investments, including registered retirement savings plans.

Just over half said tax cuts would be a better way to encourage Canadians to save more.

The CFIB said it's using the new information in its lobby against the CPP increase. Leaders in P.E.I., Ontario, Newfoundland and Labrador and Manitoba have all said they're in favour.

The poll’s margin of error was plus or minus 2.5 per cent 19 times out of 20.