Rudy Haugeneder
B次元官网网址 staff
Despite keeping more money out of peopleB次元官网网址檚 pockets, premium increases for CanadaB次元官网网址檚 social safety net B次元官网网址� Canada Pension Plan, Employment Insurance, Medicare B次元官网网址� are necessary to keep them meaningful, financial experts say.
Helmut Pastrick, chief economist for Central 1 Credit Union, the central financial association for B.C. and Ontario credit unions, said the pension plan premium increases are necessary to offset stock market losses in recent years and to pay the growing number of baby boomers who will rely on it when they retire.
If premiums into the self-funded plan were frozen at the current rate, he said, the pension benefits would not increase in the future and might even shrink.
Travis Koivula, a certified financial planner with Island Savings Credit Union in Victoria, said CPP is B次元官网网址渁 primary source of retirement incomeB次元官网网址� for most seniors B次元官网网址� now and in the future.
Canada Pension Plan, administered by an independent financial investment management board that invests the assets to earn money to pay pension benefits, must B次元官网网址渋ncrease premiums or cut benefits,B次元官网网址� he said. ThatB次元官网网址檚 something retired people canB次元官网网址檛 afford when theyB次元官网网址檙e not working, he added.
B次元官网网址淢ost people take far more out of CPP than they put in over the years.B次元官网网址�
It is important younger people contribute more, to not only secure their own retirement futures, but take care of their parents and grandparents, Koivula said.
No one likes to see their payroll deductions increase for CPP, EI or the provincial Medical Services Plan, he said, especially since average wages havenB次元官网网址檛 increased. B次元官网网址淏ut if rates didnB次元官网网址檛 increase, the long-term viability of Canada Pension could suffer.B次元官网网址�
Pastrick agreed, adding the same applies to MSP and EI premiums.
B.C. Medical Services Plan premiums rose six per cent on Jan. 1, meaning a family of three or more will pay $128 monthly B次元官网网址� up $7 from last year and $84 for all of 2012.
Federal EI and CPP premiums will increase collectively by $306 per employee this year, with just under half paid for by employees themselves.
The Canadian Taxpayers Federation and Canadian Federation of Independent Business say the increases are little more than taxpayer gouging and will prevent job growth.
Taxpayers federation B.C. director Jordan Bateman said the increases will hurt the economy because B次元官网网址渇amilies and seniors are already finding it difficult to keep up with rate increases at B.C. Hydro, ICBC, B.C. Ferries and tax hikes at the gas pump.B次元官网网址�
Federation of Independent Business B.C. chapter spokesperson Shachi Kurl described the CPP and EI rate hikes as payroll taxes that B次元官网网址渕ake it harder for small business to create new jobsB次元官网网址� during tough economic times.
While her organization successfully lobbied the federal government to keep EI rate increases at half of what were planned, she said governments are B次元官网网址渋nsensitive to (the) profits small businesses need to survive.B次元官网网址� She added the increases come at a time when Canadians can least afford them.
Bateman said all levels of government, including municipal and regional governments, B次元官网网址渁re treating the taxpayer like an ATM, taking money from them hand over fist.B次元官网网址�
People who complain about increased premiums do so without understanding their impact on critical social safety net services which B次元官网网址渇or the most part they are getting full value for,B次元官网网址� Pastrick said. B次元官网网址淢ost people look at the cost side and donB次元官网网址檛 think of the benefit side,B次元官网网址� he said, B次元官网网址淭he alternative (to these services) is much worse in social terms.B次元官网网址�
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