Newspaper article The Canadian Press

Five Things to Know about the Canada Pension Plan and Its Expansion

Newspaper article The Canadian Press

Five Things to Know about the Canada Pension Plan and Its Expansion

Article excerpt

What you need to know about CPP deal

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VANCOUVER - Finance Minister Bill Morneau met his provincial and territorial counterparts in Vancouver on Monday and reached an agreement with most of them to expand the Canada Pension Plan. Here are five things to know about CPP and the proposed deal:

1) The system is designed so that each generation of workers pays for its own retirement. That makes it different from two other income replacement programs for seniors and retirees: old age security (OAS) and the guaranteed income supplement (GIS). Those measures are covered through general tax revenues, meaning that workers today pay taxes to raise the incomes of poorer seniors.

2) CPP premiums have only been raised once in the last 20 years. In 1997, finance ministers agreed to a phased-in increase in premiums to ensure one generation of workers wasn't paying for another generation's retirement. The argument today is that the CPP should pay more in benefits and help those who aren't saving enough for retirement. …

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