Bankers attempt out-of-pocket profit from workers' pensions
PRPPs riskier, costlier than CPP expansion.
August 2, 2012: The Canadian Bankers Association has written provincial premiers, urging them to implement the federal government's Pooled Registered Pension Plans (PRPPs) in order to help Canadians save for retirement.
That's rich: for years, Canadian banks have raked in millions of dollars in high fees on the $800 billion Canadians have invested in mutual funds. Canadian mutual funds carry among the highest management fees in the world, charges that can easily wipe out half of an individual's retirement savings.
Now banks eagerly await PRPPs, knowing the federal government will not cap fees, but simply require that fees be in line with the high prices that banks and insurance companies now charge for administering pension plans!
Employers are not required to offer PRPPs, and do not have to contribute a single penny toward workers' retirement. One hundred percent of the risk and all of the high cost will be borne by workers.
As "solutions" go, this one's a dud, says the Canadian Labour Congress. It states premiers were right to direct finance ministers to continue their work on expanding the Canada Pension Plan, a far superior plan for addressing Canada's mounting retirement.
Related individuals, organizations and significant events
Grow the CPP: A better way to save.
Links and sources
Premiers should ignore bankers and proceed with CPP expansion
Posted: August 16, 2012
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