Alberta pension fund has more funds than expected
And that means paying less in premiums.
Provincial Alberta authorities have suddenly shared some very good news with the region's residents. According to a report from independent consultant Lifeworks, the Alberta Pension Plan (APP) has exceeded its fund accumulation target.
Simply put, there is a lot more money in the pension fund than was needed, and APP can now allow residents of the province to save billions (!) of Canadian dollars annually through lower contribution rates with more impressive benefits.
How did this happen? Alberta's much younger population (so much for the unexpected benefits of immigration!), its high employment rate, and its higher pensionable earnings. These three factors led the province to contribute billions more to the Canada Pension Plan (CPP) (Lifeworks estimates about 60) than was needed to fund the benefits paid to Alberta seniors.
Provincial Premier Danielle Smith said the report is posted on Alberta's official website and invited all residents to read it and give the government feedback:
"This report shows a made-in-Alberta pension plan could put more money in the pockets of hard-working families and business owners and improve retirement security for seniors. We want to hear from you because it’s your pension, your choice. I’m so excited to hear what Albertans think about a provincial pension plan that could benefit Albertans now as well as our future generations."
President of Treasury Board and Minister of Finance Nate Horner has reported that the Alberta Pension Plan will save for people of the province CA$ 5 billion in the first year. Citizen approval is needed for the plan to be implemented. In the next six months, until the spring of 2024, the government will conduct an information and awareness campaign, followed by a referendum.
