Rather than considering pushing back the minimum age to be eligible for the QPP pension, Quebec should offer more flexibility in order to avoid penalizing anyone approaching retirement.
This is the message that both the Conseil du statut de la femme and the Conseil du patronat du Québec sent to the parliamentary committee on the future of the Québec Pension Plan (RRQ). The commission on the proposal to postpone the minimum age of eligibility from 60 to 62 was in its second consecutive day, Thursday in Quebec.
According to the Conseil du statut de la femme (CSF), such a postponement of the age of eligibility for the QPP risks “unduly penalizing women who wish to retire partially or completely before the age of 65 because of a job that has become arduous, and for whom the amount of the annuity represents an immediate income which they cannot do without”.
The CSF also referred to women in their early sixties who increasingly have to act as caregivers to an aging parent, or even as guardians of their grandchildren.
In the opinion of the president of the CSF, Louise Cordeau, certain women thus find themselves in a “financial situation which justifies that they have the latitude to apply for their pension from the QPP from the age of 60”.
In the process, the Council for the Status of Women disagreed with the proposal to increase the “adjustment factors [c’est-à-dire une réduction du montant de rente] for a retirement pension applied for before age 65”.
New marital reality
Moreover, the CSF highlighted two elements which, even absent from the consultation document, should “deserve the attention” of elected officials and administrators of the QPP: the surviving spouse’s pension and the amount of the death benefit.
In the opinion of the CSF, in its current parameters, the surviving spouse’s pension no longer corresponds to the evolution of marital reality, with the “multiplication of break-ups in couples and the formation of new unions”.
Louise Cordeau cited as an example the case where “the beneficiary of the surviving spouse’s pension is not necessarily the mother of the deceased’s children nor the one with whom the union was the longest”.
As for the death benefit paid by the QPP, Ms.me Cordeau reported an “amount of $2,500 which, in addition to being taxable, has not been indexed since 1998, which weakens the financial situation of many bereaved people, including a good number of women”.
More flexibility and tax incentives
For its part, the Conseil du patronat du Québec (CPQ), which brings together the largest employers in the private and parapublic sectors, doubts the relevance of raising the minimum age of eligibility for a retirement pension from 60 to 62 years.
In the opinion of the CPQ, rather than penalizing workers who wish to retire and apply for their pension from the age of 60, the government should favor financial and tax incentives, such as an improvement in the tax credit for career extension, so that it “always pays off and is attractive for experienced workers to stay in or return to the labor market”.
“The CPQ believes that the choice of retirement age is up to the citizen, and that each situation is different. This is why the decision to retire must remain flexible,” argued Karl Blackburn, President and CEO of the CPQ, during his presentation by videoconference to the parliamentary committee.
The approach we want to favor is to use other levers available to the government to encourage people to take up a pension after age 60.
Karl Blackburn, President and CEO of the Quebec Employers Council
As for the impact of postponing the age of eligibility for the QPP on the labor shortage, the Conseil du patronat believes that such a postponement “would only contribute marginally” to this important issue. for the Quebec economy.
Among other things, according to the CPQ, the work activity rate of citizens aged 55 to 59 has already increased in recent years, and fewer and fewer people apply for their pension at age 60.
“The effective retirement age has increased over the past 20 years. It’s a safe bet that this trend will continue, in particular thanks to the rise in the level of education and the more active participation of workers aged 60 and over in the labor market”, according to Norma Kozhaya, Chief Economist and Vice- president of research at the CPQ, who took part in the presentation of the employers’ association with Mr. Blackburn.
Moreover, the CPQ agrees with the proposal to gradually postpone the age limit from 70 to 75 for starting to receive a pension. The employers’ group also supports the proposal to make QPP contributions optional for people aged 65 and over.