Alberta Could Amass Half of CPP Assets with Proposed Pension Plan Detachment

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In an analysis commissioned by the Alberta government, it has been estimated that should the province detach from the Canada Pension Plan (CPP) and establish its own pension arrangement, it could be entitled to over half of the assets in the CPP.

The report, developed by an independent consultant firm, Lifeworks, projected that if Alberta proceeds to exit the CPP—with a mandatory three-year notice—by next year, it could potentially claim around $334 billion. This would account for approximately 53% of the CPP’s total asset pool by 2027.

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It is notable that Alberta’s secession would mark the first instance of a province leaving the CPP. Quebec, on the other hand, has remained detached since the CPP’s inception in 1965.

Nate Horner, Alberta’s Finance Minister, emphasized that taking into account Alberta’s growing economy and young workforce, the province must allow its residents to decide about the possibility of an Alberta Pension Plan. Horner stressed that it was critical to disclose these findings to Albertans, allow them to provide feedback and let them have the final say on the proposed changes.

He further underscored that such a singular manoeuvre could potentially save Albertans around $5 billion in the first year itself. This pension independence has been a key facet of the “fair deal” strategy proposed by former United Conservative premier Jason Kenney for negotiating with Ottawa. Kenney’s plan also included the abilities for Alberta to establish an exclusive police force and a tax revenue agency.

The report approximates the cost of introducing an Alberta pension plan ranging from $100 million to $1 billion, a value contingent upon the extent to which Alberta decides to leverage existing CPP structures. The additional cost for setting up the investment arm of this autonomous pension plan could fluctuate from $75 million to $1.2 billion, which again, could vary in accordance with Alberta’s utilization of existing infrastructures and expertise.