Ottawa already seeking to 'derail' an Alberta pension
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Summary
In this episode, we are joined by Mitch Sylvester, the UCP Chair for Bonneville and the lead on the Alberta First Pension plan, to discuss the benefits of pulling Alberta out of the Canada Pension Plan.
Transcript
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Hey everyone, welcome back to the Alberta Roundup. I'm your host, Rachel Emanuel.
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Today, we are once again taking a look at the Alberta pension plan. We know that there has
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been some people organizing all over the province trying to push this thing through. Today, I am
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joined by Mitch Sylvester. He's the UCP chair for Bonneville, and he's also the lead on the
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Alberta First Pension. Mitch, thanks so much for joining us today. Yeah, you're welcome. Nice to
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be here. So Mitch, why don't you start off by explaining, I know that you've been doing town
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halls all over the province, informing people about the Alberta pension plan, what that would
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look like for Albertans. What exactly is your plan here? What are you guys working on right now?
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Well, what we're trying to do is we're trying to basically educate people and get them to
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understand why it's such a good idea to move the Alberta pension plan here from the CPP.
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Um, we're really seeing that it's an absolute no-brainer from our perspective. Um, Albertans
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will be richer, uh, we'll have a better pension plan in the end. Um, and it'll be a large transfer
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of a huge asset to the province of Alberta and away from control of the federal government.
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So you just said it's a no-brainer, you know, what are some of the actual digits that we're
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looking at? What would be the cost benefit for Albertans if we were to pull ourselves out
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of the Canadian pension plan? Well, just, just Albertans pay $9 billion a year to the CPP
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and only collect six. So that'll give us the opportunity to use the difference to give our
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seniors a large increase in pay. The way we're framing this is that we can give seniors a 40%
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increase in pay, which comes to about $3,600 a year based on a $750 a month check, which is the
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average. And the other great benefit of that is, is that, uh, the fund actually owes the province
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of Alberta $335 billion based on the original formula that set this whole thing in motion.
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So when Canada Pension was built, it was designed so that people could leave the pension fund
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and leave with their contributions, their net contributions, even if they had run their own
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pension plan. So as a consequence to that, Alberta's overpaid or has paid more, uh, than other
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provinces and accumulated $335 billion. Now that's based on an actuarial report by, uh, LifeWorks,
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which is formerly Marnot-Chapelle. Now looking at that, we understand that when they came up with
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that $335 billion number, uh, I'm sure that they looked at it very carefully, fully understanding how
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big a deal that was going to be if they released that number and how much of a big deal it would be
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for the province of Alberta to acquire an asset of that size. So one of the things that you just
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said that caught my attention there was that if we were to pull ourselves out of the Canada pension
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plan, we would actually be able to give seniors a boost in their pension plan payments. One of the
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things that the Alberta NDP has been saying time and time again with Alberta Premier Daniel Smith,
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and looking at this idea of an Alberta pension plan is, you know, they're really fear-mongering.
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They're saying to seniors, you guys aren't going to have a pension. The Alberta government wants to
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steal your pension. Sounds like you're saying the exact opposite. What would be the monetary value
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of this boost to payments for seniors? $3,600 a year, it would be very easy to do without changing
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anything. So it's based on our contributions, which are $9 billion a year, because we're younger,
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we work more hours, and we're richer. And that's not going to change for 25 more years. So what we're
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seeing is that in the very short term, Albertans will be able to get an immediate 40% raise
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but in order to bring it over it, it has to at least match CPP. But that won't be a problem,
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we'd still have that $3 billion surplus. So if we decided to give seniors a 40% increase in income,
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we could actually leave that $335 billion, or whatever that number is that they owe us sitting
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in one pile. And we could allow it to collect interest. If we allowed that to collect interest
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at the current rate, in eight years, it would double. So just imagine we'd have $670 billion
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in a pile there that was also collecting interest. And at the current rate of return,
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that would give us about 10 times the annual rate of return of what we actually pay
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into Canada Pension. So the stability of it is unquestioned. There's absolutely no worries
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about stability. As a matter of fact, I would venture to say that we would be way more stable
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So Mitch, you've been doing some of these town halls. What are some of the questions
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that you're getting? How are Albertans feeling about the prospect of having their own pension plan?
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Well, everybody's very excited about it by the time you leave the building.
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What I'm seeing, the big concern is, is the transportation part of it.
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But I mean, that's built into every pension plan. The pension would follow you if you decide
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to move away and you've paid into Alberta pension. It would be just the transportation part of it
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would be just like CPP. If you move somewhere else, it follows you around. I think that's
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the biggest worry people have. We haven't really heard much about the fact that people are afraid
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that the pension wouldn't be there for them. One of the things we know is that the Alberta
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government commissioned this report and the federal government disputed its findings. And now we're
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waiting for the federal government to say what they actually believe Alberta is out. I believe that
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number is expected in the fall. Is this an issue for people saying, well, I'm interested in having
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an Alberta pension plan, but I don't actually know what we would be getting from the federal
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government. And so I'm not really keen to make a decision until we hear that number from the feds.
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That's only coming up from government. I really haven't heard it from the people. The people
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are anxious. Everybody understands that there's going to be money coming over. The lowest number
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we've heard is $120 billion. Even at $120 billion, if you look at the financial position of the province,
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which is $100 billion in debt with $25 billion in the Heritage Trust Fund, that's still a large
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windfall. That's a lot of money. But that's also not including the $9 billion a year that we pay
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into the fund, which makes it very stable for Albertans, much more stable than for probably
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anywhere else in the country. So even without the number, we have a very stable fund and could give
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So, you know, that latter number that you just mentioned, do you think it's still worth it then
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for Alberta to pull out of the Canada pension plan, have its own, even if the federal government
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were to say, I disagree with your findings, I'm going to give you, you know, about one third
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of what the province is asking for, what the province believe it's owed. Is it still worth it
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Absolutely. It would be, it's still, it's still absolutely worth it. It's, it's, it's more than,
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it would still be one of the most solid pension plans anywhere in the world. There's absolutely
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no way that if somebody offers you even $125 billion with the amount that, with the way we pay
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in, that by the time that our demographics and our population gets to the point where we're
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collecting more than we're paying, that fund will be a huge amount of money. The other thing that I see
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here is, is, is that most, most people that we talk to in town halls and everything don't really
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feel that there's going to be a pension plan there for, for the younger people or for their kids.
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This way we would assuredly have a pension plan there for everybody.
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Yeah. When we talk about that $125 billion being on the lower end, I mean, I think you'll agree with
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me that the current federal level government isn't exactly a big fan of Alberta. Most of us feel we
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haven't exactly gotten a fair deal. Seems that Prime Minister Justin Trudeau isn't too interested in
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Albertans. Do you think there's any chance that, I mean, for lack of a better word, the feds would
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maybe try to screw Alberta over even more than by giving them less than that $125 billion? I just
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suspect they are going to make this process as difficult as possible and to drag it out as long
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as possible because it's not in Ottawa's best interest to have Alberta pull out of this plan.
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That's absolutely correct. So right now they're already trying to, to derail us. Heather McPherson's an NDP
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member from Edmonton is putting in legislation that would, that would actually say that they're
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going to have to change the rules as they go. So, so what they're, what they're proposing is they're
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proposing to make it like a constitutional thing where you have to have seven out of 10 provinces
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agree before Alberta could leave the pension plan. Based on the current agreement, it's Alberta's right
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to leave the pension plan anytime it wants. If they change that, which is such a large asset at stake,
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I think they're going to do everything they can to keep it. I believe that that would be their best
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chance to derail this. I think the number's in stone. I really think that, I talked to other
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actuaries and I asked them literally, how close is this number? And they said, well, you have to
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understand the fact that these people have done the homework and they've looked really hard at these
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numbers and they wouldn't publish that and put their name on it if they thought that this number wasn't
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very accurate. And the other thing that I always bring up at our talks and meetings is that Bill
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Marneau, who was finance minister for the Liberals up until a very few years ago, it's his firm that
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wrote this report up. He's very aware of what that number is. He's a Liberal. He totally doesn't,
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he totally understands the consequences of putting that kind of a number out there.
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Our biggest thing is that it's such a slam dunk no-brainer for us. We're just not understanding
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why Albertans are not all excited about getting it to come over as fast as they can. Everybody's wary
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of it, but I think that there's no need to be. I think it's absolutely, it's law. It's something
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that's been thought out in the 60s when they wrote it up. And the number coming to Alberta is
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legitimately large. And that's why all the fuss. You said, you know, people seem a bit wary. Usually
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after the town halls, people sound more excited about it, hearing the benefit to Albertans. Have you
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noticed a difference at all doing a town hall and say rural Alberta versus somewhere like Edmonton,
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the response, or is it pretty much the same everywhere you go? It's been pretty much the
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same everywhere we go. We've had very little opposition, actually, in the town halls we've
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been at. We bring an expert to answer the questions. That's not me. It's been 10 or 10
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in a day has been coming with us. He's an economist. So he answers all the hard questions because he has
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all the answers. That's what he does for a living. And he currently agrees that it would be a very,
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very good deal for Alberta. And actual Marnot Chappelle's report actually agrees that it would
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be a very good deal for Alberta. So we're not by ourselves in thinking that it's going to be a
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very good deal for Alberta. Actually, anybody that talks about it agrees that this is a very good deal
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for Alberta, not such a good deal for the rest of the country. But you know what? I think that's not
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our concern. I think the rest of the country votes against Alberta on a regular basis. They bring in
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governments that try to hurt Alberta and continue to try to hurt Alberta. So I think Alberta in this
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particular case needs to take care of itself. I was looking at some numbers and it seems like
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everywhere else from the rest of Canada is trying to move here anyway. So it might be in their best
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interest after all. More people are moving to Alberta than any other province in Canada.
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So Mitch, you know, you're doing these town halls. What exactly is the process? You guys are
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collecting signatures. Explain to me what are the steps that you're doing before you might actually
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have a referendum on having an Alberta pension plan? So we need 10% of the electorate to sign
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on our petition in order to get the referendum triggered. What we need to do is we need to gather
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the names of the people. We have a 90-day window to do it. So we're going to gather the names ahead of
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time. And then we're going to go door to door and get the signatures after it's done.
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Or if failing that, the other thing that's come up lately is we just might do a straight
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door-to-door campaign after we do the town halls. So you're doing the town halls, collecting signatures
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now, getting the names. And that way, when you only have that 90-day period, you kind of know who to
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go back to and get signatures from again. Do I have that correct? Absolutely. That's exactly the plan.
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So for people who are listening or interested, is there somewhere that you're posting your town halls,
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people who can know where to go? How can people best get involved? Okay, so we have an Alberta First
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Pension website. You can sign up directly on the website. You can do it there. And then the other
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thing is, is our town halls are all going to be posted there. We'll be going all over Alberta again.
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So we'll have a town hall very close to where you live, no matter where you live. We're going to go
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back to the peace country and then come back south. We're going to be in Edmonton on Monday night
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to 27th. And then we'll be starting a whole bunch more meetings in June, back to central
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southern Alberta, the far south. So yeah, we pretty much got Alberta all covered, already all booked
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and all covered for the next five, six weeks. Great. Mitch, thanks so much for joining us today.
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You know, I don't think the Alberta pension plan has gotten much coverage in the legacy media,
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but it's probably one of the bigger stories unfolding in the province right now. It'll be
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interesting to see what happens in the next couple of months and certainly to see what that number
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that the federal government offers us in October is. So thanks very much again for explaining to
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my audience and just telling us a little bit about what's going on in those efforts.
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Yeah. Thanks, Rachel. Thanks for the opportunity.
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All right, everyone. I hope that you guys have a great rest of your week. Don't forget to subscribe
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to True North so you don't miss any of my content or any of my colleagues' content and to like this
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video. Let me know if you guys want to hear more about the Alberta pension plan. I'll see you guys