Canada's chief actuary said Alberta would be entitled to proportional interest on the money invested by Albertans from the Canada Pension Plan, if the province withdraws from the CPP.
Position Paper of the Chief AdvocatePosted online Friday, University of Calgary economics professor Trevor Tombe reaches a similar conclusion. Last year, Tombe calculated that Alberta would be entitled to between 20 and 25 percent of the $575-billion plan.
“This clearly refutes the government's 53 percent claim that has been clearly touted for some time now,” said Tombe, director of fiscal and economic policy at the university's School of Public Policy.
As part of its exploration of removing Albertans from the CPP and creating a provincial pension plan, the Alberta government commissioned a report from consultants at LifeWorks.
In 2023, the authors concluded that Albertans would be entitled to $334 billion of CPP if withdrawn on January 1, 2027. That would be more than half the value of the CPP nest egg shared by Canadians living outside Quebec.
Tombe says LifeWorks assumed Albertans would be entitled to more interest if they created an independent provincial pension plan in 1966 — when the CPP began — and watched the interest accumulate.
Lead actuary Asia Billig disagreed with LifeWorks' explanation. His position paper says the federal law governing the CPP should be interpreted to allow all states to withdraw from the plan at the same time and take their share.
“A calculation method that results in negative portions, or notional allocations to all provinces that exceed the total net investment income, does not respect the textual indications of the law,” his report says.
She writes that none of the scenarios presented in the LifeWorks report meet the law's interpretation.
About the risks and benefits of creating an Alberta Government website Alberta Pension Plan Still includes statistics from a LifeWorks report about Alberta's potential share of the CPP.
The Alberta government is still analyzing the report
In a statement to the CBC on Friday, Finance Minister Nate Horner's press secretary Justin Bratinga said the chief actuary's report did not include a dollar value or a formula for calculating one.
The premier has previously said she will put a referendum question to Albertans about creating a provincial pension plan before deciding whether to withdraw the province from the CPP.
“We are still analyzing the report and will have more to say at a later date,” Bratinga said. “We will not consider moving forward with a referendum on this issue until we have concrete numbers for Albertans to provide.”
Tombe also hoped to see a number or range provided in the chief actuary's analysis, which took more than a year to complete.
However, he says that the number can be reached based on the interpretation of the law by the main accused. The actuary also cites Tombe's analysis and agrees with his interpretation.
Tombe says the attorney general's interpretation could still lead to a viable argument for creating an Alberta pension plan.
Although Alberta is entitled to 20 per cent of the CPP, the province's young demographics work in its favor to limit payments to retirees, he said.
“I hope this report provides for a more informed, thoughtful policy conversation, because practical people can differ in how they weigh the benefits against the risks,” Tombe said.
