Alberta Allowed to Leave CPP
According to Employment Minister Randy Boissonnault, Alberta is legally capable of opting out of the Canada Pension Plan, but such a decision would be irreversible, essentially a “one-way ticket.”
The idea of Alberta’s United Conservative Party (UCP) leaving the CPP and establishing its own pension plan has been under consideration since 2020. However, Premier Danielle Smith has recently taken a significant step by presenting a report outlining this plan and indicating that public feedback would determine the necessity of a referendum.
Boissonnault, in an interview with CTV’s Vassy Kapelos on Question Period, explained that once a province decides to exit the CPP, it triggers a process outlined in the 1965 legislation, and there is no turning back.
The Alberta government is relying on a report from the consulting company LifeWorks for its cost-benefit evaluations of a potential Alberta Pension Plan. According to this report, Alberta would be entitled to approximately $334 billion by the time it departs from the CPP in 2027, which represents nearly half of the total funds in the federal program.
This move has led to a back-and-forth between Premier Smith and Prime Minister Justin Trudeau in recent days. As per the Canada Pension Plan Act, a province seeking to withdraw must engage in negotiations with the federal government and reach an agreement on the exit process.
When asked whether the federal government plans to conduct its own analysis regarding the financial obligations that Alberta may have if it proceeds with its CPP exit, and whether there are measures to prevent Alberta’s withdrawal, Boissonnault responded that the current focus is on preserving the existing system.
Boissonnault emphasized that this is a contentious issue where the federal and Alberta governments hold differing views, and he believes that Albertans should be spared the “stress,” “anxiety,” and “distraction” of this debate for the time being.