2023 UCP Alberta election

[Good2Golf]

I guess we’ll see, won’t we?

Edit to add: The world of politics contains many a fairy tale…like self-balancing budgets, electoral reform to address regional concerns more fairly, etc.

Additionally, a figure that can be/is actually derived from a legislative formula is not so much a fairy tale itself, but an indicator that the dialogue will be an iterative process, as most here acknowledge. Few seem to have a problem when the transfer amount is assessed at a more likely (yet still sustainable) $100-130B.

 

[Remius]

I guess we’ll see, won’t we?

Edit to add: The world of politics contains many a fairy tale…like self-balancing budgets, electoral reform to address regional concerns more fairly, etc.

Additionally, a figure that can be/is actually derived from a legislative formula is not so much a fairy tale itself, but an indicator that the dialogue will be an iterative process, as most here acknowledge. Few seem to have a problem when the transfer amount is assessed at a more likely (yet still sustainable) $100-130B.

Support numbers were low even before fairy take or realistic numbers were used. Not sure what those support numbers look like now.

I personally have no issues with any province going their own way with this. I guess it’s a matter of what is realistic and why.

The CPP is actually very well managed. Not sure why Alberta would want to take a risk when something is not broken but also works very well. I suspect Albertans feel that way as well if those polling numbers are to be believed.

 

[CBH99]

I have to imagine anything that can be perceived as turning the screw on Eastern Canada will be largely seen in a positive light by many in Alberta...

But I don't have any data, just a suspicion.

As a born & raised Albertan, I have to strongly disagree with you on the above.

Something perceived as turning a screw against Eastern Canada wouldn't be celebrated by anyone I don't think - turning the screw against Ottawa is a different thing entirely

Yeah, just wondering if there was more recent data. In May it was only at 21% support.

Hey now, that's enough support to become Prime Minister...

 

[Good2Golf]

Support numbers were low even before fairy take or realistic numbers were used. Not sure what those support numbers look like now.

I personally have no issues with any province going their own way with this. I guess it’s a matter of what is realistic and why.

The CPP is actually very well managed. Not sure why Alberta would want to take a risk when something is not broken but also works very well. I suspect Albertans feel that way as well if those polling numbers are to be believed.

TBH, I think it’s less about CPP being a good/bad/whatever type of fund, and more about Alberta looking to take more control over those things that it has legitimate agency to do so. I don’t believe it’s just a numbers thing. I certainly would think that polling and assessing the support for a separate APP is something being done. Trevor Tombe’s realistic numbers actually support a reasonably assumed transfer and sustainable fund. I have a hard time immediately downplaying a potential transfer as a sky-is-falling scenario. Why is the assumption that APP fund management would be a poop show?

 

[Kirkhill]

As a born & raised Albertan, I have to strongly disagree with you on the above.

Something perceived as turning a screw against Eastern Canada wouldn't be celebrated by anyone I don't think - turning the screw against Ottawa is a different thing entirely

That was then, this is now?

Not born in Alberta but I was here then. When the Petro Canada building was called Red Square and people vowed they would rather push their cars than fill up at a Petro Can station.

 

[QV]

So long as the RoC keeps electing a federal government that is outright hostile to Alberta interests, these moves towards succession will continue and grow. Legitimately so. What could bring Smith's initiatives like this cascading down is a complete routing of the LPC at the next election. But, a LPC downfall is only temporary and the hostility will ratchet back up after the populace tires of a CPC government. Despite what happens in the next federal election, I hope Alberta pursues all avenues for more control (like Quebec) to protect itself from errant federal leaders with agendas.

 

[IKnowNothing]

Additionally, a figure that can be/is actually derived from a legislative formula is not so much a fairy tale itself, but an indicator that the dialogue will be an iterative process, as most here acknowledge. Few seem to have a problem when the transfer amount is assessed at a more likely (yet still sustainable) $100-130B.

But that's not the transfer amount that has been used to build the sales pitch. And that's what it is - a salespitch. Smith wants this to happen, and has for decades. Polling suggests the majority of Albertans don't. To get what she wants, Smith is either honestly/dishonestly (don't know which is worse) trying to use a pipedream to win them over.


Below are some excerpts from the currently active engagement survey (apologies for the formatting.) The Lifeworks report is being positioned as accurate (not as a negotiating tool), with the resultant windfall being a set in stone entitlement. Albertan's are being asked how they would like to spend that windfall, and how they would like it managed. They're not being asked if they would like to move forward with a plan shaped by reasonable number or to what degree their approval would hinge on a given asset transfer/ level of improvement.

According to the Canada Pension Plan Act, any province can withdraw from the Canada Pension Plan (CPP) and set up its own pension plan. One condition is that the new plan provides comparable benefits to the Canada Pension Plan (the same condition for Quebec’s own plan). LifeWorks wrote a thorough report estimating the benefits for Albertans and outlining the process of withdrawal. The LifeWorks Report estimates moving to an Alberta Pension Plan would mean an extra $5 billion yearly in savings to start. If we put that all towards reducing payroll premiums that would mean up to $1,425 less taken off your paycheques per year ($2,850 if you are self employed). This could also mean a reduction in what businesses pay of $1,425 per employee per year. However, we could also use all or a portion of that extra $5 billion yearly to increase pension payments for seniors. The following questions are related to the Report itself.

6. If Alberta switches to an Alberta Pension Plan from the Canada Pension Plan, how should the savings be used?

While many Albertans see the Canada Pension Plan as a retirement pension, the plan offers different types of benefits. If an Alberta Pension Plan was established, the benefits would not be less than Canada Pension Plan. However, since there would be a large asset transfer to an Alberta Pension Plan, the government could look at improving other benefits under the plan. Understanding what Albertans value most about benefits will help inform how an Alberta pension could provide the most benefit if adopted.

How important is each of the following benefits to you?

Section 4: Plan Security and Stability

Given the potential size of the asset transfers from the Canada Pension Plan (LifeWorks calculates $334 billion) and Alberta's young demographic, an Alberta Pension Plan would be able to deliver benefits over the long term at a lower cost than the Canada Pension Plan. According to the report, an Alberta Pension Plan would be more secure than the Canada Pension Plan because an Alberta Pension Plan would have a much bigger pool of assets compared to its number of retirees.

8. An alternative to providing pension benefit increases or contribution reductions would be to use the $5 billion in savings to grow the size of the APP fund to provide greater long-term security. Would you prefer to:

9. What else should the Panel consider about the use of these new assets if an Alberta Pension Plan was established?

 

[Good2Golf]

Seen. I also appreciate that different groups assess numbers differently, however, if the end result is the same (ie. Sustainable benefits with lower contribution rate than CPP), be it LifeWorks’ $334B or Trevor Tombes’ $100-130B, it seems worthy of keeping the dialogue going until there is a noteworthy “shut it down” from Albertans writ large.

 

[QV]

Rahim Mohamed: Alberta claim to half of CPP makes it clear who pays the bills

The province's withdrawal would force a higher contribution rate in the rest of the country and could endanger the CPP's solvency

nationalpost.com

Doubt anyone is shocked some of the loud critics are from the CPP team itself: “Any idea of a withdrawal from the CPP would be complex, fiercely disputed, involve political posturing and would result in risk for Albertans for years to come,” senior CPP Investments comms director Michel Leduc saidin a statement Thursday.

This statement from the comms director can be safely dismissed.

 

[Remius]

Rahim Mohamed: Alberta claim to half of CPP makes it clear who pays the bills

The province's withdrawal would force a higher contribution rate in the rest of the country and could endanger the CPP's solvency

nationalpost.com

Doubt anyone is shocked some of the loud critics are from the CPP team itself: “Any idea of a withdrawal from the CPP would be complex, fiercely disputed, involve political posturing and would result in risk for Albertans for years to come,” senior CPP Investments comms director Michel Leduc saidin a statement Thursday.

This statement from the comms director can be safely dismissed.

Why would any of what is stated be safely dismissed? Are you saying it would not be disputed, isn’t complex and does not entail risk? Not involve political posturing? If you are please explain because he’s seems pretty much on point.

 

[Good2Golf]

Maybe CPP administration doesn’t like the thought of reducing their staff by ~20-25% after a transfer of some amount to an APP?

 

[Brad Sallows]

Not sure why Alberta would want to take a risk when something is not broken but also works very well. I suspect Albertans feel that way as well if those polling numbers are to be believed.

Lower employee/employer premiums, thus more take-home pay.

The performance of the CPP - or any other plan - is irrelevant to beneficiaries as long as payouts are "defined benefit". The beneficiaries' actual ROI is completely deterministic and modest. No-one gets a bigger cheque when plan performance exceeds that number (which, over the long term, is easy to do), or a smaller cheque if it does not.

 

[QV]

Why would any of what is stated be safely dismissed? Are you saying it would not be disputed, isn’t complex and does not entail risk? Not involve political posturing? If you are please explain because he’s seems pretty much on point.

Because the "Communications Director" of the entity that would take the hit is not going to communicate anything but statements meant to defeat the initiative and preserve that entity. A biased source making biased observations = dismissed.

Besides, "saying it would not be disputed, isn’t complex and does not entail risk" could describe your next motorcycle purchase too.

 

[Blackadder1916]

. . . Why is the assumption that APP fund management would be a poop show?

Past experience with Alberta governments in managing investment funds.

Yes, the Alberta economy is healthy, but we are essentially a one trick pony. Government budgeting since oil (with rare, rare exceptions) has always been at the whim of world wide oil prices (and our crude isn't cheap). When times are good, they are "very" good out here. When the price is low, the government blames everybody but themselves for not saving when we had the opportunity. And on those rare occasions when they did put away a few shekels, the first instinct is to invest it in marginal "resource" (read oil and gas) plays.

 

[IKnowNothing]

Noticed an interesting discrepancies/ interpretations between the Lifeworks report and the act

In LifeWorks Executive Summary
4. Assume all obligations and liabilities accrued and accruing in the CPP for members residing in the province up to the beginning of the third year following notice

In the LifeWorks Process for Withdrawing... Section
"3. Assume all obligations and liabilities accrued and accruing in the CPP for members residing in the province up to the beginning of the third year following the year in which the province gives notice."

In the Act
" for the assumption under that plan of all obligations and liabilities accrued or accruing to the first day of that third year with respect to the payment of benefits under this Act attributable to contributions made under this Act in respect of employment in that province or in respect of self-employed earnings of persons resident in that province;

There is a strong argument to be made that the APP would have to assume the liability for (current) CPP entitlements owed to those that are not residents of Alberta - the Interprovincial/Jurisdictional Employees who maintained residence outside of Alberta while working there, and those that lived in Alberta and have since left. The magnitude of the liability? I don't know. Likely material, or else LifeWorks wouldn't be trying to exclude them. Any dilution via being responsible for more payouts is going to take away from any hypothetical premium reduction.

 

[Brad Sallows]

Past experience with Alberta governments in managing investment funds.

All federal governments are crap-shows in some respects with money, especially when the money is essentially at government's discretion to manage. But CPP and QPP are OK. So to the extent experience is a guide, an APP is more likely to be OK than not.

 

[Kirkhill]

Rahim Mohamed: Alberta claim to half of CPP makes it clear who pays the bills

The province's withdrawal would force a higher contribution rate in the rest of the country and could endanger the CPP's solvency

nationalpost.com

Doubt anyone is shocked some of the loud critics are from the CPP team itself: “Any idea of a withdrawal from the CPP would be complex, fiercely disputed, involve political posturing and would result in risk for Albertans for years to come,” senior CPP Investments comms director Michel Leduc saidin a statement Thursday.

This statement from the comms director can be safely dismissed.

My take?

"You (may/probably/do) have a case but we will tie you up in courts for generations. "

Or as a very large client of mine put it to my very large employer - "We've got more lawyers than you."

Kind of a strange take from a voluntary association with a withdrawal mechanism drawn into the contract.

 

[Kirkhill]

Past experience with Alberta governments in managing investment funds.

Yes, the Alberta economy is healthy, but we are essentially a one trick pony. Government budgeting since oil (with rare, rare exceptions) has always been at the whim of world wide oil prices (and our crude isn't cheap). When times are good, they are "very" good out here. When the price is low, the government blames everybody but themselves for not saving when we had the opportunity. And on those rare occasions when they did put away a few shekels, the first instinct is to invest it in marginal "resource" (read oil and gas) plays.

On the other hand, we have a pony.

 

[QV]

My take?

"You (may/probably/do) have a case but we will tie you up in courts for generations. "

Or as a very large client of mine put it to my very large employer - "We've got more lawyers than you."

Kind of a strange take from a voluntary association with a withdrawal mechanism drawn into the contract.

I'm guessing that is because if it were come to pass, the loss of Alberta's outsized contributions would be a reality smack to the voting block in the RoC that will be instantly felt and can't be dismissed or watered down with CBC newspeak. Which could hurt the LPC electorally. This is just the LPC and it's supporters circling the wagons.

 

[IKnowNothing]

I'm guessing that is because if it were come to pass, the loss of Alberta's outsized contributions would be a reality smack to the voting block in the RoC that will be instantly felt and can't be dismissed or watered down with CBC newspeak. Which could hurt the LPC electorally. This is just the LPC and it's supporters circling the wagons.

At an appropriate transfer level, and properly assuming responsibility for all obligations and liabilities associated with employment income from Alberta since 1965, there will be some impact to Canadians of all political affiliations, but not enough to make it a major electoral issue. Lets say 12% of the population gets 18% of the money. That still leaves 82% of the money for 88% of the population. 6 spread across 12 is a lot. 6 spread across 82 is not near as much. That's before accounting for a certain amount of the 18 being owed to some of the 82.

If Smith convinces Albertan's that they're entitled to 54% of the money, and they go for it- it won't be the LPC and it's supporters "circling the wagons" - it will be working Canadians of all political affiliations across the country telling them to go piss up a rope.