Government Policy and Retirement Saving: The Proposed Reforms

JEFFREY TROSSMAN

ABSTRACT

This paper critically examines the federal government's proposed reforms to pension policy. The centrepiece of the reforms (which will not be fully implemented until 1995) is a new set of contribution limits for Registered Pension Plans and Registered Retirement Savings Plans. The author considers the government proposal in light of the goals of Canada's pension policy, and in the context of tax policy more generally. Recent U.S. pension reforms are also briefly outlined to give a comparative perspective. The author concludes that the reforms achieve many of their stated goals. Notable, they give more equitable access to tax assistance for those in differing employment situations. However, the proposal also suffers from serious flaws. In particular, it will not work to the benefit of those most in need. The proposed reforms are distributionally perverse, in that they afford greater tax assistance to those with greater income. The author outlines some tentative solutions to this difficulty.

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Citation: (1989) 47(Supp) U.T. Fac. L. Rev. 742.
Copyright © 1989. University of Toronto Faculty of Law Review.
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