By: Amanda Coletta on
Tom Mulcair, Leader of the Opposition and NDP MP for Outremont, in a speech on January 15, 2015
This number comes from data covering both the employed and the unemployed available to work. By not using the data on employed Canadians only, Mulcair’s statement is misleading.FactsCan Score: Misleading
In a January speech, Tom Mulcair, the NDP leader, said, “seven out of ten working Canadians don’t have a pension.”
The statement is a recurring one. On the loss of manufacturing jobs in Southwestern Ontario, Mulcair told the CBC, “400,000 well-paid jobs disappeared […] and frankly most of them came with a pension. Now seven out of ten Canadians are working but they won’t have a pension.”
Canada’s retirement income system has four pillars that include various pensions and other savings. Mulcair doesn’t distinguish between pension options in his statement, but we separate them below.
The first pillar includes standardized and universal public benefits such as Old Age Security and the Guaranteed Income Supplement.
The second includes mandatory public workplace coverage: the Canada Pension Plan and Quebec Pension Plan. Almost all working Canadians over the age of 18 earning more than the minimum amount of $3,500 per year must pay into them. Contributions are split evenly between the employee and employer, or borne fully by someone who’s self-employed, and the amount depends on a person’s income.
The third consists of employer- or union-sponsored plans known as the Registered Pension Plan. They are registered with the Canada Revenue Agency and one of the pension regulatory authorities because they are subject to government support in the form of special tax measures and regulatory oversight.
In the fourth pillar are additional non-registered savings such as bank deposits.
Making sense of the numbers
In terms of pensions available to working Canadians, we are concerned primarily with the second and third pillars. Since contributions to the second pillar are mandatory and Mulcair’s statement makes clear he is referring to jobs with employer-sponsored pension plans, we need to look at what the data says about the RPP.
According to Statistics Canada, the total number of active RPP members increased from 5.5 million in 2002 to 6.2 million in 2012. Despite the increase, the numbers represent about one third of the labour force, a figure that has remained virtually unchanged for a decade.
It is important to note that Statistics Canada uses the term “labour force” to describe all individuals who are available to work, encompassing both the employed and the unemployed.
If we exclude the unemployed, the figure rises to just over 38 per cent of employed Canadians covered by an RPP in 2012.
The Canadian Labour Congress uses similar numbers. In April of this year, the organization noted that “less than 40% of workers have access to a pension plan at work.” A 2014 Fraser Institute report explained “just over 38 per cent of employees belong to an employer-sponsored pension plan.” Both consider working Canadians to be those with a job, instead of those available to work but not working.
If Mulcair is referring solely to RPP coverage for the Canadian labour force, then his statement that seven in ten Canadians do not have a pension is correct, as the Statistics Canada data reflects that 67.5 per cent – or a rounded 70 per cent – do not.
But hearing the term “working Canadians,” a reasonable person would understand this to refer solely to those Canadians with jobs, which is also how the CLC and the Fraser Institute use the term. In this case, Mulcair’s figures are off by 6 per cent, which translates to nearly six in ten working Canadians without a pension. We do not interpret “working Canadians” as encompassing those Canadians who are not working, as Mulcair has done.
By using the RPP coverage figure for the labour force as a whole, instead of the slightly better figure for the employed only, Mulcair’s statement about coverage for “working” Canadians is misleading.