Will we soon have to wait until we are 62 or 65 before we can start receiving retirement benefits from the Quebec Pension Plan (QPP)? The Legault government must decide the issue after a key public consultation that opens in the National Assembly on Wednesday.
• Also read: RRQ: the true portrait of retirees
• Also read: No more QPP pension from 60?
In France, for several weeks, we have seen monster demonstrations in response to the reform the government wants to push through, raising the retirement age from 62 to 64 for fear of lack of money.
In Quebec, the situation is different: “The cash inflows into the QPP will be sufficient to pay their pensions to the beneficiaries for the next 50 years,” according to a consultation document prepared by Retraites Québec.
But here, too, demographic change and the shortage of workers require adjustments. And as in France, the Legault government expects union resistance.
Two scenarios
From Wednesday, many groups interested in the issue, including experts and trade unions, will march before a parliamentary committee to decide on the major reform proposed by the QPP to adapt its system “to the challenges of the 21st century”.
Six years after the last consultation, which resulted in an increase in the pension replacement rate at age 65 from 25% to 44%, the QPP now proposes two scenarios:
- raising the minimum age for participation in the QPP from 60 to 62 and the maximum age from 70 to 72 by 2030;
- Raising the minimum entry age from 60 to 65 and the maximum age from 70 to 75 by 2045.
“We’re not talking about retirement age here,” said Retraite Québec’s chief actuary, Jean-François Therrien, in an interview with our parliamentary office.
Wait until the 65th
In both scenarios, the age at which Quebecers can receive 100% of their pension without being penalized would still be set at 65. However, the minimum age to begin receiving QPP benefits at a discount would be pushed back by two or five years.
Currently, Quebecers can start drawing their pension at age 60, but it will be reduced by 36% for life. Those who wait until the age of 65 are entitled to 100% of their pension, those who retire by the age of 70 are entitled to a bonus.
“The QPP pension, with its full indexation (at age 65) is a perfect tool to protect yourself in retirement and increase your financial security,” emphasizes Mr. Therrien.
In other words, Retraite Québec wants fewer Quebecers to punish themselves by retiring before age 65.
CONSULTATION ON THE REFORM OF THE QPP
An overview of the consulted groups
Wednesday February 8th
MORNING
- Quebec Association of Public and Semi-Public Sector Retirees
- Alban D’Amours, President of the Panel of Experts on the Future of Quebec’s Pension System, and Luc Godbout, Research Chair in Taxation and Public Finance at Sherbrooke University
AFTERNOON
- Confederation of National Trade Unions (CSN)
- Quebec Trade Union Confederation (FTQ)
- FADOQ network
- youth strength
Thursday February 9th
- Council for the Status of Women
- Central Unions of Quebec
- Quebec Employers Council
Tuesday February 14th
- Corporation of Thanatologists of Quebec
- Canadian Institute for Actuaries
Source: National Assembly
The PQ wants a different solution
The Parti Québécois fears harming those who have worked hard all their lives and opposes raising the minimum age for entitlement to pension benefits.
“We will ask the government to commit not to raise the minimum age for participation in the QPP,” PQ leader Paul St-Pierre Plamondon told our parliamentary office as consultations on Retraite Québec’s proposed reform began on Wednesday.
Photo Martin Chevalier
Paul St-Pierre Plamondon, Head of PQ.
Officially, the Legault government has not yet decided whether it will pursue one or the other of the solutions proposed by Retraite Québec to push back the age at which Quebecers can start drawing their QPP pension by either two or five years.
For the Parti Québécois, the downside of such an approach is “that it’s wall-to-wall,” says St-Pierre Plamondon.
“It is necessary to take into account the situation of a number of categories of workers, whose ability to continue working varies depending on the type of employment. There are very demanding, very tough, especially physical jobs that can make a worker choose the QPP at the age of 60,” said the MNA for Camille-Laurin.
Concerned about workers with physical or mental health problems, the PQ leader believes it is not for the RRQ to “determine each individual’s particular situation”.
“So we think it’s more respectful to give every worker a choice (sooner or later to get their pension),” he explained.
viability
On the other hand, the Parti Québécois suggests proposing other solutions to ensure the viability of the plan and to encourage seniors to participate in the labor market.
For example, to fill the coffers, the PQ is proposing to increase the maximum allowable annual earnings, also known as the maximum eligible earnings for the QPP, from $66,000 to $75,000.
“It would balance the plan without hitting people who are in a precarious situation, the PQ leader believes. We urge the government to explore such solutions, as increases in this cap over the last few years have really been below inflation. »
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