Susan Nickerson talks innovative pension plans

Partner Susan Nickerson has told BNN Bloomberg that Canadian pensions “need more innovation in plan design.”

Speaking live on BNN Bloomberg, Susan discussed findings from a HOOPP retirement survey and said “Canadians would [rather] take a pension over an increase in salary—which I thought was interesting, because when I talk to some employers they don’t think their employees appreciate their plan.”

“Some of that is financial illiteracy. Employees who have gone into a company and they have always had a pension—they take it for granted.”

Susan emphasized the fact that “we’ve always had the traditional DB and DC model, but it would be nice to have something in between.”

When asked about what innovative options were available, Susan said “there is the target benefit plan model which gives that certainty as to how much it’s going to cost an employer to contribute to a pension, but it also allows the benefits and the risk of longevity and investment to be pooled, and a target like benefit to be paid at the end—that’s a great innovative design.”

“We’re seeing this in the west, Québec and New Brunswick, but we really need to get this across the country.

“We had a good Bill on the table—Bill C-27, unfortunately that one died, but it was a good piece of legislation that might have made that available to the federal sector.”

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