Quote:
Originally Posted by bizaro86
Yeah, sort of, except prior generations paid lower rates. Basically, when they started the system, there wasn't a prior generation collecting, so the rates were low, and they promised people benefits that they didn't make them pay for.
Which is why the rate was only 1.8% for the first 20 years, and is now 2.75 times higher at 4.95%.
The contribution rates doubled between 1992 and 2003, because the governments/electorates chose to underfund the pension plan before that time. Essentially, that generation didn't pay for anything close to their own CPP, and now those working now have to pay for their own plus the CPP for the prior generation.
Historic percentages are found here.
http://www.servicecanada.gc.ca/eng/i...ribrates.shtml |
At some point then, when those who didn't contribute fully stop collecting will the rate go down? Or better yet, we keep the rate the same and jack up the benefits to screw the next generation.