Question:
In this assignment, you will choose a Canadian policy document and complete a critical analysis of 3000 words (+/- 10%), grounded in the theories and constructs studied in the course. A list of policy documents for analysis, Policy Documents by Province is provided, but students can also choose their own document (subject to approval from the course Instructor).
Critical analysis is grounded in power relations constructed by race, class, gender, ability and other social constructs. To begin your analysis, state your own social identity to clarify your perspective or lens. Ask questions about the policy grounded in critical thought: Who are the authors of this policy? What authority do the authors have to create policy? What are the strengths and weaknesses of the policy (power relations)? How will the policy be implemented, evaluated, and monitored? What conclusions emerge about the policy from your analysis?
Ethical Considerations:
Students cannot interview or otherwise engage human participants due to ethical considerations. Any research involving human subjects requires completion of an ethics application, and our seven-week course format does not provide enough time to write a proposal and have it approved. As a result, students are not to conduct personal interviews or use privileged information. Therefore, in the assignments, you are limited to your own experience and what is available in the public domain. When discussing your experiences in a workplace, you should anonymize the organization if you think issues might be sensitive. When doing critical reflective analysis, you must keep it anonymous and focused on self and personal observations and insights. For more information on ethics,
Answer:
This critical analysis of a Canadian Policy Document was based on a varied collection of data gathered from many resources through research. Andonov (2017) stated that the Ontario Budget 2015 had taken the steps for building the retirement security deserved by the workers, also supporting the long-term development of the economy. This will be outlining the evaluation in association with the power as well as privilege and the constructs that will be used regarding the evaluation i.e. race, gender, ethnicity, class as well as globalization.
Personal Perspective
I am Asian/Sri-Lankan married woman have worked in different environments has given me an opportunity to contribute to the Canada Pension Plan. However, the contribution of the organization I worked made different contributions according to my position within the salary scale (Anon, 2017). My social identity will be covering the broader issues regarding social identity, and specifically, my identity as a Canadian will be having a sense of belonging towards national, ethnic, geographical as well as cultural groups and towards the local, regional as well as national establishments.
Summary
The Ontario Retirement Pension Plan Act will be delivering on the commitment of the government to strengthen the retirement security in respect of more than four million young and old Ontario workers. Some of these workers do not have accessibility to a sufficient workplace pension plan. The Act will protect essential legislation requirements regarding the plan, which includes participation, contributions, type of benefits as well as sustainability of the plan. The act will be ensuring the employers, as well as employees throughout the province, have the required information in preparing with regard of getting implemented (Godbout, 2015).
Analysis
According to Wang, (2014) the plan will be offering two advantages as in a retirement and a survivor benefit. The Ontario Retirement Pension Plan is designed for providing the plan members with a fifteen percent income replacement rate after forty years of plan contribution (Wang, 2014). The amount of money a person will be receiving from the Ontario Retirement Pension Plan before their retirement will depend on the number of years they contribute to the pension plan and their salary all through the years. Wang (2014) revealed that government designed the Ontario Retirement Pension Plan for being sustainable over the more extended period. This Act established the official funding rules for guiding the actions of the Ontario Retirement Pension Plan Administration Corporation as well as the government in respect of a shortfall or excess related with funding. For supporting the transparency also accountability toward sustainability regarding the plan. The government is committing doing the introduction of legislation that would be doing the establishment of an Office of the Chief Actuary. This office will be providing the government and the Ontario Retirement Pension Plan Administration Corporation with professional and fair advice plus guidance (Sorensen, 2016).
Additionally, Trudel (2015) highlighted that the policy document will be establishing the compliance also enforcement structure regarding the Ontario Retirement Pension Plan Administration Corporation for encouraging the employers and plan members for complying with the Ontario Retirement Pension Plan legislation, addressing the concerns of non-compliance as well as creating a means for resolving the disputes (Trudel, 2015). Furthermore, the compliance and enforcement structure will be getting applied to every administration stage of the Ontario Retirement Pension Plan, from the process of employer verification to the collection of contributions as well as the payment of benefits (Trudel, 2015). The Ontario Retirement Pension Plan Administration Corporation will have the permission to do the administering of fines. Employers who will not be successful in deducting or remitting contributions will be charged interest regarding late payments.
The Government of Ontario is making plans for the introduction of the Ontario Retirement Pension Plan for supplementing the available federal benefits regarding retirement. Organizations with current “comparable” pensions will not be having the requisite for getting enrolled in the Ontario Retirement Pension Plan. According to Rose, (2016) enrolment will be considered being compulsory in respect of those not having a pension. Curtis, (2017) mentioned that organizations are offering a vast range of plans for supporting their employees save in respect of retirement. There are primarily two general kinds of pension plans such as defined benefit (DB) plans as well as defined contributions (DC) plans.
The challenge in respect of government, retirement providers, employers as well as individuals is arriving at a solution that will be lifting the prospects regarding retirement. In respect of the government, it should be ensuring the continuity to make sure the sustainability of the Old Age Security (OAS), Guaranteed Income Supplement (GIS), Canada Pension Plan (CPP) as well as Quebec Pension Plan (QPP) programs are the foundation of the retirement method. Veall, (2014) stated they could be adjusting for responding to the shifts in the demography. Furthermore, seeking answers will assist the population segments that are running the threat of poverty in retirement as well as addressing the policies that will be reducing the attractiveness of retirement savings in respect of numerous Canadian individuals. To avoid risk, solutions are implemented by the government should increase of retirement readiness; they should be interested in preserving what is functioning within the present process.
In respect of the private providers, it could be stated that they could consider innovative methods for improving the customer requirements who will be contributing to the plan.
In respect of the employers, it could be stated that the employers could offer accessibility to a retirement plan in respect of their employees. There will occur the use of auto-enrolment for increasing the rate of participation regarding the entire plan as well as regular financial education could assist staff’s property plan in respect of their retirement (Weingarten, 2016).
Individuals are also playing a pivotal role to ensure his/her readiness regards to retirement, within a process that does the balancing of government-aided minimum guarantees.
Concerning the Defined Benefit Pension Plans (DB), it could be stated that this plan is one where the employees are receiving a defined monthly stream of income upon retirement. The amount of that benefit is fixed irrespective of the returns made regarding investments in the pension fund. Its determination is made depending upon the formula that is typically reflecting the factors like the years of service, age as well as average incomes of the staffs. The management of assets in the pension funds are done by the organization in respect of the employees. There might occur the funding of the defined benefit plans entirely via employer contributions or via the association of employer and staff contributions. From the perspective of the staffs, the main benefit regarding a Defined Benefit plan is that it is providing a guaranteed as well as secure stream of income upon retirement (Carr, 2017). In respect of the employers, it could be stated that apart from the major administrative expenses, the major problem with a Defined Benefit Plan is that they are bearing all the risks related with the funding of the plan, and to maintain the solvency regarding the fund. Many organizations having Defined Benefit plans solvency contributions will be exceeding the capital expenses (Manns, 2017). Organizations having a Defined Benefit plan will not be having the requirement for participating in the Ontario Retirement Pension Plan when their available plan is considered being adequately liberal. To be specific, Defined Benefit plans that are earnings-based will be having the requirement for offering an annual benefit rate of accrual of at least 0.5%.
With reference to Defined Contribution Plans, employers are making predetermined contributions into a pension fund but are not guaranteeing a particular stream of income upon retirement. The ultimate benefit amount to be paid is depending upon the investment performance regarding the fund. In similarity to the Defined Benefit plan, contributions can be made by the employers alone or, in a more common manner, with the help of the employers as well as the staffs (Crossley, 2013). In similarity to a Defined Benefit plan, organizations having an adequately generous Defined Contribution plan will not be participating in the Ontario Retirement Pension Plan. For getting exempted, the Defined Contribution Plans of the organizations would be required having a minimum annual contribution of 8% of base salary earnings. In respect of the staffs, Defined Contribution plans will be offering a slightly increased risk, but increased potential reward as well. While there is occurs, fixed advantages relating to a Defined Benefit plan, the income from a Defined Contribution plan is depending upon how effectively the pension fund is performing. When it is considered performing effectively, it will be generating increased retirement benefits in comparison to a Defined Benefit plan. When it is considered to be performing in an ineffective manner, incomes might be considered being reduced. Moreover, Defined Contribution plans are transferred in aneasier manner from one employer to the next that is considered being a significant consideration if workers are changing jobs at an increased frequency than earlier (Kwok, 2016).
In respect of Hybrid Pension Plans, it can be stated that these plans are including both a Defined Benefit as well as Defined Contribution element. They are regarded having the eligibility under the Ontario Retirement Pension Plan provided that, when combined, the two elements of the plan collectively will be meeting the necessary conditions.
In respect of the Group Registered Retirement Savings Plans, it can be stated that a group Registered Retirement Savings Plan is similar to a personal Registered Retirement Savings Plan. Staffs are choosing the amount that is required to be contributed to their plan and in majority of the case, employers are matching those contributions up to a specific limit. Every contribution to the plan is tax-deductible as well as every investment earnings are sheltered by taxes. The major advantage of group Registered Retirement Savings Plan is that staffs are having more control over the fund. They are generally having increased flexibility about how much they will choose to do contribution (Jog, 2016). They are also having increased control over the ways by which the investment of money is to be made. Individuals will also be having the ownership of the fund proceedings. In respect of the employers, group Registered Retirement Savings Plans are attractive since they are not required worrying about the threats as well as long-term liabilities related with a Defined Benefit pension. Group Registered Retirement Savings Plans are not considered being pension plans since there is no general investment fund and pooling of risks are not done. There isn’t any eligibility of the group Registered Retirement Savings Plans under the Ontario Retirement Pension Plan. Organizations having such a plan will be having the requirement for joining the Ontario Retirement Pension Plan (Inderst, 2014).
In respect of the Deferred Profit-Sharing Plans, it can be stated that it is an employer-sponsored plan related to profit-sharing. Organizations are doing the sharing of business profits with their staffs by making investment in the plan periodically. Staffs are not contributing to such a plan. There isn’t any minimum level of contribution and businesses might not be contributing to a Deferred Profit-Sharing Plan when there will be occurring reduced profitability. The contributions of Deferred Profit-Sharing Plans are tax-deductible in respect of the business. Staffs are paying taxes on their advantages in respect of withdrawal. The Deferred Profit-Sharing Plans are mostly provided in juxtaposition with a group Registered Retirement Savings Plans. In those cases, staffs are contributing to the group Registered Retirement Savings Plan as well as the organization is contributing to the Deferred Profit-Sharing Plans. In respect of the staffs, the benefits of a Deferred Profit-Sharing Plans are generally the same in respect of group Registered Retirement Savings Plans. Staffs are getting benefitted particularly when the organization is performing in an effective way. In respect of businesses, Deferred Profit-Sharing Plans are allowing the flexibility for contributing more when profits are considered being more and are acting as a safeguard in leaner times since there are the requirements of no obligatory contributions. In similarity to the group Registered Retirement Savings Plans, Deferred Profit-Sharing Plans are not having the eligibility under the Ontario Retirement Pension Plan. Organizations with a Deferred Profit-Sharing Plans will be having the requirement for joining the provincial pension plan (Beshears, 2017).
The Ontario Retirement Pension Plan will be having a major negative influence on manufacturing organizations as well as workers in Ontario. For organizations having no retirement advantage at all, on the other hand, the expenses of the Ontario Retirement Pension Plan will be important. The impact will be unreasonably felt by small businesses.
The government has met with a huge range of stakeholders at the beginning of 2015 for obtaining feedback on three major issues regarding the design of the Ontario Retirement Pension Plan. These are the scope of the plan, the minimum earning threshold as well as assistance in respect of the self-employed. The Ontario Retirement Pension Plan Act, 2015 (Bill 56) received royal assent on May 5, 2015. Along with the aspect of laying the foundation regarding the Ontario Retirement Pension Plan, the Act has provided in respect of the implementation of the Ontario Retirement Pension Plan by the government but is not addressing the aforesaid concerns related to design.
Insights
On April 23, 2015, the Ontario government did the presentation of its 2015 budget that included various announcements concerning the pension plans. The main announcements are considered to be the establishment of the Ontario Retirement Pension Plan Administration Corporation, target benefit pension plans, payment of variable benefits in respect of the Defined Contribution plans, contribution holidays as well as benefit improvements, exemption to the thirty percent rule that limited the capacity of the pension plan for investing in the infrastructure of Ontario, update of requirements regarding reporting, pension plan advisory committees as well as public and para-public sector pension plans. In respect of the establishment of the Ontario Retirement Pension Plan Administration Corporation, it can be stated that this professional as well as independent establishment consisting of nine to fifteen members whose appointment has been done by the Lieutenant Governor will be having the responsibility in respect of operationalizing the Ontario Retirement Pension Plan, undertaking the administration of the plan as well as doing the investment of contributions (Bosiclair, 2015). In respect of the target benefit pension plans, it could be stated that the government is doing the reaffirmation of its commitment for developing a regulatory structure in respect of target benefit multi-employer pension plans. In respect of payment of variable benefits regarding the Defined Contribution plans, it could be stated that proposed changing aspects to the Pension Benefit Act will be permitting the payment of variable advantages to members as well as former members in a direct manner from the Defined Contribution plans (Beland, 2017). In respect of contribution holidays as well as benefit improvements, it can be stated that in April 2015, the Ontario government did the tabling of certain proposed amendments in respect of the purposes relating to consultation stating that when a plan is having a transfer ratio or a going concern funded ratio of less than 85%, then there is the requirement of immediate funding of any amendments for bringing the ratio up to 85% and if there is the possibility for application, then funding of the remaining amendment expense for no more than 5 years. Moreover, when a plan is having a transfer ratio of 85% or above then, the expense relating to any amendments must be funded for no more than eight years on the basis of going concern and no more than five years on the basis of solvency (Beath, 2014). There might occur the reduction or suspension of contributions when this will not be reducing the transfer ratio of the plan below 105%. There was the exemption to the 30% rule that limited the capacity of the pension plan for investing in the infrastructure of Ontario. It can be stated that on November 6, 2014, an amendment was proposed by the Ontario government in respect of the regulations that was concerned with the exemption regarding the 30% rule in respect of investments in the infrastructure of Ontario (Ontario.ca, 2017). This rule will be limiting the capacity for holding a significant percentage of the voting shares regarding an infrastructure business. With the completion of the period of consultation, there occurs the preparation of the regulations to this effect. In respect of pension plan advisory committees, it could be stated that for further enhancing the transparency in respect of the pension plan members, the government will be taking steps for facilitating the establishment of the advisory committees. The function of these committees will be having the involvement to oversee the plan administration, making recommendations to the administrator that is concerned with the plan as well as doing the promotion of the information as well as understanding regarding the plan (Andonov, 2017). In respect of the public as well as para-public sector pension plans, it could be stated that the Ontario government is having the intention towards establishing a legislative structure that permits single-employer pension plan from the para-public sector for getting converted towards jointly sponsored pension plans or merged with the available jointly sponsored pension plans under specific conditions.
Closing
To conclude it can be stated that while attempting for the improvement of the retirement income security in Ontario can be considered being praiseworthy, the present approach will be having a major net negative influence on the economy, manufacturers as well as their staffs. The manufacturers in Ontario are undertaking competition on an international basis in respect of customers as well as new mandates for products. In the present environment, it could be stated that there is the requirement of major changes to the Ontario Retirement Pension Plan that will begin with the creation of a more favourable environment in respect of manufacturing investment. The conversion of the Ontario Retirement Pension Plan to an incentive-based, voluntary program for assisting organizations to provide more coverage will be helping in increasing the retirement income security without the creation of major new expenses. Along with these, the stages for streamlining the education will be reducing the obstacles and will be providing an incentive to smaller employers for providing pensions from within the current structure of the private sector.
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