Tory Leader Tim Hudak says the Liberal government’s own documents show a payroll deduction for its proposed pension plan will kill tens of thousands of jobs and drive businesses out of the province.

Hudak along with the party finance critic MPP Vic Fedeli produced confidential advice to cabinet obtained through a legislative committee showing that every $2 billion in payroll deductions equals 18,000 jobs lost.

“The ORPP is a payroll tax and when you put a tax on jobs there is going to be fewer jobs,” Hudak told a news conference at Queen’s Park on Tuesday.

He said that using the advice to cabinet as a rule of thumb and applying it to the billions deducted federally for Canada Pension Plan, some 150,000 jobs could be lost.

“Kathleen Wynne was warned by her finance officials that payroll tax increases are going to cost jobs,” Hudak said.

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Premier Kathleen Wynne said it is the government’s responsibility to see Ontarians have a dignified retirement now that Ottawa has refused to increase CPP benefits.

“We know that people are struggling in their retirement,” she told the legislature.

Susie Heath, a spokesperson for Finance Minister Charles Sousa, noted that a new report by former Bank of Canada Governor David Dodge says that enhancing retirement savings is the right thing to do, both now, and in the future.

“And that the effects on the economy in the short run are small relative to the longer-run economic benefits. An increase in the CPP financed by appropriate premiums, would be an efficient way to increase household savings and to provide for higher retirement incomes,” she told the Star.

Hudak said he is focused on job creation, but conceded an argument can be made for a voluntary pooled pension plan.

“We’ve got the million jobs plan for lower taxes, affordable energy, less debt and a focus on skilled trades,” he said, adding the Liberal pension plan has more to do with promoting Wynne that solving problems for seniors.

Fedeli said the confidential cabinet document warns the consequences will be “lower business investment, relocation of business to other jurisdictions, reduce work effort, out migration of people.”

He said last year Canadian workers and employers contributed $42 billion to the CPP and Ontario’s share was $16.5 billion.

“So using the ministry of finance’s own assertion that every $2 billion eliminates 18,000 jobs, that would mean payroll taxes necessary to fund this new Liberal pension scheme would lead to 150,000 job losses across Ontario,” Fedeli told reporters.

He said Ontario workers and employers can’t handle another payroll tax given they already pay the highest payroll taxes in Canada, adding the deduction could be as much as $2,500 a year for both employees and employers.

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“Any time you cut somebody’s paycheque by $2,500 it’s a tax . . . this is a tax on the middle class,” Fedeli said.

Pension plan supporters say it is not a tax but rather an investment in the future.

“The bottom line is it’s pretty hard to save for a pension when you don’t have a job. It’s very difficult to save for a pension when you can’t even pay your hydro bill,” Hudak said.

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