The Progressive Conservatives and a business group are shooting down Premier Kathleen Wynne’s push to create an Ontario Pension Plan, intended to supplement incomes for retirees.

In a fragile economy, the last thing workers and their bosses need is more money off their bottom lines in pension premiums, said Conservative MPP and finance critic Vic Fedeli.

“As always, the Liberals’ instant reaction is to raise taxes . . . on employers and they want to raise taxes on employees,” Fedeli told reporters Wednesday.

“Quite frankly, I don’t think this province is ready to trust the government with another billion dollars,” he added in a shot at Wynne’s minority government for the potential $1.1 billion cost of closing two GTA power plants before the 2011 election.

There are no estimates from the province on how much money it would need to raise to start a provincial pension plan.

“This is a big piece of work,” a government official told the Star’s Martin Regg Cohn.

With Wynne and others already pushing Ottawa to enhance the $183-billion Canada Pension Plan, Fedeli maintained “the whole pension issue should be dealt with at the federal level.”

Ontario is looking at starting its own pension plan because of concerns over the disappearance and shrinkage of traditional company pension plans, leaving workers vulnerable when they retire.

CPP benefits are now capped at about $12,000 a year, well below the poverty line.

About 60 per cent of workers do not have employer pension plans, leaving them reliant on their own savings and any government help available.

The federal government has been resisting the push for CPP enhancements, with Finance Minister Jim Flaherty warning the economy’s delicate state makes it difficult to force workers and employers to pay higher premiums.

The Canadian Federation of Independent Business shares those concerns, saying any more plans to require employers to pay more in premiums — or join an Ontario pension plan — would amount to a tax on jobs and drive up costs.

“For employees, you’re going to take less money home from your paycheque but at least it’s deferred income,” said Plamen Petkov, Ontario vice-president for the CFIB.

“But for employers it’s a payroll tax.”

Employees now pay 4.95 per cent of their pay into CPP, to a maximum of $2,356 this year. Employers match that.

Concerns about income security for retirees prompted NDP Leader Andrea Horwath to propose a supplementary Ontario pension plan back in 2010, with workers getting $700 monthly.

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“We think this issue has to come back,” New Democrat MPP Michael Prue (Beaches—East York) said Wednesday.

“Fortysomethings with no pensions are getting very worried. The reality is, come 20 years from now, you’ll have a poor sub-class of retirees.”

When Horwath suggested an Ontario pension plan, the Liberals, led by former premier Dalton McGuinty, did not pick up on the idea.

Wynne, however, is considering a plan to be announced in Finance Minister Charles Sousa’s fall economic statement in November, and is trying to convince other premiers to put pressure on the feds for CPP enhancements.

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