Who’s risk is it anyway? How Canada and Britain are dumping pension risk

Pension Risk 3

I’m off to Manhattan to talk to a couple of hundred Canadian pension experts.

This is broadly what is going to be said, I’ll be sharing the stage with a couple of Canadian pension experts and (if you open the presentation), they’ll be speaking to the slides with Canadian flags in the header.


I may by then have alienated the Canadian pension plutocracy with my latest blog but I’m not jetting 8,000 miles for a friendly chat! For the next two days, I’ll be holed up in the Manhattan Midtown Hilton chewing the pension fat and I’m waving the flag for Britain.

CPBI Forum

There appear to be three major differences between the ways we go about things.

  1. Canada, unlike Britain, does not have a uniform pension policy, each province takes its own decisions – so there’s a whole bunch of Canadian pension policies, glued together by organisations like the Canadian Pensions and Benefits Institute.
  2. Canada still believes in sharing risk between employers and members. In this it is either behind or ahead of Brtiain, depending on where in the circle of this debate, you stop the wheel.
  3. Britain believes in personal financial empowerment, Canada is more sceptical.

I am going to be arguing that Britain’s pension reforms are currently quite radical. While every G8 country is moving towards annuitisation, we are moving to pension freedoms. While our former colonies polarise between compulsion (the Australian model) and enlightened self-interest (the American model), we go forward with auto-enrolment.

Britain is making a pension statement in all this, and I’ll be interested to see what the Canadians and Americans at this Forum make of it

Pension risk

Of course, our attempt to liberate may end in tears and wet pants. We may find ourselves having to create collective structures that share the risk between participants, as the Canadians are doing (especially in Ontario). I doubt that we’ll have an appetite to take risk corporately, but I suspect there is an appetite among ordinary people for what the Canadians call “Target Pensions”.

target pensions

In the meantime, I’ll be interested to find just how widespread pension coverage is in Canada. The chap I’m presenting with, Simon Nelson of Eckler, has been a bit coy about this. I suspect that Canada has more than a few of its citizens excluded from the kind of high quality corporate schemes that Simon’s consultancy advises.

While I am a big fan of the Canadian risk-sharing model, I’m not clear about what the support structure is for those who don’t enjoy wealth in retirement. Is there an issue with pension exclusion in Canada? I intend to find out!

Pension Risk 2


I suspect that Canada is struggling along, trying to find solutions to the big issues for pension policy makers – just like us.

The trouble is that there is not empirical data to tell us whether what they are planning to do about it, is any more likely to work than what we are planning to do about it.

What’s more, I suspect that those who are making the policy up in Canada, spend too much time in fancy conferences, just like  their British counterparts.

What we are doing in Britain, should be of interest to other countries and I hope my trip will justify the substantial cost of flying me to and putting me up in  New York. For my part, getting an insight into other country’s problems might help me do my job back in Blighty a little better.

At least , that’s how I’ve sold it to my bosses.

About henry tapper

Founder of the Pension PlayPen, Director of First Actuarial, partner of Stella, father of Olly . I am the Pension Plowman
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