William B.P. Robson, a co-author with David Slater of a series of papers on pension issues, has written an ambitious survey of the state of Canadian economic policy in the areas of pensions and health care. He argues that it is appropriate to tackle both issues in the same paper because they are both major spending programs strongly related to the life cycle of Canadians, and face challenges arising from the aging of the population. Robson notes that the pension debate uses the metaphor of three pillars to describe a comprehensive pension system: a safety net to guard against destitution in old age; a mandatory employment-related system to provide basic replacement income; and a voluntary system supported by provisions that reduce the double-taxation of saving. The main elements of public policy related to pensions in Canada cover these pillars. He recognizes that all three of the pillars cannot be directly applied to health care, but he argues that the three-pillar metaphor is still a fruitful perspective because it facilitates constructive responses to the pressures confronting Canada’s health system and illuminates interactions between the pension and health systems. Hence his title “six pillars of social policy”. Based on his examination of Canada’s pension and health-care systems, Robson makes a number of recommendations. First, he advocates more prefunding in both the pension and health areas to cover the future cost of the aging baby-boom cohort. Second, he recommends a gradual increase in the normal age of eligibility for pension benefits. Third, he recommends the creation of a second pillar, a mandatory contribution scheme in the health area as a way to avoid the development of a means-tested system that would exacerbate the disincentives to work and save. Fourth, he puts forward the idea of a new type of saving vehicle that provides tax-relief on distributions rather than on contributions so that Canadians can avoid the high marginal effective tax rates associated with means-tested programs.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Download reference. The following formats are available: HTML
(with abstract),
plain text
(with abstract),
BibTeX,
RIS (EndNote, RefMan, ProCite),
ReDIF This chapter was published in: Patrick Grady & Andrew Sharpe (ed.) The State of Economics in Canada: Festschrift in Honour of David Slater, Centre for the Study of Living Standards, pages 183-224, 2001.
Find related papers by JEL classification: O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: