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Our Total Liabilities
On top federal and provincial debt loads, there are a series of unfunded
liabilities for which we are responsible. Simply put, an unfunded liability
is a commitment for a future payment for which we do not currently have
the funds.
The Canada Pension Plan (CPP), for example, is a largely
an unfunded liability (as is, for example, the Ontario Workers’
Compensation Board). And as Canada’s population ages, the CPP will
impose an increasing burden on younger generations to meet these obligations.
The following chart illustrates this trend.
Canadians Will Still Be Paying For Previous Excesses
When An Aging Population
Will Place New Demands on the Public Purse
| Source: Canadian Institute of Actuaries,
Troubled Tomorrows- The Report of the Canadian Actuaries Task Force
on Retirement Savings |
| Key Points |
- Canada is moving from a world where
5 workers will support each retiree to one where 3 workers will
support each retiree.
Typically, government expenditures on the elderly are about 2.5
times those on the young, meaning that public finances will come
under pressure as the Canadian population ages.
- Unsustainable spending and a large
national debt will place an extra burden on young workers at a
time when they will already be expected to pick up the tab for
an aging population.
- Existing program obligations (or unfunded
liabilities) amount to about $1.4 trillion.
- By 2036, those under 20 will account
for only 20.2 percent of the population while those over 65 will
account for 24.8 percent of the total.
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