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Retailers wary of Ontario Retirement Pension Plan


July 28, 2014
By Canadian Garden Centre & Nursery

July 29, 2014, Toronto – Members of the Retail Council of Canada (RCC) are raising concerns about
the implications of the Ontario Retirement Pension Plan (ORPP),
proposed in the latest provincial budget.

"Retailers understand the need for all Ontarians to build an adequate
nest egg for retirement," said Diane J. Brisebois, president and CEO of
the Retail Council of Canada. "The level of retirees' incomes affects
the overall economy and of course determines people's abilities to buy
goods from our members. The challenge will be to balance the importance
of long-term pension incomes against the nearer-term impact on growth,
jobs and investment."

In a recent telephone survey about the introduction of the ORPP, retailers expressed concerns about:

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  • The significant cost that this program will impose on merchants. This is especially troubling for small to mid-sized retailers.
  • A
    $3,500 annual salary contribution threshold that members say will limit
    the hiring of seasonal, part-time and first-time employees.
  • Retail
    sales remaining nearly flat in Ontario for many categories, which
    retailers say will leave them no way of recouping these costs except by
    increasing prices or by decreasing staff or new hires.
  • The increased pressure from all quarters: the rising Canadian dollar, cross-border shopping and limited economic growth.

"There
is a limit to the payroll contributions that retail businesses in this
province can be expected to pay without there being a significant
economic impact," said Brisebois. "We have a substantial employer
health tax, the second highest WSIB rates in Canada and now we are
looking at a new provincial retirement pension plan. The government will
have to look at the cumulative impact of these payroll costs, to ensure
they do not diminish our capacity to hire more Ontarians and to make
key investments."

The Retail Council of Canada is a
not-for-profit association representing more than 45,000 stores of all
retail formats, including department, grocery, independent merchants,
regional and national specialty chains, and online merchants.


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