The Common Good Retirement Plan
By Lina Khatib, CCVO Policy Analyst
Last month, along with the Institute for Community Prosperity at Mount Royal University, CCVO co-hosted a roundtable for nonprofits to learn about the proposed Common Good Retirement Plan for Canada’s nonprofit and charitable sector. The roundtable brought together an engaged group of nonprofit representatives who provided feedback and posed pertinent questions regarding the proposed retirement plan. The plan is meant to address the retirement saving needs of nonprofits of any size and sub-sector interested in enhancing retirement security for their employees. This includes both nonprofits currently offering retirement benefits to employees, as well as those who do not currently offer retirement benefits. CCVO has since become a Common Good Champion in support of the initiative, and encourages other nonprofits to learn more about the plan and how it can bring value to their organization.
“The nonprofit sector empowers the quality of life we too often take for granted. And while nonprofit employers can’t easily compete with salary levels offered in other sectors, there’s no good reason why they shouldn’t be able to offer a range of benefits supporting healthy workplaces. This should ideally start with a well-designed retirement plan that offers income security to the professionals who are ensuring we all live in vibrant communities.”
- David Mitchell, CCVO President & CEO
Key Features of the Common Good Retirement Plan
The Common Good team estimates that 850,000 nonprofit and charitable workers in Canada - representing about half the sector - lack a workplace retirement plan, and many others offer lower quality, high-fee plans. The plan is intended to be a nationally portable, high-quality retirement plan with a flexible design to reflect the needs of the nonprofit sector workforce. Established as a not-for-profit corporation, the following lists the key features of the Plan:
Overseen by a board of directors with a legal duty to put plan members’ interests first
Established as a Group TFSA/RRSP
Membership either mandatory or voluntary
Open to sector employees, freelancers, and spouses
Employees’ contributions would be flexible, and employer contributions optional
Curated set of professionally selected investment options, including smart defaults
Post-retirement options to turn savings into a stream of income
Simple, digital-first member and employer service.
The plan has the potential to target the needs of an underserved population, including the needs of nonstandard workers and marginalized groups, such as part-time, temporary, on-call, contract, freelancers or self-employed individuals – all groups that are prevalent among smaller and mid-sized nonprofits and traditionally excluded from collective workplace retirement plans. Employers who already have a group savings plan in place may consider switching over in order to expand coverage to a broader portion of their workforce.
To launch Common Good, the initiative needs confirmed support from at least 50 employers who are publicly committed to offering the plan to employees, should it proceed. The initiative also requires sufficient funding to cover implementation costs and costs associated with scaling the plan, in addition to a high level of interest from employers and workers in the sector.
Click here to learn more about the plan and how you can get involved.