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2015 Pre-Budget Submission Update

Key Highlights of Finance Committee Report

The House of Commons Finance Committee has now issued its final report as part of the 2015 pre-budget consultation process. We are pleased to announce that in the main report CALU is mentioned as a witness on two separate occasions (see page 52) and CALU’s two recommendations have been incorporated into one recommendation at the conclusion of the report (see item #11 on page 72 of the report). For your convenience, these key highlights are noted below.

From Page 52 of the Main Report

As a means of allowing individuals to save for longer periods of retirement, the Investment Funds Institute of Canada advocated a reduction in the mandatory minimum withdrawal amounts for registered retirement income funds and/or an increase in the age by which the initial mandatory withdrawal must occur. Similarly, the Conference for Advanced Life Underwriting asked for an increase in this age [note: this was not part of CALU’s  recommendations] and it provided various formulae for calculating the mandatory withdrawal amount.

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The Conference for Advanced Life Underwriting urged the government to educate Canadians about their financial obligations relating to long-term care services, and to ensure that tax rules encourage more Canadians to purchase individual long-term health care insurance. It mentioned, in particular, tax-exempt registered retirement savings plan withdrawals to purchase such insurance.

From the List of Recommendations (starting on page 71)

#11. That the federal government examine ways to help Canadians save for long-term care. Moreover, the government should examine innovative means by which to support retirement security for seniors, such as through modifications to registered retirement income fund withdrawal rates.