Gendering the Pension Promise in Canada: Risk, Financial Markets and Neoliberalism

AuthorMary Condon
Published date01 March 2001
Date01 March 2001
Subject MatterArticles
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Osgoode Hall Law School, York University, Canada
This article argues that retirement income provision in Canada is built on gendered
assumptions, which produce material disadvantage for women. These inequalities are
being exacerbated by current neoliberal trends towards the ‘marketization’ and indi-
vidualization of pension provision, supported by tax, securities and corporate legal
norms. The argument is developed using recent legislative changes to the operation of
the Canada Pension Plan and recent developments in the regulation of mutual funds
in Ontario as case studies. The article concludes by sketching out some possible points
of departure for feminist interventions in pension privatization debates.
THIS ARTICLEuses recent reforms to retirement income policies in
Canada as a site for examining aspects of the material impact of neolib-
eral restructuring on Canadian women, as well as the role of law in
furthering this agenda. The argument of the article is developed by first
demonstrating that the Canadian pension framework, outlined briefly below,
has been and continues to be fundamentally gendered, both in its impact on
individual women and in the categories of analysis that are used to undergird
the system. Second, it is argued that this ‘genderedness’ is being intensified
in the current era of economic restructuring, such that many women are being
adversely materially affected. This is occurring because of political choices
that are being made, not just in Canada, to ‘marketize’ pension policy, that
is, to link it even more closely to the operation of financial markets. Two
SOCIAL & LEGAL STUDIES 0964 6639 (200103) 10:1 Copyright © 2001
SAGE Publications, London, Thousand Oaks, CA and New Delhi,
Vol. 10(1), 83–103; 016322

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specific examples, (1) reforms to the Canada Pension Plan (CPP) and (2) legal
treatment of mutual funds, will be described. One conclusion to be drawn
from these examples is that the gendered repositioning occasioned by neolib-
eralism varies across class and sexuality. Thus, the shift to financial markets,
accompanied as it has been by the ambiguous results of gender-oriented
activism in political debate about the CPP described below, suggests that
feminist scholars may need to both reconsider their focus on the welfare state
as the locus of materialist emancipatory politics (Fraser, 1998) and pay close
attention to the legal regimes that facilitate this market-oriented restructur-
It should be pointed out, of course, that it is not only by means of pension
reform that the Canadian state is being restructured in accordance with
neoliberal principles, with gendered implications. The research presented in
this article is part of a larger collaborative project1 which is investigating the
implementation of privatizing policies in a variety of social and legal arenas
in Canada, such as labour markets, family and welfare policies, tax policy,
immigration, criminal justice, health policy and reproductive choice and
technologies. The particular focus of the project is the role of law in privatiz-
ation, both in terms of the myriad ways in which law and legal regulation are
implicated in this economic and social restructuring, and also assessing the
possibilities for using law in progressive ways to counter the gender dis-
advantage which it is argued is occurring.
In a number of countries, retirement income policies tend to involve a
mixture of ‘public’ and ‘private’ provision, and thus to reflect the inter-
dependence of state and market. In Canada, retirement policy is usually
characterized as having three ‘tiers’. The first tier is represented by a universal
state benefit, known as the Old Age Security Program.2 Funded from general
revenue, this is meant as an anti-poverty measure and it is both taxable and
repayable, above a threshold amount, by the more well-off. The second, the
CPP, has been since 1966 a publicly administered ‘paygo’ plan (where the
contributions of today’s workers support today’s pensioners) from which all
workers, and in some cases their spouses and survivors, will receive benefits.
These benefits are financed by mandatory contributions from employers and
employees, based on a percentage of income. In the ‘income replacement’ lan-
guage of pension policy, CPP benefits are pitched so as to replace about 25
percent of pre-retirement income, up to the Canadian average income of
C$35,800 (1997 figures).3 The third tier is composed of a mixture of
employer-sponsored pension plans (RPPs), and individual ‘registered retire-
ment savings plans’(RRSPs). With respect to the former, it should be pointed
out that employers are not required to provide pension plans for their
employees. In the latter, employees voluntarily deposit money in a variety of
investment vehicles provided by financial institutions, and most notably in

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Canada by the mutual fund sector. Such investment is facilitated by the fact
that employees no longer make contributions to CPP beyond the average
wage (Deaton, 1989: 228–9). While Canada is one of the ‘developed’ coun-
tries that has relied most heavily on the labour and financial markets to
provide retirement income for its citizens (Esping-Anderson, 1990; Orloff,
1993), the state and its laws have been implicated in these tiered retirement
sectors at all levels. Thus, the state accomplishes the direct provision of
income through the OAS, the collection of CPP contributions and, until
recently, lending out the modest surplus in the CPP fund to provincial (or
local) governments at below-market interest rates, the regulation of
employer-sponsored plans and the provision of generous tax deductions to
individuals sheltering income in RRSPs.
Retirement pensions may be understood as a form of social insurance against
risk, in this case the risk of outliving one’s material resources when other
ways of accessing income are less tenable (Rose, 1996; Sohrab, 1996). Under-
stood as social insurance, they were one of the lynchpins of the post-Second-
World War welfare state, which attempted in a variety of ways to secure the
‘pension promise’. Yet in most welfare states the capacity to access this insur-
ance against poverty at an advanced age derives not primarily from being a
citizen of a particular polity but either from a prior connection to the paid
labour market or from being in a familial relationship with, or a survivor of,
a wage earner (Donnelly, 1993; Orloff, 1993). Both the second and third tiers
of Canada’s retirement policy, as well as the GIS and Spouse’s Allowance
components of OAS, are linked in various ways to wage earning or family
relationships. This point implies that conceptually, as well as in practice, the
distribution of the risk of being materially disadvantaged in old age will vary
across gender and sexuality, since women’s differential relationship to the
paid labour market reflects their particular role in social reproduction (Mac-
Donald, 1998).
With respect to the Canadian labour market, Townson has documented
extensively the phenomenon whereby women are much more likely than
men to be employed in ‘non-standard’ work, which she defines as part-time
work, self-employment, temporary work, or multiple jobs with a series of
employers (Townson, 1997: 2–3). In 1994, for example, 40 percent of women,
as compared with 27 percent of men, worked in non-standard jobs (1997: 13).
Specifically, 24 percent of all women workers compared with only 8 percent
of men were in part-time jobs, most often in the retail trade and other con-
sumer services (1997: 5, 8). This point is one not only about labour market
participation rates but also about pay. Thus, ‘the average earnings of all
women, including those who worked part-time or in other types of work
which was not full-time, full-year, were $20,219 in 1995 which was still only
65% of the average earnings of all men at $31,053’ (1997: 16). The impact on

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the ability to make contributions to labour market-based pension schemes,
and to receive benefits on the basis of contributions, is obvious. As Orloff
expresses it (1993: 314), ‘Women’s inferior status in the work force means that
women are disproportionately disadvantaged when benefits reflect work-
related inequality’. In terms of family status, on the other hand, Statistics
Canada reports that, in 1993, 56 percent of all senior women living alone or
with unrelated persons had ‘low incomes’.4 As Leonard and Nichols put it
(1994: 9–11), ‘for the majority of women, their marital status will determine
their material conditions in old age, since poverty is far more pronounced
among single elders than among married couples’. McDonald’s 1997 study of
retired widows, who ‘constitute approximately 47% of the senior popu-
lation’, and 49% of whom ‘lived below the low income cut-offs of Statistics
Canada’, leads her to reinforce the claim that ‘married women are one
husband away from poverty’ (McDonald, 1997b: vi–vii).
Further, Townson claims (1995: 6) that there are significant differences
between men and women in attitudes to retirement. In a survey...

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