I did provide a presentation to them.
The EI hiring credit was seen by 64% as being somewhat or very effective in helping them to maintain or strengthen business performance. It does this by offsetting at least some of the EI premium increases when businesses grow their payroll. This is especially important for smaller firms who tend to be more sensitive to these kinds of cost increases. While small business would prefer to see EI premium rates frozen, the EI hiring credit does provide some relief to the smallest firms.
However, I want to mention that we have some concerns with the suspension of the Canada Employment Insurance Financing Board Act and the dissolution of the board. We understand and support the need to cut costs, and it makes sense to suspend the board's operations while it has nothing to do. However, our interest has always been that there be an EI account independent and separate from general government revenues, so that surpluses that accumulated in the past, to the tune of $57 billion, could never again be spent on other government priorities. While we understand the practicality of suspending the board's operations, we insist that EI continue to be treated as an account separate from general revenues.
The next part of Bill C-45 that is of interest to small business relates to provisions intended to create pooled registered pension plans. This is important as the majority of small business owners don't have a retirement plan for themselves or their employees. Why is that? Most small business owners will tell you that having a retirement savings plan is too expensive and too complicated to administer.
We believe that PRPPs will start to address some of those issues. We recently asked small business what features they would find most attractive in a PRPP. We found that giving employers a choice, keeping costs low, having no payroll taxes on the employer contributions, and minimizing the paperwork were all equally important. In theory, with this framework in place, PRPPs should address these issues to some degree; however, it will be up to the provinces and financial institutions to make it attractive to small firms. The good news is that just over one-third would consider offering a PRPP and another 30% might become interested once they have more information. Offering more options for retirement planning is welcomed by CFIB and our members.
The last provisions of Bill C-45 that I want to focus on are changes to public sector pensions. We welcome these changes, as they start to address some of the unfairness and unsustainability of public sector pensions. Let me illustrate why this is a concern for small business owners. More than half, 58%, of small business owners said they did not feel they had sufficient disposable income to take advantage of the various retirement savings options available to them.
Furthermore, more than half do not believe that they will be able to retire comfortably until they are well past the age of 65. Contrast this with the fact that in the last five years, nine out of ten new federal public sector pensioners retired before the age of 65 with guaranteed retirement incomes. Much of this is being paid for by those very same taxpayers who cannot afford to put money toward their own retirement, partly because they have to pay taxes to help pay for government pensions.
Last year, CFIB launched a pension campaign calling for greater transparency of public sector pension liabilities and fairness for taxpayers. Over the last year we have collected over 55,000 action alerts from small business owners concerned about the state of Canada's public sector pension system. Many of you have likely received these in your offices. These small business owners are particularly concerned with the sustainability of the federal pension plan, as it has an unfunded liability estimated to be somewhere between $140 billion and $220 billion.
We're pleased to see that Bill C-45 will start to address these issues by gradually moving federal public sector workers to a 50-50 split in contributions from their current 37% share. This will also bring the federal public service more in line with most of its provincial counterparts. This measure was well supported by small business owners.
We also support the provision of Bill C-45 that will move the retirement age to 65 for new employees as of 2013. Many other organizations, including federal agencies like the EDC and Bank of Canada, have also made changes to address their pension issues by providing a different type of pension plan to new employees that includes increasing retirement age to 65. It is good to see the federal public sector is also moving in this direction. We believe that these provisions are a good start in addressing some of these issues.
All the provisions I have discussed here are important to small business. As such, we would want to see them implemented as soon as possible.
Thank you.