I'm a strong believer in the Canada Pension Plan. By this I mean it's a very well-designed pension plan. A lot of people think it's the best-designed plan in the world, and I agree with that.
The only thing is this. If I had been asked to be involved in the decision made in 1966, the main thing I would have changed is not the benefit design, because it's designed as well as could be. There is nothing perfect, but it's very well designed. The point is in respect of the financing. In those days I considered there were two deficiencies in that respect. This is why our children today are paying much more than they should to the CPP. The real full cost of the CPP is about 6%. As you know, our children are paying 9.9%, because they have to pay for the deficiencies that have been built up over the years.
There are two reasons for these deficiencies. The first one is that the full cost of the CPP is 6%, and from 1966 to 1986 the contribution rate charged was only 3.6%. The second point is that normally a fully funded private pension plan—the CPP is not a private pension plan—does not provide benefits immediately to people who have just retired, who are already retired. As most of you must know, by 1977 all people who contributed to the CPP over only 10 years were entitled to full benefits. This is the second point that gave rise to those high deficiencies of the Canada Pension Plan, the high liabilities that have not been paid for, and it's our children who pay for that.
If we had to start it over again, I would say, well, I understand that for starting a new plan 6% is a lot of money, but let's do it immediately, otherwise the problem will be even bigger later on. That's what happened, because having charged 6% rather than 3.6%, that would have represented 2.4% more, but now our children are paying 4.4% more. We have created a big problem that is more expensive to resolve today than it would have been if it had been done in this manner in the first instance.