Cory Morgan: Is Harper’s Appointment to Alberta Investment Corp a Step Toward a Provincial Pension?

The firing of the entire Alberta Investment Management Corporation (AIMCo) board by the Danielle Smith government appeared to come out of left field. AIMCo manages over $160 billion in public assets including several pension plans. Shaking up the leadership of a board entrusted with such a large public asset pool is not to be taken lightly.
Eyebrows were raised further when former Prime Minister Stephen Harper was appointed the new chair of the AIMCo board. Premier Smith has a plan for AIMCo, and it’s likely related to her intention to create a provincial pension plan.
Alberta’s government has made no secret of its intention to form a provincial pension plan. This is an important facet of Smith’s UCP leadership campaign’s provincial empowerment plank.
In choosing Stephen Harper to chair AIMCo, the Alberta government is signalling an intention to wade back into the provincial pension plan debate. It’s assumed that if Alberta forms its own pension plan, it will be managed by AIMCo.
One of the challenges Smith has faced in garnering public support for an Alberta pension plan has been winning public trust in the concept. The benefits of the CPP may be relatively modest, but for many Albertans, it’s their prime form of income in retirement and they have little interest in gambling with it. Unless Albertans feel confident the funds in a provincial plan will be responsibly held and managed, they won’t support it.
Stephen Harper is a man respected and trusted by Albertans. While Danielle Smith can be inclined to be impulsive and dive into issues, Harper is known for careful and strategic policy moves. Both mindsets have political merit, but when it comes to something as sensitive as the management of a pension plan, Harper’s controlled approach is preferred. His appointment to head up AIMCo will make many Albertans comfortable with the notion of a provincially managed pension plan.
Harper’s task now will be to manage AIMCo efficiently. He must not appear politically motivated in his management, which will be difficult for a man who is inherently political. His task isn’t just to be a good guardian of the existing funds, but he must do it so well that Albertans will entrust him with their retirement plans. It’s an unspoken agenda for him, and a challenging one.
While the federal government desperately wants to turn Canada into a hub for manufacturing batteries for electric vehicles, it doesn’t justify investing pension funds into such a high-risk venture. Pension funds must be invested with the intention of safe growth of the fund and nothing more. Trust in the fund becomes eroded with incidents such as the Northvolt investment.
Alberta has had a long history of bad investments when the government tries to get into business. The province recently lost over a billion dollars when it backstopped the Keystone pipeline.
Harper must prove himself to be a guardian of the dollars entrusted to his care who will resist the temptation to invest the funds with political motivations. Self-control has always been a hallmark of Harper’s leadership, and he will surely apply it in heading AIMCo. Smith made a smart appointment both politically and economically, and it will help her build support for an Alberta pension plan.