Bill C-26 (Historical)

An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act

Part 1 of this enactment amends the Canada Pension Plan to, among other things,
(a) increase the amount of the retirement pension, as well as the survivor’s and disability pensions and the post-retirement benefit, subject to the amount of additional contributions made and the number of years over which those contributions are made;
(b) increase the maximum level of pensionable earnings by 14% as of 2025;
(c) provide for the making of additional contributions, beginning in 2019;
(d) provide for the creation of the Additional Canada Pension Plan Account and the accounting of funds in relation to it; and
(e) include the additional contributions and increased benefits in the financial review provisions of the Act and authorize the Governor in Council to make regulations in relation to those provisions.
This Part also amends the Canada Pension Plan Investment Board Act to provide for the transfer of funds between the Investment Board and the Additional Canada Pension Plan Account and to provide for the preparation of financial statements in relation to amounts managed by the Investment Board in relation to the additional contributions and increased benefits.
Part 2 makes related amendments to the Income Tax Act to increase the Working Income Tax Benefit and to provide a deduction for additional employee contributions.

Canada Pension Plan

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, it is a pleasure to rise today and support BillC-26 at second reading.

We have heard quite a difference of opinion in the House on the advisability of this bill. Maybe we can start from a place that we do all agree with, that it does not serve the Canadian economy well and certainly does not serve Canadian seniors well to have people retire into poverty. Unless people are going to work their entire life until they drop, we project that there will be a period when they are not working for their income. That income has to come from somewhere, and if it is not coming from their going into work every morning, then it has to come from money they have saved on their own, or it is through a mechanism like the Canada pension plan, or from another kind of benefit if it is not from their working family members.

The kind of system projected by the Conservatives, when they talk about individual savings, is the one we once had when people who were past their working lives had to be supported by their family members. That was great for those who had family members who could support them, and it was very bad for those who did not. So the CPP was by far and away an improvement on that situation, through which people could manage to save for themselves throughout their working life. Things like the OAS and GIS are important in that regard too.

There is a need for income in retirement. We can all agree on that. The gold standard for that would be to have some kind of guaranteed annual income in retirement, I think it is fair to say. But given that we do not provide in that way, the Canada pension plan has been a great mechanism for working Canadians to make sure they do have at least a basic income when they retire. It was based on three pillars, that there would be a CPP there to provide about a third of what people might need in retirement; that their company pension plan would provide another third; and that their personal savings would provide the final third.

In Canada today, two of those pillars are in serious jeopardy. We know that almost seven out of 10 Canadians working today do not have a company pension, meaning that a third of that retirement income scheme is gone. We know that most working Canadians are struggling very hard to save. Many are living pay cheque to pay cheque, so they are not able to save to the extent they need to in order to be able to furnish a third of their retirement income once they are no longer working. That is why there is a need to enhance the first pillar, the public pension. It has to do more, in our view, to make up for the problems in realizing the potential of those other two pillars.

People may be approached by their financial adviser and told there are all these plans, but one plan has 40 million people in it, those being everyone in the country, and it is fully portable.

Particularly in this age, people are having a hard time finding a job that will last the 20, 25, 30, or 35 years necessary for them to be able to buy in sufficiently into a company pension plan, if there is one, to have it produce adequate income for them in retirement. Most Canadians are going to have seven or eight different employers in their working life if they are young now, and it is almost certainly the case that many of those employers will not have company pension plans. Even if they did, they would not have the same plan. CPP provides an important benefit with its full portability. That is an advantage of the plan.

Every working Canadian is in the plan. That is another advantage in spreading the risk. Furthermore, it has been proven to have some of the lowest administration fees and, therefore, it gets the best value for money for the contributors, who do not have to have their money shuffled off to those who are administering the plan.

It has the added advantage, when every working Canadian is in that plan and everyone who has worked is living off a portion of that plan, that it has a certain political backing. That also goes toward mitigating risk. We really are all in the CPP together in a way that we are not in any private pension plan, so Canadians can feel confident that their savings held with the CPP are less likely to fail than those in many of the private options that are out there.

It has another benefit that is even rarer today, even in the case of Canadians who do have private sector pension plans, in that it provides a defined benefit. That is very helpful when trying to project what income people will have in retirement and, therefore, how much they need to save to go above and beyond what their pension plan will provide, whether CPP or a combination of CPP and a private pension.

People who are in a defined contribution plan who do not know what that plan is going to produce once they do finally stop working will find it a lot harder to know exactly how much they have to save. That is another benefit of the Canada pension plan.

I do applaud the effort to raise the benefits of the CPP. I think there are a few things to say about that. One is that I really do doubt whether it is enough. In fact, I do not think it is. I would like to see the government go further in enhancing the Canada pension plan, because I do think it is a great option for most working Canadians, who are not making a lot of money, not just to save for their own retirement in a well-working, proven fund, but also to have their employer make a matching contribution to that.

Indeed, when we talk about Canadians taking charge of their own future and saving their own money through TFSAs, for instance, we do not talk about what is absent, namely employer contributions. That is another important aspect of the CPP.

I would like to see it further enhanced. This is a good first step. It is certainly not worth opposing simply because it is not ideal. However, I would like to see the government push harder for an bigger increase in the CPP. I think it is important.

We also know that this will not do anything for seniors right now. That is important to consider, because it will do a lot for young people over the course of their working lives, but not for seniors rights now. My children, who are three years old and four months old, are going to benefit from this. They will see that benefit. I am quite happy to do that for them. However, for people in my parent's generation who are just looking at retiring, other measures will be needed for them.

I do want to take a moment to address some of the arguments I have heard in the chamber today. The first is that somehow the Canada pension plan is a payroll tax. I simply do not agree with that. It may be true as a term of art in accounting terms, which may be where it is recorded on the ledger. However, for ordinary Canadians who are going into work every day and are working to put food on the table today and for that period in their life they look forward to when they will not go into work every day, the CPP contribution on the part of their employer is part of the wage package. That is part of what they are going into work for, as well. So I do take exception to those who continually refer to this as a tax. It is not a tax. It is part of the wage package.

It is up to Canadians to take charge of their own future and to decide how they are going to save for retirement. In that regard, a perfectly legitimate decision on their part is to decide to do that saving through the CPP, to do it collectively, to have a plan that is better than the options they get through the private sector, and to decide that we are in this together and to elect a government that will implement a mandatory public pension. That is a perfectly acceptable decision. That is something I take them to have done in the last election.

Again, I would like to see it go further. I think many Canadians would like to see this proposal go further. However, part of the decision that was made was also to reject the idea that somehow each Canadian is on their own individually, and that they have to make choices as individuals. I believe we can make a collective decision to enhance our public pension system and that it would be a good way for us all to save for our retirement, and to do it in a way that is fair to each Canadian.

When we talk about individual Canadians who are saving for their retirement and some of the options available to them, what is missing is that Canadians with more money have more options to invest. As people hit certain income thresholds, they can gain access to certain funds and other clubs that provide better returns. It is a fiction to say that all Canadians are equal when it comes to the private retirement investment market, and that we all have the same options. One of the things that the Canada pension plan recognizes is that we all need to be treated fairly. This is another reason to support the plan.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Mr. Speaker, I thank my colleague for a very well-delivered speech on Bill C-26.

I have to say that when we look at young Canadians today, they are not living in the same situation we did, and do, meaning that today, most of us at my age, anyway, including my colleague across the floor, have had the benefit of having a pension at the end to help us and to ensure that the golden years are golden. However, for these young people, when they start off their careers, there is no guarantee of any funds or pensions. It is our responsibility to ensure that we do the right things to make this happen.

We know that in the United States, it could be a crippling situation in 2033, as far as the benefits that would be allowed.

It is not only the Liberal Party and the government bringing this to the table. It is all 10 provinces and the territories. Are we saying that the 10 provinces, the territories, and the government are all wrong and are all doing the wrong thing?

Can you expand on that, please?

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, it is my privilege to speak to Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

While I believe that the Liberal government has good intentions, it has failed to recognize the negative impact this legislation will have on the overall economy.

As many of my colleagues have already pointed out during this debate and in previous debates, what we see in this legislation is a fundamental difference between the Conservative Party of Canada and the other parties in this chamber. In this party, we believe that Canadians are in the best position to make their own decisions, and this includes decisions relating to their retirement.

Let me be perfectly clear. We in the Conservative Party are not against the CPP. We are not against helping Canadians save more for their retirement. We are certainly not happy to see seniors struggling to live out their retirement in comfort. We do believe that government policy should provide opportunities and avenues to save and to reduce taxes so that Canadians can save more of their own money when it is within their means to do so.

We strongly believe in the right of each Canadian to make his or her own choices. Canadians know what is best for them and for their families.

On the other hand, Liberals and New Democrats believe that government knows what is best for Canadians, and they do not trust Canadians to prepare for their own retirement. They seem to believe that the only way Canadians can save for retirement is through a mandatory increase in CPP contributions by both employers and employees.

We saw this ideology from the Liberal government in its first few weeks, when it slashed the tax-free savings account contribution limit by half. The Liberals made this cut even though the TFSA is a popular means of saving for Canadians at all income levels.

Individuals with annual incomes of less than $80,000 accounted for more than 80% of all TFSA holders and about 75% of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000. At the end of 2013, about 1.9 million Canadians had contributed the maximum amount to their TFSAs. About 46% of these individuals were seniors, and more than 70% were age 55 or older. Furthermore, about 60% of the individuals contributing the maximum amount to their TFSAs had incomes of less than $60,000 in 2013.

The tax-free savings account is an avenue for saving that all Canadians should take advantage of. It is an opportunity to have their investment grow at a far higher rate than they would see with the CPP. The money they deposit is readily available in case of an emergency or to make a lump sum payment to pay down their mortgage more quickly. Opposition parties have scoffed at this idea, because they believe that Canadians do not have disposable income to put in a TFSA. If that is true, how can the government justify siphoning off more money from Canadians' paycheques and holding it until they retire?

Canada is heading toward a large increase in the number of Canadians who will be entering retirement over the next decade. This is not the time to be limiting the amount of savings that would benefit these Canadians the most.

The CPP hike will take 40 years to be fully implemented, so none of these new benefits will go to seniors who need it today, or even in the next few years.

This increase will not only not benefit Canadians entering retirement soon, it will directly negatively impact the way families, students, and young employees invest their money now. A CPP increase will take money away from their paycheques, money that could have been invested or spent on immediate needs. I am talking here about new graduates wanting to pay off their student loans, or families saving for their children's education, or a middle-aged couple making a lump sum mortgage payment to reduce overall interest payments. With this plan, some households will be paying up to $2,200 more per year in payroll taxes. That is $2,200 per year that is not available to positively impact our Canadian economy.

As I said at the beginning of my remarks, I believe that the Liberals have the best interests of Canadians in mind, and their intention to help Canadians in retirement is good, but it is clear that they are going about it in the completely wrong way.

Let us not forget the impact these policies will have on job creators. Canadians cannot contribute anything to the CPP if they do not have jobs, and the introduction of this increase will result in job losses across Canada.

At a time when the Canadian economy is losing jobs and struggling to create new jobs, and when we see low growth across the board, we simply cannot impose more expenses on business in Canada. This will mean that companies will not hire that extra worker, not create that new position budgeted for, and not expand into new sectors. In some cases, they will actually have to lay off employees.

In 2015, the Canadian Federation of Independent Business studied a CPP tax hike and found that it would eliminate up to 110,000 jobs and permanently lower wages by nearly 1%. Simon Gaudreault, chief economist at the CFIB, tells us that this agreement will have serious negative impacts on workers and the Canadian economy. The announced changes, including increased contributions, may put Canadian wages, hours, and jobs in jeopardy.

Hendrik Brakel, senior director, economic, financial and tax policy at the Canadian Chamber of Commerce, also notes that increases will have many effects on the Canadian economy. He said:

...we’re worried a big tax increase is headed for the middle class like an elbow to the chest....

This comes at the worst possible time—an economy reeling from weak commodity prices and slower consumer spending will be lucky to eke out growth of 1.5% next year. It’s difficult to stimulate the economy while pulling money out of the pockets of Canadians.

It is not just directors and chief economists who are speaking out against this increase. This past summer, a young woman who manages the payroll for a number of small and medium-sized businesses in her area told me that she could not believe that the Liberal government would be increasing this mandatory contribution. She assured me that this would mean layoffs, decreased investment, and postponement of expansion. In other words, no new jobs.

We have heard from experts and ordinary Canadians that Bill C-26 will have negative consequences and will hurt, more than help, our young people and seniors.

Last, I would like to quote Mr. Fred Vettese, chief actuary at Morneau Shepell and co-author, with our current finance minister, of The Real Retirement. He wrote in the Financial Post, on June 5, that:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get. Yes, a little over five per cent of seniors today still have income below the poverty line....

Canada has a world-class retirement system, and the numbers support that, with 83% of Canadian households on track to maintain their current living standard in retirement, according to a study by McKinsey & Company. In addition to that, according to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in 1970 to 3.7% today, which is among the lowest in the world.

I would like to quote Finance Canada, from June 2015:

Overall, Canada's retirement income system is performing well. Canadian retirees achieve relatively high levels of income in retirement, and compare well to retirees in other Organization for Economic Co-operation and Development countries. With support from all three pillars of the retirement income system, the median Canadian senior earns about 91 per cent as much as the median Canadian--well above the Organization for Economic Co-operation and Development average of 84 per cent. Internationally, Canada has one of the lowest low-income rates for seniors.

I agree with the broad intentions of the Liberal government as it approaches this legislation. We, as members of Parliament, should strive toward the goal of having every single Canadian senior retire in comfort. However, as I have outlined throughout my remarks, I believe that the Liberals have not considered the many negative impacts this policy change will have on Canadians.

I cannot support Bill C-26, as the negative consequences are far too crucial for me to ignore.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, that is a very good point. It reminds me of some of the conversations that took place during electoral reform. The problem with our current system of electing governments is that we suffer from policy lurch. It is very hard in this place to take a long-term view when there is a new government, on average, every 10 years that completely clears the deck of the previous government, saying it is going to go in another direction. Then in another 10 years, another new government says that it is going to go in another direction.

Bill C-26 is a very real effort. Yes, it is going to take a long time to get implemented, but it is taking that vision in several decades. Yes, it will only affect the kids of today, but I think those children will be very thankful that we had the foresight to act now before the problem went beyond this.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, I share my colleague's concern about seniors. I am especially concerned that the current fix proposed in Bill C-26 will do nothing to address the problem that elderly widows are having, which is that they may not have worked, their husbands have died, and they do not get any of their husbands' pensions. This bill would do absolutely nothing for them. Could he expound on some of his ideas for a solution?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, I am very pleased to have this opportunity to speak to Bill C-26, which is the government's effort to expand and enhance the Canada pension plan. As many in the House know, the expansion of the CPP has long been a policy objective of the NDP. From the campaigns of both the Liberals and the NDP, I do not think Canadians are under any sort of surprise that this policy eventually would be brought up in the 42nd Parliament.

As we all know, Canada's retirement system is based on three pillars: a combined Canada pension plan and the old age security from the government side; workplace pensions that used to be provided by many workplaces but are increasingly uncommon; and the RRSP and private savings of Canadians.

Unfortunately, two of these pillars are now in not very good shape and it is a moral imperative that we act to do now what we can, looking into the future, to prop up the third one, namely the Canada pension plan and the combined old age security and GIS.

I listened both yesterday and today to arguments from the Conservatives about giving Canadians more choice and putting money back into the pockets of people. I could not agree more with those two. With this measure, we are giving seniors a choice. I believe that in the future, with more money in their pockets, they will have more choice.

I also understand the arguments the Conservatives have made about the cost of living increases going on in Canada. I do not believe that this is a cost of living increase. It is not a payroll tax. It is a very simplistic argument and it misleads the conversations that we ought to be having about our retirement future. This is an investment in our future. I know of no other tax that Canadians pay where they will actually get dividends at a later point. These are deferred wages that they will be drawing from in their retirement years.

I have also heard of the absolute calamity that Canada has experienced now that the tax-free savings account has been dropped from $10,000 to $5,000 a year. The costs to the treasury would have been enormous in later years if the $10,000 limit had been allowed. I wonder how this connects with the increased reliance on the guaranteed income supplement that the Conservatives are always proposing as a measure to help Canada's seniors. I agree that the GIS plays a very important role, but the goal of this place is to get to a point where the guaranteed income supplement is not as necessary. Despite what the Conservatives say, the measure of the TFSA only helps a small segment of the population.

I have also heard the arguments about increasing personal responsibility. That is a terrible argument to put forward to someone who is living paycheque to paycheque and giving up on their own retirement future to help put their kids through college, to make a housing payment, to put food on the table. To tell someone that they are not personally responsible because they are not saving enough is just a terrible argument to make to people in these tough economic times. We are all hard-wired to help our kids. It is something I would do in a heartbeat and without a second thought.

When times are tough, especially when we have minimum wages that do not even come close to what the living wage is, it becomes near impossible to save for retirement. The facts from Statistics Canada back this up.

We also know that defined benefit pension plans, like the Canada pension plan, are one of the most effective tools in combatting income inequality and retirement insecurity.

I want to contrast that with the defined contribution plans of which some in the House are in favour. There has been a push from the right to consider that Canada engage in more defined contribution plans, but we can see examples from around the world of the problems with these plans.

I refer hon. members to the case of Australia. Australia has had its superannuation plans. They are defined contributions. They were instituted in the mid-1990s. Around that time, nearly 80% of workers were covered by these plans. We look 20 years later and nearly 50% of Australian seniors now live in poverty. The country is the fourth highest spender on government assistance. Sixty-five per cent of seniors have no money left in their defined contribution funds by the time they reach age 75. That is completely inadequate.

Another recent study compared the pension income of British citizens with defined contribution plans to Dutch citizens with defined benefit plans. It found that the cost was 1.5% more in fees per year to run the defined contribution plan. Over time, these fees add up. In fact, a British citizen who made the same contributions and earned the same investment returns ended up receiving a pension payment that was 50% lower than his Dutch counterpart. This makes it more crucial for the government to push for defined benefit plans that do not suffer from those same problems. The CPP is the best retirement vehicle we have to ensure that happens.

The proposed changes in the bill are welcome, but they are unfortunately inadequate for what is needed now. I want to give that caveat to the government side. It is a good plan for those who are very young now and would have the full benefits in many years, again looking to our future. However, the plan needs to go hand in hand with solutions for those retirees or soon-to-be retirees right now.

Seniors have been struggling and this plan would do nothing for them currently. There has been unacceptable erosion in workplace pensions over the last decades. Six in ten Canadians have no workplace pension. We have even sold the idea that RRSPs and TFSAs are great options to replace workplace pensions. I think everyone here can see from the evidence that has not worked. These voluntary options have shown their inability to address the issue of lacking real pensions and a weak Canada pension plan.

Among those aged 55 to 64 without access to a company pension, about half have less than half of what they would need to pay their bills. A staggering 32% have less than $1,000 in retirement savings. That is one-third of the population.

This is a crisis that needs concrete solutions. When we have seniors living in poverty and food insecurity, with very little to no retirement savings, it is a moral imperative for the government to act. Not only is it the right thing to do, but this kind of thing if left unchecked becomes catastrophic for the economy.

If we are talking about 10 to 15 years in the future and we have millions of Canadians with little to no disposable income, then the economy tanks because they cannot afford to buy anything.

Poverty deniers on the right like to point to home ownership of seniors as proof that there is no crisis. However, we know that even with accounting for the total net worth of seniors, only 28% of seniors without employer pensions have even five years' worth of replaced income saved. Five years of savings is nowhere near the target needed for a happy and healthy retirement.

Enhancing the CPP is something that we have always fought for in the NDP, and we welcome the government's initiative for this. However, more needs to be done.

This plan would raise the CPP up to 33%. We in the NDP will continue fighting for what was passed at the Canadian Labour Congress, which is the voice of working people. We need to go to 50% benefits of the pre-retirement income if we to be serious about tackling the issues of retirement, security, and income inequality.

We also need to continue tackling the GIS and raising it. While the increase that came in budget 2016 was welcome, it has still left a lot of seniors without the adequate income they will need.

Also, if we are talking about seniors and their state today, what happened to the conversation about universal pharmacare, so we never again have a senior who has to choose between healthy food and taking their proper dosage of medication?

We need to enhance home care and palliative care, which is at crisis levels. I hope to see that in the health care accord.

There are a lot of things we could do.

The bill is a good idea, but it only tackles one small part of what needs to be done. We will support its passage, but it is too important not to lose sight of the larger problem of seniors today. Rather than taking a piecemeal approach to pensions and retirement, we need to develop a national strategy for seniors that completely looks at all facets, a strategy that will respect aging. For seniors who have lived their lives building our country, and who continue to make great contributions, the least we can allow them is to live in dignity and with respect.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Tax cuts mean more production, the sale of more products abroad, the creation of more jobs in Canada.

What do you think of Bill C-26, the government bill we are in fact debating in the House of Commons? It aims to increase the Canada Pension Plan by increasing the ratio from 9.9% to 11.9%, which is equivalent to an average $1,000 increase per year, per employee, for each enterprise. When you add the contribution of employers of approximately $1,000 per employee, and that of the employee of about $1,000 more per year, you get a total of $2,000 per worker, even though the increases will only begin in 40 years.

In your opinion, how will this impact our manufacturing businesses, which create jobs and wealth?

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Mr. Speaker, it is tough to follow the member for Richmond Centre after that kind of firebrand speech, but I will do my best.

It is always a pleasure to rise to speak about legislation before the House. Today, we are talking about Bill C-26, which would increase CPP premiums and increase that payroll tax for a benefit sometime in the future. The finance minister has admitted now that the benefit would be realized by workers 40 years from now. That is who will see the benefits from this.

Let us be under no illusion, Even though the government wants us to talk about increasing CPP benefits, this would do nothing for seniors today and it would do nothing for workers approaching retirement. Maybe if people are in their twenties and in jobs that are stable enough that they are making enough money to make the full contribution, this would benefit them, but for the next 40 years they would be paying more. That is our main concern today.

When the bill came forward, when this idea was floated, I sought to consult my constituents, as I do on pieces of legislation like this. I heard back from a prominent local business owner in Chilliwack who is involved in the business community. I want to share his thoughts on this. He is actually in the financial services industry and helps others plan for their retirement, so I think he has a level of expertise that the House should well consider.

I will be quoting extensively from his contribution to my consultation. He said:

If the primary intent is to take care of Canadians, I wonder what other options were explored. If mandatory contributions to retirement plans are desired, was there a “choice” option considered? Perhaps a Canadian could choose to contribute more to CPP, or, instead, open their own locked-in pension plan and make the mandatory contributions there...have restrictions on withdrawals, risks, etc.

Most 'regular Canadians' would not profess to know all the details and the considerations that were explored by the Federal Government, before proposing this solution. Most business owners would like to think that the government is working in their best interest...I sincerely hope it is. However, perhaps incentivising Canadians to save more by increasing the RRSP contribution limit, not decreasing the TFSA limit (as this government has done), providing larger tax benefits for contributing to mandatory Locked-in RRSPs, etc... options like this might warrant more exploration. Not only would Canadians need to take ownership and increase their education on the matter, but it could also increase and improve the private sector...both of these are good for Canadians.

I understand some things are necessary and hard choices need to be made. My fear is that the increased mandatory contributions are not going to solve the real issue. The issue touted by the Federal Government is that Employer Pension Plans are becoming fewer and farther between and Canadians are not saving for themselves. One might make the argument that having an employer or the government say, “we'll do this for you” is part of the problem. If Canadians are not saving enough, then they need to be educated, incentivised and learn to save for themselves. I believe in having a pension plan like CPP, however, if we don't address the real issue (too many Canadians are spending all the money they earn, in order to increase their “lifestyle” as rapidly as possible...not taking responsibility for their own future...) we will need to increase contributions to CPP again in the future, for a similar reason...

I have a family member in his early 30s. He is very aware that he has no pension and needs to create his own pension. He chooses to be content with his lifestyle and does not spend all the money he makes. He continues to educate himself, as well as increase his good habits of contributing to his RRSP, TFSA and savings....this is what Canadians need to do.

I would make the argument that having a public pension plan is a very good thing, for many reasons. However, if the public pension plan begins to try and replace or “take over” the responsibilities of Canadians, it might be considered to be creating and enabling a problem for the future of the very Canadians it wants to protect. I'm not saying that line has been crossed with the current CPP changes, but if the line hasn't been crossed yet, it appears, at least on the surface, that we are headed that way.

Those are words from a very prominent business person in Chilliwack who is concerned about this approach of the government. I share many of those concerns. I think that the proposed changes to the CPP, again, as has been said many times by Conservatives on this side of the House, could result in over $2,000 a year being taken from the incomes of Canadian workers. In a family, that is about $1,100 each.

Earlier, I heard a member from the NDP say that he was concerned about people who come into his office who are living paycheque to paycheque. My riding is not a high-income riding. The average income is under $40,000 a year. My constituents are living paycheque to paycheque. Bill C-26 and increasing mandatory CPP contributions will not help them. It will take money away from them and put it into a CPP plan that they may never be able to access.

That is another part of this discussion that I think we need to be honest about. When we are talking about increasing a mandatory payroll deduction, we are taking $1,000 away from a Canadian worker and putting it into a government-run CPP pension plan. If that person dies before reaching the age of retirement or does not live to the age of 85, this increased amount of money that is taken from each and every paycheque, the reduction in disposable income for the families in my riding, is not saved in an RRSP, a TFSA, or something that is designated to the individual. It is not an asset that can be passed on to the heirs of the contributor, to their family, or to their children like a TFSA or an RRSP.

Therefore, to say that it is for their own good that the government will take more money off of their paycheque and put it into an account that they can draw from in retirement might sound great to people because they might think that they could stand to save a little more. However, what they do not realize and what they are shocked to learn when they learn more about CPP, which most people do not look into until they approach retirement, is that this is not an asset that is transferrable to their heirs. Rather, if they die young it goes into the general revenue of the account. It disappears. Therefore, they have spent their entire working life paying more under this plan and they do not have the ability to pass that on to their heirs.

This is bad for the people who say they want a choice in how they save. It is bad for low- and middle-income Canadians who will not benefit but will see a reduction in take-home pay, a reduction that they simply cannot afford. Certainly, as the member for Richmond Centre said, as the government seeks to increase costs on all Canadians through a carbon tax, they can ill-afford yet another payroll tax that reduces their take-home pay. It is bad for families because they cannot pass along this investment. It is not like other registered investments that can be passed on. It does not help seniors now.

We know that during the campaign the Prime Minister famously accused small business owners of simply being people who were looking for ways to avoid paying their fair share of taxes. Therefore, we should not expect the Liberals to take the concerns of groups such as the CFIB seriously. However, on this side of the House we do. Last year, for the first time in 30-plus years, the CFIB was not invited to make a pre-budget consultation, so perhaps it should not surprise us that the Liberals are not taking its advice as well.

However, Dan Kelly, the president and CEO of the CFIB, stated:

It is tremendously disappointing to see that finance ministers are putting Canadian wages, hours and jobs in jeopardy and willfully moving to make an already shaky economy even worse.... Despite all the talk, it appears that jobs and the economy are not particularly high priorities for the governments that have signed off on this deal.

He went on to say:

Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike....

This is going to affect real, hard-working, taxpaying Canadians. This is not going to help those workers for 40 years. It will not help seniors in retirement who may hear about this and think that they will get a raise. They will get nothing out of this. Rather, this is simply taking away choice from Canadians in planning for their own retirements, and taking away money from their paycheques now, which as far as we are concerned is the wrong direction. We will be voting against it.

[Alice Wong, Conservative, Richmond Centre, BC]

Mr. Speaker, it is my pleasure to rise today to discuss the proposed changes to the Canada pension plan in Bill C-26.

As has been mentioned by my colleagues earlier, this change would raise CPP premium rates. This plan would also increase the maximum level of earnings on which CPP premiums would need to be paid. The net result of these changes would be that both employers and employees would have to pay more. Indeed, the CRA has published a table showing that this amount could be as much as $2,200 more, each and every year, and this number would continue to go higher and higher.

Nearly all Canadians would be affected by this expansion. Everybody earning a salary in this country would be negatively affected and would see their paycheques decrease as this payroll tax takes effect. Likewise, employers would see the cost of hiring employees rise.

As a former small business owner, I have first-hand experience in seeing how a business can be affected by payroll taxes, including CPP premiums. During the past year, I have thoroughly enjoyed my role as the critic for small business, holding the government accountable for its actions and inactions. I have heard from entrepreneurs and small business owners from across the nation in round tables and one-on-one meetings. Each time the topic of the proposed CPP expansion is brought up, immediately I hear the same thing: when the cost of hiring employees rises, employers hire fewer people. Payroll taxes, which include CPP premiums, are one of the largest costs for small business owners.

These employers are leaders of our communities and care about investing in their employees. However, if they cannot afford to pay for their employees, they will be forced to either reduce their workforce or increase the workload on their current staff to avoid hiring new workers.

One entrepreneur from Toronto explained to me that she is already feeling constrained by the increasing tax burden on her business. She said that, if the CPP expansion were to move forward, she would have to expand the job duties of each of her current employees rather than hiring new workers to fill the gaps.

Small business representatives from across the country have also added their voices to this conversation, urging the government to rethink this plan. Among them, the Canadian Federation of Independent Business, the CFIB, is the most notable. It conducted a number of surveys on its members, asking for opinions and potential business decisions they would have to make, should this expansion move forward. The results are troubling.

These surveys indicate that two-thirds of small business owners believe that this expansion would compel employers to freeze salaries in order to account for the changes. The math is simple. Dollars that would otherwise go into salaries would, instead, go into extra payroll taxes. When we consider the government's track record of increasing payroll taxes, increasing small business taxes, implementing a nationwide carbon tax, and cutting tax credits, it is no wonder business owners are choosing to hold onto their wallets.

I would not be shocked to see the Liberals finally decide to raise the GST to pay for their spending spree. Who wants to invest in such a high tax environment? One of the arguments being used to support the expansion of the CPP is that it would help struggling seniors. However, the proposed plan would not be fully implemented for another 40 years, which means seniors would not be receiving the help now that the government says they need. I would challenge the government that there are many other ways they could help seniors and the aging population, but the Liberals have chosen to turn their backs on Canadian seniors.

I am going to let the House know what seniors think. The carbon tax would increase the cost of everything, including their groceries and heating their homes. That would be dramatic. That would be devastating to our seniors.

Now that I have talked about seniors, I will talk about our youth, whom the government claims the bill would benefit the most. Our youth benefit from employment, and this bill would make it more difficult for employers to hire our graduates. Young participants in my round tables are more concerned about their jobs, about their take-home money now, instead of paying into something for 40 years down the road.

Not only that, but we are forcing Canadians to invest in a pension plan that offers a low rate of return. According to a well-quoted study by the Fraser Institute published in May 2016, and externally validated by many other organizations, the projected real rate of return for CPP investees is 2.1%.

I will quote from the study:

Canadian workers retiring after 2036...can expect a real rate of return of 2.1 percent from the CPP.

This basically means the majority of our workforce today, contributing to CPP, is making a real rate of return that is barely above inflation. Remember, when people retire and draw funds from the CPP, that amount is taxed with income taxes.

Some Canadians are comfortable with the CPP and the fact that it is backed by the government, but we are given no choice in the matter. CPP legislation forces all Canadians to participate in this low-return investment. The government has made the decision for the rest of the country, regardless of the personal situation for how Canadians want to fund their retirement.

There are other ways that government could encourage Canadians to invest in their retirement. There are already many options available to individuals, including the well-known registered retirement savings plan or tax-free savings accounts. The CPP is only one method of saving, amongst others, but this is a forced method of saving for retirement.

By highlighting and encouraging other programs, Canadians are able to create a retirement financial plan that suits them best and does not solely rely on government to make this choice for them.

At a time when our economy is struggling and many people are unable to find work, such an expansion of the CPP would only magnify these problems. Our job creators would face another burden in their ability to hire new workers, and Canadians would have less money in their pockets to invest in the economy.

I am convinced the government does not want to help Canadians save. If it did, the Liberal government would not have chosen to reduce the amount of money individuals can contribute to their RRSPs or tax-free savings accounts.

Canada has excellent programs that allow Canadians to choose how they want to save their money for retirement. As I have said before, instead of making it more expensive for our small businesses to hire staff and create jobs, we should be minimizing taxes, cutting red tape, and trusting Canadians to make their own decisions regarding how to spend and save their money. I will continue to fight for our hard-working job creators.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I very much appreciate that New Democrats are supportive of this legislation. I think we share a lot in common. Workers today will benefit from this agreement that was achieved between the provinces and the leadership in this national government.

Today we have Bill C-26, but there are other aspects of the pension program. I am looking specifically at the GIS, the guaranteed income supplement, and how that program also helps supplement individuals who are in need of income.

Does the member have any thoughts on how he sees this as a bill that is one piece of what I would suggest are the three pillars of the pension issue: the CPP, the GIS, and the OAS? Can the member provide some comment in regard to the GIS and the OAS?

[Susan Eng, Counsel, National Pensioners Federation]

Thank you.

Mr. Chair and members of the committee, while seniors today need several measures to help them with their health and financial concerns, they are also concerned about the financial security of tomorrow's seniors. Without reservation, the National Pensioners Federation commends the federal and provincial governments on reaching a historic agreement to increase the CPP.

We welcome the proposals in Bill C-26, which is being debated now, to implement that increase and to amend the Income Tax Act to facilitate deductions for the contributions, but we especially commend the addition of the increase to the working income tax benefit to allow lower-income Canadians to participate in the pension plan, so we encourage speedy passage of Bill C-26.

The CPP and previous availability of workplace pensions are largely responsible for the large drop in seniors' poverty over the past two decades, but the effect is finished and workplace pensions are disappearing, so poverty is creeping up again. As recently reported, seniors' poverty has increased from a low of 3.9% in 1995 to just over 11% today, or one in nine seniors. Fully 28% of single female seniors and 24% of male seniors are living in poverty in this country. In human terms, that's 665,000 Canadian seniors living in poverty, mostly the oldest, mostly single, mostly women.

This issue of financial security is exacerbated by concerns about increasing income inequality, and there has been quite a lot of discussion around a guaranteed minimum income. This committee itself has actually recommended that an expert panel be established so the issue can be properly examined, and we encourage you to do so.

Those are our recommendations. We'd be pleased to take your questions.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I am pleased to rise today in the House to speak on behalf of the New Democrats and express our support at second reading for this important piece of legislation. Bill C-26 amends the Canada Pension Plan act, among other acts, to incorporate the recent agreements reached with the provinces to enhance the Canada pension plan benefits for all Canadians.

While we believe that better was possible and will continue to urge the government to make a more improved plan available for workers in this country, and despite the fact the full effect of these changes will not be felt for 49 years, this CPP enhancement is in theory an important first step in improving retirement security for young Canadians. We congratulate everyone, particularly labour, which worked so hard to lay the groundwork for this agreement.

New Democrats have fought for decades for increases in the Canada pension plan, old age security, and the guaranteed income supplement benefits for all seniors. In fact, the idea of having universal retirement security programs for all Canadians has been a core New Democrat policy going back to the formation of our party. We have urged every government for decades to make meaningful improvements for Canadians, so that every Canadian can retire in security and in dignity.

Our support for the bill is qualified. That is because while the enhanced expanded CPP proposed by the bill is a plan that will benefit a new generation of workers entering the workforce, it does almost nothing to alleviate the retirement income crisis of those approaching retirement now and, quite frankly, in the decade or two ahead. We must now see immediate action by the government to help those seniors and Canadians who are on the cusp of retirement and who will not benefit from these changes. Government must build on the momentum of this agreement and take the next steps to improve long-term retirement security for today's workers, including addressing the valid concerns raised by Quebec about the impacts on low-income workers.

In the New Democrats' view, much more needs to be done to help our seniors live with the dignity they deserve. The high cost of housing and prescription medication, the clawback of the GIS, and the indexing of pensions are just a few immediate issues that we think require more work by the government. We also think that the government needs to keep its promise to introduce a new seniors price index to make sure that old age security and the guaranteed income supplement keep up with rising costs.

Retirement insecurity in this country is reaching a crisis level, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. A large part of this problem is fuelled by the erosion of workplace pension plans to the point that six in 10, or 60% of, working Canadians have no workplace pension.

In the New Democrats' view we need a clear breakdown from the government as to who will benefit the most from this plan and who will benefit the least, and how these changes will interact with other programs, and how we can strengthen the workplace pension regime in this country, as well as the public component that the bill addresses.

By way of background, it is helpful to review what is being proposed by the bill. Currently the CPP covers earnings up to a cap of $54,900. For earnings up to the cap, the CPP is designed to replace about 25% of the income. The maximum pension that a worker who fulfills all the criteria, working for 40 years and contributing the maximum amount, can look forward to is about $1,092 per month or $13,100 per year.

Contributions are 4.95% for the employer and the employee, up to the same cap. The expanded CPP proposed by the bill is a separate new tier. The new tier is added on top of the existing one. The new CPP tier does two things phased in over the next nine years to 2025. First, it takes the replacement rate up to 33 1/3% from the current 25% of earnings, and, second, it expands the upper earnings cap from today's $54,900 up to $82,700.

The net result is that when this plan is fully phased in by 2065, a worker who earns $54,900 annually in 2016 dollars would receive a maximum annual pension of about $18,117 in 2016 dollars by the time he or she retires. For a worker at the $82,700 maximum tier amount income level, CPP benefits would rise to a maximum of $20,352 a year in today's dollars.

The reason I am using today's dollars is that it is important to understand the very limited expansion that the current government has brought forward. If people can imagine that in 2065 they would be at the maximum CPP pension if they contributed for 40 years at the maximum earnings level, with a resulting pension of $20,352 a year, just about every Canadian planning for retirement would see that that is absolutely insufficient to retire with.

We all, though, acknowledge that the Canada pension plan was never designed to be a full retirement plan—although there is a credible argument to be made that a government pension plan could in fact achieve that if it were wanted—but was intended to be supplemented by private savings and workplace pensions. This is why I raised earlier the very alarming statistic that more than half of Canadians have no workplace pension. This is very different from the 1960s and 1970s when a much higher percentage of Canadians had a plan at work.

Canadians who are working today cannot expect to have very much pension income from their employment. Of course, given the rising costs of living in this country, particularly in Vancouver where I come from, it is very difficult for them save the amount of money they will need to supplement their Canada pension plan. So what the New Democrats would like to see and what we have advocated for a long time is a Canada pension plan designed in a way that the worker and the employer would contribute sufficient money to replace 50% of the money a person would need upon retirement. In concert with that, we also propose strengthening the programs, policies, and laws in this country to encourage employers to create pension plans in the workplace to help those workers supplement their pensions. We also believe, for instance, that laws that protect pension funds upon bankruptcy also need to be strengthened so that workers, as we saw in the case of Stelco, would not see their deferred salaries—the money they have saved over the years—distributed among creditors upon bankruptcy. That is a long-standing problem in this country that neither Conservative nor Liberal governments have ever had the political courage to touch, but it is a matter of fundamental justice.

The Canada pension plan is the best pension plan in this country for a number of reasons. It is portable. It does not matter if people quit or leave a job in New Brunswick and move to British Columbia and start working again, because their Canada pension plan will still be activated. It is the cheapest pension plan in the country. There is a associated cost for employers, who normally have to provide a pension plan, as they have to hire pension lawyers and actuaries and custodians of the money, whereas in this case, all of the costs of the plan are borne by the government. Being the largest plan in the country, it is also the safest repository of Canadians' income. In sum, it is the cheapest, most portable, safest pension plan in this country.

I think Canadians from coast to coast would love to see the current government increase Canada pension plan contributions to such a degree that we could phase these in slowly and affordably over time so that the plan would actually do what it is intended to do, which is to make sure it replaces 50% of workers' income upon retirement so that more Canadians can retire in dignity.

I just want to conclude by saying that I often hear the Conservatives use language calling this a payroll tax. Retirement investment is not a tax. It is an investment. There is no secret to pensions. People put away a bit of money for a long period of time. That is savings, and that is how they fund their retirement. When workers and employers both contribute to that pension plan, that is how we get a dignified retirement for Canadians in this country, and it is about time that the Conservatives recognized this and joined the 21st century so that Canadians can retire in dignity and with some level of security.

[Sylvie Boucher, Conservative, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Mr. Speaker, today I rise in the House to speak to Bill C-26, which seeks to enhance the Canada pension plan. Although the bill's intention is good, I think it is important to point out certain facts.

First of all, in order to qualify for a pension, one must first have a job. Just last week, the Minister of Finance painted a very grim picture when he said that we just have to accept that jobs are precarious, and still, the Liberals want to implement a system to enhance the Canada pension plan.

Where are we going to find the money, if jobs are so precarious? Will it come out of taxpayers' pockets? What about creating jobs? The Liberals talk a lot about retirement, but never about creating jobs.

As usual, the Liberals are living on another planet, not the one that middle-class Canadians live on, and they are not creating any jobs. Our current economic situation is disastrous, and the Liberals continue to spend recklessly.

On top of that, some households will have to pay up to $2,200 more a year, when we know that they worked so hard to save that money. These smoke-and-mirrors tricks are the Liberal way. In their la-la land, everything happens by magic. More than anyone, the Minister of Finance should be able to wake up his Prime Minister.

We are not living in the land of unicorns nor are we living the life of the rich and famous. We are real people, people who work, people who are scrambling to work, and people who have trouble saving. Canadians will have to wait 40 years for the CPP to increase. As a result, no new benefits will be paid to the retirees who currently need them.

According to the logic of the Minister of Finance, who said last week that Canadians should get used to mobile employment, temporary contracts, and a number of career changes in their lives, who will benefit from this plan? It is not seniors. Is it the next generation? I do not believe so, since, the way things are going, that generation will be overtaxed and its power to pay will be reduced.

Already today, new graduates are struggling to find jobs. Imagine what the situation will be like in 10 years. It will be more difficult for them to pay back their student loans and buy their first home, especially since the minister just tightened the mortgage requirements. This measure could have a huge impact, particularly on the first-time home buyers market. Those who qualify to purchase a home will have to settle for a semi-detached or a condo. Those who were just able to afford a condo will have to continue renting or living with their parents. It will create more boomerang children.

Bill C-26 is an enormous financial hole for taxpayers. For Canadian families, this means there will be less money in their pockets, and it will be even harder for them to save money for a vacation or for their children's post secondary education.

Young families today will have to deal with this job shortage because according to the Minister of Finance, they will have to get used to seeing certain jobs disappear and adapt to job insecurity. In fact, that is what is happening right now in some of our regions. If we follow the Liberals' logic, young people will not be able to contribute to this plan because job opportunities will be scarce.

When it comes to taking more money out of Canadians' pockets and out of our pockets, the Liberals are champions. They never miss an opportunity to impose another new tax on taxpayers. We do not have to look far in the text of the bill to see that this government plans to take money here, there, and everywhere.

Why is this government so set on taxing Canadians? The Liberals have the nerve to get rid of tax credits for children's sports and arts, and reduce the TFSA contribution limit by half. Why do they not trust Canadians? Do they think they are more responsible than Canadians? Do they really think that taxpayers' money will do better in their hands until retirement comes along? I doubt it. Not all of us have $1,500 to spend to get access to one of their ministers.

When we gave out tax credits and collected fewer taxes, we still managed to balance the budget. This government is doing its utmost to get every last penny from families and yet still finds itself in the red to the tune of over $30 billion. If anyone is truly irresponsible, it is the Liberals opposite.

Basically, the Liberals subscribe to the theory that the end justifies the means. However, they talk mainly about the end, and only whisper about the means, because they know that no one is excited about the new taxes, especially voters.

As my grandfather used to say, heaven is blue and hell is red. Let us not allow the Liberals to lay waste to the Canadian economy with their grandiose ideas.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, as the new official opposition critic for economic development in Quebec, I am pleased to contribute to the debate on Bill C-26, which would increase employee and employer contributions to the Canada pension plan.

It is important that we debate this bill because many Canadians are currently unaware of the consequences of the Liberal plan. What is worse, many of these changes will only be implemented in 2019. Therefore, it will be impossible to assess the impact and the potential harm of this bill before the next election.

Why wait? That is because the Liberals know that every Canadian's income will decrease and that thousands of jobs will be put at risk by imposing an additional burden on businesses, including SMEs, which are the backbone of our economy.

A total of $2,200 a year will be collected from workers and the entrepreneurs and businesses that create jobs. The Liberals are tight-lipped about that. An Ipsos poll published last month provides supporting evidence, by showing that 80% of Canadians want to be consulted before increases in contributions to the retirement program take effect. This same poll also revealed that 70% of workers do not support the CPP expansion if it affects wage increases, which is very likely.

The Liberal government is also claiming that it is listening to young people, but if it took the time to explain to millennials what is about to be imposed on them, they would be taking to the streets to protest this government's attitude.

Let us put this in perspective. The Maple Spring of 2012 in Quebec occurred as a result of the provincial Liberal government's decision to increase tuition by $1,625 a year. Students are supposed to be able to complete a bachelor's degree in three years in Quebec. If a tuition hike of $1,625 a year for three years caused that much outrage among young people, how will they react if word gets out that the federal Liberals are about to take $2,200 away from them every year for the rest of their working lives, which will likely span four decades or more?

I can already tell that the Liberals opposite are going to say that they are investing for the millennial generation's future. Is that really the case? Let us look at the numbers to determine whether young people will really come out ahead. Take for example a taxpayer who earns the maximum amount of $82,700 proposed by Bill C-26. At the current contribution rate of 9.9%, this worker would be entitled to a pension worth 25% of his salary or $20,675. If the contribution rate is increased to 11.9%, as proposed in Bill C-26, the worker would be entitled to a pension worth 33% of his salary or $27,291. That is an increase of less than $7,000 a year. A person who earns an average income of $40,000 would only get $3,200 more, and that income would also be taxable.

However, if instead we allow families to take the $2,000 a year that would be confiscated from them under Bill C-26 and invest it themselves in a TFSA, for example, in 40 years they will have saved over $280,000, which is a rate of return of 5% per year. When they retire, they would have an additional $14,000 a year or double what they are being offered under the Liberals' retirement plan.

What is even better, is that, unlike the CPP payments, that money would be completely tax free. They can always contribute more if they want, although the Liberals chose to reduce the TFSA contribution limit to $5,500 after we increased it to $10,500 in our last budget.

There are also other advantages to preferring a TFSA over an increase in the CPP. If a person dies, the amount of his TFSA goes to his estate. The money goes to family, friends, or the charity of his choice. On the other hand, if a person dies and all his pension funds have been invested in the CPP, the government takes the money. There is only a reduced annuity of 60% for the survivor in the couple, if the couple has remained married, as is not always the case as we can see from today’s divorce rate, or a meagre $237 per month for the children, only up to age 18, or to age 25 if they remain in school. For everyone else, nothing.

Of course, all this applies only if the CPP remains solvent. Our population is getting older, and life expectancy has increased considerably since the introduction of the CPP in the 1960s. Young taxpayers have no guarantee that the money will be there when they need it. The Liberals dipped multiple times into the employment insurance fund under the Chrétien and Martin governments. It is difficult for us to trust them again.

The CPP Investment Board says it will be solvent for the next 75 years. The former Pearson and Trudeau governments thought that as well, with a combined contribution rate of 3.6%, which proved inadequate. The Chrétien government had to triple the rate to 9.9% in the 1990s. Instead of examining long-term solutions, as our former government was doing, to ensure the continuity of the CPP fund by progressively raising the retirement age to 67, the new Liberal government has no other solution but to further tax workers and employers in order to mask the problem. Furthermore, many specialists have said that putting the retirement age back at 65, contrary to what we did, would cost the government billions of dollars in the years to come.

Bill C-26 increases the contribution to 12%, and if the Liberals’ sunny ways and rose-coloured glasses projections again prove incorrect, what guarantee do we have that it will not be necessary to hike CPP contributions again in 10 years or 20 years? If that is not a Ponzi scheme, I would like to know what is.

Faithful to its current policy of buying Canadians’ votes with borrowed money, the Liberal government goes on dreaming that it can continue to ask future generations to pay for its mismanagement. That is cross-generational theft, and it is absolutely shameful.

This is why we are going to oppose the passage of Bill C-26. This bill is going to cost more for workers and entrepreneurs, of whom I am one. I have mentioned several times in the House that I am an entrepreneur. I have 25 employees and, for my company, this policy represents $25,000, even almost $30,000 in additional costs per year. What will probably happen is that I will be forced to abolish a position or a position and a half to be able to provide this amount to the workers’ fund. So this is jeopardizing thousands of jobs, it will be of no assistance whatever to persons already retired, and it will make it increasingly difficult for companies to create jobs.

The government has to consult the people who will be paying the tab. If it had done so, Bill C-26 would never have appeared on the Order Paper.

The House resumed consideration of the motion that Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act be read the second time and referred to a committee, and of the amendment.