House of Commons Hansard #13 of the 37th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was board.

Topics

Nuclear Safety and Control Act
Government Orders

4:45 p.m.

Some hon. members

Agreed.

Nuclear Safety and Control Act
Government Orders

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Some hon. members

No.

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

All those in favour of the motion will please say yea.

Nuclear Safety and Control Act
Government Orders

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Some hon. members

Yea.

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

All those opposed motion will please say nay.

Nuclear Safety and Control Act
Government Orders

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Some hon. members

Nay.

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

In my opinion, the yeas have it.

And more than five members having risen:

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

Call in the members.

And the bells having rung:

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

Order, please. At the request of the chief government whip, the vote is deferred until tomorrow at 10 a.m.

Nuclear Safety and Control Act
Government Orders

4:50 p.m.

Liberal

Marlene Catterall Ottawa West—Nepean, ON

Mr. Speaker, pursuant to Standing Order 45(7), I would ask that the vote be further deferred until next Tuesday right after question period.

Nuclear Safety and Control Act
Government Orders

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The Acting Speaker (Mr. Bélair)

Does the chief government whip have the agreement of opposition whips to further defer the recorded division?

Nuclear Safety and Control Act
Government Orders

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Liberal

Marlene Catterall Ottawa West—Nepean, ON

Mr. Speaker, I will confirm with the other whips whether they agree and report back to the House.

I am told that yes indeed there have been consultations with the other four whips, and there is agreement to defer it further until Tuesday afternoon.

Nuclear Safety and Control Act
Government Orders

4:50 p.m.

The Acting Speaker (Mr. Bélair)

The hon. members have heard the chief government whip. Consequently, the recorded division stands deferred until next Tuesday, at 3 p.m., after oral question period.

The House resumed from October 22 consideration of the motion that Bill C-3, an act to amend the Canada Pension Plan and the Canada Pension Plan Investment Board Act, be read the second time and referred to a committee.

Canada Pension Plan
Government Orders

October 23rd, 2002 / 4:50 p.m.

NDP

Pat Martin Winnipeg Centre, MB

Mr. Speaker, I was only five minutes into my speech when the House adjourned for the day yesterday so I am glad to continue with some of our thoughts regarding Bill C-3, an act to amend the Canada Pension Plan and the Canada Pension Plan Investment Board Act.

Yesterday I dealt with some of the reservations of the NDP. To summarize the points I raised, the question that arises is this: Is it a good idea for us to be on the open market with our Canada pension plan savings? I will try to answer that not in an ideological way but just by looking at the empirical evidence.

If we look at the actual experience in the last period of time since the Canada Pension Plan Investment Board was struck, put in place and put in charge of investing our hard earned pension contributions, the experience has been terrible. I could have done better by playing pin the tail on the donkey when it comes to the stock market investments it has made. Unfortunately, it chose to get into this free market, the stock market, at exactly the wrong time, like a bunch of amateurs or a bunch of tourists. It was seduced by the high earnings in the bubble that took place in the high tech sector when people were getting returns of 20% and 30% per year on their investments. The board wanted a piece of it and got in, but it got in at the wrong time and has lost a fortune. Originally the board was given $11 billion to invest on our behalf. In the first return that came back, it had lost $1.5 billion of that.

I am not trying to argue ideologically that it should not be in there. I am just trying to share with the House the empirical evidence. It has been a disaster. What struck me as odd in that first quarterly financial statement is that the board doubled the CEO's salary even though he lost $1.5 billion in the first venture into the stock market. It also doubled his performance bonus. His performance bonus went from I believe $140,000 a year to over $200,000 a year. Imagine that. If the board is going to reward bad behaviour so generously, what if we ever do show a profit? It will be staggering. What I am saying is that we seem to have adopted the worst corporate models in the structure of this board, not some best practices or some unique structure, because let us face it, this is unique. This is the taxpayers' money being invested on our behalf on the private market. Those are my reservations. Yesterday I did raise some of the details of what our reservations are but this summarizes them.

We are apprehensive. Now the fund is no longer $11 billion. The fund has grown, not because we have made smart investments but because the rate of contribution has been massively increased. It is now $53 billion in spite of the fact that in the next quarterly report the board reported a loss of $800 million. In the quarter after that it lost another $1.5 billion. In the quarter ending in September 2002 it lost $1.3 billion. The fund is hemorrhaging. We are making bad investments. The people we have put in charge of our retirement security are investing badly on our behalf.

Whether it is a good idea or not, we cannot argue with the fact that had we not gone down this road those many billions of dollars would not have been lost and would still be sitting there or maybe would have been loaned to municipalities or provinces, as was our past practice, so that the money could have been used in relatively low interest infrastructure loans to benefit Canadians. It certainly would not have been invested offshore, which is the experience now.

Part of the bill would allow the Canadian Pension Plan Investment Board to invest on foreign shores 30% of the $53 billion it now plays with. Surely parliamentarians would argue that we are trying to maximize the benefit to Canadians with the use of this money by providing a good rate of return, yes, but that we have as a secondary objective economic development in our own country. Besides, there are no ethical guidelines built into Bill C-3. In fact it specifically states in the CPPIB mandate document that no other consideration other than the “maximum rate of return” shall be contemplated in the investment strategy.

I will not buy shares in a mutual fund if I know that mutual fund is investing in some maquiladora sweatshop on the Mexican border where child labour or rampant abuses take place. I choose not to have my investment dollars invested in unethical investments, but no such guidelines exist within Bill C-3 or within the trust document of the Canada Pension Plan Investment Board. What if it would get a great rate of return for clear cutting the rain forests of the Amazon? Do Canadians want to participate in that even if we would get a better rate of return? I say no.

If we were to put it to Canadians they would say no, but they will not have a chance to say no. Why? Because of the other thing I raised yesterday, which was the composition of the 12-person board entrusted with our the security of our pension future. It is not representative of Canadians. There is no worker representation. There are no working people, no organized labour, no pensioners and no participants in or beneficiaries of the plan represented on the 12-person investment board that makes the decisions. It is a basic tenet in the trade union movement I come from that any employee benefit plan should have equal joint trusteeship. Labour and management jointly decide how a pension plan is invested, not a bunch of Bay Street appointees of the Liberal Party who are appointed by the minister.

One of them who was appointed is a Liberal member of Parliament whom I beat to win my seat. He has no financial background. David Walker is a political scientist. He is now one of the 12 people in charge of investing $56 billion on our behalf. What is his brilliant financial experience? I am not saying he is not a competent and capable guy, but he is certainly no financier nor does he represent any of the groups that should be represented on the board. I think it is crazy.