House of Commons Hansard #109 of the 39th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was farmers.

Topics

Food and Drugs Act
Government Orders

5:30 p.m.

Independent

Louise Thibault Rimouski-Neigette—Témiscouata—Les Basques, QC

Mr. Speaker, like my colleagues, I of course take an interest in the health of my constituents and indeed of all my fellow citizens.

I consider it very important that drugs, foods and authorized therapeutic products be safe, that the effects of these products that are available over the counter or by prescription be studied and known, and that labelling of these products be accurate and honest.

By the way, I still do not understand why this government refused to respond to the very legitimate public demand as expressed in a bill introduced by a colleague calling for labelling of food products containing GMOs so that consumers can know exactly what they are buying.

I will return to the matter under debate. On one hand, the government does not want the public to have information on these GMOs, but it continues to trust pharmaceutical companies to test their own products. On the other hand, through this bill, the Conservative government is imposing severe sanctions on producers, vendors and importers of natural products and drugs that do not comply with Health Canada standards and is placing natural products in the same category as drugs under the heading of “therapeutic products.”

I understand that we do not want to put people’s health at risk, and I agree. Obviously, we must not approve a product that is dangerous to health. However, neither should we approve a system of labelling that would be incorrect in terms of dosage or the composition of a drug or natural product used for therapeutic purposes.

In that respect, and only in that respect, drugs and natural products are similar when they are used in the hope of bringing about a cure. We must have very strong tools to protect the public from fraud—which regrettably does exist—or from truly dangerous products. We know that the wrong information can have harmful and tragic consequences.

It seems to me that, above all, we must make available the necessary resources to inspect products thoroughly, to deal with inquiries properly and to ensure necessary monitoring. Unfortunately, that is not what the government is doing. Instead, it puts before us a bill with tremendous ramifications without providing the means for the agency responsible to properly deal with natural products and drugs.

Some aspects of this bill alarm people who properly like to use natural products. They prefer such products because they feel they are more in keeping with their culture, their lifestyle or, quite simply, their health. Traditionally, there has been a certain tension between those who believe in the practices of western medicine and promoters of alternative medicine, which, of course, includes the use of natural foods.

As my colleague from Quebec reminded us during this debate, between 33,000 and 40,000 natural health products are now waiting for approval. It may appear to some people that the delays that have built up are related to the new licensing requirement provided in this bill.

Many people will ask, quite properly, how a new product would be approved by Health Canada.

Increased powers for inspectors and much heavier penalties for those who break the law—they go up to $5 million and a three-year prison sentence—obviously make some people worry that the bill could create a de facto prohibition on the introduction of any new natural health product.

In my view, these concerns and perceptions deserve to be taken into account. Moreover, the doubts that arise from reading this bill are both numerous and varied. It is quite normal and legitimate to raise questions about the bill.

For example, is the prohibition on direct advertising maintained? What is the purpose of creating a licence for interprovincial exports? Is a product not inspected when it enters Canada? Third, the requirement for hospitals to report adverse reactions to a product to Health Canada could be rejected by the provinces because it deals with the administration of the health system, which is not under federal jurisdiction.

Therefore, I can only come to the conclusion that this bill is, to say the least, poorly constructed. When I say that, I am not blaming the drafters of the legislation but rather the intentions of the Conservative government. I humbly suggest that the faults are so numerous that I doubt that a committee really could amend this bill without changing the scope of the bill, which we know would make the amendments unacceptable.

As a result, it would be a loss of valuable time to send this bill to committee. Instead, we should send this bill back to the minister and his department to start over and make all the necessary corrections, especially since we learned during the debate that the minister wanted his government to introduce several amendments. Other members have referred to the infamous letter that the minister sent to the chair of the committee, and asked to see it. I am not a member of that committee, but I am just as interested in it as my colleagues.

In my view, if we are serious about this bill, it should be sent back to the minister and his department. They should be told to go back to work and when it is properly done, bring it back to the House. Then we will discuss a bill that will not raise so many questions. I have been here all day and I listened to the debate from the beginning. If the bill raises so many questions, it is probably because there are significant flaws in many places.

As the member for Wascana remarked, in a constructive spirit, if we are to produce something that is of benefit to our fellow citizens, the Conservative government should go back to work and introduce a new bill that will do a much better job.

Food and Drugs Act
Government Orders

5:35 p.m.

Liberal

Larry Bagnell Yukon, YT

Mr. Speaker, I am wondering if the member could provide for the public watching a technical outline of the new enforcement regime in this bill.

I will read a couple of concerns that I have received. Martin states: “I am opposed to the police state powers in Bill C-51.” Anne asks: “Why do bureaucrats want seizure warrants without judge approval? With fines being increased a 1000 times, and seizing authority without a warrant, is Bill C-51 meant to bankrupt and silence its target audience?”

I thought the member made a good point about trying to make all these amendments at second reading. There was a bill in the justice committee and some members wanted to add a year to the penalty in the bill and the Conservative chair ruled it out of order as it was beyond the scope of the bill.

The amendments the Conservatives are proposing are good amendments, but they are far more drastic than that particular change, so I can understand why opposition members are a bit skeptical about being able to make these changes at second reading.

Food and Drugs Act
Government Orders

5:40 p.m.

Independent

Louise Thibault Rimouski-Neigette—Témiscouata—Les Basques, QC

Mr. Speaker, it is difficult to answer the member's question in only a few minutes. I thank him for the question. I think that the most important aspect of his question is precisely that there are so many concerns about the operational framework for managing all this. There are so many concerns—I referred to them earlier—about the potential fines. When the citizens who we legitimately represent begin to be more afraid of how the bill will harm them rather than seeing how it will benefit them, that is reason enough to question it. That is when we have to work together to truly improve the bill so that it is worthy of the people we represent.

Food and Drugs Act
Government Orders

5:40 p.m.

Charleswood—St. James—Assiniboia
Manitoba

Conservative

Steven Fletcher Parliamentary Secretary for Health

Mr. Speaker, with regard to the fines, right now the maximum fine under the legislation is $5,000. If a company or organization puts a product on the shelf or a product was tampered with or any number of scenarios, the maximum fine for that company is $5,000. Yes, the bill would increase it manyfold, to $5 million.

Does that not make sense? Of course there would be a scale, depending on the severity of the injustice, but there needs to be consequences that matter if a product ends up harming or killing someone.

I will make a comment for the member for Yukon. For people to suggest that somehow the bill on product safety is equated to a police state is a real disservice to the integrity of everyone in the chamber and the people who live under those type of terrible conditions—

Food and Drugs Act
Government Orders

5:40 p.m.

Conservative

The Acting Speaker Andrew Scheer

I will have to cut off the hon. parliamentary secretary to allow the hon. member for Rimouski-Neigette—Témiscouata—Les Basques to respond.

Food and Drugs Act
Government Orders

5:40 p.m.

Independent

Louise Thibault Rimouski-Neigette—Témiscouata—Les Basques, QC

Mr. Speaker, I am old enough to remember the disaster caused by thalidomide, for example. Our colleagues referred to that. In addition, we spoke a great deal about other drugs with adverse effects.

This is my answer to the parliamentary secretary: we cannot put a price on protecting our citizens. However, we have work to do when a bill is worded in such a way that it causes citizens to fear that certain substances—primarily natural products—would be more heavily penalized and would involve greater risks than drugs.

It is not our role to instill fear in our citizens; we are here to reassure, help and, of course, protect them. I would never want to help one group at the expense of another.

In my mind, one question remains: how can Health Canada allow pharmaceutical companies to be self-regulating to the point that they verify their own drugs? I believe that—

Food and Drugs Act
Government Orders

5:40 p.m.

Conservative

The Acting Speaker Andrew Scheer

Order, please. The member for Vancouver East.

Food and Drugs Act
Government Orders

5:40 p.m.

NDP

Libby Davies Vancouver East, BC

Mr. Speaker, I am very pleased to rise in the House today to speak to Bill C-51. I have received a ton of emails both in my riding in east Vancouver and here in Ottawa. I have hear from constituents every day because the word is out in the community about the impact of the bill. I hope either we can defeat the bill, or if it does go to committee, that we can get it significantly changed so we can respond to the overwhelming concerns put forward by the public about the impact on the availability, accessibility and licensing of natural health products.

First, I thank my colleague, our health critic, the member for Winnipeg North. She has very valiantly stayed on this file and kept our caucus updated as to the progress of the bill. I know she will be very active at the committee, if it goes to committee, working with community interests and practitioners to ensure it does not become a big stone wall that denies access for people. Therefore, I thank her for the work she has done and the work she probably will do in the future. There will be a lot of interest in the bill, and a lot of people will follow it.

Very briefly I want to go back to 1997, when I first ran for the NDP in Vancouver East as a member of Parliament. I remember at that time there must have been a proposal in the House, under the Liberal government, to try to regulate natural health products. During the election campaign in May 1997, all hell broke loose in the community because of that. The government was completely caught off guard. It had no idea that it would get the reaction it did. It tried to do what the government today has tried to do, and that is to put natural health products in a box with drugs and to give the nod to the big pharmaceutical companies.

People in communities across the country cottoned on to what was going on and a massive campaign took place. It was a fairly quiet federal election campaign in 1997, but this issue kept on coming to the surface. It was a grassroots issue because people were so outraged, particularly in a place in east Vancouver. The heart and soul of Vancouver is Chinatown, the very origins of our city. A lot of the Chinese traditional medicine practitioners were very concerned about how it would impact them. Therefore, it became very much a cross cultural campaign as well.

After the federal election, the federal government of the day had to back off on what it wanted to do. As we know, since then we have had various machinations in terms of attempts for a regulatory approach. Suffice it to say, all credit goes to well-informed citizens who pay attention to legislation that sometimes creeps in, and they get the word out there about it. As a result, we get all these emails from people who are alerted to what the government has tried to do.

I am very thankful our caucus, with our health critic, the member for Winnipeg North, has monitored the bill very closely. We cannot support it in its present form. We are very concerned that it will lump natural health products in with drugs under a category called “therapeutic products”, which reverses a long-standing practice and position of a separate regulatory framework.

When I read some of the concerns listed in the emails I receive, one of them is the change of the categorization of natural health products. To treat these products the same as drugs is very inappropriate and is much too rigorous.

There are other concerns as well. We know right now there is a huge backlog of applications for the marketing approval of natural health products. How will that be dealt with under the bill? How will we ensure that the backlog is dealt with?

We are very concerned that the fines and penalties within the bill are incredibly excessive. It will mean that practitioners, producers and people who retail or market these products will hang on with their fingernails for their livelihood, and that is a very serious concern.

Why would there be such excessive fines and penalties for these products? In fact, the enforcement provisions are very heavy. They even allow inspectors to enter private property without a warrant. What is going on here?

We are very concerned that in the bill, as we have seen in other bills, so much discretion is left in the hands of the minister and the fact that regulatory requirements can be overridden within the department. Why would that be allowed to happen? This sets off alarm bells for people, especially when they go through the fine print and look at what is taking place.

I am very thankful we have had so much response on the bill. I have had more response on this bill than any bill for a very long time. I gather that other members of the House are getting the same kind of response.

I will read some of the responses I received. Jennifer, from east Vancouver, said:

Bill C-51 undermines the civil rights of Canadians to take control of our own health and well being. It goes against all logic and intuitive common sense and in no way serves the interests of your electorate....

Millions of alternative health practitioners that are certified through Canadian educational institutions who have dedicated their life to studying the healing effects of herbs would not be able to stay in practice.

I have another email from Anne, who lives in east Vancouver. She says:

—categorizing Natural Health Products as therapeutic products, together with drugs, medical devices, cells, tissues, organs, and veterinary drugs, Bill C-51 is viewing these exclusively to the lens of pharmaceutical drugs.

Food and Drugs Act
Government Orders

5:50 p.m.

Conservative

The Acting Speaker Andrew Scheer

Order, please. I hate to interrupt the hon. member at this point, but she will have three minutes remaining in her time for her speech.

It being 5:51 p.m., the House will now proceed to the consideration of private members' business as listed on today's order paper.

The House resumed from April 15 consideration of the motion that Bill C-520, An Act to amend the Income Tax Act (Home Buyers' Plan), be read the second time and referred to a committee.

Income Tax Act
Private Members' Business

5:50 p.m.

Bloc

Guy André Berthier—Maskinongé, QC

Mr. Speaker, I am pleased to speak today to Bill C-520, An Act to amend the Income Tax Act, which would amend the federal government's home buyers' plan.

I would like to thank the member for Delta—Richmond East for introducing this bill. I would also like to highlight the excellent work my colleague, the member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, has done on this issue.

The bill we are examining today would increase the ceiling on RRSP contributions that an individual could use to purchase a new home from $20,000 to $25,000.

This bill could be very interesting to young couples. It would enable them to purchase their first home, but contributing to an RRSP from a young age also enables them to develop good savings habits. With this bill, the ceiling on contributions would go from $40,000 to $50,000 for a couple with enough money in their RRSP.

Obviously, the Bloc Québécois supports this measure, because it will make it easier for many young Quebec families to purchase homes.

Furthermore, during pre-budget consultations, the Standing Committee on Finance indicated in its report that the government should quickly adopt this measure. It is not expensive, it would help support the construction industry, and, as I said, it would help young couples purchase homes.

In its supplementary opinion on pre-budget consultations, the Bloc Québécois said it supported the recommendation to increase the amounts available under the home buyers' plan in order to make home ownership more accessible. The government did not include this, and many other recommendations, in its recent budget. Let us hope that this bill will help move things along as quickly as possible in the interest of the people we represent.

The federal government's home buyers' plan currently allows an individual to withdraw up to $20,000—$40,000 for a couple—from their registered retirement savings plan to purchase or build their first home. This program works and it is time to increase the amounts involved, given the increase in the cost of housing.

As I just said, the purpose of this plan is to help young families buy their first home. It encourages buyers to save money to put a down payment on a house. By putting the emphasis on the down payment, this plan helps the buyer reduce their debt load over the years by significantly reducing their mortgage payments.

Since its creation in 1992, this plan has clearly been effective. Since that time, roughly 2 million people have used this plan with the goal of buying their first home.

To a certain extent, this type of program has helped Canadians and Quebeckers avoid the difficulties that a number of borrowers in the United States have experienced lately. We are all aware of the crisis that climbing mortgage costs have caused.

As I was saying earlier, Bill C-520 proposes to increase the ceiling to $25,000 for an individual and $50,000 for a couple.

Obviously, this amendment was created to respond to the significant increase in the price of houses that we have been seeing in recent years. In the riding I have the honour of representing, the price of houses has risen considerably. Whether in the Trois-Rivières-Ouest area or in Lavaltrie, Lanoraie or Berthier, house prices have risen steadily for a number of years now. It is becoming increasingly difficult for some people to buy their first home.

Improving the program as Bill C-520 seeks to do will help matters somewhat. In addition, I believe that this program will encourage economic development and social cohesion in our regions. More and more young families may choose to move to the regions and contribute to the strengthening of local communities.

As well, adopting this bill is a positive and necessary measure in increasingly uncertain economic times. With the price of gas going up, although the Conservatives prefer to ignore the effects on our communities, it is obvious that the prices of many essential consumer goods, such as food, transportation and of course houses, will unfortunately continue to rise.

In Quebec today, La Presse published an article about how the cost of fuel is causing families' transportation costs to go up. For example, a person living in Lavaltrie who commutes to Montreal every day is now spending $50 to $60 more per week. These costs are significant. We have to lower the interest rates that these young people, and many not-so-young people have to pay to buy their first homes, a purchase that can, in many cases, improve their lives and their living conditions. That is why it is so important to provide our fellow citizens with programs that can help them somewhat.

As legislators, we want to help families buy their first homes, and at the same time, we want to encourage them to save. I think that the committee will have to make some amendments to improve certain aspects of this bill. For example, there is the matter of indexing amounts. This measure is important because it will ensure that in 10 years, for example, the amount set out will still be enough and will still be relevant with respect to changing costs of buying a house. We should not have to come up with a new bill every time.

I will conclude by saying that the Bloc Québécois will support this bill for families because it is in the interest of all Quebeckers and therefore of all Canadians.

As a responsible party, we are prepared to work with the other members to improve the socio-economic status of the people we represent. But I should point out that there are other pressing housing needs. We must not forget that there is still a critical need for social housing. Recently, we have seen that social housing is also a problem in regions such as Rouyn-Noranda and Rimouski. Investment in social housing is also needed.

In conclusion, we need to help low-income individuals and families and the middle class obtain adequate, affordable housing. The federal government needs to step up to the plate on this issue, especially since it can afford to, with its surplus. This money should be used to improve the living conditions of all those who are in need and who need our support to improve their quality of life.

Income Tax Act
Private Members' Business

6 p.m.

Conservative

Peter Goldring Edmonton East, AB

Mr. Speaker, it is a privilege to rise to support the bill brought forward by my colleague, the member for Delta—Richmond East. He is to be commended for not only identifying a situation that could be improved, but he has also offered to the House the means to provide that improvement.

Bill C-520 is an act to amend the Income Tax Act with respect to the home buyers' plan. It is a simple bill with a clear intent to make housing more affordable for Canadians by increasing the maximum amount that can be withdrawn from a registered retirement savings plan to be used under the home buyer's plan.

Home ownership is a dream and a goal that is just about universal. When young Canadians finish their education and head out into the workplace for the first time, they need a place to live. For most, this is the first time they are truly living independently from the parents and it is a challenging experience.

With the first job, frequently comes the first apartment, most likely to be shared, to be affordable, but still it is a rented space that is a place to live, not really a place to be considered a long term home. It is a way station in life, not intended to be permanent. The permanency comes with home ownership, a place that can be truly called their own.

Owning a home is something to which most Canadians aspire and purchasing a home is usually the biggest financial transaction most of us will make in our lives. With the passage of this bill, that dream and goal of owning a home would become a little more possible for many Canadians.

The home buyers' plan was first introduced in February 1992 by the Conservative government. The wisdom of the program is self-evident and the subsequent government kept it in operation. The idea was and is to encourage and reward thrift by allowing individuals to withdraw money from their registered retirement savings plans, tax-free, as long as the money is used for a down payment on a first home and is re-deposited to the RRSP over a period of 15 years. The maximum amount that can be withdrawn for an individual is $20,000.

The repayment plan is within the means of most Canadians. The participants have 15 years in which to repay the amount they borrowed from their RRSP or face paying taxes on the money as income. That is certainly manageable with careful budgeting, especially given that the participants have already shown that they know how to save since they managed to save the money in the first place.

However, since the introduction of the home buyers' plan, about 1.5 million Canadians have taken part in the program, borrowing more than $15 billion from their RRSPs to be used as a down payment on that first home.

This is an example of a government program that works the way it should. There has been no need for extensive advertising to convince people that this is a good idea. Right from the beginning, Canadians embraced the home buyers' plan. Canadians understand the need to plan for the future and the importance of owning their own home is part of that plan.

The existence of the home buyers' plan has encouraged young Canadians to start planning for the future at perhaps an earlier age than they would have otherwise, opening RRSPs with the intent of using that money as down payment for their first home under the home buyer's plan.

Saving for the future is not as common as it once was. Statistics Canada tells us Canadians are not as thrifty as they were a generation ago. A personal savings rate is a fraction of what it once was, which makes the savings that come from an investment in a home even more important. Any decline in savings is a matter of some concern and it is good to encourage Canadians to prepare for their futures.

Programs like the registered retirement savings plan and the home buyers' plan encourage thrift, which should help provide for more pleasant golden years for our senior citizens, not to mention the joys of home ownership when that first home is purchased.

The hon. member for Delta—Richmond East is to be commended for the bill which will further encourage Canadians to plan for the future. I know he is well aware of the success of the home buyer's plan and is equally aware of how housing prices have soared in the country since the plan was first introduced in 1992.

In 1992, when the home buyers' plan was started, the average price of a house in Canada was $149,000, but by the year 2006 that number had risen to $276,000, and that is more than an 85% increase.

In Edmonton the average sale price of a house was $109,000 in 1992, considerably below the national average. By 2006, in just over a decade, that average cost had risen to $250,000, a 228% increase.

However, the maximum amount allowed to be withdrawn from an RRSP under the home buyers' plan remains unchanged since 1992 at $20,000. It seems to me that given the increase in housing prices in the past 16 years, that an increase in the maximum is in order, and the hon. member for Delta—Richmond East has proposed in the bill a very reasonable increase to $25,000.

Buying a house today means spending more money than when the home buyers' plan was first introduced in 1992. By supporting the bill, the House is acknowledging that reality and doing its part to encourage Canadians to be thrifty.

We all are aware of the economic difficulties that have plagued the housing industry in the United States in the past couple of years. Thousands of first time home buyers have lost their homes, in many cases literally abandoning properties they could not afford to keep.

The economic fallout from the situation of subprime mortgages and asset-backed commercial paper has had a ripple effect throughout the entire American economy and indeed around the world.

Perhaps, if the United States had a different model for home ownership, and perhaps, if it had a home buyers' plan such as Canada, its housing picture would not be as bleak.

The home buyers' plan encourages potential homeowners to save for their purchase. By making a substantial down payment they not only reduce their monthly mortgage payments but immediately will have built up some equity in their property, equity that can be used as collateral if their circumstances change.

In the United States, those who are abandoning their homes frequently bought their homes with the minimum or no down payment and were unable to build up any equity in those homes before interest rates rose and housing prices dropped. They were unable to meet the payments and could not sell the homes for what they owed. It is small wonder that they walked away from their purchase. They really had nothing invested in it.

I have noted with concern that some lenders in Canada have adopted similar measures to make housing more affordable for first time buyers. The traditional 25-year mortgage can now be stretched to 40 years, and the down payment that used to be 25%, then 10%, can now be 5% or even 0%. While that may make purchasing a home easier, it does not always make keeping that home easier.

The home buyers' plan does make keeping that first home easier. It encourages thrift and responsibility, two notable Canadian values.

Certainly, there is support for the bill from across the country. It makes sense that a good idea such as this one is being endorsed by real estate industry groups and financial organizations, as well as Canadians in general.

As a nation we have encouraged our citizens to prepare for their retirement. This marriage of real estate and the registered retirement saving plan is a logical one. Real estate generally appreciates in value and certainly in the long term it is usually cheaper to own than to be paying rent for the rest of one's life. When the mortgage is paid off, hopefully before individuals retire and their income drops, their monthly expenses go down.

It seems wise for the House, therefore, to adopt the idea of the hon. member for Delta—Richmond East and increase the limit that can be applied to the home buyers' plan.

For the participants, this is a matter of short term pain for long term gain. In fact, one can argue there really is no short term pain involved here. Assuming the home buyer follows through with the 15-year repayment schedule, what is lost is the interest the money would have accrued over that 15-year period. But that is counterbalanced by the savings involved in being able to make a larger down payment on a residence than would otherwise be possible. As I see it, both the home buyer and the country comes out ahead.

To summarize, it is my honour and privilege to support the bill brought forward by the hon. member for Delta—Richmond East. I commend him for his forethought and urge the House to consider it favourably.

Income Tax Act
Private Members' Business

6:10 p.m.

Liberal

Ken Boshcoff Thunder Bay—Rainy River, ON

Mr. Speaker, I appreciate the opportunity to speak to the bill because originally 15 months ago I was asked to present the bill and in fact had already had it drafted by the clerk. Things were going very smoothly until I realized that my buy Canada motion for public transit was pretty much a priority for myself and my riding. I am really glad to see this surface again in this way.

In particular, my sister-in-law, who is a very highly respected broker, will appreciate this as will John Litt who is an Ontario Real Estate Association representative and had been a real champion of this issue. Mr. Litt and his team deserve full marks for encouraging this.

Just as an aside, the City of Thunder Bay has the highest rate of home ownership in Canada and I am proud to announce that. It also has the second highest rate of home ownership for people with recreational properties. Some call it cottages, others cabins, and in our neck of the woods it is called camp.

As mayor, I met frequently with the Thunder Bay Real Estate Board and as MP I am regularly briefed by its representatives.

When this came forward, it seemed to me like a very natural type of bill that should be proceed in a very regular way. The purpose of the bill is to raise the limits from $20,000 to $25,000 per plan holder with future indexing. Let us face it, we really do not want to come here every 16 years to do this. To bring it to the rate of inflation would bring the plan closer to its value.

Let us look at the stats when it was introduced in 1992. Since that time average residential home prices have risen 66%. The consumer price index is now up 27 points over the same period. If we use that $20,000 under the plan adjusted for inflation, it would now come to $25,400. Therefore, the bill itself is very reasonable and very fair in terms of what it intends to do as compared to the original base.

Just as an aside, of course, in November 2005 gasoline was 79¢ and now it is twice as much at $1.48, so I will ask members to research their governments to find out what gasoline prices were under which government.

When we make a case for raising the limits, it is the fundamental argument as the case for the plan itself. Canadians can save for retirement and save for a home simultaneously. Previously, one had to make that decision: retirement, home, or in many ways diluting both of those ambitions.

The Canadian Real Estate Association has been successful in making the pitch that home ownership is the cornerstone of retirement for the vast majority of Canadians and they really should not be placed in a situation where they have to choose. This plan has allowed Canadians to save for retirement and leaving the option to borrow against RRSPs at a later date to access ownership.

The fact that we have come to the realization that it should be indexed means that we do not have to play catch-up. Members of the Canadian Real Estate Association will realize that this will be good legislation that makes a lot of sense to a lot of people. Because it does not divert retirement funds from the goal of retirement security, we know that the bill has further merit.

I would like to quote from the Canadian Mortgage and Housing Corporation. It said: “The plan is a means of promoting homeownership and homeownership is good public policy. The reasons are strongly embedded in the fabric of Canadian society. Surveys show that owning a home is an aspiration of the majority of Canadians. Homeownership makes better citizenship, it represents an important national asset, and it provides a sense of being part of free enterprise. There are major economic and employment spin-off effects from housing, directly and indirectly”.

We have been under the impression that home ownership has increased four points, from 62% to 66%, over a 10-year period, from 1991 to 2001, and the plan can take a considerable amount of that credit. We also know that mortgage insurance flexibility and its expansion along with the dropping of interest rates have also been positive contributors to that.

We must do everything we can to encourage people to save. Certainly, research by the Vanier Institute of the Family shows that the overall increase in home ownership has been driven entirely by those aged 55 and over. Their ownership rate increased by 68%. The question is: How can we get younger people to save and realize the dream of owning their own homes?

The Vanier Institute reports that, on the surface, the increasing proportion of Canadians who own their homes looks like good news, indicating that home ownership is a realistic goal for all. That goal has proved to be attainable for older Canadians, but it remains to be seen whether or not, over time, the same proportion of younger Canadians will be able to make the dream of home ownership a reality.

This is another step we can take to make it easier for younger people to own their own homes. Clearly, the program has been working, is working, and this bill would make it work even better.

Members of Parliament, over the past year or 15 months, have all generally been supportive of the proposal to raise the limits. The fact that it exists comes from two parties. Former minister Don Mazankowski initially introduced it and the current hon. member for LaSalle—Émard and former prime minister made permanent this legislation. Therefore, we owe a great deal to two parties for what we have today. If people really wanted to argue against them, they would be talking about pre-tax dollars, but I would think that argument would ignore the fact that an effective mechanism is in place to protect the integrity of retirement savings.

There are at least three points that I would like to make. First, the borrowed savings are invested in a principal residence, which of course is the pillar of security. Second, the plan would require the borrower to repay the plan over 15 years. Third, as an incentive to repayment, funds not repaid are fully taxable. That should get a healthy rate of repayment and statistics show that it has been well accepted and repayment rates are very positive.

We really do not want to get into a situation, such as is becoming the trend with our friends to the south, where mortgages of 35, 40 or 50 years are now commonplace. It probably means that people will never own their own homes. We have already discussed the value, pride, investment, and basically the value system that home ownership provides.

The home buyers' plan is unique among support plans. It encourages savings and maximizes down payments. These are important. Heaven knows that Canadians want to avoid the disastrous subprime situation.

Let us face it, this is a very modest request. We are all going to support and endorse it, I hope. Paying off a mortgage is key to fighting inflation. There are 90,000 members of the Canadian Real Estate Association encouraging us to do this. We have a national housing policy. With all of these things combined, including the good work of the Canadian Real Estate Association, the local brokerages, and all regional real estate associations that are all asking us to do this, the least we could do, in an all party way, is unanimously endorse this bill.

Income Tax Act
Private Members' Business

6:20 p.m.

Conservative

Leon Benoit Vegreville—Wainwright, AB

Mr. Speaker, I appreciate the opportunity to speak very briefly to this bill. Private member's Bill C-520 brought forward by my colleague from Delta—Richmond East allows first time home buyers to take up to $25,000 from their RRSPs, rather than the $20,000 limit that is in place right now. It is an update of what has been accepted and available in Canada for some time now.

This is an excellent measure. I am confident the bill will be passed by the House. We can tell that from what members have said.

The other thing that our government did in the last budget was to put in place a tax-free savings plan which allows wage earners to put aside up to $5,000 per year and the interest earned on that $5,000 accumulates tax free. This plan will commence in the 2009 tax year.

These plans, along with some other changes to the tax law that have been brought about by this government over the last two and a half years will make it much easier for first time homeowners to accumulate the money required for a down payment on a house.

Other members have mentioned the problems caused by having no down payment or a very small down payment. We have seen the mess that has been created in the United States and which has spread around much of the world. This measure is a very good step toward allowing an amount, in this case up to $25,000, to be taken from registered retirement savings plans accumulated over whatever period of time and put toward the purchase of a new home. Of course that money over a 15 year period would be put back into the registered retirement savings plan. Therefore, the integrity of registered retirement savings plans and the purpose of RRSPs, which is to save for retirement, would be maintained as well.

I want to commend the member for Delta—Richmond East for bringing this bill forward. The bill certainly demonstrates the incredibly beneficial measures that can be brought forward through a private member's bill. I commend him for that as well.

Income Tax Act
Private Members' Business

6:20 p.m.

Liberal

Larry Bagnell Yukon, YT

Mr. Speaker, I want to commend the member for Delta—Richmond East on bringing forward this bill. It is a very positive initiative which is sorely needed in today's housing market. I congratulate him on that, and the member for Edmonton East for congratulating him for that. I also want to congratulate the member for Thunder Bay—Rainy River for initially contemplating this initiative and for all the work he has done on this and the eloquent way in which he described the need for this bill.

The main reason I wanted to speak is to say that I hope that the Conservative members in particular during their caucus meetings tomorrow morning will pass on to others in government this spirit of goodwill and the need for housing that they have outlined in speaking to this bill. I hope that they will encourage the government to move on some other fronts in the same spirit. It would be contradictory to take one step forward with this bill in addressing a very serious need and then to take another step backward on a different issue.

The member for Delta—Richmond East has disagreed with his government and the Prime Minister and has voted against them before. He could do it on some of these areas, too, if the need arose.

The point is there are people who are really in need of housing. There is huge housing crunch. We have some programs that have been successful in helping to deal with that. Certainly not all of the problems have been dealt with and more has to be done, but I am not asking for that at the moment. All I am asking is that those successful programs be allowed to continue while other initiatives are contemplated, or that these initiatives be expanded.

I am talking about three programs. One is the national homelessness partnering strategy. It has been hugely successful. The government extended it a year. The second one is the residential rehabilitation assistance program which helps people, many of whom could not otherwise afford it, including seniors, fix up their homes. This program is absolutely critical. Now that gas prices have gone up so much, they are going to need every bit of help they can get to survive. Making their houses more energy efficient would be helpful. The third program is the affordable housing initiative which provides people who otherwise would not have the ability the possibility to own a home.

These three programs still have a chance. That is why I am encouraging the Conservative members to bring this to their caucus meeting tomorrow. These three programs are still producing results, but they will expire at the end of March 2009.

For any program, there is a huge machinery of government. There are local committees in place that do excellent work to help implement these programs. Decisions are made months in advance of their implementation. We are getting close to the time when they are going to need to know. They are going to have to make decisions. Huge amounts of money are not needed, and in fact, the amounts are very small in the large scheme of things, to complement this excellent bill and to help some people into housing. I would encourage the Conservative members, when they go to their caucus meeting tomorrow, to urge the finance minister to simply announce that he will extend these programs at least at the existing level of financing until other successful initiatives are added.

These programs have proven to be successful. They are helping alleviate the housing crisis in Canada. The Conservatives have not cancelled them, which is good. They may not have done anything wrong, but I am just bringing this forward because there is an advanced timeline in the machinery of government. Unfortunately, there are so many rules that people have to follow that they have to know in advance whether these good programs will continue so that there is not a break in them. For instance, there is one shelter in our area which is funded by one of the programs. If that shelter had to close, imagine what would happen to the people who would have no place to go in a climate where there are many consecutive days at -40°.

Again, I compliment the member for Delta—Richmond East on the fine way in which he has brought forward this initiative. I hope he gets unanimous support.

However, I encourage him to encourage the government to build on the three programs that are really helping people who otherwise would have no chance of having a shelter over their heads and who continue to have some hope through the assistance that those programs are providing to some of them.