House of Commons Hansard #102 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was spam.

Topics

Retirement Income Bill of RightsPrivate Members' Business

7:10 p.m.

Conservative

The Deputy Speaker Conservative Andrew Scheer

The time provided for the consideration of private members' business has now expired and the order is dropped to the bottom of the order of precedence on the order paper.

Pursuant to an order made on Friday, November 19, 2010, the House shall now resolve itself into committee of the whole to consider Motion No. 8 under Government Business.

I do now leave the chair for the House to go into committee of the whole.

(House in committee of the whole on Government Business No. 8, Mr. Andrew Scheer in the chair)

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7:15 p.m.

Conservative

Gordon O'Connor Conservative Carleton—Mississippi Mills, ON

moved:

That this Committee take note of the national discussion focusing on improvements to Canada's retirement income system, including the ongoing dialogue between federal, provincial and territorial governments and consultations with all Canadians.

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7:15 p.m.

Macleod Alberta

Conservative

Ted Menzies ConservativeParliamentary Secretary to the Minister of Finance

Mr. Chair, I appreciate the opportunity to start tonight's take note debate on retirement income security and pensions. Being someone of such young and tender years, I am sure you are going to enjoy all of this discussion that we will be having here tonight, because rest assured, we are concerned about your future as well.

Tonight's debate is another illustration of how important this issue has become and remains for all Canadians and all parliamentarians. As I have said before, while we may not always have the exact same solutions to these issues, I would like to think all parliamentarians share a common desire to help seniors and retirees in Canada for today and for tomorrow.

This is not a simple or straightforward issue at all. As we have seen in Parliament, especially this past year, there are widely different aspects of this issue. They include everything from private sector pension plans, taxation issues, bankruptcy legislation, the levels of public servants' pensions and much more, all equally worthy of our attention. To be sure, this past spring, the finance committee, of which I am a member, conducted a study on the broad subject matter of retirement income security. In those hearings, we heard the wide range of concerns associated with this issue, concerns that touched countless areas and multiple jurisdictions.

Personally, this is an issue I have had the honour to spend the last three years or so working very closely on, as the finance minister's parliamentary secretary. I know how truly important it is to Canadians. I have conducted town halls. I have chaired round tables. I have read countless handwritten letters. I have spoken directly to thousands of Canadians personally. I heard the personal and heart-wrenching stories. I heard the emotion and the anxiety in the voices of the people telling them. I know how important this issue is to them and the generations of Canadians that will follow, and our Conservative government knows how important it is that we address this, but we also know how important it is that we get it right.

Despite what some might say tonight, there are no quick or easy solutions. The federal government alone cannot find or be the only solution as well. The government action alone, in the absence of personal responsibility, is not the solution. We cannot pretend otherwise. We have to look at the issue from all angles, always aware of the implications of solutions that we may propose, implications on not only those directly affected, but also those indirectly impacted and the larger Canadian economy. We also must always involve Canadians through open and public consultation when exploring this issue. It is too important to exclude Canadians from this discussion.

Since 2006, those are the broad objectives our Conservative government has strived for as we worked to improve the lives of seniors and retirees in Canada, not only for today but for tomorrow as well. This has included everything from our work to reform federally regulated private pension plans to landmark tax relief for seniors and retirees and, most prominently of late, our work with the provinces and territories to address this issue in a collaborative and pan-Canadian manner.

With respect to our work with the provinces and territories, it has been based on both extensive, factual research and open, public consultation. Indeed, there has been extremely good co-operation over the past few years, as we have been able to narrow down what we think can work and what merits more study.

We also ruled out ideas we collectively determined cannot work. For instance, along with our provincial and territorial partners, we examined the notion of creating another supplemental, government-run pension plan. The verdict was unanimous. This was not a good idea. Ontario's Liberal finance minister, Dwight Duncan, has firmly and publicly rejected the supplemental plan as “very costly to set up and administer”.

Indeed, during the finance committee study and elsewhere, we have repeatedly heard the same concerns from academics, labour and business.

For instance, the Canadian Institute of Chartered Accountants came out strongly against the supplemental plan, and said, “We believe that such initiatives would require the inclusion of significant incentives, costing deficit-laden governments scarce funds, and would further complicate the system”.

Labour unions have been equally dismissive. For instance, the Communications, Energy and Paperworkers Union of Canada told the finance committee that a supplemental plan would not work. It said, “As regards supplemental pension plans, our union experience shows that people do not spontaneously or easily contribute to a supplemental pension plan, even when the offer is attractive”.

It is little wonder even my Liberal colleague on the finance committee, the member for Saint-Léonard—Saint-Michel, dismissed the idea. To quote him, “The only thing that will happen is that the people who have the money will voluntarily put it into the CPP, so I don't think we'll solve the problem”.

I am confident that the spirit of co-operation and progress will continue later this year when federal, provincial and territorial finance ministers meet in my home province of Alberta in my riding of Kananaskis in December.

As I have said on numerous occasions, if we really want to tackle this broad issue as a federal government, we have to work with our provincial partners. The fact of the matter is that the overwhelming majority of pension plans in Canada, over 90%, are provincially regulated. Nevertheless, while the federal government cannot act on larger matters without our provincial partners, we can and have acted decisively on matters of exclusive federal jurisdiction.

First and foremost, last year we conducted the most comprehensive review of the framework governing private pension under federal jurisdiction in over two decades. We started that process back in January 2009 when we released a major research paper on federally regulated pension plans for public comment.

As our Conservative government believes that the Canadian public has the right to have their voices heard on this issue, we invited and listened to all who wanted to make their voices heard through public town halls and online consultations from May to March 2009.

Based on the tremendous feedback we received from Canadians from coast to coast to coast, we released the most comprehensive reforms in nearly 30 years of the federal pension framework.

Among those key reforms is: requiring an employer to fully fund benefits if the whole of a pension plan is terminated; establishing a distressed pension plan workout scheme under which employers, employees and retirees may negotiate changes to the plan's funding requirements; permitting the Superintendent of Financial Institutions to replace an actuary if they are of the opinion that it is in the best interests of the members or retirees; and, requiring the administrator to make additional information available to members and retirees following the termination of a pension plan.

I am happy to report that those reforms were welcomed and appreciated. Dan Braniff of the Common Front for Retirement Security described them as “an important milestone for creating greater security for many pensioners and plan members”. He thanked us for taking this “very important step for better retirement income security”.

Those reforms represented one of many instances where we took the time and effort to get it right. Our Conservative government will continue along that path. We will listen to the views of Canadians and all parliamentarians here tonight as we work towards a long-term solution to improve the retirement income security of Canadians.

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7:20 p.m.

Liberal

Gerry Byrne Liberal Humber—St. Barbe—Baie Verte, NL

Madam Chair, I would like to ask the parliamentary secretary what was the basis on which the decision was taken to ultimately destroy thousands and thousands of dollars in value to those lower income senior citizens who hold RRSPs?

In May 2010, the Government of Canada decided that for those who cash in RRIFs, registered retirement income funds, those funds would indeed be accountable to whether or not those citizens received the benefits of the guaranteed income supplement.

Prior to May 2010, if a senior pensioner were to cash in a RRIF, he or she could elect to have those funds deemed optionable under the terms and conditions of the old age security, GIS legislation. They were optionable, the same way that employment insurance and other pension income is currently now, to this day, still optionable.

But if a senior citizen cashes in a RRIF today, that income is no longer optionable and it is calculated against the means test of whether or not that senior citizen will gain access to the guaranteed income supplement.

As a result of this unannounced policy decision by the federal government, literally thousands, if not tens of thousands, if not potentially hundreds of thousands, of Canadian seniors who cashed in a RRIF so that they could pay for medical assistance or emergency care will now have that income calculated as to whether or not they will be eligible for the guaranteed income supplement next year.

They are not aware of this because the government did not ever make this known to any member of the public. They are going to lose their guaranteed income supplement, literally thousands of dollars out of the pockets of seniors citizens.

Why did the federal government not publicize this? Why, more importantly, did it take this decision?

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7:25 p.m.

Conservative

Ted Menzies Conservative Macleod, AB

Madam Chair, I am afraid I do not know all of the details on that, but I will certainly look into getting a fulsome answer for that.

What the government did recognize was the fact that those people holding RRSPs suffered a severe shock in 2008-09, seeing the value of their RRSPs drop drastically. For those who were required as of that date to roll those instantly, at the end of that year, into a RRIF, the government extended that two years so they would not be forced to roll their RRSPs at that low rate. It would actually provide them the opportunity to rebuild the value of those RRSPs.

The government recognized that they, through no fault of their own, saw the value of their RRSPs drop. It was market factors, blame whoever, it was not the seniors who should be blamed. The government recognized that and moved that date back two years so it would actually allow the seniors to regain value in their RRSPs before they were rolled into RRIFs.

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7:25 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Madam Chair, I would like to ask the Conservative member a question about a situation pertaining to private pension plans. One of my fellow members just asked about an aspect of public pension plans, and now it is time to look at private plans.

For economic reasons, some employers were unable to respect private pension plans either in terms of their contributions or the security of funds. We recently introduced Bill C-290, which asked the House to alter tax credits. The purpose of this bill was to help the employees of two companies in particular, the Jeffrey mine in Asbestos and Atlas Stainless Steels in Sorel.

I would like to understand the government's philosophy with regard to the existing protection for private pension plans. I would also like to know how the government intends to help those who lose money on their pensions.

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7:30 p.m.

Conservative

Ted Menzies Conservative Macleod, AB

Madam Chair, there are a lot of pension members who found themselves in most distressing situations especially with the downturn in the markets. We saw large pension funds that were losing millions of dollars a day. Some of those pension funds could have been topped up and should have been topped up, but the rules that were in place at that time, in fact the rules that had been in place since 1985, allowed them to take a pension holiday. If they were 85% funded when they had to report to OSFI, they were allowed to take a pension holiday. They were also not required to report to OSFI for three years. We did not realize how serious that was. That has been in place since 1985.

We recognize that challenge. I heard from many fund sponsors that if they were allowed to top up their contributions over the 100%, they would do that. We put in place that mechanism so they could over-fund for a rainy day to make sure they were funded in case of drops in value. As well we made sure that we required them to report every year so they would not get so far behind in their funding.

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7:30 p.m.

NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

Madam Chair, the parliamentary secretary talked about the difference between the increase in CPP and QPP and the proposal for a supplemental CPP and he pretty well discounted that. I note recently that Professor Kesselman and Jack Mintz also reached the same conclusions.

We have had discussions on the bankruptcy and insolvency, Companies' Creditors Arrangements Act, CCAA, situation of Nortel, AbitibiBowater and others. In all the dialogue we have had on those issues, there is a more immediate one which is the seniors in poverty that we keep discussing in this place. Does the government have any plans to increase old age security and GIS in the foreseeable future to help people who are in this severe situation?

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7:30 p.m.

Conservative

Ted Menzies Conservative Macleod, AB

Madam Chair, I do need to recognize the member for Hamilton East—Stoney Creek. He indeed has done extensive consultations with people not just in his own riding, but he has travelled around and listened to people. We recognize his contribution. As he states, he and I have had many discussions both in the House and in my office. He is passionate about making sure that we make the right decisions. We are trying to put forward as a package what will work for the short term, whether it be changes that help seniors today, but also to make sure that the changes that we make will help young people going forward.

The one issue we have not talked about yet and I am sure it will come up is a report we are expecting very soon from the financial literacy task force that will provide us with some insight on how we need to educate young people. I referred to this in my opening remarks about people looking after themselves. We cannot take away the responsibility of the individuals to make sure that they make the right decisions to prepare for their retirement. It cannot just be government that looks after their retirement. People have to take some personal responsibility. There are extenuating circumstances that are beyond people's control. I talked about that in the downturn in the markets, but personal responsibility also has to be a part of this. That has to be factored into our discussions here tonight. How do we encourage young people to think about their retirement? How also do we encourage people to keep working longer?

I personally feel that there is no place in my future for retirement. Why should many other people who want to continue working be forced out of work? They have productive years. They want to contribute. There are many good years left in some of us old souls and we should be given a chance to keep contributing.

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7:35 p.m.

Liberal

Judy Sgro Liberal York West, ON

Madam Chair, it is great to be focused on pensions tonight. It helps to show Canadians that we are very serious about these issues and that we care.

In a country like Canada, it is unacceptable that senior citizens would be subjected to poverty and squalor during their retirement years. If Canadians are to take a more active role in retirement planning, then governments must also be prepared to step up and do their share.

That is a quote. On October 13, 2010, I presented a white paper to the leader of the Liberal Party. That paper took more than a year to write and it contained 28 recommendations for substantive changes to the various pension systems in Canada. That paper contained the words that I have just said. They represent the guiding philosophy that was used during the drafting of that paper. They are the basis for my actions and beliefs as they relate to pensions and pension reform in this country.

Canada is a nation rich with resources and potential and our citizens should be able to enjoy a measure of dignity during retirement. Contrarily, more than 200,000 Canadians over the age of 65 currently live well below the low income poverty line.

What that means is that after a lifetime of working to raise their families and pay their taxes, 200,000 Canadians are being forced to choose between buying groceries and paying the rent because their retirement income is simply too low to allow them to do both. While almost unbelievable in Canada, this is a daily reality for far too many. In response, the daily goal set by this or any government of Canada should be to immediately correct this wrong.

I would suggest it is shameful that the government seems ambivalent to the issues of inadequate pension security. We need to get serious about pension security, coverage and adequacy before we see more situations such as the one which is currently threatening 17,000 former employees of Nortel. That is 17,000 people who worked for a lifetime, paid their taxes and put money away for a rainy day, but despite their efforts saw their savings wash away because of inadequate legal protections. Shame on all of us.

I am not here to poke holes without offering my thoughts and ideas. That is what my white paper is all about. Historically speaking, prior to the Great Depression, most Canadian social services were delivered by a patchwork of religious, volunteer and charitable organizations. However, the reality is that today, in addition to being essential for basic living, many Canadians view pensions as defining elements of our national identity.

Where are we today? Most Canadian seniors are eligible for old age security and most former workers can receive Canada pension plan or Quebec pension plan benefits based on their contributions during the course of their careers. Those at the lowest end of the income scale are also eligible for the guaranteed income supplement. Alone, these mechanisms provide somewhere in the neighbourhood of 30% of one's replacement income in retirement.

In dollars, these plans pay a maximum of about $20,000 annually, but the average payout continues to be significantly less. Current economics suggest that this will not be enough for most Canadians who will need private retirement savings to survive. All of us know that is not sufficient today, never mind 20 years from now.

A number of Canadians do have a private pension through their employers and/or take advantage of government tax shelters, such as RRSPs or the tax free savings account, but recent events have called the security of these private investments into question. With this, it is this last option that in many respects needs some of the most dramatic attention from government today.

In the past few years alone, we have seen a number of private companies become insolvent. Once that occurs, it would seem that employee pension plans are inadequately protected under Canadian law. The real life result is that thousands of hard-working Canadians, like the 17,000 former employees of Nortel, are being cast to the wolves and the government seems content to watch the carnage.

In fact, last week one witness at the industry committee suggested that Nortel employees can expect to take a “haircut at the neck” when it comes to their pensions. How is this acceptable?

Despite repeated calls for action, the government seems willing to sit back and allow the markets to do as they will to many of these people. I will not support this approach and I am proud to say that my party is not prepared to sit back either.

On paper, it may seem as though Canada has already addressed the challenges presented by an aging population through the utilization of a range of public and private mechanisms. But, despite this apparent resolution, retirement income security, adequacy and coverage continue to be looming problems that require the immediate attention of business, labour, individual citizens, and governments at all levels. I very much hope all of us can work together to come up with some solutions as we move forward on this important issue.

The undeniable fact is that over the next 20 to 30 years, Canadian pension regimes will face a perfect storm of an aging population with longer lifespans and dramatically higher levels of personal debt, coupled with lower disposable incomes and global economic and market instability. Immediate steps must be taken in the short term if pension security, adequacy and coverage are to be attainable for the long term.

In an effort to ensure that Canada's retirement income system is prepared for these challenges, I have suggested adopting a multi-pronged, internally coherent strategy that will shore up our system while being mindful of several key principles.

First, we need to underscore the value of a functioning pension system. I strongly believe that a reliable retirement income regime is in everyone's best interests, as indicated by the parliamentary secretary.

Second, we should be rethinking the three pillars of the existing pension system. Canada has long prided itself on the success of its current retirement income system. The three primary mechanisms associated with that system are: old age security and the guaranteed income supplement; the Canada pension plan; and the various private plans in privately administered options. A fourth pillar includes private savings outside of tax-sheltered plans. These structures have provided a strong base. However, they will face new pressures as the national population continues to age over the next 20 years. Weaknesses must be purged and strengths should be expanded upon.

Third is the integration of existing systems. It is essential that the existing structure be examined holistically and with a multi-generational focus. Public and private structures should be integrated with the stated goal of providing more seamless coverage to the population.

Consideration must also be given to those who have traditionally fallen through the cracks. In particular, women, who statistically endure a greater rate of poverty due largely to factors involving longevity, employment type and tenure, must receive the attention needed to ensure retirement income security, adequacy and coverage on par with all Canadians.

With these principles in mind, and understanding the need to respect any relevant jurisdictional and partnership issues, my white paper is proposing several specific recommendations to help ensure Canada's pension and retirement savings structures are fortified in a way so as to ensure they are prepared for the anticipated storm. Those reform proposals include measures such as: the establishment of a supplemental Canada pension plan; launching financial literacy measures; a review of the cost of living calculation; and the creation of a stranded pension agency.

All of the items in the white paper have been shared with the government. I am very hopeful that it will review those recommendations. Clearly, I would not be offended if it adopted several of them.

Many of these measures are also encapsulated in Bill C-574, the pensioners' bill of rights that I presented earlier and on which we had the first hour of debate.

While I am pleased to hear that the parliamentary secretary is going to support sending my bill of rights to committee, I look forward to working with all of the parties in the House to improve the pension system.

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7:45 p.m.

Conservative

Mike Wallace Conservative Burlington, ON

Madam Chair, it is my pleasure to take part in tonight's discussion on pension reform.

The Minister of Finance and the Parliamentary Secretary to the Minister of Finance have spent a lot of time over the last number of years looking at this issue. I am fortunate enough to be on both the finance committee, which dealt with this issue last spring, and on the industry committee at present where we are discussing Bill C-501.

Parliament and this government have been engaged in this issue and we have made a number of changes over the last couple of years.

However, I am not absolutely sure about something. The member for York West has been sitting in on our industry committee on the issue of Bill C-501 but I cannot tell whether the Liberals are supporting that private member's bill. I wonder if the member could tell us. I know that is a private member's bill and probably an individual decision, but based on the work that she has done and whether that bill would actually help Nortel employees, will the Liberals be supporting it coming back to the House?

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7:45 p.m.

Liberal

Judy Sgro Liberal York West, ON

Madam Chair, yes, I have been attending the industry meetings dealing with Bill C-501, which I am sure we will hear more about as the evening progresses. We have had a lot of very important people come in and give testimony, whether it was Nortel pensioners, Bowater or the many companies across Canada that are very concerned about the impact Bill C-501 will have. As parliamentarians, I think we are all trying to make a difference and many of us have different opinions.

This bill is important. It will soon have an opportunity to be looked upon in discussion with the department. At the appropriate time, we will make the appropriate decision.

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7:45 p.m.

NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

Madam Chair, I was pleased earlier tonight to hear the member from York West express her concerns for the 200,000 seniors who live in poverty. I know she has been working with the Nortel workers, as have other members of this House.

In fact, I was on a CBC panel with the member fromMarkham—Unionville where I made the suggestion that the government should consider cancelling the next corporate tax breaks of about $1 billion coming in January 2011 and put the money directly into old age security. The member from Markham—Unionville gave a flat no. I am curious as to what the member would say to that suggestion herself.

The finance minister seems to have a strong opinion here and so he is very helpful to the member I am sure.

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7:45 p.m.

Liberal

Judy Sgro Liberal York West, ON

Madam Chair, it is interesting to hear the member talk about the unaffordable tax cuts that the government of the day is talking about.

I would suggest that we reinvest that $6 billion in tax cuts in people. I strongly believe our seniors deserve care. We have been talking about a family care program that would be an expansion of the compassionate care program for EI. This would allow individuals who have a seriously ill parent to take up to six months off to take care of their elderly relative.

I believe we should be investing our money in people and not in prisons and fighter jets. That is a clear philosophy, especially when we have a $57 billion deficit that we have to work with.

There are some real opportunities in the future but investing in people is our priority.

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7:45 p.m.

Liberal

Maria Minna Liberal Beaches—East York, ON

Madam Chair, we all know that the old age security, GIS and CPP combined only replace about 30% of a senior's income. That leaves about 70% uncovered, which means, of course, that a lot of seniors are struggling and in the future it will get much more difficult.

The other plan that was supposed to help was the RRSP. Unfortunately, we all know that the RRSPs are really not working in our country. I think the average contribution to RRSPs is about $1,000 or $2,000 a year. Only about 10% of Canadians actually max out their RRSP limit, and that is only Canadians who are fortunate enough to have quite a high income. On top of that, we have to add in the fact that private pensions or company pensions are diminishing, while some of them are defaulting, which is a whole other issue. There is a lot of instability and a lot of problems.

I wonder if the hon. member could tell us what direction we really need to be going in to ensure Canadians have some stability in their pensions in the future.

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7:50 p.m.

Liberal

Judy Sgro Liberal York West, ON

Madam Chair, I did not realize this before, but while I was travelling around doing my consultations, as was the parliamentary secretary, I learned that in order for people to have a pension they must work for the labour union or the government.

I think that is very unfair. My bill of rights is about levelling the playing field. We need to provide more opportunities for people to contribute to a pension plan and the supplementary Canada pension would provide that opportunity. Everyone who has a social insurance number in Canada would automatically be enrolled in the plan but they could opt out if they chose.

That would allow everyone, from homemakers, caregivers, farmers and the self-employed, to put an extra $100 into their supplementary plan. There would be no obligation on employers. It would be an individual's right to put that money in the plan. The plan would be well managed, be low risk and would have low management fees.

The reason some of the provinces did not support the plan was because of all the talk about the huge costs. However, Alberta and British Columbia were very much enthused about going in that direction. Unfortunately, they did not all have the adequate information to understand it fully. I am quite confident that with further discussion, they will be very supportive of that.

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7:50 p.m.

Conservative

David Sweet Conservative Ancaster—Dundas—Flamborough—Westdale, ON

Madam Chair, I appreciate the opportunity to question the hon. member who I have worked with on several committees and for whom I have great respect.

I just have to comment on a statement that she made earlier. We have taken a lot of measures in the economic action plan, as well as with Advantage Canada, to ensure that Canada is the most competitive tax jurisdiction so we can attract companies here. Tim Hortons returned to Canada. In the city of Hamilton where my riding is, Canada Bread has built a multi-million dollar facility that I think will create hundreds of jobs.

The member was talking about tax breaks and this whole notion of them being given to companies. Is the member not aware of the correlation between attracting corporations that create jobs and that create an opportunity for people to contribute to pensions so that they can actually get those defined benefits later on?

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7:50 p.m.

Liberal

Judy Sgro Liberal York West, ON

Madam Chair, I have always been involved in economic issues and economic development attracting jobs.

We currently have the lowest corporate tax rate, even lower than in the U.S. We hear people compare us to that. I must say that under the Chrétien-Martin years, we gave the biggest tax cuts to the corporations of over $100 million.

We are well aware of the fact that we need a healthy economy but we also need to have healthy people who can contribute to a variety of different plans that will encourage them to save for the future.

As I indicated earlier, we will have 10.9 million seniors in another 26 years. The fiscal capacity of this country will be under enormous strain. The social infrastructure will be unable to bear that, unless we get Canadians involved in saving money.

The TFSAs that came out on a voluntary basis, which was a Liberal recommendation that was implemented by the government, which I congratulate it on, had $16 billion put into it in one year. I believe that if the vehicles are provided, people will invest and save their money.

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7:50 p.m.

Bloc

Luc Desnoyers Bloc Rivière-des-Mille-Îles, QC

Madam Chair, I think that it is important to talk about retirement today. When we look at the economic crisis we have just gone through, we see that hundreds of thousands of workers have been affected and/or have lost their pension. This has had a serious impact on workers.

When plants close or lay off huge numbers of workers, these people find themselves unemployed or in precarious part-time or temporary jobs. Workers who have been laid off and are in unstable jobs, as I said, can no longer pay into any sort of pension plan. They cannot save any money anymore, because they no longer have enough money to save for a comfortable retirement.

The economic crisis also brought us face to face with a pension crisis, something we had not been confronted with in many years. When I talk about a pension crisis, I am referring to pension plans that have been changed, abandoned and lost. We talked about workers from Nortel, AbitibiBowater, the Jeffrey mine and Atlas Steel, to name a few. We could name dozens and dozens of companies that have been forced to change or abandon plans. For example, Nortel workers are losing their pension plan altogether.

People who are close to retirement and are faced with this sort of situation are in serious trouble, because they cannot retire with sufficient income to allow them to live in dignity, face the future and keep on going.

Right now, there is only one segment of society that can afford a registered retirement savings plan. Roughly 27% of people can afford an RRSP in addition to their regular plan. It is devastating.

The Bloc Québécois has made a number of important demands over the years. The Bloc Québécois has always supported initiatives for retirees and seniors in Quebec. It will continue to support measures that will help retirees and seniors.

One of the many things we have done is introduce Bill C-290, to provide compensation to retired workers who have been cheated and whose pensions are cut off when a former employer declares bankruptcy and fails to fulfill its obligation to contribute to the employees' pension plan.

The Bloc Québécois was dismayed to see this bill defeated by the Liberals and the Conservatives. The bill set out to protect the retirement income of workers at a company in bankruptcy. Once again, the Liberals and Conservatives are demonstrating their profound indifference toward workers, especially retirees.

The Bloc Québécois will ensure that retirees are not cast aside by the Conservative government. We have not stopped promoting to the government a series of solutions to protect retirees. We have presented a solid plan with a number of income protection measures, namely that the federal government follow Quebec's lead and take trusteeship over the pension plans of federally regulated bankrupt businesses. This would prevent these pension funds from being liquidated while the markets are at their lowest. We also proposed introducing preferred creditor status for disabled employees who lose their benefits following an employer's bankruptcy and amending the investment act to keep the threshold for automatic review of foreign acquisitions at $300 million. Such a measure would ensure that companies like Nortel would not be sold off at a discount to the detriment of retirees.

The Bloc Québécois is also making major efforts to improve the GIS.

Another proposal is the elimination of the six-month delay for the wage earner protection program. Thus, victims of massive layoffs followed by delayed bankruptcy would be eligible for the severance they are due.

We are also proposing that the contribution limits for pension funds be increased to 125% of the break-even point. This measure would encourage the establishment of a significant pension reserve. The government went back to this after trying to pass the buck to the provinces.

The Bloc Québécois supports supervision of pension plans subject to federal jurisdiction to help avoid high-risk investments, such as investments in the company. Furthermore, companies with insolvent pension plans because of stock market downturns generally have five years to replenish their funds. To counter the effects of the downturn, the government has increased this time frame to 10 years in order to give companies some breathing room, prevent bankruptcy and protect both workers and pensioners. The Bloc Québécois approved this exceptional measure that fosters the survival of businesses.

We are asking for minimum funding requirements to make pension funds less sensitive to market fluctuations. As we can see, there are a number of proposals that should be added to the government's agenda to improve pension plans, should there be one in future.

Canada and Quebec have various pension plans: old age security, guaranteed income security, the Canada pension plan and the Régime de rentes du Québec, which falls under Quebec's jurisdiction. It is important to respect Quebec's legitimate right to its own pension plan.

A number of citizens' groups, retiree organizations and unions, such as the Canadian Labour Congress and the Fédération des travailleurs et travailleuses du Québec, are calling for significant changes to the Régime de rentes du Québec and the Canada pension plan, as well as an increase in the guaranteed income supplement. They believe it is vital that the government move forward with pension fund security reform. We must heed this request by various organizations and propose important changes.

Only the Canada Pension Plan and the QPP were not affected by the recent economic crisis. Other plans were all affected in different ways. As advocacy groups were saying, the advantage of the CPP and the QPP is that they are transferable, universal and indexed. These groups are calling for benefits to be increased from an average of 25% of a person's salary to 50%, since 25% is clearly insufficient. Doubling benefits would help lift retired workers over the poverty line. When future CPP and QPP benefits are increased, the guaranteed income supplement must also be substantially increased at the same time.

The CPP and QPP are secure, stable and indexed, and their administrative costs are minimal compared to those of financial institutions in Quebec and Canada. Improvements such as these would significantly reduce the incidence of poverty among the seniors and retirees who benefit from these pension plans.

We are saying yes to improvements to the public plan. We must conduct an in-depth review of what is being proposed and ensure that all the necessary analyses are conducted. The Canadian Labour Congress and the federations have approaches worth considering.

In conclusion, the proposal, which involves gradually increasing QPP and CPP benefits by increasing contributions and raising the limit on pensionable earnings, is an approach that should be thoroughly examined. It must be done right, through meaningful consultation—

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NDP

The Deputy Chair NDP Denise Savoie

The hon. member for Hamilton East—Stoney Creek.

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NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

Madam Chair, my friend from the Bloc was speaking earlier about his concerns about companies that have gone under for a variety of reasons, such as AbitibiBowater's and Nortel's issues.

I have said before that we insure our homes, cars and ourselves. Is it not common sense that we should ensure our pensions? The NDP has proposed a national pension insurance plan, which would be funded by premiums paid by the plan holders. I am wondering if the Bloc would support such a measure.

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Bloc

Luc Desnoyers Bloc Rivière-des-Mille-Îles, QC

Madam Chair, the Fédération des travailleurs et travailleuses du Québec is calling for some type of insurance to protect pension plans. We need to take a closer look at the approaches proposed by the Fédération des travailleurs et travailleuses du Québec and by other unions in Quebec to determine how to protect pension plans.

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Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Madam Chair, first I would like to thank my colleague from Rivière-des-Mille-Îles for his speech. He spoke about the two types of plans. I would like to ask him about the guaranteed income supplement, a public plan for seniors that he mentioned briefly, which is available to individuals whose old age pension income is too low.

Can he tell us why, under this government and the one before it, people who were entitled to the guaranteed income supplement did not receive it?

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Bloc

Luc Desnoyers Bloc Rivière-des-Mille-Îles, QC

Madam Chair, I thank my colleague for his question.

Seniors must apply to receive the guaranteed income supplement. Unfortunately, a number of retired seniors were shortchanged by these two governments, by both the Liberals and the Conservatives. They did not receive the guaranteed income supplement because they had not applied. We are obviously calling on the government to make this automatic, to ensure that individuals are automatically registered for the guaranteed income supplement once they are entitled to it and have reached the required age.