Bill C-25 (Historical)

Pooled Registered Pension Plans Act

An Act relating to pooled registered pension plans and making related amendments to other Acts

This enactment provides a legal framework for the establishment and administration of pooled registered pension plans that will be accessible to employees and self-employed persons and that will pool the funds in members’ accounts to achieve lower costs in relation to investment management and plan administration.

Pooled Registered Pension Plans Act

[Joe Preston, Conservative, Elgin—Middlesex—London, ON]

Mr. Speaker, I said in answer to a question from a previous speaker exactly that. I spent my time this weekend wandering through my riding, going to different events, and that is what I being asked. When I told people I was going to be speaking on pooled pensions in the House, people asked me if we had not already passed it, that they were waiting for it to happen.

I thank the member for London West because his previous background was in the type of business that may be the types of groups of people that would administer this, other small businesses helping with pooled pensions so that small business people and entrepreneurs can save for retirement without really having to leave their businesses and be there to serve their customers.

[The Acting Speaker, Bruce Stanton]

Before I call on the hon. member for Chambly—Borduas, I must inform him that I will have to interrupt him at 6:30 p.m., at the conclusion of today's government business.

[Matthew Dubé, NDP, Chambly—Borduas, QC]

Mr. Speaker, thank you for your kind warning.

My speech will be very similar to that of the hon. member for Pierrefonds—Dollard. The simple reason is that the public consultations that she carried out in Quebec with the hon. member for Marc-Aurèle-Fortin were also held in my riding. Many of the comments that she heard about the problems facing our seniors or those retiring soon are the same comments that I have heard. And when we think about it, this affects everyone.

I would like to use the short time that I have to talk about that and to explain why we think the measures proposed in Bill C-25 are not appropriate.

That is basically it. We are not saying that this bill is a travesty. We simply want to provide people who are going to retire or who already have retired with better tools.

What this bill is proposing is very similar to what we already have, such as RRSPs. What is more, we have been given very little information. We do not know the administrative costs associated with this plan. The employer is not required to contribute to the plan, something that is done in many other countries. The pension plans of the largest corporations require the employer to make a certain contribution. There are many problems with all this.

The NDP believes that these measures are not appropriate at this time, especially when the eligibility age for old age security is being increased from 65 to 67.

We saw with RRSPs what can happen when people are asked to invest their pensions in the stock market. That is what happened in 2008.

Many Canadians were rather fortunate compared to Americans. Nonetheless, people have been seriously affected. At the very least, we cannot downplay the importance of all this. People invested in RRSPs for 10 years and saw their investments dwindle. When it comes to retirement security, that is not the norm in a country such as ours. Members will recall the case of Nortel, where there were no provisions in place to guarantee people's pensions.

In the last minute I have left, I would like to say that in talking to people, their main complaint was that they were tired of investing in the market and not having retirement security. They said that they want to have the support of a system in which they can invest, such as old age security and the guaranteed income supplement.

The guaranteed income supplement is a very important tool. We in the NDP would like to increase the GIS. With a very small investment, we could lift most seniors living below the poverty line above that line and enable them to live in dignity. That is what the people in my riding and many other ridings told us.

We oppose this bill because it is not the right tool in the current economic situation. There are much better tools. That is what the NDP would do if it formed the government.

[The Acting Speaker, Bruce Stanton]

The hon. member for Chambly—Borduas will have six minutes to finish his speech and another five minutes for questions and comments when the House resumes debate on the motion.

The House resumed from June 11 consideration of the motion that Bill C-25, An Act relating to pooled registered pension plans and making related amendments to other Acts, be read the third time and passed, and of the motion that this question be now put.

Pooled Registered Pension Plans

[Mark Adler, Conservative, York Centre, ON]

Madam Speaker, it is my great pleasure to rise today to speak to Bill C-25, the pooled registered pension plan.

I want to congratulate the Minister of State for Finance on the amazing and wonderful work he has done on this bill and on chairing the committee headed up by the minister and all the provincial finance ministers. I want to congratulate him on his efforts in guiding this bill through the House of Commons.

I have been a member of Parliament now for a little over a year. What has really struck me in my time here so far is the negativity I hear from across the aisle from the nattering nabobs of negativism. No matter how good a public policy initiative is coming out of this government—

[An hon. member]

It's all good.

[Mark Adler, Conservative, York Centre, ON]

—and it is all good, the members opposite oppose it.

I am reminded of the movie A Few Good Men. Jack Nicholson is on the stand and is being cross-examined by Tom Cruise. Tom Cruise says, “I want the truth”, and Jack Nicholson barks back, “You can't handle the truth”. Those are the people we are opposing on the other side of the House. They cannot handle the truth. They prefer to live with Tattoo on Fantasy Island, and those in the third party, well, they are just Lost in Space.

As a government, we have the responsibility to make decisions. We have a heavy burden on this side. We are the only party standing in the way of the NDP forming government. That is a very heavy burden, one which we do not take lightly.

We on this side are not concerned about 2015. We hear about the NDP and its rush to form government in 2015. In fact, I hear it is even cornering the market on orange carpeting for their ministerial offices already. Let me say one thing. We on this side are not concerned about 2015. We are concerned about 2020, 2030, 2040, 2050. The legislation we are proposing is not just to get us to the next election. We are proposing legislation that is good for our children, our grandchildren and our great-grandchildren for generations to come.

Before I speak specifically to the bill, I will talk about where we are in terms of our economic situation. We are number one in the G8 in terms of economic performance.

[An hon. member]

Thanks to this government.

[Mark Adler, Conservative, York Centre, ON]

The member is right. It is thanks to this government.

We have recovered all of the jobs that we lost during the recession. Since July 2009, we have created 765,000 net new jobs. The World Economic Forum says we have the strongest financial and banking system of any country around the world. Forbes magazine says we are the best place to do business.

A few months ago, Governor Branstad of Iowa said on Meet the Press, “The Canadian government has reduced their corporate income tax to 15%. I've had companies that I've called on in Chicago to come to Iowa say, 'We like Iowa, but if they don't change the federal corporate income tax, we're probably going to go to Canada'”.

It is all about the profits, and with profits come jobs. Moody's has given us a AAA credit rating again, as has Fitch.

Our strong economy, the jobs we have recovered and being number one in the G8 are not good enough. We are not standing still with that. I will be speaking to Bill C-38, the budget implementation bill, tomorrow.

Everything we do on this side of the House, every legislative initiative, has a purpose. Everything is tied together. It is part of our comprehensive plan. Again, it is for Canada's future. We are investing in Canada's future, in our people, not in the next election.

With respect to our retirement system, we have identified that 60% of Canadians will not have a sufficient amount of money to retire. That is unacceptable to the government. That is why we have put forward Bill C-25, the pooled registered pension plans act. Under this plan, we will add a fourth pillar to the retirement income system that we have.

Let us take a look at our retirement income system as it stands today. We have the OAS and the GIS. We increased the GIS in last year's budget by 25%, the largest increase in the history of the GIS, and it was opposed not once but twice by the opposition. In fact, the first time the opposition forced an election because it was opposed to the initiatives we had in our budget, particularly those to create jobs and to help seniors.

The second pillar is the CPP and the QPP. Both are actuarially sound, yet we still took time to improve the CPP under its mandatory five-year review.

The third pillar is the RPP and the RRSP. The RRSP is an interesting vehicle. That vehicle is open to all Canadians; however, we find that $600 billion is underfunded in the RRSP. This indicates that people are not saving enough for retirement. That is a problem.

What else have we done to help seniors in this country? We have given them, on average, $2.3 billion in tax relief. We have given our seniors pension income splitting. We have doubled the maximum amount of income eligible for pension income credit. We have established the TFSA.

The PRPP is needed in our country. I will close with a personal anecdote. My father was an immigrant to the country and he worked hard. I remember when I was a young fellow looking through the window late at night, waiting for my father to come home. He would pull up in the car, which had a very distinctive sound. I remember running to the window and watching him get out of the car. He was so tired he could barely drag himself out of the car and get into the house.

My father did not have a retirement income mechanism in place at the time. My father has since passed away. My father owned a shoe store and had one employee. It was a small business. This would have been so beneficial for him and his family, and for the employee and her family.

This is the kind of country we are trying to create in Canada, where our seniors have a proper amount of income so that they can retire in dignity and live a full life of quality.

[Irene Mathyssen, NDP, London—Fanshawe, ON]

Mr. Speaker, just to extend the analogy in regard to A Few Good Men, it might be remembered by this House that the Jack Nicholson character was found guilty of supporting heinous and violent crimes.

I did want to ask a question in regard to the fact that only about 30% of Canadians have the fiscal ability to put savings into RRSPs. Unfortunately, over a 40- to 45-year period, the RRSP is reduced significantly. About 40% of the money that goes in goes to pay fees to the financial institution.

I wonder if the member opposite would like to circle that square.

[Mark Adler, Conservative, York Centre, ON]

Mr. Speaker, I do not know if it is geometrically possible to circle a square.

The hon. member raises a rather interesting question because she seems to be offering more of an answer. She said that 30% of people cannot invest in an RRSP, which is all the more reason that we need a PRPP.

The hon. members on the other side are proposing an increase to the CPP. They do not understand two things. One, we need to have the agreement of two-thirds of the provinces representing two-thirds of the population to make any changes to the CPP mechanism. Two, CPP comes out of people's paycheques. This would be just another tax on people, which would be a job killer, which the NDP would probably support in any event.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, my distinguished colleague is talking about a plan that will guarantee pensions, but what is the point of a pension plan when we do not know how much money it will generate? That is a major problem.

People know exactly how much they will have to pay every month, but the amount they will get out of the plan after 30 or 40 years remains a complete mystery since the employer will choose who administers the plan and the level of risk of the investment. Employees may have to invest in a high-risk plan without having any say in the matter.

Is that what the government calls planning for retirement? Is that what the government calls planning a pension income?

[Mark Adler, Conservative, York Centre, ON]

Mr. Speaker, it is pure speculation on the part of the hon. member to say that. He clearly does not know the facts. He has not read the legislation.

There is a strict regime in place. That is why they are called pooled registered pension plans. They will be pooled. Administrative costs will be kept down. This is what Canada needs. This is what our seniors need to live a life of quality and dignity.

We owe our seniors so much in this country. This government recognizes that. This government is prepared to do something about it, unlike those people on the other side.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Mr. Speaker, as a supporter of this particular initiative for all the reasons that were outlined throughout this debate, some of it is pretty good. The idea of pooling pensions and the risk taken is mitigated as a result of this, no problem.

However, would the hon. member say that this is the be-all and end-all? Is there not a second part to this that the government could do, such as a supplementary CPP or something else? Is this really it for the Conservatives' economic action plan when it comes to pensions?