Bill C-28 (Historical)

Financial Literacy Leader Act

An Act to amend the Financial Consumer Agency of Canada Act

This enactment amends the Financial Consumer Agency of Canada Act to create the position of Financial Literacy Leader within the Agency. The Leader is to be appointed by the Governor in Council to exercise leadership at the national level to strengthen the financial literacy of Canadians. The amendments also provide for the other powers, duties and functions of the Financial Literacy Leader.

Financial Literacy Leader Act

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

Mr. Speaker, I would like to thank my colleague for his question because this is exactly why we are saying that there is still a long way to go.

This is the kind of education, the kind of work that a government and MPs can do, in co-operation with all the other authorities, to help people escape poverty and make the most of the means at their disposal. Bearing in mind the objective of eliminating poverty, something that we as members of Parliament are trying to do, we must continue pushing ahead with this issue, with developing the concept and clarifying the definition of financial literacy and the mandate of the financial literacy leader, the position this bill would create. It is completely relevant.

As I said in my speech when I commented on debt, very often, people who are in debt do not appear to be poor. This problem is specific to poverty, particularly in my riding, Chambly—Borduas. It is a very dangerous path. It is also what is known as a slippery slope: people can get into debt, and that can exacerbate the problem of poverty.

We can resolve the problem of debt, or at least we can do our part. We will certainly not resolve it overnight. However, once people can get proper financial literacy education, we will be able to do our part to try to resolve this issue, which is increasingly present in our society and which, I believe, is a form of hidden poverty that is of great concern.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is with pleasure that I rise to speak to Bill C-28. Off-hand, there are a couple of good reasons to speak in favour of the bill.

First, it is a step forward, as we acknowledge within the Liberal Party. We did have concerns during second reading, but many of those concerns were addressed at committee. We are pleased with the responses that we heard at committee and in the other discussions that have taken place since second reading, which ultimately bring us to where we are today. We recognize that the bill does take us forward.

The other thing that I like about this particular bill is that it points out the difference in good part between the government and the Liberal Party. On the one hand, the Conservatives have recognized that there is a need to deal with the issue, but on the other hand, they are not coming up with any sort of comprehensive plan. They did not really show evidence of any meetings with stakeholders prior to the bill coming to the House at first reading. It is almost as if they had an idea, or someone within the party had an idea, and they kept it to themselves and then tabled the bill.

Within the Liberal Party, we believe that the bill could have been so much better. Had the government actually held some consultations with different stakeholders, I believe that we would be looking at a much more detailed plan today as to where we should be going.

Financial literacy and education is critically important. We have to look at education in terms of it going beyond the House of Commons simply passing Bill C-28. That is why I referred to the stakeholders.

I might have referred in the past to the fact that I was the education critic in the Province of Manitoba. There are many battles that take place within education about what should and should not be part of the curriculum. People want to emphasize, for example, the importance of language arts and mathematics, and justifiably so. When our students graduate from high school, we want them to have a basic understanding of the language arts, mathematics and a number of other areas.

At the end of the day, we are suggesting that financial literacy is critically important. However, when we look at how we would disseminate that information, it is a huge mistake for us not to take into consideration the important role that other stakeholders have to play. That is why I bring up the whole area of education.

When we talk about leadership, we want leadership from the government in dealing with this very important issue. However, we are not just hoping to see legislation before the House, but also a government that is actively promoting and encouraging dialogue with the different stakeholders.

That is why I posed my question in regards to the Minister of Intergovernmental Affairs, because this is somewhat time sensitive. This is an interesting issue and we brought it up today in question period. We must ask ourselves: To what degree does that particular minister now have responsibility in regard to this legislation?

It would appear that the bill has the support of all members of the House and will pass. I do not know for sure, but we will find out when the bill is actually voted on. However, what do we do after we have passed the legislation?

What is the next step? I understand and appreciate that the primary purpose of this legislation is to create a financial literacy leader. That is great, but along with that we need to recognize the importance of education and reaching out to the different stakeholders.

It is not good enough to just say, “Here is the idea, let us put it to the House and have the House vote on it” and then leave it at that. There is a responsibility for officials, like the Minister of Intergovernmental Affairs, to go out and meet with different representatives of government, different levels of government, to say, “Here is what is happening in the House. Here is the type of thing we think we could move forward on. What do you think as a provincial entity?”

We need to recognize that different departments are involved. A provincial jurisdiction will have a department of consumer and corporate affairs. There will also be departments of education and other departments that one might want to consider. There may even be different departments within the national government itself that would have a vested interest in this whole subject matter.

I have referred to school divisions. Even our municipalities, whether large municipalities or cities, or small, rural municipalities, all have a vested interest, even in distributing information on tax rolls, and so forth, so that people can understand what a tax roll is and the obligations to pay a property tax and how that is done through automatic banking if one chooses.

There are all sorts of reasons why all these different government agencies have a vested interest. I would suggest that we need go even beyond that. We have to look at the private sector and the important role it has to play. It is not just about the banking industry or our top banks, because some of the most progressive policy today regarding finances and consumer awareness is actually coming from our credit unions, our co-ops. Those are private companies or corporations that have seen the merit of consumer awareness or financial literacy. The private sector obviously has a critical role to play in this, and we need to encourage that ongoing support.

I did not make reference to the non-profit sector, but obviously that sector also has a role to play. I remember meeting with representatives of Winnipeg Harvest, the largest food distribution centre for people who just do not have the ability to pay for all of their food and have to go to Winnipeg Harvest as a result. I have talked to representatives of Winnipeg Harvest about the issue of finances. Non-profit organizations have a great talent pool, including social planning councils.

Whether it is government, non-profit agencies or the private sector, all have a role to play in financial literacy. Nevertheless, I would suggest that there is only one real authority with the most significant leadership role to play, and that of course is here within the House of Commons

We need to see a government that is committed to doing more than just bringing in Bill C-28 to creates a financial literacy leader. We need to ensure there is a lot more than just that. Nonetheless, it is good that the government has brought this bill before us today and we will be supporting it at third reading, because see it as a move forward.

We believe that it will add to the importance of education on a very important issue. However, we do not want the government members to sit back and say they have done enough because there is a lot more that needs to be done.

Things have changed dramatically. It was not that long ago that teenagers would open up a bank account by providing a couple of pieces of ID. They could deposit or take money out of the bank and it was pretty simple. Loans and credit cards were more challenging at that early age, but the point is that they went to the bank. All of a sudden we have phone banking systems where you can register your bills and make payments and do transactions over the telephone. Prior to that we could make automatic deposits or withdrawals to pay our monthly bills, and now it is through the website. A vast majority now do their banking online.

I should be careful when I say a vast majority because I do not know that for a fact. I suspect as we continue to move forward, we will get a good, solid majority of people banking online. However, I know there are many people today who refuse to use the technology, sometimes for very good reason. They choose to have a face-to-face connection with the teller or to walk to the bank.

Things are changing and they are changing rapidly. We need to recognize that change. With that change all sorts of other issues arise such as credit cards and the amount of money paid in interest and service charges on credit cards. If a 19-year-old or even a 40-year-old is given a credit card, especially at this time of the year with consumer spending expected to increase significantly, those credit cards are very attractive little pieces of plastic. It does not take too much to accrue a significant amount of money on that piece of plastic.

Now stores have gift cards. People purchase them as a Christmas gift or as a holiday gift. Many gift cards have a short period of time before they expire and many consumers are not aware of that. These are the types of things that have an impact. This is why it is so very important that we recognize education is of critical importance. We need to ensure that whether people are 16 years old in high school, or 30 years old working on a factory floor or working in an office, there is an advocate talking about what is happening and what consumers can do to protect themselves. We must ensure that there is someone who is on the consumers' side, ensuring their rights and that they are not being taken advantage of or exploited.

In 2001 we saw the creation of the Financial Consumer Agency of Canada, which I thought was a great initiative of the former prime minister, Jean Chrétien, and his government. It was in direct response to what was happening in the real world. Gift cards were coming out big time back then and there was very little consumer knowledge about them. At least the government back in 2001 recognized the importance of consumer education and created that agency. There is a great deal to be learned if we go to its website. I have encouraged constituents to visit it.

We recognize that the government has seen the agency's merit. It has proven itself because it has now stood the test of time. Even though the Liberals brought it in, the Conservatives have now been in for a number of years and they have recognized the value of the agency because the legislation that we have before us today, Bill C-28, would create a financial literacy leader who would be reporting to the Commissioner of the Financial Consumer Agency of Canada.

Today, under the Conservative banner, we see the Government of Canada recognizing that what Jean Chrétien and the Liberals created back in 2001 was a good idea. We find that governments at different levels are on board with respect to that particular agency. I believe that tying the new literacy leader to this agency will be a good thing and it will give more credibility to the financial literacy leader and the office that no doubt will follow.

I know that Canadians are very concerned about debt and the overall debt that Canadians have today, and we should be concerned. Mark Carney, Governor of the Bank of Canada, raised the issue of just how much debt there really is. The number that I have heard is $1.63 for every dollar of annual income. That is significant. From what I understand, the Governor of the Bank of Canada has highlighted the point that it is a record high for consumer debt.

The government does have to take some responsibility for that record, and I do not say that lightly. It was the current Minister of Finance who introduced the 40-year mortgage, which did not even require a minimum down payment. Even though the Conservatives have learned their lesson and are bringing it back to 25 years, that 40-year mortgage contributed to the overall debt ratio that Canadians have today.

The bottom line is that government does play a role. Financial literacy is important and we in the Liberal Party have recognized that. We are supporting the bill because it does move us forward, although not very much, but we are prepared to support it at third reading.

We encourage the government to do more. If it wants some good ideas, it can always turn to the opposition members, particularly members of the Liberal Party who would be more than happy to share our ideas. We recognize how important it is to talk about financial literacy.

[Sean Casey, Liberal, Charlottetown, PE]

Mr. Speaker, I want to pick up on the very last point that my colleague made with regard to the level of household debt in our country. There is no question that the level of household debt has ballooned and this is one of the reasons that undoubtedly prompted the government to say there was a need for greater financial literacy. What is ironic is that the level of household debt was caused, in part, by the decision of the Conservative government to introduce 40-year mortgages with no down payments.

My hon. colleague said that the appointment of a financial literacy officer was a good first step. Given that the situation we are in is not one that is entirely separate from the policies of the government, what measures would he propose because there is more that we could do? Could he go through some of the measures that we could undertake over and above the appointment of a financial literacy officer?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the most important thing the government could do would be to have a ministerial meeting on the issue of financial literacy. The government has an obligation to not only recognize an issue, but to consult with people, different organizations, whether it is the government or private sector, to see how it can take a more collective approach to ensure we maximize the amount of financial literacy programming. Not only would people in schools be educated, but there would also be the potential of educating people within the working environment. Whether one is 40 years old or 16 years old, that individual is being taught some sort of financial literacy. Hopefully the financial literacy officer would take a look at those types of initiatives to encourage that.

I made reference to the $1.63 of debt for every $1 annually that a person has. That is very close to what it was for the Americans at the time in which they had the huge housing crisis. I am not trying to raise a red flag unnecessarily, but I would suggest that people should take note that the Governor of the Bank of Canada, Mark Carney, raised the issue. We should be listening and taking appropriate action, especially on government policy.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I am pleased to ask another question on this issue.

I have to say that the committee did a fine job. I was not there, but I heard about it. The NDP proposed six amendments in all, while the Liberals and the Conservatives did not suggest one single amendment.

One of the amendments put forward by the NDP was that the legislation should express explicitly that the incumbent of this position should be bilingual. As we have seen in the case of the Auditor General of Canada, a unilingual anglophone holds this position. However, right now, it seems he is making an effort at least to learn the second official language.

As I did not attend the committee, I would like to know whether the Liberals supported this amendment to ensure that the legislation states explicitly that the position should be filled by someone who is bilingual.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the Liberal Party has made a very strong statement on the Auditor General, second to no other statement, saying that in positions of this nature it is a mistake not to have someone who is bilingual. I hope the Conservatives have learned a lesson on that particular issue. We will have to wait and see what they do.

In regard to the amendments, after bills pass out of second reading the Liberal Party approaches committees very seriously. We listen to what people have to say. In some bills, amendments are moved and in others they are not. With the first omnibus bill, the Liberals introduced over 400 amendments inside the House on third reading and the NDP did zero. It fluctuates. Sometimes we move amendments. It depends on the critics. A lot depends on what other amendments are being moved. Sometimes an amendment that is moved by one opposition party has the support of the other opposition party.

If there is a good idea and we feel it would make the bill better, we would support the amendment. It is unfortunate that the Conservatives did not make some of the changes some of their colleagues suggested. I suspect we might have even voted for some of those amendments. As I acknowledged at the very beginning, the bill would be just a small step in an area in which we need to make some significant steps.

[Sean Casey, Liberal, Charlottetown, PE]

Mr. Speaker, the hon. member indicated that a key part to increasing financial literacy would be co-operation among the provinces.

When we look at the record of the Conservative government in terms of dealing with the provinces, we have a Prime Minister who will not meet with the provincial ministers as a group. We have a Minister of Intergovernmental Affairs who does all his work either in Ottawa or in Labrador. We have a Minister of Finance who says to the provinces, “Here is what you are getting for health care”. That is the Conservatives' idea of federal-provincial co-operation. We have changes to old age security that would increase the welfare rolls in the provinces; changes in EI that are going to increase the welfare rolls in the provinces; changes in crime legislation that are going to increase costs in the provinces.

Given the state of federal-provincial relations in this country, could the member explain his level of optimism that this would achieve its objective, given the necessity of working together between the provincial and federal levels of government to get it done?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I started my speech by saying that one of the things I like about the bill is that it shows a difference between the Conservatives and the Liberal Party of Canada.

The members of the Liberal Party of Canada believe that in order to adequately deal with financial literacy in our country, in order to get the job done and get it done right, we need to work with the provinces, the different stakeholders including school divisions and so forth, and the private sector. That means having ministers who actually go out and meet with their provincial counterparts, the Prime Minister having a first ministers' meeting and so forth.

[The Acting Speaker, Barry Devolin]

I regret having to interrupt the hon. member for Winnipeg North at this time. It being 1:30 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 November 8 consideration of the motion that Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act, be read the third time and passed.

[Tarik Brahmi, NDP, Saint-Jean, QC]

Mr. Speaker, the points of order we heard are very technical but yet very interesting.

First, with your permission, I would like to share my time with the hon. member for Pontiac. It is always an honour to speak in the House about bills, in this case, Bill C-28, the Financial Literacy Leader Act. The incumbent of this position would report to the Commissioner of the Financial Consumer Agency of Canada. Given that I already spoke about this bill at second reading, today, I am going to speak more specifically about the amendments that were tabled by my colleagues when this bill was examined by the Standing Committee on Finance.

I can only express my sincere disappointment that the Conservative members rejected the six amendments that were tabled by my NDP colleagues. It is always sad to see how little the Conservatives are willing to co-operate. Although all six amendments were relevant, two of them were particularly vital: the one pertaining to the bilingualism of the financial literacy leader and the one pertaining to the creation of an advisory council.

The following are comments by the Parliamentary Secretary to the Minister of Finance when my colleague from Sudbury tabled our three amendments during the committee hearing. The third amendment would ensure that the financial literacy leader would be bilingual.

In answer, the Parliamentary Secretary to the Minister of Finance said, “That's a huge priority for this government. This is why we continue to put forward policies that support that”. She also mentioned, “I would also say that in choosing a financial literacy leader, we do want to make sure there is merit that goes with any appointment”.

With both of those comments, there is a blatant contradiction between the fact that she acknowledged that the literacy leader should be bilingual, but on the other hand that the language skills were not mandatory for that position. We have seen that contradiction in many nominations by the Conservative government. It demonstrates that, for the government, language skills and namely the ability to speak French are not part of the merit that is required to get these positions.

For Quebec members of Parliament, this is a real problem because it gives us the impression that the government is always telling us the same thing about bilingualism—that it is going to appoint a person based on merit and then ask that person to learn French. This sends a message that linguistic ability is not among the prerequisites and skills required to be appointed to these positions. As a member of Parliament from Quebec, I find this to be a completely unacceptable message. That is what I had to say about the first amendment.

The second amendment that the hon. member for Sudbury proposed involved the creation of an advisory council in accordance with the second recommendation of the financial literacy task force. This was one of the 30 recommendations this task force made. We see that, in this bill, only one of those recommendations was taken into account, that of creating the position of financial literacy leader.

Once again, this bill leaves much to be desired. In fact, it is really just an empty shell, considering that, out of 30 recommendations, the government acted on only one: the creation of this position.

We often hear the government argue that this bill calls for the creation of a website. The government seems to think that websites have magical powers. That is the answer we always get any time we ask the ministers about the cuts made to public service positions responsible for answering questions from the public. We are often told that people can simply consult the website, because all of the information is there. That is more or less what we have heard from the government members who have spoken on this.

Furthermore, people have a tendency to forget that we can teach financial literacy to Canadians and enhance their knowledge, but there is no point in explaining how to manage their money if they have no money to manage. Sometimes they have no money because the banking system is sucking up such a huge amount of money.

I would like to give some of the figures from Canadian banks, which, as we know, have a virtual monopoly. Let us look at the banks' profits after taxes—not the total business but the profits. The profits of Canadian banks have increased from less than $10 billion—or to be more specific, $9.7 billion—in 2000 to over $25 billion in 2011.

Twenty-five billion dollars for a population of approximately 35 million represents $700 per person. In other words, on average, a family of four gives $3,000 to Canadian banks. I see that the members opposite find that completely acceptable. They would say that this is a sign that the banking system is well managed. However, for me, it is a sign that we are all being swindled by the banks since they are charging ridiculous interest rates in certain cases, particularly in the case of credit cards.

I would like to remind you of a proposal that was made and has been supported by the NDP for a number of years. We proposed that credit card interest rates be limited to 5% above the Bank of Canada's key lending rate, which has been at 1% since September 2010. Then, instead of having interest rates of 25% or 26% in some cases, an NDP government would legislate to have these rates limited to 6%.

This would allow credit companies to continue to be very profitable and make huge amounts of money while ensuring that people with the worst credit ratings, the most disadvantaged in our society, would not be charged exorbitant credit rates. These people have to borrow money through channels that give them the highest interest rates. Since they do not have a good credit rating, they cannot take out a line of credit, for example, which has a much lower interest rate.

In conclusion, since I have only 30 seconds left, I would like to say that it is with great disappointment that I am going to support this bill at third reading. The main reason for my support is that we cannot oppose the basic principle of at least creating the position of financial literacy leader. I think this bill is an incredible waste of time and energy for Parliament. The bill looks good but it does very little.

[Mathieu Ravignat, NDP, Pontiac, QC]

Mr. Speaker, I listened carefully to the hon. member's very interesting speech.

He obviously showed that there are a number of problems with financial literacy in Canada and that the measures proposed by the government do not fully address them.

My question for him is very simple: what could we have done to truly contribute to the financial health and literacy of Canadians?

[Tarik Brahmi, NDP, Saint-Jean, QC]

Mr. Speaker, I noted this regarding one of the amendments proposed by my colleague from Sudbury, who was sitting on the Standing Committee on Finance at the time. He proposed the creation of an advisory committee.

One of his recommendations called for this advisory committee to be made up of stakeholders from different backgrounds who were familiar with the population and who would be able to provide tools and suggestions and could also exercise oversight over the financial literacy leader.

This would allow for some oversight, instead of a single person being in charge of providing a better financial education for Canadians.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I was interested in my colleague's comment that the NDP put forward six what he considered to be reasonable amendments at the committee and not a single one was favoured with a supportive vote by my colleagues in the ruling Conservative Party. In fact, not a single amendment has ever been allowed to any piece of legislation in the 41st Parliament. Even at times when the Conservatives know full well that the amendments have merit, they act and behave as if they have some kind of monopoly on all wisdom, all knowledge and all good ideas. At times the minister has had to get up at report stage and introduce the very same things that they voted down at the committee stage. They must find that embarrassing, to be hoisted with their own petard in that way.

I am interested in the quote by the member for Saint Boniface. Does it not seem to be contradictory that she spoke in favour of the same principle that my colleague put forward in the amendment? Does my colleague have any explanation for such contradictory behaviour by the parliamentary secretary?

[Tarik Brahmi, NDP, Saint-Jean, QC]

Mr. Speaker, absolutely, this is a blatant contradiction. The parliamentary secretary said that it is a huge priority for the government to have bilingual appointments and a few minutes later the very same member voted against that amendment. It is a contradiction that I do not have an explanation for. The only suspicion I have is that Conservatives want the possibility to make appointments of people they know are not bilingual and who will only have to pretend that they will learn French in the future.