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.

Retirement Income Bill of Rights

[Andrew Saxton, Conservative, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I am pleased to have the opportunity to speak to this private member's bill today, particularly because it deals with Canada's retirement income system. This is an issue about which I and the Conservative government feel very strongly.

Seniors in my riding of North Vancouver, and indeed across Canada, have spent their lives working hard to build stronger communities within a more prosperous Canada. Many seniors have made great sacrifices to provide the lifestyle and privileges that so many of us enjoy and sometimes take for granted. It is their hard work that has helped make Canada the greatest nation in the world.

We have tremendous respect for Canadian seniors. That is why our government has been demonstrating our commitment to them for more than seven years.

For example, we established October 1 as National Seniors Day. We have funded more than 11,000 new horizons for seniors program projects in hundreds of communities across Canada, including in my community of North Vancouver. We have invested in helping seniors quickly access information about the programs and services they need in their communities. We have passed the Protecting Canada's Seniors Act.

The Protecting Canada's Seniors Act is an important piece of legislation regarding a very critical issue. It will help ensure consistent, tough penalties for crimes involving elder abuse. The act confirms that age and other personal circumstances will be considered as aggravating factors for criminals who target the elderly.

Our government has also taken concrete action to ensure that seniors and pensioners continue to have more money in their pockets, so that they can enjoy the quality of life they have worked so hard to achieve. For example, we have introduced pension income splitting, doubled the maximum amount of income eligible for pension income credit, increased the maximum GIS earnings exemption to $3,500, increased the age credit by $1,000 in 2006 and another $1,000 in 2009, and increased the age limit for maturing pensions and RRSPs to 71 from 69 years of age. The government has also introduced the highly praised tax free savings account and cut the GST from 7% to 6% to 5%. Overall, our action has resulted in the delivery of over $2.7 billion in targeted tax relief to seniors.

Let me tell the House about some of the seniors who are benefiting. People like Harold and Shirley, a retired couple, are real people. For many years, they worked hard and paid their taxes. Each year, they receive $55,000 and $25,000 respectively in pension income. As a result of the actions our government has taken since 2006, they now have more money in their pockets.

Harold and Shirley are expected to pay $2,260 less in personal income tax. This includes about $700, which they have saved by taking advantage of pension income splitting, and about $960 from the doubling of the pension income credit and the increases in the age credit. They are also paying $740 less because of our GST cut. This adds up to a total of $3,000 in tax relief for 2013 alone. This allows Harold and Shirley to keep more of their pension income right where it belongs: in their wallets.

This year's economic action plan builds on these efforts and contains more measures to benefit seniors. For example, we are expanding tax relief for home care services to include personal care services for those who, due to age, infirmity or disability, require assistance at home. Our government is supporting palliative care services by providing the Pallium Foundation of Canada with $3 million over the next three years to support training for front-line health care providers. We are assisting in the construction and renovation of accessible community facilities by investing $15 million a year in the enabling accessibility fund.

Seniors are benefiting not only from these measures but also from our country's strong retirement income system. This system is based on three pillars. The first pillar is the old age security program, which provides a basic minimum pension for all Canadians.

The second pillar includes the Canada pension plan and Quebec pension plan. These plans ensure a basic level of earning replacement for working Canadians. They currently provide over $45 billion per year in benefits.

The third pillar of Canada's retirement system includes tax-assisted private savings opportunities to allow Canadians to accumulate additional retirement savings. This includes registered pension plans, registered retirement savings plans, and, as I mentioned earlier, the tax-free savings account we introduced.

Though this three-pillar system is strong, we have taken action to improve it. In 2012, our government passed Bill C-25, the Pooled Registered Pension Plans Act, to provide employers, employees, and the self-employed with an accessible large-scale and low-cost pension option.

For millions of Canadians, PRPPs, as they are called, will provide access to a low-cost pension arrangement for the very first time. They will enable more workers to benefit from the lower investment management costs that result in a large pooled pension plan.

PRPPs are portable and represent a tremendous opportunity for many employees and small businesses that want greater pension plan options as they prepare for retirement.

The Canadian Federation of Independent Business welcomed our PRPP legislation, stating that “PRPPs will be an excellent addition to the retirement savings options for small business owners and their employees.”

We agree. PRPPs are an outstanding addition that will benefit millions of Canadians. It is estimated that 60% of Canadians are not provided with a pension plan by their employer. PRPPs would fill this gap.

I would also like to note that the system our government is building on is one of the greatest retirement income systems in the world. Canada's retirement income system is recognized around the world as a model that succeeds in reducing poverty among seniors. It also provides high levels of replacement income to retirees.

Andrew Coyne of the National Post wrote:

By most measures, Canada's retirement income support system is an outstanding success. The poverty rate for Canadian seniors...is among the lowest in the world.

He is correct.

Unfortunately, the bill we are debating today, Bill C-513, does nothing to benefit Canada's strong and world-renowned retirement income system and brings no value to helping seniors. In fact, the private member's bill from the member for York West could seriously impair key aspects of the existing pension and retirement savings system. It falsely claims to provide a retirement income bill of rights, but in fact the bill would only impact pensions that are federally regulated—that is, less than 10% of all pension plans in Canada. To be clear, over 90% of all pension plans in Canada are not covered by this bill.

The bill also unnecessarily duplicates existing provisions in federal pension legislation, such as information disclosure provisions to pension plan members and retirees, and fiduciary requirements for pension plan administrators.

Bill C-513 also falsely claims to enhance the financial literacy of Canadians. Indeed, the bill is repetitive and would introduce needless complexities to our government's actions in this area over the past years.

With financial products constantly evolving, we know that financial literacy is an increasingly necessary skill for all Canadians to learn. As November is Financial Literacy Month, I am pleased to note that our government has taken action to increase the financial knowledge of Canadians. We began by establishing the task force on financial literacy and committing additional funding to the Financial Consumer Agency of Canada to undertake financial literacy activities.

We passed Bill C-28, the financial literacy leader act, to allow for the appointment of a financial literacy leader. Once appointed, the financial literacy leader will work with stakeholders across the country and direct a national strategy on financial literacy. This will empower Canadians by equipping them with the skills they need to make the best financial choices.

This year's budget also committed to better protecting seniors who use financial services. This initiative will be completed by working with banks and other financial institutions to ensure they develop and distribute clear information. This will help ensure seniors get the information they need about powers of attorney and other bank services geared toward seniors' needs.

Our commitment to financial literacy is clear. What is also clear is that this private member's bill is simply not in the best interests of Canadians.

We will continue to take action to benefit Canadians and seniors and to create prosperity for them and for all Canadians.

Financial Literacy Leader Act

[Mathieu Ravignat, NDP, Pontiac, QC]

Mr. Speaker, I will repeat the quote that I was attempting to read by the finance columnist from The Globe and Mail, Rob Carrick. He wrote something that I think is quite revealing. He said:

...it's disappointing to see banks, advice firms, investment dealers and mutual fund companies treated solely like part of the solution to the lack of financial literacy in Canada, and not part of the problem as well.

We need to recognize that financial institutions and banks in this country have an extremely powerful role to play with regard to persuasion over Canadians. It is that persuasion that could be used rightly or wrongly to affect the financial lives of Canadians.

As well, members should keep in mind the glaring statistic that 26% of Canadians struggle with even the most basic numeracy and 56% do not have high enough levels of numeracy to demonstrate the skills and knowledge associated with the ability to function well in Canadian society. Keeping that fact in mind, we should all be worried. We should also be worried about the high level of domestic debt. This problem needs to be addressed.

HRSDC reveals that the relevant statistics for financial literacy are 20% and 48%. If we compare that with the United States, Canada has one of the highest levels of annual costs for equity funds, which is 2.31% compared to 0.94% in the U.S. It is no wonder banks want more customers.

The highest earning 11% of Canadians contribute more to RRSPs than the bottom 89% of tax filers combined. Canadian taxpayers subsidized those RRSPs to the tune of $7.3 billion in annual net tax expenditures.

To continue with some interesting statistics, 30% of Canadian families lack any retirement savings outside of the Canadian pension plan. Also, as I mentioned before, Canadian household debt is at 150% of income and 25% of Canadians increased their debt load over the past year. In the last quarter, the CPP outperformed the markets by a margin of 10 to 1.

Why am I referring to all of these statistics? It is because what we are discussing with the bill is the relationship of power between the average Canadian citizen's knowledge of the financial system and that of the banks in this country. If we do not empower Canadian citizens with the ability to understand the financial system and what financial institutions impose on them, then we are on a slippery slope.

The measure proposed by Bill C-28 is a good one. However, from our perspective, it is not enough.

For example, we are concerned that there is no explicit requirement that the incumbent of this position be bilingual. And yet, we live in a country with two official languages.

We believe that the person responsible for improving financial literacy throughout Canada must be able to communicate in both French and English. The minister of state has assured us that the incumbent will be bilingual, but the Conservatives are refusing to put this in the legislation. That worries us.

The conclusions of the task force on financial literacy clearly state that the financial literacy leader must be kept apprised of the situation by an advisory council consisting of representatives of the industry, unions, educators, government and voluntary organizations from across Canada. This provision is included in this bill and will prevent the participation of a number of partners following implementation of financial literacy. The Financial Consumer Agency of Canada and the government have said that an advisory council will be established, but that this does not require legislation. This is confusing.

At committee stage, we proposed some amendments in order to address some of the shortcomings. We proposed that the requirement of bilingualism be added—we did ask for that—that a definition of financial literacy be added and that more responsibility be given to the incumbent of the position to be created.

However, the Conservatives rejected our amendments. Stakeholders told us that creating this position is better than the status quo. The government has at least agreed to create this position. In light of the fact that the expenses related to this position were approved in the 2012 budget, we support the bill. We will nevertheless continue to push the government to go further. Even though it has taken a small step in the right direction, there is still a long way to go.

How could we improve the situation? Financial literacy is an important aspect of consumer protection. The fact that many Canadians do not have savings and the rise in consumer debt are symptoms of the discrepancy between the rise in the cost of living and salaries, not financial illiteracy.

Too many Canadians are living paycheque to paycheque. This situation proves that the government is not taking a leadership role and that it is incapable of addressing issues that are truly important to Canadians. The government has never implemented strict laws and regulations to protect consumers. This bill falls far short of providing any real help to consumers.

We believe that the best way to support consumers is to establish a single-window consumer protection department or agency that would handle all consumer issues. If the government really wants to protect consumers, then it should move forward with credit card regulations, for instance, and implement important regulations that would cap interest rates and eliminate the excessive fees paid by consumers.

We in the NDP have a better plan in mind for financial security for retirement. We need to strengthen the Canada and Quebec guaranteed pension plans by gradually doubling benefits in an affordable manner to a maximum of $1,920 a month, thereby providing Canadians with an adequate level of guaranteed income during their retirement.

However, the government and politicians basically need to ensure that Canadians are educated and have access to financial training, as well as ensure that Canadians are protected, particularly from the banks, credit card companies and other financial institutions such as insurance companies, and the power they can hold over Canadians' lives. To that end, those institutions need to be properly controlled through legislation that focuses on the common good.

[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.

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.

[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.

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

Mr. Speaker, despite a certain level of enthusiasm, financial literacy does not necessarily seem the most exciting of subjects. That being said, it is still an extremely important subject. It is important for young people who are beginning to save their money and to understand what is involved in investing and having money, and it is important for retired seniors who must manage their pensions and a significantly lower income now that they are no longer working and are taking their well-deserved retirement.

Following consultations and a study, the government introduced Bill C-28, a bill that would create the position of a leader who would be responsible for the development of financial literacy for Canadians.

Initially, we opposed this bill for the reasons I will set out. However, we will support it at third reading for the reasons that I am also going to take this opportunity to explain.

First of all, we kept up our opposition for a number of reasons. The first point, and it is not the least of them, is that the position would not necessarily be bilingual. As a matter of fact, my colleague from Louis-Saint-Laurent recently put forward a first-rate bill. She has done an outstanding job on this issue. However, even though the incumbent of the position would not be an officer of Parliament, it is necessary that he or she be bilingual. This person will have to interact with people from all linguistic communities, including those in Quebec, where there is a high concentration of people whose mother tongue is French, in New Brunswick, in Eastern Ontario and elsewhere. We must be able to allow people to learn financial literacy skills in the official language of their choice. This is a very important point.

We put forward an amendment to this effect in committee and, unfortunately, it was rejected by the government. Nevertheless, we want to support the bill now because it is a very good start, but we regret that this position, which should have a mandatory bilingual designation, does not. This is a very simple, but a very important, requirement.

The second point, which led to a certain degree of consternation among our members and caused us great concern, is the fact that the people who studied this issue recommended that a board be set up to engage in consultations with the financial literacy leader. The board would be made up of people representing a variety of sectors, such as the financial education sector, unions, financial institutions and so on. The board would engage in consultations with the financial literacy leader and create a system to consult people from all walks of life. This is very important when speaking of financial literacy.

Despite the important role played by financial institutions, when teaching financial literacy to Canadians, it is important not to do so in a way that will benefit only the financial institutions. Financial literacy must consider the diverse realities of individuals and various sectors, such as the unions, and the importance of pensions, for instance. When we talk about financial institutions, there is the size of the investment. When we talk about the people who are in a position to educate Canadians and so on, I think it is very important to have a board involved.

Now we are told, following the committee study, that it is not necessary that the board be established as part of the bill. Just the same, we are concerned about the political will that currently exists on this issue.

I think that the board should be established in the bill. We would require this. Why should we wait? Why should we just hope that the board will be established? I think that if we could include the establishment of the board in the bill, we would already be ahead of the game. We are very concerned about this, but not enough to oppose the passage of the bill. I think we will be taking a big step in the right direction in order to establish a position for beginning Canadians' financial literacy education.

These are the reasons why we were opposed to the bill, but we also believe that we are heading in the right direction. We are comfortable with giving it our support at the moment, but we will continue to push for improvements in the measures in the bill. Now that I have an opportunity to talk about financial literacy and Bill C-28, it would be unfortunate if I missed my chance to explain how this affects the people in my riding.

First of all, I am going to refer to a resident in my riding who works for a financial institution and with whom I often have an opportunity to chat. He has become a very good friend. His name is Jacques Rémy and he is the general manager of the Caisse populaire Desjardins in Beloeil–Mont-Saint-Hilaire. When I sat down with him in my riding one Saturday evening for supper, I had a chance to discuss various problems faced by the residents with regard to their pensions, their retirement and their investments.

One of the major problems at the moment is debt. Many residents are going deeper and deeper into debt. It may not necessarily be the fault of the individual, but there is not enough financial literacy. I do not want to lay the blame on Canadians, but these days, there are so many opportunities to invest, to contribute to savings plans, and to use several credit cards with all the rewards they offer, and all this may be quite difficult to manage. Considering that the cost of living is going up, just like everything else, it can be very easy to wind up in debt, and this has become a very serious problem. As I said, I had a chance to talk about this with Mr. Rémy, who is the general manager of a financial institution, and he is seeing this more and more often.

For instance, in a riding like mine, there is a great deal of hidden poverty. We are a suburb, there are beautiful houses, people sometimes have two or three cars in their driveway, but this does not necessarily mean that they do not have problems with debt that could lead to poverty. As the representative for these people, I think it is so important to promote financial literacy in every way we can, and this is an idea or a value that I share with my colleagues. This is why we are going to support this positive first step, while bearing in mind the extremely important fact that we have to continue improving the measures and the systems already in place.

There is another anecdote involving financial literacy that I would like to tell. Every year, a seniors fair is held in Chambly. This is a very interesting and important event in our community. The agencies serving seniors get together with members of both the National Assembly of Quebec and Parliament in Ottawa. We and the agencies can set up booths where we distribute brochures and give out other types of information, and there are presentations given by community stakeholders.

Last year, when I attended the fair for the first time—I went this year, too—there was an extremely interesting presentation on financial literacy. It focused on, as I said at the beginning of my speech, the best way to manage our pensions, our RRSPs and all the financial resources we have, the money we save and for which we work very hard over the years.

In the case of our seniors, this is well-deserved financial support. Promoting financial literacy and helping our seniors by ensuring that they are able to use the educational tools we can offer them as a government and as representatives is a worthwhile undertaking. Often when we speak of financial literacy, it comes down to explaining how important it is.

When we speak about financial literacy, one of the traps we often fall into is thinking that people are to blame, that they are not educated and not able to manage their money. I cannot emphasize enough that this is absolutely not the issue we are discussing here today. The problem is that people feel overwhelmed by the various investment options available to them.

Seniors often face this problem. They frequently receive telephone calls at home from people offering different types of services. As an aside, these calls are often not legitimate. This is a big problem. It is one of the reasons why we are supporting the government's bill to impose harsher penalties on people who commit crimes against seniors.

That being said, there are many new measures that allow people to invest and to retire relatively easily. It is really important for seniors to be able to rely on someone. That someone could be the person in the position we are creating today, or when the bill is voted on, of course.

This is a troubling issue that also applies to young people. I have spoken about seniors, I have talked about their experience, but there are also young people who are beginning their working lives, who are beginning to learn what it means to have an income and money to spend.

When you are young—I have enough experience to talk about it and to say that we have all been there—you eventually reach a point in your life where you have some independence and you have money to spend for the first time. Once you reach that point, you want to know how to get the most for your money, how to spoil yourself a little, if you can, and also how to make sensible and responsible decisions.

Here again, I am repeating myself, but it is so important to underscore it: I am not trying to say that young people are not able to make sensible decisions or be responsible, but the point is that more and more frequently credit cards are being offered to very young people. When you are very young, you try to learn how to invest in an RRSP, how to invest in that famous retirement pyramid, which consists of RRSPs as well as contributions to a retirement plan. When you reach this point in your life, it is very important to have meaningful support from the government and from various agencies, which will be possible with the creation of a new position with the mandate of promoting financial literacy.

I have been talking about this issue for several minutes now. It is interesting because this shows that financial literacy can mean different things to different people. From my comments, it is clear that this can mean different things to different people of all ages.

We in the NDP firmly believe that a concrete definition of the term “financial literacy” is needed. When a position is created whose mandate is to promote financial literacy and educate citizens, it is crucial that we have a clear definition, as was the case with the infamous “net benefit”. Thus, once greater clarification and precision are brought to the definition, then we can have a leader, someone who is responsible for and able to properly manage the file.

In the past, the lack of a clear definition was one of the reasons we had decided to oppose the bill. However, the pluses outweigh the minuses at this point. Although we would like to see more clarification at this stage, we hope to achieve that in the coming months and years, as this matter evolves. We do still have this concern, and it is very important that it be raised here today.

While I am on the topic of our change in position on this bill, I would also like to explain the other reason we reached this conclusion; it was because of the work done in committee, particularly by our party's consumer protection critic. Financial literacy is extremely important for the protection of consumers, and the hon. member for Sudbury has done an excellent job on this. He meticulously explained to us that when the Standing Committee on Finance began examining this bill and this issue, many witnesses called for the same things that the NDP has been calling for. They had the same concerns and raised the same points that I just mentioned in my speech.

Looking at the work done in committee, it is clear that the witnesses were able to explain to the members the importance of moving forward by taking this first step.

After hearing this testimony, we think it would be a big mistake not to support this first step in the right direction. This testimony also allowed us to confirm the problems with this bill.

This is a good opportunity to emphasize the committee work and the importance of inviting expert witnesses from different backgrounds. Various testimony was given by a diverse group of witnesses, including economists, people representing financial institutions and people representing unions. In my opinion, bringing all these people together to have a serious discussion about something that affects us all, without allowing the discussion to focus too much on one topic and not enough on another, allows us to have a clear view of the overall picture.

Another thing that is very important in all this is ensuring that everyone's interest is served. Last fall and this past spring, we debated a bill whose number escapes me, unfortunately, that would implement another retirement savings account much like an RRSP. When we were discussing this bill, many concerns were raised about the various existing retirement accounts and plans.

We do not want to fall into the same trap. Far too often, people have watched the companies they worked for declare bankruptcy and have ended up losing their pension. We do not want the retirement plans and pensions of people who have worked so hard for so long to be tied to the fate of a company that mismanages its investments and ends up going under. In 2008, at the height of the last recession, this type of situation happened at an alarming rate in the U.S.

That is why we should make financial literacy more of a priority. Doing so would help us start a conversation on these retirement plans, on RRSPs and on all the measures available to us as individuals and workers, regardless of where we work. This allows us to recognize the risks of these measures, so that we may proceed safely. There is nothing worse than working for years, investing and contributing to various retirement plans only to lose that money because of bad decisions made by people at the head of various companies.

That is why we want to be very careful. It is very important to educate Canadians so they have the tools they need to make good decisions about their investments and for their retirement.

I would like to talk about my own experience. As I mentioned earlier, retirement may seem very far away for young people of a certain age who are just starting to work, to have some money and to have these kinds of opportunities. People in their twenties do not think about their pension, but I believe that it is very important to start thinking about it. I always say that pensions are very important to our seniors and those who retire, but they are also important to our young people. We have to realize this and set aside our preconceived ideas about this affecting one group of people more than another or only affecting people of a certain age.

This is an extremely important matter, and I cannot stress that enough. For that reason, we support this bill and we will continue to improve these measures and work on this, so that Canadians can make good investments and have adequate financial security.

The House resumed from October 31 consideration of the motion that Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act, be read a third time and passed.

Business of the House

[Peter Van Loan, Conservative, Leader of the Government in the House of Commons]

Mr. Speaker, this afternoon, before we depart to our constituencies and events for Remembrance Day where most of us will be participating in remembrance services in our ridings, we will resume third reading debate on Bill C-28, the financial literacy leader act.

The week of November 19 will continue to see a lot of important action at the House committee level, where we are looking at the budget implementation act, Bill C-45, the jobs and growth act, as it advances through the legislative process. The finance committee is supported by 10 other committees looking at it and all together they will conclude the review of this very important bill and the very important job creation and economic measures that are laid out, measures that were first put before Parliament back in our March budget.

Meanwhile, on Monday the House will continue the third reading debate of Bill C-44, the helping families in need act, which we started this morning. Given support for the bill from all corners of the House, I hope it will pass that day so the Senate can pass it before the end of the year.

After Bill C-44, it is our intention to take up the report stage and third reading of Bill S-11, the safe food for Canadians act, which was reported back from the agriculture committee yesterday. I hope we will see strong interest in passing that bill quickly, just as we did for second reading.

Once that bill passes on Monday, the House will return to third reading of Bill C-28, the Financial Literacy Leader Act, if we do not finish the debate today.

That will be followed by second reading of Bill S-8, the Safe Drinking Water for First Nations Act. On Tuesday, Wednesday and Friday, the chamber will consider report stage and third reading of Bill C-27, the First Nations Financial Transparency Act, which was also reported back from committee yesterday.

I should also advise the House that on Tuesday when we return from the Remembrance Day week, immediately after question period I will call ways and means Motion No. 14 respecting some technical amendments to tax laws. Let me assure the House that there should be no doubt about this, but the opposition will no doubt be disappointed. This motion will definitely not implement the New Democrats' $21.5 billion job-killing carbon tax.

Finally, on Thursday before question period, the House will resume second reading debate of Bill S-8 and after question period we will take up Bill S-2, the family homes on reserves and matrimonial interests or rights act, also at second reading.

Protecting Canada's Seniors Act

[Irwin Cotler, Liberal, Mount Royal, QC]

Mr. Speaker, I am pleased to rise to speak to Bill C-36, what the government has named the protecting Canada's seniors act. I am pleased to do so not only as a senior myself but also on behalf of a riding that has one of the greatest concentrations of senior citizens anywhere in the country.

For a legislation with such a grand title, this enactment is actually only one clause long. Simply put, it adds a one-line addition to the Criminal Code section on sentencing, that judges are to consider “evidence that the offence had a significant impact on the victim [due to] age and other personal circumstances, including health and financial situation”.

Essentially, the bill seeks to increase sentences for offenders who abuse our seniors in the commission of any offence, which is itself a very worthwhile goal, as the Parliamentary Secretary to the Minister of Justice outlined in his remarks.

The seriousness and scope of the problem of elder abuse has been discussed over the course of our analysis of this legislation in committee, but it warrants attention yet again.

A number of studies have suggested that as many as 10% of seniors in Canada may be subjected to some form of elder abuse, yet as witness testimony before our committee put again and again, the true figure is likely much greater than that, as many cases go unreported. Indeed, underreporting, often due, inter alia, to the close or even dependent relationship between victim and victimizer, as well as the isolation of many seniors and their frequent lack of awareness about the resources that may be available to them, makes elder abuse a very complex crime to detect, to prosecute and to prevent in particular.

Accordingly, if the issue of elder abuse is to become a national priority, if it is to be effectively addressed and redressed, a concerted effort extending across party lines will be required. In that connection, I am pleased that our committee meetings on Bill C-36 generally took place in an open spirit of non-partisan co-operation. We saw at committee how efficiently matters can proceed when justice bills do not include unnecessary mandatory minimums, which very often are objectionable in and of themselves and disproportionately affect those who are the most vulnerable. Indeed, we observed that it is in fact possible for MPs to work together in a common effort to tackle crime without eliminating judicial discretion, a trend that I hope will continue.

One thing upon which committee members, witnesses and even the minister himself, as well as the parliamentary secretary in his earlier remarks, agreed is that this one-line amendment to the sentencing guidelines will not protect Canada's seniors on its own, the title of the bill notwithstanding.

Accordingly, I will organize my remarks as follows. First, I will briefly look at what Bill C-36 can be expected to accomplish. Second, I will use the remainder of my time to discuss additional avenues to explore appropriate actions to consider if we are to combat elder abuse, and how it can be done in a more comprehensive and effective manner.

The bill before us is a small step. Admittedly, it is a step in the right direction, but an insufficient step. By directing judges to consider the impact on the victim due to age, health and financial considerations as an aggravating factor at sentencing, it may lead to more serious sentences where warranted. Accordingly, when white collar criminals specifically target seniors to defraud them of their savings or of their hard-earned pension money, or if workers at seniors' homes are neglectful or violent toward residents, or in extreme cases when family members violently mistreat seniors, these offenders undoubtedly deserve to be severely punished by the Canadian justice system.

At the same time, we need to be reminded of the considerable evidence showing that longer sentences do not deter crime and that changes to sentencing guidelines are unlikely to have a preventative effect. This is particularly important in the realm of elder abuse. By the time a judge issues a sentence, the abuse has occurred and charges have been laid. Indeed, the offender must be found guilty for there even to be a sentencing process to begin with.

Nonetheless, as witnesses at committee explained, there are so many obstacles to the requisite steps in the process prior to sentencing that it is unusual for a case of elder abuse to actually arrive at the sentencing phase. The impact of this bill would therefore likely be quite modest. Again, and this bears recall, the criminal justice process is rarely utilized in cases of elder abuse. The primary reasons for this, as outlined in a report by the Library of Parliament, are as follows:

(1) the fact that prosecutions are often difficult, as the victim may be reluctant to cooperate in a prosecution against the loved one; (2) the victim may have poor health and possible present or impending mental incapacity; (3) the prosecution may take so long that the victim dies before the case goes to court; and (4) the perpetrator may be the only significant person in the victim’s life and to report and testify against them would result in loneliness and pain from the perceived consequences of the intervention.

Nevertheless, it is to be hoped that Bill C-36 would focus the attention of judges and other court officers on the particular odiousness of the victimization of the elderly, what has been referred to here as “the denunciation objective”.

Ideally, the focusing of attention within the legal system would combine with a new horizons public awareness initiative such that all Canadians would begin to be aware of the seriousness of the problem and the importance of finding solutions. Indeed, if nothing else, Bill C-36 could serve as what I would expect to be a unified statement by this House that the abuse of Canada's seniors is simply unacceptable and that hon. members condemn it in the strongest possible terms, which again goes to the denunciation objective.

Or course, condemnation only gets us so far if it is not followed by concrete action likely to facilitate the detection and, in particular, the prevention of elder abuse. Otherwise, we run the risk that Parliament and the country will move on to other pressing matters and that seniors who need help will be left with nothing but a remnant of moral support. As a case in point of how easily good intentions and even very good work can fade into the background, we need only remember the report entitled “Not to be Forgotten: Care of Vulnerable Canadians”, published one year ago by the ad hoc Parliamentary Committee on Palliative and Compassionate Care. That report is a thorough analysis of the challenges faced by elderly Canadians and the challenges faced by government institutions and others who seek to provide them with care. It contains many well-thought-out concrete recommendations on how these challenges might be met. Regrettably, most of the recommendations in the report's 192 pages have not been implemented. Yet we are left debating a bill called the protecting Canada's seniors act, which is, as I said, but one line long. It is a good bill but there is much more that must be done.

I will move to the second part of my remarks and elaborate on what can and indeed needs to be done in this regard.

First, it is crucial, as my colleague from Pierrefonds—Dollard has addressed, to raise awareness among all Canadians that the abuse of seniors is a significant problem, one that is simply unacceptable. Programs such as the federal elder abuse initiative, mentioned by the parliamentary secretary, are a welcome beginning. However, efforts in this regard must be continued and intensified. The government can do this by establishing its own set of programs as well as helping to fund those that are run by the provinces and non-governmental organizations and that warrant further support.

Increased awareness is required on a variety of fronts. Not only must everyone be made generally aware of elder abuse, but professionals who work with the elderly also require training so they will know how to properly care for seniors, how to recognize signs of abuse and how to minimize patient-to-patient abuse in institutional settings. Family members should be made aware of things they might be doing that they perhaps might not have considered to be abusive but that have detrimental effects on the seniors in their lives. Third parties need to understand that silence in the face of abuse is intolerable and that resources exist for dealing with abuse, if indeed it is reported and acted upon. Of course, seniors themselves are too often ashamed of abuse. They will minimize it and may indeed endure what is a completely unacceptable situation.

It is therefore critical that seniors be made aware that abuse is not something to be tolerated and that a range of options exists for addressing and redressing it. Alternatives to the criminal justice system do in fact exist in this regard. Indeed, seniors must be encouraged to confide in a doctor or call an elder abuse hotline. They need to be told that both hope and help are out there.

Second, in addition to raising awareness, the federal government can take the lead in enhancing our understanding of the nature and scope of elder abuse in Canada. Last year's committee report and witness testimony before the justice committee focused a great deal of attention on the fact that data on elder abuse are sorely lacking and that effective action will be difficult to take without a fuller understanding of the problem.

According to the Ontario Network for the Prevention of Elder Abuse, most agencies do not keep information on the number of cases reported or responded to. Without national standards for collecting statistics about elder abuse, we are simply left patching together data from different studies with different scopes and methodologies, along with anecdotal evidence from a patchwork of jurisdictions. HRSDC has funded preparatory work for a national prevalence study through the national initiative for the care of the elderly, referred to earlier. A good way for the government to demonstrate its seriousness on this file would be to ensure high level and sustained funding for the study itself and its recommendations.

A third recommendation that was mentioned in the report and that arose frequently at committee meetings on Bill C-36 was the need for increased funding and support for institutions, often non-profit organizations that do much of the on-the-ground work in the fight against elder abuse. We met some remarkable people at committee who work daily to protect seniors, and I commend their efforts and those of other professionals who are instrumental in preventing, detecting and addressing elder abuse. They described to us some truly appalling cases of mistreatment and yet remain undeterred in their tireless and noble service to seniors and therefore, in effect, to all of us. We should be very grateful to them and very proud of their good work, which we commend them for and trust will continue.

One can hope that such dedicated people will continue their good work regardless of government funding, but we need not equivocate with respect to such a commitment. Groups need financial and other resources to hire and train responders to intervene in cases of elder abuse, and to set up elder shelters and affordable housing, as my colleague for Pierrefonds—Dollard said, and elder abuse hotlines and victim support services, and to develop pioneering initiatives such as financial literacy programs for seniors to help them protect themselves from fraud. The federal government must be at the forefront of funding and nurturing such activities, as my colleague from Pierrefonds—Dollard said, to help them escape poverty.

Inadequate funding of such organizations can have an impact in ways that we do not always consider. That was explained at committee by a member of the elder abuse intervention team from Edmonton's Catholic Social Services, who talked about how important it was that instances of elder abuse be handled by experienced staff. Unfortunately, cases of elder abuse are too often dealt with by people who may lack the necessary experience, as the organization's inability to offer high-paying jobs leads to employee turnover and employees leaving after short periods of time.

A lack of resources may also mean that when people do as they are told by public awareness campaigns and report abuse, organizations may then become overloaded and unable to respond precisely because they do not have the resources to begin with. As a result, people who report abuse understandably become frustrated and less likely to report it in the future. Ultimately, these organizations are doing impressive things with very limited resources, but they need more government support.

Fourth, the federal government can also do more to help address the systemic inadequacies that are at the root of many cases of elder abuse. Witness testimony before committee highlighted a number of these systemic inadequacies. Employees in health care facilities are often faced with an excessive workload and long hours, factors that can create an environment in which elder abuse is more likely to occur, especially when combined with inadequate training.

Better training is required particularly to help workers detect and deal with patient-to-patient mistreatment, a form of elder abuse that often goes unnoticed. As well, overcrowding can lead to an elderly patient being repeatedly transferred from one institution to another, a state of affairs that one witness at committee said should qualify as institutionalized abuse.

Fifth, and as a corollary to this point, increased funding for home care might help with overcrowding by keeping many seniors out of institutions in the first place, thereby distributing the responsibility. Even though most of these institutions operate under provincial jurisdictions—although veteran hospitals, for example, are federally run—the federal government has a clear role to play in helping to ensure adequate health care funding. When health transfers are clawed back, it becomes that much more difficult for the provinces to address these issues.

Sixth, at the same time as we tackle these systemic problems to which I have referred, we must also deal with those specific individuals who abuse the elderly, which is what Bill C-36 attempts to do. However, there are a number of other ways in which elder abuse can be addressed from a criminal justice perspective.

The minister said at committee that he recognizes the important role that law enforcement officers and other legal professionals can play in preventing, detecting and intervening in cases of elder abuse. I was glad to hear that perspective taken, and I hope to see that recognition translate itself into action.

However, better training required for police officers and officers of the court in how to deal with seniors is something that needs to be put into place. Young police officers may not always know, for example, how best to gain the trust of an elderly victim, and lawyers who prosecute elder abuse cases may need to adjust their interrogation techniques to make them more effective with certain seniors.

Another way of increasing the effectiveness of legal professionals is to include them as part of multidisciplinary teams—a recommendation that was made by almost each one of the witnesses who appeared before us—such as exist already in certain parts of the country and in those of the witness testimonies who made reference to them. When elder abuse is detected, police officers, social workers and health care professionals can coordinate from the start to ensure that the situation is dealt with appropriately from a social and medical perspective as well as from a legal one.

For our part as legislators, we should consider certain changes to the Criminal Code that can have a greater impact than Bill C-36. Witnesses at committee raised the possibility of enacting specific elder abuse laws that would complement those already in place in provinces and territories.

In addition, the committee discussed whether a mandatory reporting law for elder abuse might be appropriate. One witness, a social worker from Alberta, told us he has a legal duty to report the abuse of a child but no such duty to report the abuse of a senior citizen, by contrast.

In general, there seemed to be support, among the professionals we heard from, for a law that would require at least those who encounter abuse in the course of their professional duties to report it to the authorities. Such a law could supercede certain confidentiality barriers so that those who encounter abuse are not professionally bound to keep it secret.

For example, bank employees sometimes suspect that a senior is being taken advantage of financially, but they are unsure whether they are permitted to do anything about it. Clarifying the legal obligations of such an individual could help stem the tide of financial abuse of the elderly.

These are just some of the many ways in which the government could truly be “protecting” Canada's seniors.

I appreciate that the minister and the Conservative members of the committee agreed that Bill C-36 alone is not enough. However, they have yet to put forward sufficient concrete suppletive measures in the realm of health care, research and justice, and they have yet to provide adequate support for community initiatives. Instead, regrettably, health care transfers have been reduced; old age security has been cutback; and attempts to deal with the problems with the Criminal Code, while acceptable as far as they go, focus only on punishment—again, after the fact—and not on the necessary prevention itself. Seniors could be forgiven for looking at this one line “protecting Canada's seniors act” and wondering where the rest of it is.

As a side note, this House, last Wednesday, began third reading of Bill C-28, financial literacy leader act. This is important legislation regarding the Financial Consumer Agency of Canada, which itself has a role to play in the combatting of financial abuse of seniors.

At the risk of going beyond the scope of this debate, I do hope that the post of financial literacy leader, once this legislation has passed, would recognize his or her role in combatting elder abuse by improving not only the financial literacy of seniors but their understanding of the rights they possess when confronted with things like inappropriate investments, affinity fraud and aggressive sales tactics, all of which the Financial Consumer Agency of Canada identifies as methods used to target seniors.

Returning and concluding—

[Dr. Colin Bennett]

I thank you for the opportunity to appear before your committee and to speak about this important issue.

I am a professor of political science at the University of Victoria and have been studying privacy protection issues for nearly 30 years in Canada and internationally. I've written or edited six books on the subject and numerous articles. I'm currently in receipt of a grant from the Social Sciences and Humanities Research Council to study privacy protection of social media. I'm also working on this same subject under a contributions grant from the Office of the Privacy Commissioner of Canada.

The privacy questions raised by social networking services are broad and dynamic, as you've no doubt discovered. Social networking challenges some of the traditional approaches and assumptions behind our privacy protection laws. As you've just heard, it requires extensive education.

The Privacy Commissioner of Canada has already outlined the privacy principles that should apply to social media. Her office has been at the forefront of global efforts to ensure that big data companies abide by established privacy rules and practices. But social media is not just out there, and it's not just about Facebook, it's also about our own organizations and our own practices.

Rather than discuss social networking in all its manifestations, I want to address an area of social networking and privacy that is far closer to your own experiences and lives as politicians. I want to raise a set of questions about how your own political parties use social networking services, and indeed, other sources of personal information to build databases about Canadian citizens.

I have just co-authored a report on privacy in Canada’s political parties for the Office of the Privacy Commissioner. This work was started back in 2011 and was published earlier this year. I'd like to take this opportunity to summarize the main findings, because I think this relates closely to the subjects of your inquiries.

Canada’s federal political parties can and do collect a large amount and variety of information on Canadian citizens: on voters, volunteers, donors, members, and supporters. A disparate and fluctuating number of employees and volunteers might also have access to these data, individuals who may have no privacy and security training. Increasingly, these data are communicated through highly mobile and dispersed electronic formats, and increasingly, they are captured through the observation of social networking activity.

Canadian parties now operate extensive voter management databases; they have been doing so for some time. There are the Conservatives' constituent information management system, CIMS, Liberalist, and NDP Vote. The foundation of these databases is the electoral list provided under the authority of the Elections Act by Elections Canada, but upon that framework, a large and increasing range of other data about voters is added and analyzed.

These data come from a variety of sources: telephone polling, traditional canvassing methods, petitions, letters, commercially available geo-demographic and marketing databases, and indeed, from social networking services. Overall, however, for a variety of reasons, the contents of those systems are shrouded in some secrecy.

As new technologies pioneered in U.S. elections increasingly play a role in modern campaigning, so the range and variety of personal data available to parties will increase, and so will the concerns about the protection of personal privacy.

Here are some examples: smart phone applications for political canvassers; targeted online advertisement software; targeted e-mail campaigns, which match IP addresses with other data sets showing party affiliation, donation history, and socio-economic characteristics; sophisticated market segmentation strategies aligning online and offline behaviour; extensive use of robocalling and robotexting; and, of course, the use of social networking and social media to plan campaigns, to target likely voters and donors, and to measure impact and engagement.

Social media not only provide a convenient method to target likely supporters, but also to capture increasingly refined information about the preferences and behaviours of voters, and their contacts and their friends. These developments have received much attention in the current U.S. election cycle. One of the most notable trends is the increasing use of customized and targeted political advertisements based on the digital trails individuals leave through their social networking activities. A recent report suggests there were no fewer than 76 different tracking programs that were observable on www.barackobama.com.

Surveillance during Canadian elections is less extensive and is less intrusive—well, so far. Nevertheless there have been a number of recent controversies that have raised concerns about the practices of political parties and have raised the profile of this issue.

The Privacy Commissioner has also received a number of complaints and inquiries about the activities of our political parties over the last several years, and they've also been raised to some extent in the provinces. However, she can do little to address these inquiries because, unlike in most other democratic countries, Canadian federal privacy protection law does not cover our political organizations.

Parties do not engage in much commercial activity and are therefore largely unregulated under the Personal Information Protection and Electronic Documents Act, PIPEDA, or substantially similar provincial laws. They're not government agencies and therefore are unregulated by the Privacy Act. The only federal law that really governs their privacy practices is the Canada Elections Act, but that legislation only applies to those voter registration data collected and shared with parties and candidates under the authority of that legislation.

Parties are also exempt from the new anti-spam legislation, Bill C-28, as well as from the do not call regulations administered through the CRTC. Thus, for the most part, individuals have no legal rights to learn what information is contained in party databases, to access and correct those data, to remove themselves from the systems, or to restrict the collection, use, and disclosure of their personal data. For the most part, parties have no legal obligations to keep that information secure, to only retain it for as long as necessary, and to control who might have access to it.

Virtually every other public or private organization in Canada must abide by these basic rules, so why should political parties be different? Of course, I concede that political parties play a critical role in our democracy. Parties need personal information to mobilize and to educate voters and for a variety of other reasons, and it has been claimed that these important functions outweigh the arguments for regulation and that therefore voluntary self-regulation will suffice, but as our report demonstrates, the current voluntary policies of our main federal political parties are incomplete, and they are inadequate.

From the point of view of an ordinary supporter or contributor, or potential voter who wishes to exercise control over his or her personal information, the existing voluntary privacy commitments of Canada’s main federal parties are often difficult to find, often inconsistent, and often somewhat vague.

No party is any better or worse than any other here—I'm not picking winners or losers—but there's little evidence, frankly, that any of your parties has given sustained consideration to privacy and to the risks associated with amassing vast amounts of personal data. For example, there's no link to privacy on the home pages of either the Liberals or the NDP, the last time I checked. There is a link on that of the Conservative Party, which is fairly prominent, but their policy is also somewhat incomplete, and it contains vague assertions and exemptions.

It would be my preference for Canadian federal political parties to be brought within the statutory requirements of PIPEDA and therefore under the authority of the Privacy Commissioner of Canada. I would urge the committee to consider that. However, in the meantime I think more can be done on a voluntary basis.

I think it would be a good idea—and I have read that some political parties have already done this, but it's not necessarily prominent—that all federal political parties declare that they voluntarily abide by the obligations in PIPEDA. It would be a good idea for them to revise their privacy policies and base them on the 10 privacy principles upon which PIPEDA is based, and to publish these more prominently. I think all parties should appoint a responsible official, the equivalent of a chief privacy officer, who would have overall responsibility for the collection, use, and dissemination of personally identifiable information. All political parties should adopt appropriate risk management strategies in case of data breaches. Data breaches are seen in many other areas of our life, in the public and the private sector. I think there should be training of staff and volunteers on privacy and security issues.

It may be that some of those activities are already occurring. I don't wish to be too critical, but my point is that it's not necessarily obvious, and therefore it's very difficult for individuals and ordinary voters and supporters, etc., to find out what their rights are.

These questions are not just about privacy. Lack of attention to the protection of personal information can erode the trust that Canadians have in the political parties and in our democratic system. In an age of social networking, being more proactive about privacy protection and providing those necessary assurances is also good organizational practice.

In summary, I applaud the committee’s attention to these challenging issues concerning social media and to the practices of big data companies such as Facebook and Google. There's been a great deal written about that subject, and I can certainly talk about those wider issues. At the same time, little attention has been given to the questions that I raise here, which I think are very much related to the topic of your inquiry and, of course, to your own individual work.

I would encourage you, therefore, to think about what I've said and to work within your own organizations to get your own houses in order and to encourage your respective parties to follow the same set of information privacy principles that apply to most other Canadian organizations.

I fear that controversies about parties and privacy protection of voters will only continue. The appropriate management of personal data in an era of extensive online social networking is not only in the interests of individual citizens, but also in the interests of your own parties and of the long-term health of our political system.

Thank you very much for your attention.

Financial Literacy Leader Act

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I am happy to rise this evening and speak to Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act.

I do support this bill, although with some reservations, which I will speak to. My main concerns are the lack of an advisory council and the lack of inclusiveness. I do think this bill could have been more inclusive. I hope that when the government reviews this piece of legislation, it makes that a primary concern.

In listening to the debate this afternoon, I have wondered about the percentage of our economic trouble that is caused by low financial literacy. If we recount the state we are in at the moment, we have quite low economic growth. Our growth rate has just been reported and downgraded to 1.6%. We have been through a major recession. If we look across the water to Europe, the United Kingdom has been through a double-dip recession. There is all kinds of trouble in Greece and other countries. The United States has been struggling, although there are some signs of a little bit of a pickup there.

What is the cause of the problem? We know that what happened in 2008 was mainly the result of economic turmoil in the United States, where consumers became too indebted and bought into some bad mortgages. The financial institutions in the United States had invented financial tools that enabled mortgages to be bundled and packaged, and sold from institution to institution. Most institutions had no idea what they were buying but just thought it was a great deal. Earnings went up and up with apparently little or no risk. The economy, under the Bush regime, just continued on until we had a crash.

The investors who bought all of these bundled mortgages realized that the mortgages were flawed and faulty, and there was a crash. Fannie Mae and Freddie Mac and other institutions went under. If we think about that collapse, it not only happened in the United States but went right around the world as well. There was a big increase in unemployment. I read an interesting book written by Gordon Brown on this topic, talking about how global leaders acted very quickly to try to stem a depression, which I think was a real possibility. We are still feeling the effects today.

When I think about this I wonder how much of it was caused by a lack of financial literacy. I would say that very little was. It was really about the large financial institutions that were playing fast and loose with the rules, fooling each other as much as they could to make large profits.

While I see the inherent value of these changes, I do think there is a much larger picture to be taken into account here. I would also say that these things are very unpredictable. In 2008, we had the Minister of Finance on the other side of the House saying that there were no problems with the economy, and all of a sudden we lapsed into a recession.

I would suggest that it is actually the government that needs to sharpen its pencil and take more account of these things, for example, by listening more closely to the Parliamentary Budgetary Officer.

I am disappointed that there was no effort to include an advisory committee in this act. I hope that the government reviews this, perhaps a year into the implementation of the act. The advisory committee would not only bring more eyes to look at this but would also be more inclusive.

I will conclude by talking about the value of inclusion. For example, if labour unions were brought more onboard in this bill, they could go to their memberships and spread the word not only about this new institution but also help increase financial literacy among their members. I really would advise the government to take that into account.

[Annick Papillon, NDP, Québec, QC]

Mr. Speaker, it will be my pleasure. I very much appreciate my hon. colleague's comment.

Indeed, it makes no sense that so many people need food banks right now. In my riding of Québec, which usually does pretty well and has a relatively low unemployment rate, the need for food assistance has been doubling or tripling every year. It makes no sense.

This tells us—us parliamentarians, that is—that there is growing social inequality and the poor are getting poorer. Some people are having a hard time paying their rent and others are probably feeling overwhelmed by the high cost of cellphones, and so on. And since they cannot understand everything that is happening around them, they are forced to turn to food banks to make ends meet.

So there is a connection here with Bill C-28. I thank the hon. member for his comment, because we absolutely must address this situation.

[Annick Papillon, NDP, Québec, QC]

Mr. Speaker, as the deputy critic for consumer protection, it is my great pleasure to speak today on a subject of great importance: financial literacy. There is no better time to talk about this issue because November, which starts tomorrow, is financial literacy month in Canada.

I know that “financial literacy” is not a hook for everyone, but it really matters to Canadians in their daily lives.

Bill C-28 would create a financial literacy leader in Canada. That is an interesting idea, but the bill before us today is pretty much an empty shell because it does not include the kind of meaningful political directions we were hoping to see. Nor does it include a definition of financial literacy, accountability mechanisms or concrete measures to increase financial literacy in Canada. That is a real shame.

Having read the bill, I have a number of questions. For example, what is the Minister of Finance's definition of financial literacy? No doubt they will say that financial literacy is having the knowledge, skills and self-confidence to make responsible financial decisions. However, such a simplistic definition gets in the way of creating a real strategy to address this complicated issue. We need a strategy for the medium and long terms. This bill does not come through.

Who is responsible for helping Canadians improve their financial literacy? A number of interveners have recommended ways to improve Canadians' financial knowledge. For example, the banks have created a number of initiatives to help Canadians learn more about this issue. Unfortunately, those same banks are responsible for the problem. Messages promoting healthy financial habits are too easily eclipsed by financial industry advertising about easy credit.

At a time when the number of financial products is growing faster than the need for them—there is no denying that this is true—it is extremely important to be well informed about financial matters. Financial concepts are often complicated and can be confusing for the consumer after a while or when the time comes to evaluate whether or not a product is suitable. Information provided to the client must be clearer in terms of content and presentation.

Ken Georgetti, president of the Canadian Labour Congress, summarized the situation very well: “Canadians need better government policy rather than lectures on how to save money.” The government is ignoring the harmful conduct of financial institutions.

As the main source of this difficult to understand information, the financial industry must improve the clarity of its communications. That was one of the recommendations made by the Task Force on Financial Literacy that is not in the bill.

The task force report to the minister states:

Canadians need financial information and advice that is relevant, understandable and engaging, and we believe governments and financial services providers have a responsibility to ensure that their communications meet these criteria.

Improving financial skills must be a lifelong endeavour. According to the task force experts, students should receive basic financial education. We cannot talk about financial literacy without deploring the lack of resources for youth. We are talking about elementary and secondary school students. It is a loss that economics is no longer taught in Quebec's secondary schools, because it is at that age that young people begin making many financial decisions.

Earlier, I heard the member for Burlington say that this should be taught in university. Personally, I believe that it should be taught at a younger age. It should already be part of their education. This reminds us that it is important that we accept this responsibility and take action now.

Many of these young people have started working and are continually exposed to consumerism and credit, without always having the tools they need to really understand the choices available to them. I will not talk about the fine print at the bottom of the page since it is not always easy to understand the preconditions and other similar elements.

James Clancy, president of the National Union of Public and General Employees, expressed an opinion in this regard that I share. He said that educating the public about finances, even at a young age, is good. Giving them a fighting chance to keep some savings in their bank accounts—through reduced banking fees, lower credit card interest rates or regulating industries—would be impressive. The government should focus on making serious changes to ease the burden on families and communities, and that is exactly what the NDP is proposing.

Canada's Task Force on Financial Literacy made 30 recommendations, one of which involved the creation of a financial literacy leader position. This bill does not take into consideration the other 29 recommendations.

The Conservatives do not seem to want to seriously tackle this problem since, if they did, they would have added some of the task force's other recommendations to this bill, including the creation of an advisory board that would include groups of workers and volunteers, as well as educators—in short, people who have expertise on the ground, the people the Conservatives should be listening to but ignore in many instances.

I would like to talk about another phenomenon related to financial literacy and that is the indebtedness of retirees. This seems to be a growing phenomenon.

Option consommateurs, an organization that I met with recently and that I commend, is currently conducting an awareness campaign to encourage Canadians to increase their knowledge of personal finance. The organization has noted that, unfortunately, more and more retirees are finding themselves in a precarious financial situation because they do not have enough savings for their retirement. What is more, this situation is only going to get worse when the age of eligibility for old age security increases from 65 to 67, another one of the Conservatives' bad decisions, another decision that is going to cause harm.

The NDP has a real plan to solve the problem of financial security for Canadian retirees. We are going to strengthen the guaranteed pension plans in Canada and Quebec, thereby giving Canadians an acceptable level of guaranteed income during retirement.

Furthermore, why not start up a national dialogue on the reasons why the houses we live in should be treated not as investments, but simply as roofs that all Canadians should be able to have over their heads? Retirees are not the only ones whose financial situation is deteriorating. A few days ago, Statistics Canada increased its estimate of the household debt ratio. This rate is now at 160% of disposable income. This higher level of debt makes individuals more vulnerable to economic shocks. So why is the financial burden on households increasing? The reason is easier access to credit, as well as the fact that the cost of living is increasing but wages are stagnating. This is the result of this government's ineffective economic policies.

Once again, and we have seen this many times, this government would rather lower the corporate tax rate, claiming that that will create jobs, instead of giving a tax credit to businesses that create jobs. That is what the Conservative government does.

If this government cares about protecting consumers, it should implement regulations on credit cards, so we can impose a cap on interest rates and eliminate the excessive fees paid by consumers.

Considering the lack of enthusiasm for financial literacy shown in recent years—or even decades—by the Minister of Finance and his colleagues, they need help, and a financial literacy leader position could help Canada at least take a small step in the right direction. We will continue to push the government to go further, because even though it has made a step in the right direction today, there is still a long way to go.

The NDP proposed some amendments in committee, in order to address some flaws in the bill, such as adding a bilingualism requirement and adding provisions that clearly define the meaning of financial literacy and require more accountability from the financial literacy leader. However, the Conservatives rejected all of our suggestions. They flat out rejected the six amendments proposed by the NDP.

We are very concerned about the fact that there is no explicit requirement that the incumbent of this position be bilingual. We think that if someone is responsible for improving financial literacy across Canada, he or she should be able to communicate in French and English.

As my hon. colleague from Sudbury said earlier, the NDP believes it is possible to find a financial literacy leader who is competent, highly qualified and bilingual. He thinks that can be done for other positions too, such as government officers.

We would not be shooting ourselves in the foot if we hired highly qualified, bilingual people. On the contrary, we would be showing the whole world that we are proud of our two official languages: English and French.

That is clearly an advantage in undertaking dialogue with other countries, particularly on these issues. Speaking two languages is an advantage. It would be good for the government to understand that and take it to heart as my party and I have done.

In conclusion, Canada would be better off if Canadians improved their knowledge of the economy and made responsible financial decisions. To make that happen, we need a strategy that calls for a concerted effort on the part of clients, schools and various organizations, including those in the industry. That is why we need an advisory council made up of union and financial institution representatives and educators. That is worth repeating.

I would like to share some information. A Conservative member told me that one of my strengths is being able to cite experts in the field. I will indulge him by citing a few experts who support what we are proposing.

According to Barrie McKenna, a business columnist for the Globe and Mail, waiting for financial literacy to fill the void is like asking ordinary Canadians to be their own brain surgeons and airline pilots. The dizzying array of financial products, mixed with chaotic and increasingly irrational financial markets, makes the job of do-it-yourself financial planning almost impossible, no matter how literate you are. The average credit card agreement is as intuitive as quantum physics. Canadians are constantly bombarded with pitches to take on more debt, whether it is right for them or not. They are often blindly steered toward high-fee products and complex financial instruments. The accompanying disclosure statements are written by, and for, lawyers. There is a sounder and no doubt less costly path, but it does not suit the financial services industry or many business groups.

He goes on to say that Ottawa could mandate plain-English disclosure. Working with the provinces, the government could enhance regulation of industry sales incentives and defined-contribution pensions. Ottawa could strengthen the CPP, forcing Canadians to save more money for retirement, while benefiting from the CPP's low administrative costs.

Of course I agree with some of what he says. However, I cannot stress bilingualism enough in this area, as that is what is important. Mr. McKenna clearly highlighted the importance of understanding that, at present, consumers are bombarded by financial products. We must all do our part in order to make financial information easier to understand.

Thirty per cent of Canadian families do not have retirement savings outside of the Canada pension plan. Twenty-five per cent of Canadians have accumulated more debt in the past year. Never before has Canadian household debt been so high. Now more than ever the government must implement policies to help people and families in debt. That is important.

Financial literacy is an important aspect of the consumer protection framework. As I said earlier, this bill does not go far enough. The fact that many Canadians do not have any savings and the rise in consumer debt are symptoms of the discrepancy between the rise in the cost of living and salaries, rather than financial illiteracy. Too many Canadians live paycheque to paycheque. This situation proves that the government is not taking a leadership role and that it is incapable of addressing issues that are truly important to Canadians. The government has never implemented strict laws and regulations to protect consumers. And this bill falls far short of providing real help to consumers.

We believe that the best way to support consumers is to establish a single window consumer protection department or agency that would handle all consumer issues. If the government really wants to protect consumers, then it should move forward with credit card regulations and implement regulations that would cap interest rates and eliminate excessive fees paid by consumers.

In closing, I would like to briefly talk about retirement. Many retirees have more and more debt. The population is aging and many people are worried about what we will do for them. The NDP has an effective plan for financial security in retirement. We would strengthen the Canada and Quebec guaranteed pension plans by gradually doubling benefits in an affordable manner to a maximum of $1,920 a month—this is not a gold rush—thereby providing Canadians with an adequate level of guaranteed income during their retirement.

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

Mr. Speaker, it is a pleasure to rise today to speak to Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act, or more to the point, let us talk about having a financial literacy leader, or as my hon. colleague pointed out, financial literacy coordinator. It is necessary across all regions in the country for the sake of the troubled times that we have entered into. For that reason alone, having a person in charge of financial literacy is one that is necessary.

We are living in a different world than we used to. My father worked in one mill for over 40 years and he had what is called a defined benefit pension plan. Quite simply, when he retired, he had the same amount of money each and every month apportioned to him and the financial risk was taken on by the company. These types of pension plans are not as prevalent as they used to be.

What is happening is a lot of pension plans are becoming what is called the defined contribution plans, so the company contributes like they did before, but so does the individual contribute. The essential risk of a pension plan now falls on the shoulders of the individual worker or the person investing in that plan. There is a fundamental shift. People have to plan, if they take an annuity, how their asset mix is to be placed, which was done before in a defined benefit plan by the person in charge of the plan itself. Now we have entered a new age when there are a lot of people in that position.

The other aspect is there are a lot of people out there now who are in transient work. I say that for my riding in Newfoundland and Labrador because a lot of people there get work in other jurisdictions, especially when it comes to skilled labour.

In the early nineties, we had a collapse of the cod industry, which was the greatest massive layoff in the history of the province of Newfoundland and Labrador. A lot of government programs were put in place to educate people to give them the skills. Over the years that paid off tremendously. Within my riding, a tremendous amount of people are not at the wharf, not at the factory, not at the plant, but at the airport. They are going to places like Alberta, Saskatchewan, Russia, off the coast of Africa, drilling. They are going to eastern Russia, Kazakhstan, Uzbekistan, parts of the North Sea, Norway. They are going to places that were considered to be unimaginable for so many people in my riding.

What does that mean? How does this equate to financial literacy because they are making very good money to sustain their families? The problem is the pension plans we used to rely on are not portable. These people have to be their own investor. They have to take on all the risk themselves, which is the most important aspect of having financial literacy. Because people are now investors and absorbing the risks, I would like to see more defined benefit plans. Why not? If 308 members of Parliament are eligible for a defined benefit plan, why can others not be? That is not the way it is going. The risk is falling on the particular individual and that is why financial literacy is so important.

Let us look at another aspect. Let us look at our youth today. Let us look at some of the numbers. We are indebted right now at $1.60 for every dollar that we bring in as income. This is not a good statistic, especially for the category of age 18 to 24, because they have actually fallen way behind before they have even started. A lot of that is consumer debt, which is the worst kind because there is no asset to show at the end of the day. Student debt is a big thing, but there is a degree to show for it and a education to get a high paying job. Whether they are mortgages, or automobiles to a lesser extent, or investments in RRSPs, pooled or not, these plans have a certain asset at the end of the day.

The problem is with the consumer debt and the high amount of interest on certain things, like credit cards either from a store or chartered bank, what happen is a lot of this debt will not show an asset at the end of the day and therefore it becomes that much more burdensome to all individuals, especially the young.

How do we get into a situation where we improve financial literacy? There has been a lot of talk about it in the House. The member for Edmonton—Leduc brought it up in the House during the past number of years and also had a motion passed in the House some time ago, which lends to the type of legislation we are debating today. I certainly commend him for that.

Because we are the national legislature, the federal institution, when it comes to the term “education”, according to our Constitution, it falls within the jurisdiction of the provinces. However, the federal government has a role to help coordinate some kind of educational program for the young people across the country. It is not just isolated to them, but certainly for high school students this could be an open window into the minds of our young as to how this will cripple their ability to financially support themselves and their families in the future.

Bill C-28 is a small step in that direction. As we talk here in third reading and send it to the Senate, it is a step in that direction.

We talked about the task force. My colleague, the member for Sudbury, talked quite a bit about the task force itself, the financial literacy task force with 30 recommendations, the vast majority of which are bona fide recommendations. Number one of which would be to have that coordinator, the financial literacy leader, which is most important.

If we look at the background of this, over the past little while we have talked about it a lot and now I would like to see more action given to a national financial literacy strategy, if I may be so bold as to call it that. We will make small steps along the way, and this is one of those steps that is necessary.

It is designed to create the position of a financial literacy leader and enforces the consumer provisions applicable to federal financial institutions. It is all coached within the Financial Consumer Agency of Canada. This is the particular agency that provides a lot of this information. I would like to see it be more proactive in its education. Nevertheless, it does have ability and the resources and now because of the bill, it will get more resources to make that possible, certainly under the guise of the financial literacy leader.

The legislative summary is from the Library of Parliament, and I would like to congratulate the library for the wonderful work it does.

The FCAC, the Financial Consumer Agency of Canada, monitors the financial services sector self-regulatory measures designed to protect consumers and small businesses. Again, we are in the situation where those who do not have the benefit of being a large company cannot really provide a lot of resources to looking after a lot of this material. What the government ends up doing is taking on that responsibility to provide a source of information for individuals and smaller businesses unable to afford to get the right advice, or a substantial amount of advice, to make that decision.

It also promotes consumer awareness and understanding of the financial services sector and responds to selected consumer inquiries. One point about that is very important, and that is the financial adviser. There are thousands and thousands of financial advisers across the country. I always like to recommend to people that they see a financial adviser especially those who have a skilled trade and find themselves working for a particular company for a short period of time, then another one and another one.

People are working for a 40-year span of their lives. Nowadays the idea of working for one company for over 40 years is a very rare thing. It happened many years ago for my family in a small town with a big plant, but now these situations do not happen as regularly as they used to. I would suggest people see financial advisers because they are the ones that take on the risk.

They could be pipefitters, electricians or carpenters. They are not necessarily financial experts. Many of them do not want to be. However, there is certainly a level of financial literacy that has to be attained in order for these people to support themselves as they move on from work, or if something happens to them and they have no choice but to leave the workforce because of a long-term disability or something of that nature.

It is certainly incumbent upon us to take the risk, but it is also incumbent upon us to learn about the financial tools out there to help us and to see what is available to us in order to plan over the long term.

The government has a large role, both provincial and federal, to ensure that financial literacy is a key learning tool for many of our young people and certainly for middle-aged people who have not even started to think about retirement.

I mentioned earlier the people who do not have access to a portable pension. The largest portable pension is the CPP, but whether it is the combination of the Canada pension plan and old age security coming together, it does not replace the income we had while we were working. It is a very low percentage. Therefore, for people who invest on their own, that would probably become the majority of their income as they enter into retirement years or if they face something like a long-term disability.

I have talked quite a bit about pensions, which I think is the ultimate example of financial literacy. This is important because we now have a substantial amount of people retiring. I am basically talking about the baby boomer age group, as we affectionately call it.

The 2011 federal budget announced $3 million annually to undertake financial literacy initiatives. This amount was in addition to what was provided to the FCAC, which is a $2 million fund. When we talk about the financial literacy leader, the terms of the provision are clauses 3, 5 and 7 of the bill.

The objective of the leader is to provide national leadership in strengthening financial literacy. Whether we call the person a financial literacy leader or coordinator is a question of semantics, but we get the idea that the person has to take a very large role in the lives of others. They have to coordinate across many sectors, federal and provincial, French and English, as well as first nations.

This is a huge task for this person and one that is worthy. Obviously any task that is asked by Parliament and by government is worthy, but this one also has to be contemplated and well-financed, which is why the $3 million is key here as the additional budgetary amount. In looking at this in depth, the powers, duties and functions of this particular person are also key to ensuring success is there.

I mentioned earlier that this is a small step toward improving financial literacy in this country. There is no doubt about that, but let us take a look at the financial literacy leader in this particular situation. The Commissioner of the FCAC may impose an assessment on any financial institution in order to recover some or all of the expenses associated with initiatives designed to strengthen the financial literacy of Canadians. It is putting some of that burden onto the financial sector, which is a great idea.

As is the case for Her Majesty, the Minister of Finance, and the commissioner, deputy commissioners, officers and employees of the FCAC, no action may be taken against the financial literacy leader for anything he or she does or omits to do in good faith in administering or discharging the powers or duties of the position of financial literacy leader. This is also a very important aspect. It allows this person to function in the way a person should function whose goal is to increase the amount of financial literacy across this country. We would not want to see this person chained into a position where they find themselves being suffocated, for lack of a better word, by rules and regulations and by their own machinery. It allows this person to go above and beyond the call of duty if that person chooses to do so.

The bill says the financial literacy leader will report to Parliament, and there is also a clause about civil proceedings.

The final point from the Library of Parliament is that financial literacy is frequently a topic of interest to parliamentarians, which it has been for quite some time. I mentioned my hon. colleague from Edmonton—Leduc. The issue has been discussed in parliamentary committee reports. We also heard from the member for Sudbury, who talked about six possible amendments. These were not accepted, but nonetheless, the discussion was there and I think some of them are quite noteworthy and noble in their cause.

We talked about the 30 recommendations from the task force. One of the recommendations my colleague from Sudbury brought up was about the advisory council, which I think is a positive step in the right direction as well.

What we see here are many facets of the industry, including those who are workers, such as the people I meet every weekend when I am at the airport and they are on their way to whatever job it is they have in the oil and gas sector. These are people who belong to building trades associations, or unions for that matter. They certainly do have quite a bit of input in how we can improve financial literacy.

Also, the issue has been mentioned in the House of Commons, including in the context of the private member's motion, Motion No. 269, by the member for Edmonton—Leduc, who is also the chair of the House of Commons Standing Committee on Finance. The conversation we had centred around the importance of financial literacy and how we have moved ahead into what I would deem is a brave new world for all citizens who work in this country.

As I mentioned before, there is the Canada pension plan and old age security. If people do not have the CPP, they are most likely eligible for the guaranteed income supplement. These measures do not displace the income that people earned, and certainly not if people work in the oil and gas sector where wages are so high and all of a sudden they find themselves out of work, through no fault of their own, such with a long-term disability.

Financial planning at the earliest age and financial literacy plays a very important role for many years to come. It someone gets injured on the job at the age of 25 to 30, think about how many years he or she has to recover based on his or her investments in a very short period of time. This is where financial literacy becomes that much more important. We get calls at our office every day about this.

This particular legislation, Bill C-28, required a ways and means motion as it would give the Commissioner of the Financial Consumer Agency of Canada the authority to impose a financial levy against any financial institution, as I mentioned, in order to pay for expenses related to financial literacy initiatives. During the committee study, officials also told finance committee that the government would increase the annual budget for the FCAC from $2 million to $5 million.

A significant contributor to rising household debt, which we talked about some time ago, was mortgages. One of the things I think was necessary was reducing the mortgages with 40-year amortization down to about 25 years. I think it was necessary because zero-down, 40-year mortgages were causing more problems than not. We found ourselves in a situation similar to that in the United States, where they had sub-par loans that caused ripples around the world that have lasted for years. That was not the only thing but certainly that was the genesis of it, the spark. That is one part of it that had to come down.

We are taking measures in addition to this that help financial literacy and certainly help the average consumer cope.

The danger in having zero-down, 40-year amortization mortgages is that, as we have seen, it is way too much risk to take on. We end up elevating ourselves to the statistic I read earlier, which is $1.63 in debt for every dollar that we bring in. Nations in the world are in the same ratio. In Europe right now, nations that we considered financially sound are no longer as sound.

In looking at this, I would say that many of the questions that we had asked prior to third reading were addressed in committee.

The financial literacy leader will not have his or her own office. Instead, he or she will operate out of the office of the FCAC. That was one of the questions we brought up.

There are no plans to use Bill C-28 to levy an assessment on banks to pay for financial literacy. It should be noted the FCAC already had the power to levy assessments against banks under legislation brought forward when the FCAC was created.

There was also, of course, the question about the anticipated cost, the extra $3 million for this particular individual.

Again, I would agree with my colleague that the advisory council should also be a second part to this. I am certainly willing to say yes to this, as a precursor to that step in the future.

I will go back to what I talked about in the beginning. This is a brave new world. It is one that compels our children to be that much more financially literate, to the point where this is a step in the right direction.

[Glenn Thibeault, NDP, Sudbury, ON]

Mr. Speaker, I am pleased to rise today to present the NDP's position on Bill C-28, which would create a financial literacy leader with the aim of improving financial literacy in Canada.

Let me start by saying that, obviously, an understanding of financial literacy is a good thing. Understanding how much the difference between a 5% and 5.5% APR will cost over the lifetime of a loan, how long it will take to pay off a credit card if only minimum payments are made each month, how much needs to be saved each month for school or for a car or to put money away for a down payment on a house, or for retirement, having this knowledge is clearly a benefit.

How do we get to the end point? As I said at committee, it is a little like golf. Some people hook. Others slice, but at the end of the day they are all trying to put the ball into the hole. Therefore, the question we must ask ourselves is: How well does the bill achieve its desired ends?

Unfortunately the bill, while a very small step, is not going to get us to the end point we all desire. For a start, the terms of reference for this position are extremely vague. While the holder of this post will be required to advance financial literacy, there is no definition of what constitutes financial literacy within the bill nor any attempt to define how we could or should advance it.

Moreover, the original recommendation to create this position was very clear on the need for an advisory council that would include labour, voluntary groups, educators and business stakeholders to direct the work of the financial literacy leader. The bill does not include any such measures to create this advisory council and, as such, there is very little in the way of accountability.

Additionally, there is no proviso in the bill that would ensure that this position is filled by someone who is fluently bilingual in both official languages. To me, and to the NDP, it would seem a necessary condition that someone who is expected to teach and encourage Canadians about financial literacy would be able to communicate in both French and English.

We in the NDP tried to address these problems at committee. We introduced six amendments, all of which were dismissed by the Conservative members of the finance committee. Most surprisingly, some of those nay votes seemed to contradict comments made by the Minister of State (Finance) in committee and here today.

When I asked the minister of state about the fact that bilingualism is not a legislative requirement in the bill, the minister replied that the ability to speak both official languages and to disseminate the information in both official languages will be mandatory. Yet just a week later when I tabled a motion to amend the bill to this effect, the Conservative members voted against the amendment on the grounds that they want to ensure that they can choose the right person.

We in the NDP believe that it is impossible to choose the right person if that person is not bilingual, because bilingualism is necessary to ensure that we are helping improve the financial literacy of all Canadians.

We are therefore left with a dilemma. The stakeholders that we have consulted have told us that the NDP approach is far superior to the bill that we are debating today, but unfortunately, and especially with the current government, the choice we are presented with is all or nothing, no compromise, no improvements. This is what is on the table and we can take it or leave it.

That is exactly what was on display at committee, where the Conservatives refused to accept even a single amendment. This approach is not good for the functioning of parliamentary democracy and it is not good for Canadians.

That is why we in the official opposition are not going to play these ideological games. Canadians want good governance and good public administration, and that is exactly what they will get when they elect their first NDP government in 2015.

That is why we in the NDP will be supporting the bill at third reading, not because we believe it is the big fix the Conservatives claim it is but because, for all its faults, passing the bill is better than the current status quo.

Unlike the Conservatives, we listen to stakeholders regardless of their political affiliations and we listen to their concerns when it comes to policy decisions. These groups have told us that the bill would be a small step in assisting their work and enhancing the financial literacy of Canadians.

Our concerns with the bill have certainly not disappeared. However, my colleagues and I will hold the government to account for all of the commitments that we have heard around their position, and when we form government in 2015, we will be in the position to correct all the problems that the party opposite is all too happy to ignore in order to score political points.

When we look at the bill, we should also look to place it within the broader policy changes that the Conservatives have brought forward in the past six years. For example, Human Resources and Skills Development Canada stats tell us that 26% of Canadians struggle with basic numeracy and 20% struggle with basic literacy. Yet the government that is trying to sell Canadians on financial literacy being the answer to their economic problems is the same one that cut $17.7 million from adult literacy programs in 2006. The Conservative government's approach is to give with one hand while taking away with the other.

It is clear that financial literacy is something that we cannot understand in a vacuum. In fact, during the committee process, my colleague from Quebec raised this issue with the minister of state. He said:

You mentioned curriculum. That is very much a key issue. When I was in my third year of high school—which is equivalent to grade 10, I believe—we had what was called an economic education program. It covered things like credit cards and bank accounts, but it also dealt with fundamental issues facing people such as unionization. We looked at everything from a macroeconomic perspective, taking a lot more into account than just financial markets.

Instead of strictly limiting the financial literacy discussion to financial markets, pensions and other really specific issues such as credit cards, don't you think we should widen the scope and talk about economic education in general? Taking that approach, we could work with the provinces to help them develop a curriculum component possibly for primary students, but especially for high school students, to educate all young people about the complexities of economics, beyond just the financial dimension.

The minister's response was simple and to the point. The minister said, “I certainly can't disagree with you: that needs to happen”.

When pushed on it, even the government agrees that we need a more comprehensive strategy than the one we have been presented with. Instead, we get a bill that includes recommendation one of the Task Force on Financial Literacy and ignores the other 29. The minister's response to this is that the financial leader has at his or her discretion the option to put in place many of the other 29 recommendations.

We would agree with recommendation one but not with ignoring all the others. What is the point of independent task force reports if the Conservatives simply pick and choose the parts they like? Recommendation two of the task force calls for the creation of an advisory council made up of financial institution members, educators, unions and other stakeholders to ensure that the financial literacy leader is properly guided.

The Conservatives were happy to say that they were introducing the first and most important recommendation, but what they are doing is equivalent to building a house without putting in a proper foundation. It is not enough to say that it could, will or should have been implemented. It should have been implemented side by side with the financial literacy leader legislation. To do otherwise is to say that it is not important to ensure that all voices are heard.

We in the NDP take a different approach, one that listens to a wide variety of voices and ensures that no Canadian gets left behind. We need to make finance more understandable, not just make people better at understanding it. Even for people who do not struggle with numeracy and literacy, finance is not a particularly comprehensible subject. Barrie McKenna, a business columnist for the Globe and Mail, states:

Looking to financial literacy to fill the void is like asking ordinary Canadians to be their own brain surgeons and airline pilots. The dizzying array of financial products, mixed with chaotic and increasingly irrational financial markets, makes the job of do-it-yourself financial planning almost impossible – no matter how literate you are. The average credit-card agreement is as intuitive as quantum physics.

We also need to ensure that Canadians are aware that sometimes it may not be in their best interest to take out certain financial products. Encouraging people to take out savings and investment funds creates lucrative fees for banks and brokers. In fact, according to Morningstar, an investment research company, Canadian fees for equity funds are some of the highest in the world, being on average around two and a half times higher than fees in the U.S. for example.

We need to ensure that our financial literacy regime will criticize plans where fund managers take a substantial fee regardless of the performance of the fund, that it will highlight funds like the CPP, regularly outperform private funds and it must communicate to people the need to weigh the inherent dangers of investing in the stock market. Unfortunately, without a definition of “financial literacy” and without an advisory council, we cannot be sure that this will be the case.

We as parliamentarians should also be wary about increasing the quantity of financial literacy available without ensuring its quality. We in the NDP understand that this is a possibility and introduced an amendment to improve the reporting requirements of the financial literacy leader. However, as seems par for the course, the Conservatives ignored the concerns and voted it down. This has two dangerous and interlinked consequences.

First, the model presents the possibility of shifting all blame off banks and onto consumers. At the individual level, people can begin to be blamed for their own uninformed choices and, at the national or even international levels, systemic problems are no longer the fault of banks that will lend beyond their means to individuals who borrow too much. Obviously, individuals do have a responsibility to manage their own finances but banks, hedge funds and other financial institutions have the ability to affect the economy in a much more profound way than individual consumers, and we must not forget that.

Second, what do we do for the people who actually end up worse off due to financial investments that fail? We have to understand that some people will lose their savings when businesses go bust or when the stock market drops. This has been the way the stock market has worked since the first recognizable stock exchange opened in Amsterdam in the 17th century.

What about those people who simply do not have the type of disposable income required to invest in their futures, the people who live paycheque to paycheque, the people who have seen their wages stagnate or fall in real terms since the mid-1990s? The government should recognize that for a very large portion of Canadians a lack of savings is a reflection of the disparity between the rise in the cost of living and the rise in wages over the last 15 years or so.

Encouraging savings is fine for people who have disposable income after they have paid for the essentials but, unfortunately, far too many people taking on debt is not a choice. It is the only way to survive.

An OECD report published in December 2011 pointed out that the trend toward a less progressive tax structure and a more unequal society here in Canada began in the mid-1990s under the then Liberal government and has continued since 2006 under the current government.

As famed Canadian economist, Jim Stanford, noted in his submission to the national task force:

Personal savings will never constitute an important source of financial security for the strong majority of Canadians who cannot save, given the paucity of their incomes.

If the government really wanted to give these people an opportunity to build their own savings, then it would regulate bank fees and the level of interest that is charged on credit cards in order to allow people to put a little bit aside each month to ensure that it can help with their savings.

Similarly, if the government wants to ensure that Canadians have adequate savings when they retire, the way forward is not to create a new and inherently risky vehicle for private savings. There are already multiple methods for Canadians to save for their futures, RRSPs and TFSAs spring to mind, if they have the funds available to invest.

These vehicles are already supported and funded by the government. In fact, studies have shown that the highest earning 11% of Canadians contribute more to RRSPs than the bottom 89% of tax filers combined. Because of the tax benefits of these investments in RRSPs, Canadian taxpayers subsidize that contribution by the top 11% of earners to the tune of $7.3 billion in annual net tax expenditures.

The creation of pooled registered pension plans, or PRPPs, therefore, only benefits those who are already able to invest in their retirement. It does nothing for the 30% of Canadian families who lack any form of retirement savings outside of CPP.

Encouraging people to invest in a risky vehicle on the stock market is not real leadership on financial planning. It again simply passes the entire risk and blame for an individual not having adequate retirement savings onto that individual. To make matters worse, the Conservatives have delayed the age at which Canadians are eligible for OAS from 65 to 67. It would make far more sense, if the government is really interested in Canadians' retirement security, in allowing Canadians to properly plan for their retirement, to reverse the changes to the eligibility age for OAS and, just as the NDP leader has done, make a commitment to the NDP plan to expand the guaranteed Canada/Quebec pension plan by phasing in an affordable doubling of benefits.

This plan has been called for by provinces across the country. It would allow Canadians both the ability to plan for their retirement and a guaranteed income to ensure they can retire with dignity. Moreover, the CPP is a much safer investment than market based private funds and consistently outperforms the market. Even business columnists, like the aforementioned Barrie McKenna of The Globe and Mail, pointed out the benefits of such a policy by stating:

And Ottawa could beef up the CPP, mandating Canadians sock away more money for retirement, while benefitting from the CPP's low costs.

However, so far, the government, and the Minister of Finance in particular, have not listened to this appeal for a real and proven way of ensuring Canadians can retire with dignity.

The problem is that the government seems to think that encouraging these skills is a suitable substitute for a proper regime of consumer protection, retirement security and a proper strategy for economic growth. The bill embodies the government's strategy, or lack of strategy, in addressing the issues that really matter to working and middle-class Canadians across the country.

I wonder why the creation of the financial literacy leader could not be included in the Financial System Review Act rather than being a stand-alone act? The Conservatives have no problem lumping together pieces of legislation that have no relationship to one another in omnibus budget bills but, apparently, a bill to amend the Financial Consumer Agency of Canada Act could not be included a system review of banking legislation. It appears to me that the only reason these did not go together was because the government hoped it could get some positive media out of this legislation, but who knows?

The NDP believes in real measures to protect consumers, seniors and low-income Canadians. My colleagues on this side of the House in the official opposition will continue to stand up for policies that really help hard-working Canadians. This is a small start, a very small step, and one which we will be supporting to send to the Senate in order to get the funds, which have already been allocated, out to the organizations that really need them.