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.

The House proceeded to the consideration of Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act, as reported without amendment from the committee.

Business of the House

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

Mr. Speaker, I did want to be in accord with the official opposition and NDP House leader. However, my disappointment was that before we started debate on Bill C-45, what we first encountered was a delay tactic in the form of a concurrence motion brought by the Liberal Party. Indeed, that was very disappointing to us and a surprise because Bill C-45 is important. It is the government's top legislative priority for this fall. All parties know that. He is quite right that I did want to see it debated in substance in the House rather than see those kinds of tactics to avoid debate.

Bill C-45's measures will further Canada's economic recovery and ensure the foundation for more good-quality jobs on top of the over 820,000 net new jobs we have already had. It includes an extension of the highly successful small business hiring credit that is directly helping Canadian entrepreneurs create new jobs.

Unfortunately, we have seen the NDP take an anti-job creation position. Believe it or not, the NDP finance critic actually dismissed the hiring credit as yet again another across-the-board cut for small businesses.

We want to see taxes lowered. We do not want to see higher taxes or an NDP carbon tax. That is why we have a budget bill that keeps those taxes low.

I am pleased to say that we will be voting on C-45 on Tuesday night at second reading, which will give us the opportunity to send it to the finance committee for consideration. The parliamentary secretary for finance has made it clear that she will ask the finance committee to ask, I believe, 10 other committees to study elements of the bill and potentially make recommendations with respect to changes or adopt its contents. The opposition and government members are free to make amendments at committee based on their own study as well as on the studies of those other committees. Therefore, there will be ample study of the bill and that is good for all.

Bill C-45 will continue to be debated this afternoon, tomorrow, Monday, and Tuesday. As I said, the vote on the bill will take place on Tuesday evening.

On Wednesday, we will take up report stage—and, hopefully, third reading—of Bill C-28, the Financial Literacy Leader Act. Should we be able to make quick work of that debate, the House will take up Bill C-12, the Safeguarding Canadians' Personal Information Act, at second reading.

On Thursday morning, the House will consider second reading of Bill S-2, the Family Homes on Reserves and Matrimonial Interests or Rights Act. And, after question period, we will turn to Bill S-8, the Safe Drinking Water for First Nations Act, also at second reading.

Finally, on Friday, we will start report stage of Bill C-24, the Canada–Panama Economic Growth and Prosperity Act. This bill would implement our free trade agreement with the Republic of Panama—an agreement whose time has long come. In fact, when I was the public safety minister, I was honoured to be present when the Prime Minister concluded negotiations in Panama City, some 38 months ago.

Finance

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I have the honour to table, in both official languages, the second report of the Standing Committee on Finance in relation to Bill C-28, an act to amend the Financial Consumer Agency of Canada Act.

The committee has studied the bill and has decided to report the bill back to the House without amendments.

[The Chair, Conservative, James Rajotte]

That ends the clause-by-clause consideration of Bill C-28.

I want to thank our officials for being with us here today. We appreciate your comments to the committee. Thank you.

I understand, Ms. Nash, you may want to address the issue of pre-budget consultations and the motion. The clerk had told me that.

[The Chair, Conservative, James Rajotte]

I call the meeting to order.

This is the 74th meeting of the Standing Committee on Finance. Our orders of the day, pursuant to the order of reference of Wednesday, June 20, 2012, are the study of Bill C-28, an act to amend the Financial Consumer Agency of Canada Act.

Colleagues, we are here to give clause-by-clause consideration to this bill. I believe we have six amendments proposed for this bill. We have an official from the Department of Finance present in case there are any questions from members, or the officials may wish to comment as well. Welcome to our committee.

I will proceed in order with respect to the clauses. Pursuant to Standing Order 75(1), consideration of clause 1 is postponed. Therefore we will move to clause 2.

(On clause 2)

On clause 2, we have an amendment, NDP-1. What I will do as we proceed through is ask a member of Parliament to move the amendment and to speak to it. Then any others who wish to speak to it will please indicate their intention to me, and I will ensure you do so.

We will move to amendment NDP-1.

Go ahead, Mr. Thibeault.

[Hoang Mai, NDP, Brossard—La Prairie, QC]

Thank you, Mr. Chair.

Gentlemen, I want to thank you once again for appearing today.

In this case, the lack of depth is one of the reasons we are somewhat reluctant with respect to this bill. Ms. Nash also discussed that. The Canadian Bar Association, in its letter dated September 14 regarding Bill C-28, says the following: “It is not clear whether the Financial Literacy Leader is intended to fulfill the role of the national leader recommended in the Financial Literacy Task Force Report.”

The Minister of State Finance was also asked some questions about the recommendations made by the task force, on the one hand, and about the bill's content, on the other hand. What came to light was that the leader had the possibility or the option to follow those recommendations, but that was not really set out in writing.

In addition, the Canadian Bar Association pointed out that the bill is not specific enough. It said the following: “[...] it is difficult to see how the activities of the Financial Literacy Leader could be evaluated. Too much generality can lead to unfocussed activity.”

I am sure you have read the second recommendation, which talks about an advisory council that would make a broader approach possible.

I think you said, Mr. Rabbior, that this report has been available for a long time. It has taken a long time for us to get to the first stage. We have indicated our willingness by strongly supporting the motion moved by Mr. Rajotte, as we feel that this is very important in terms of financial literacy. What we want is an applicable system that would work quickly to really tackle the problem.

Could you tell us about how the leader's role could be judged or evaluated? What would be the way to do so? Was the second recommendation a good one in terms of that? Do you want me to read the recommendation?

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you.

I will move on to another question, which concerns another weakness. I refer to a letter prepared and sent by the Canadian Bar Association, which calls attention to a few weaknesses of Bill C-28 that we have also pointed out. I think one of them is especially relevant. I will read it quickly:

[...] the activities of the Financial Literacy Leader are intended to be broader or different in scope than those of the Commissioner. If they are not related to the activities and communications of financial institutions, we do not believe that financial institutions should be subject to an assessment. Further, funding by financial institutions with respect to regulation of their activities is not conducive to an independent objective approach.

When I spoke to the minister, during his appearance on Monday, I mentioned that there could be some confusion regarding the role of financial institutions, that this was perhaps an attempt to create good consumers for financial institutions and banks. Don't you think there would be something of a conflict of interest or contradiction in asking financial institutions to make contributions for the kind of training or mandate that will be given to the leader?

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

In summary, it sounds as though every witness here today is very supportive of Bill C-28 and...being part of the Financial Consumer Agency of Canada and enshrining that as per the recommendations here.

[Stephen Ashworth, President, Acting Chief Executive Officer, Junior Achievement Canada]

Thank you very much, Chair and members of the Standing Committee on Finance. Junior Achievement is extremely pleased to be here with you today to discuss an issue of great importance to our organization: financial literacy. Before I specifically address Bill C-28, I would like to provide a brief overview of Junior Achievement and highlight why financial literacy is so important to our organization.

Junior Achievement is a not-for-profit educational organization dedicated to inspiring and preparing youth to succeed. Junior Achievement's educational programs on financial literacy, work readiness, and entrepreneurship are delivered at no cost to elementary, middle, and secondary schools coast to coast—every province.

Each day, we have the opportunity to see the positive impact financial literacy education and Junior Achievement have on youth. In Canada, Junior Achievement reaches over 226,000 students in 9,472 classes. That is over 232,000 hours of instruction annually from over 13,500 dedicated mentors in over 400 communities. Since 1955 over 4 million students have participated in Junior Achievement programs.

Junior Achievement recognizes the need and importance of support for financial literacy education within our schools. Junior Achievement is a trusted resource in the education space. For over 55 years, Junior Achievement has established relationships with teachers and schools, and they have invited us into the classroom to help ensure that our youth develop the financial literacy skills that are critical for their personal success.

The unique learning experience provided to our participants is rooted in more than 13,000 volunteer mentors who deliver our programs. Our mentors provide experiential learning to offer students real-world knowledge of financial literacy. By delivering engaging education programs to young Canadians, Junior Achievement is helping to fulfill the need for financial literacy education in schools.

Based on third-party research done by the Boston Consulting Group, we know these programs are having a positive impact on today's youth by putting financial literacy into practice with programs like “Economics for Success”, “Dollars with Sense”, and the “Company Program”, to name a few. I encourage you to actually look at that report. It shows the return on investment from investing one dollar.

Our past participants, who we call achievers, credit Junior Achievement programs with being the driving force behind their financial literacy skills of budgeting, long-term planning, and investing. In fact, over 75% of achievers believe Junior Achievement Canada programs have a significant impact in developing their financial literacy skills. Achievers save more, borrow less, and do better financially than the average Canadian. As a result, they are more self-reliant, put a lower burden on the social safety net, and provide for their own retirement.

Junior Achievement plays an important role in financial literacy education, but the fact is that we all play an important role in improving financial literacy. There is no doubt that early behaviour and skills development are essential in ensuring lifelong financial success. By building youths' knowledge at an early age, we are preparing them to make sound financial decisions and informed choices throughout their lives. By providing tools and programs that put financial literacy concepts into practice, we can help youth connect basic economics to their daily events.

We strongly support the efforts of the federal government to improve financial literacy. Junior Achievement's goals are closely aligned with the Financial Consumer Agency of Canada's mandate to promote consumer awareness and ultimately improve financial literacy.

Junior Achievement was pleased to be a participant in the consultations undertaken by the task force on financial literacy. As you know, the task force report clearly identified the need for action to improve financial literacy and to drive Canada's future success.

Further, it highlighted how non-profit organizations like Junior Achievement and those of my other colleagues at the table today can play not an optional but an essential role in ensuring a financially secure future for Canadians. That is a vision we support, and we feel it needs to be reflected in the financial literacy leadership role put forward in Bill C-28.

Junior Achievement supports the objective of Bill C-28 to appoint a financial literacy leader at FCAC. Strengthening financial literacy must be a key priority for FCAC, and appropriate resources need to be provided to support the key initiatives.

Junior Achievement believes that the role of the financial literacy leader will further encourage collaboration and coordination on financial literacy across the country. Having a financial literacy leader at FCAC will ensure continued focus on and measurable results in improving the financial literacy of Canadians.

Junior Achievement is one of those organizations working to make a positive impact on improving financial literacy. We believe there is a great opportunity to support and build on the efforts that are taking place across the country. We believe the financial literacy leader should leverage the work of national organizations that already have national bilingual distribution. Leveraging existing work will ensure consistency and will help to reach Canadians. Junior Achievement strongly believes that an important commitment within this new role must be to work with organizations and experts across the country to ensure that all Canadians can benefit from the work that has already been done. Junior Achievement sees great opportunity to work collaboratively with the new financial literacy leader towards our mutual goal of strengthening financial literacy of Canadians.

We are pleased to support Bill C-28, and Junior Achievement looks forward to working with the federal government's efforts to encourage financial literacy for our next generation of leaders.

Thank you.

[Mack Rogers, Program Manager, Community Literacy and Learners, ABC Life Literacy Canada]

Good afternoon, and thank you for the opportunity to appear before you today.

I am pleased to represent ABC Life Literacy Canada in response to the request from the Standing Committee on Finance to address Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act and to establish a financial literacy leader in Canada.

At ABC we envision a Canada where everyone has the skills they need to live a fully engaged life. Our mission is to mobilize and inspire Canadians to improve their literacy skills and support lifelong learning. We believe financial literacy is a critical life capacity.

A financial literacy leader, a national leader who helps us strengthen the financial literacy of Canadians, has the potential to help Canadians in this regard. Financial literacy is part of the spectrum of essential skills all Canadians need to thrive.

The 2003 international adult literacy and skills survey found that 42% of the Canadian population has a reading comprehension level below that of a high school graduate, the recognized standard for dealing with the demands of everyday life in our complex society. In numeracy, 49% of the population scored below the recommended level. For these country-wide challenges, the link to improvement can be found in the financial literacy field.

We at ABC believe that the financial crisis in 2008 was as much a reflection of low financial literacy skills as any other cause. Canada is not out of the woods yet. We believe the worrying levels of debt currently held by Canadians should be addressed to ensure our nation's prosperity, security, and financial safety. A key component of the answers to these challenges can be found in increased financial literacy, education, and awareness.

The financial literacy leader has the potential to strengthen these skills of Canadians through leadership and collaboration with others involved in this work already, such as FLAG, the Financial Literacy Action Group, and including, of course, the Financial Consumer Agency of Canada, which ABC Life Literacy Canada wholly endorses.

ABC has engaged in financial literacy awareness and education through our communications outreach and through our innovative adult literacy education program, Money Matters.

ABC was an active participant in the inaugural 2011 financial literacy month, providing Canadians with tools and resources they needed to increase their financial literacy. ABC also created an innovative social hub where Canadians could share financial literacy tips and pledge better financial literacy habits for themselves and their families.

Money Matters, our adult education program, generously funded in part by the Government of Canada, has been a tremendous success in the adult learner community. Money Matters has been activated in over 30 learning centres across Canada, reaching more than 600 learners and engaging more than 200 volunteer tutors from the TD Bank Group. More than 5,000 hours of financial literacy learning have already been completed by our learners. We expect to more than triple the reach by the end of this program.

It is here, on the ground of financial literacy training, that we see the biggest impact. We at ABC have witnessed the individual impact of financial literacy improvement through our programs with adult learners. Every day we are witness to the real-life impacts of these increased financial literacies. From starting RESPs for young Canadians to building a financial plan for the aged, our learners experience growth and empowerment at all levels of financial literacy. These are real-life experiences for individual Canadians and communities across the country.

Here is what some of our learners have told us.

Joanne from Hamilton told us, “If you save as little as $5 a week, it can make a big difference in your life.”

Asif from Kitchener says, “I now think about managing my money. I can tell the difference between my needs and my wants.”

A learner from Toronto said, “My family needs me to understand this stuff better, and now I do.”

Finally, Ally from Halifax says, “Banking is not as scary as I used to think. Now I can talk to bankers better.”

It is these messages we want all Canadians to understand, to talk about, and to share. It is these lessons that will improve life for all of us. We are confident that the financial literacy leader can help deliver these lessons.

To wrap up, Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act, is an important foundational step in helping Canadians achieve a higher standard of financial literacy. It builds on the recommendations from the task force on financial literacy from February 2011.

As a contributor to the task force process, ABC believes that our voice and, more importantly, the voices of the clients we serve were heard, and we support the recommendations wholeheartedly, including the establishment of a national financial literacy leader.

We at ABC believe the FCAC is a strong organization to house this individual. The FCAC's strong commitment and leadership during the 2011 Financial Literacy Month and their ongoing development of financial literacy programs and initiatives reflect the recommendations as set forth and as discussed with the Financial Literacy Action Group.

We believe that the more support we give the financial literacy leader and the FCAC, the more Canadians will be empowered to increase their financial literacy. It is for these reasons that ABC wholeheartedly endorses the amendment proposed in Bill C-28.

Thank you again for the opportunity to present ABC Life Literacy Canada's views on the importance of improving Canadian financial literacy and how Bill C-28 will work towards improving that. I look forward to your questions.

[The Chair, Conservative, James Rajotte]

I call the meeting to order.

This is the 73rd meeting of the Standing Committee on Finance this session. Our orders today are pursuant to the order of reference of Wednesday, June 20, 2012. We are continuing our study of Bill C-28, An Act to amend the Financial Consumer Agency of Canada Act.

Colleagues, we have four organizations before us today, and I want to thank all of these organizations for coming in, especially on very short notice. The committee did want to begin its work immediately this session with this bill.

First of all, from ABC Life Literacy Canada, we have the program manager, Mr. Mack Rogers. Welcome.

From the Canadian Foundation for Economic Education, we have the president, Mr. Gary Rabbior.

From Junior Achievement Canada, we have with us here today the president and acting CEO, Mr. Stephen Ashworth.

From Social and Enterprise Development Innovations, we have the program manager, Mr. Adam Fair.

Welcome to all of you.

For your opening statements you have between five and ten minutes, and we will go in the order I outlined. Then we'll have questions from members of all parties.

We will begin with Mr. Rogers, please.

[Hoang Mai, NDP, Brossard—La Prairie, QC]

Thank you, Mr. Chair.

Like everyone else, I want to congratulate you on being elected committee chair. It's always a pleasure to work with you, and I'm also very glad to see my colleagues again. I know that we work very hard in the Standing Committee on Finance, but we can also enjoy ourselves.

Bill C-28 is very problematic to me. The report put forward 30 recommendations, good recommendations, but only 1 of them was implemented. My colleague Ms. McLeod asked the Minister of State for Finance whether the recommendations would be followed. He said that the leader has the option of putting those recommendations in place, but is not required to do so. One of our problems with the bill is just that: the government put together this piece of legislation, but did not use it as an opportunity to set out a real strategy. And that's a shame because I wholeheartedly agree that it is important in terms of financial literacy.

Mr. Chair, I also want to commend you on all the work you've done on this. Unfortunately, all this bill does is establish a new position, not the strategy that was recommended. Above all, the bill doesn't provide for the advisory council, whose makeup is supposed to be somewhat diverse, if I'm not mistaken. Its members could be drawn from the educational sector, the working world and the financial sector.

There is one recommendation that I think is just fantastic, but unfortunately it's not in the bill either. I'll read it quickly: “The Task Force recommends that the Government of Canada make financial literacy training programs for young Canadians eligible for funding through the Youth Employment Strategy.” What a shame that's not in the bill.

Another prime example is the Urban Aboriginal Strategy, which would make financial literacy training programs for young aboriginal Canadians eligible for funding. The recommendations also address immigrant education.

I would just like the officials to confirm something for me. Does this bill provide for a group that could put a financial strategy in place, or does it just create a position?

[Glenn Thibeault, NDP, Sudbury, ON]

A point of order.

I've been listening to a lot of the questioning from the other side, Mr. Chair. What does this have to do with Bill C-28? We're here talking about Bill C-28. The questions that we've been hearing don't relate to the bill whatsoever. I would just like to know the relevancy.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Thank you, Mr. Chair. I also would like to congratulate you and welcome back our colleagues to the table.

I think it's critically important, and I'm really pleased, that the first thing we're dealing with is Bill C-28 as we start the fall session. I think it's really appropriate and it's extremely important.

I just have a quick comment, because I've heard it a number of times. Perhaps, Mr. Minister, as you read the task force recommendations.... It says that the financial literacy leader “should have the mandate to work collaboratively with stakeholders to oversee the National Strategy” and “implement the recommendations”. Really, I perceive this as the critical piece in terms of moving forward on all the task force recommendations, so I'm not quite sure where my colleague's concern is in terms of creating a structure that allows that important work to continue.

Minister, could you tell me if that sounds to be how you envisioned the process moving forward?

[Peggy Nash, NDP, Parkdale—High Park, ON]

Thank you, Mr. Chair.

Congratulations on your election again as chair of the finance committee. I look forward to working with you, as always.

Thank you, Minister Menzies, for being here today to discuss with us Bill C-28.

I want to echo what my colleague Mr. Thibeault said around financial literacy. We did support Mr. Rajotte's motion on this, because there are many areas where it of course would assist Canadians to have a better understanding of debt and of their obligations when they enter into debt. But we also have concerns with this bill. One of the concerns was that the financial literacy task force made 30 recommendations, the first of which was the appointment of a financial literacy leader. There were 29 other recommendations that would have really put a strong framework around such a position.

I want to clarify a couple of things. First, if we're going to appoint a person who's expected to teach Canadians about financial literacy, should they not be able to speak both languages fluently so that they can have the best communication possible with all Canadians?