Bill C-26 (Historical)

An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act

Part 1 of this enactment amends the Canada Pension Plan to, among other things,
(a) increase the amount of the retirement pension, as well as the survivor’s and disability pensions and the post-retirement benefit, subject to the amount of additional contributions made and the number of years over which those contributions are made;
(b) increase the maximum level of pensionable earnings by 14% as of 2025;
(c) provide for the making of additional contributions, beginning in 2019;
(d) provide for the creation of the Additional Canada Pension Plan Account and the accounting of funds in relation to it; and
(e) include the additional contributions and increased benefits in the financial review provisions of the Act and authorize the Governor in Council to make regulations in relation to those provisions.
This Part also amends the Canada Pension Plan Investment Board Act to provide for the transfer of funds between the Investment Board and the Additional Canada Pension Plan Account and to provide for the preparation of financial statements in relation to amounts managed by the Investment Board in relation to the additional contributions and increased benefits.
Part 2 makes related amendments to the Income Tax Act to increase the Working Income Tax Benefit and to provide a deduction for additional employee contributions.

Canada Pension Plan

[Robert Gordon Kitchen, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, thank you for the opportunity to speak to Bill C-26, the enhanced Canada pension plan that the government has introduced. While it might seem laudable that the government wants to improve the public pension that future generations may possibly collect, it is odd that it has chosen to increase the payments made by Canadians today so that potentially one-third of a person's retirement income 40 years from now will be provided for by the government.

This makes one question why the government feels compelled to increase pension benefits for future generations. By the current government's own actions today, through deficit financing, it will imperil the ability to save for the future because of the increases in taxes that its reckless deficit spending must entail. If we have to pay someone else's bills first, it is hard to save for ourselves. I have watched the government as it spends billions of taxpayer dollars today with little regard for where this money comes from, how it will be repaid, and what sort of damage this reckless spending will cause these very same retirees that the enhanced CPP is promising to help in the future.

By its own admission, the government wants to increase the monies it collects for workers today for the CPP because there is a belief that not enough Canadians have a pension plan at their work and/or that Canadians are not saving enough of their own resources for the future. Let us explore these beliefs.

Whether it is a defined benefits plan or a defined contribution plan, both of which are paid for by the employer and employee, nearly 50% of Canadian workers do not have an employer-provided pension plan at work. This may seem like a high number, and perhaps it is if we believe it is the obligation of the employer to provide a pension on top of a reasonable wage, vacation time, sick time, and a balanced work life—and the list goes on of what an employer ought to be responsible for. However, if nearly 50% of Canadian businesses are small businesses that employ between one and four people, it may seem a bit onerous on a small business to offer an additional pension plan to its one or four employees. Of these workers, 100% contribute to the CPP. Therefore, every worker in Canada does have a pension plan, yet some may have a much better plan than others. The argument that not enough Canadian workers have a pension plan at work is really an argument based on envy, that some have a better plan than others, and that it ought to be rectified by forcing small businesses to pay more for the future of their employees, some of whom may remain for one year and some for a lifetime.

I am confident that most Canadians agree that some form of a public pension plan is of benefit to society as a whole. I think the potential disagreement comes from just how much their pension should be worth, and by whom it should be run

The math behind the enhanced CPP is based on raising the contribution rates and the ceiling at which those contribution rates apply to our public pension scheme to enhance the CPP of all Canadian workers. I am not certain this math is convincing. Current estimates show that the CPP at present provides a real rate of return of approximately 3.6% and that this will decrease to around 2.1% for those retiring in 2037, according to the Fraser Institute. Currently, the average Canadian worker contributes 4.9% of his or her income to the CPP. This will increase to 5.95% based on the proposed CPP enhancement. The employer provides the same contribution. This current total contribution is 9.9%, and will rise to 11.9% of one's earnings to a maximum amount. The average Canadian wage is $48,200. Therefore, an expected contribution of $4,800 per year is invested in a pension scheme for the average Canadian worker. At the age of 65, this same worker can expect to obtain a maximum pension from the CPP of approximately $1,000 per month. However, because that worker's average wage is less than the pensionable maximum, he or she will only receive approximately 75% of that amount.

Today, the average CPP payout in Canada is $642 per month. If this same worker earning the same average wage contributes his or her enhanced 5.95% CPP allotment into his or her retirement plan and earns the same rate of return of 3.6% for 45 years, the amount of time needed to obtain the maximum payout from CPP, he or she would be able to use these funds to pay his or herself the maximum amount of $1,000 per month for at least 40 years and still have money left over at the end of this time of approximately $220,000. If we add in the employer portion, then there is now an 11.9% contribution, and the maximum return is more than attainable.

We know that the return is not exact. The worker earning the average wage of $48,000 per year, who should be able to generate $1,000 per month return from their own 5.95% contribution over 45 years, now needs to factor in how the overall employee-employer contribution of nearly 12% will go to covering such things as administrative fees to manage the money, the maximum $3,500 tax credit for the contribution rebate, and the extra funds that go to those who earn less than the average industrial wage.

The argument that not enough Canadian workers have a pension plan at work is in fact not correct and speculative at best. If the CPP is in fact a pension plan, then it really comes down to how that pension plan is being administered.

The second item I would like to address is the belief that some Canadians are not saving enough on their own, so by taking extra funds from their paycheque for an enhanced CPP contribution each month, the government is going to be doing them a favour. If I have limited resources and the government takes more of my resources in order to obligate me to settle for something second-rate, then of course I am not going to be able to save as much of my limited resources since they have already been taken by the government.

The C.D. Howe Institute examined four pillars for sources of income for retirement in exploring why the government wanted to enhance the CPP. The first source is government transfers, such as OAS and GIS. The second is the CPP. The third is employment pensions. The fourth is other assets, such as real estate, financial assets, private business, life insurance, inheritances, and essentially, any asset not managed by the government. If the government is truly convinced that it is going to improve the lot of the middle class, then this fourth pillar needs to be paid more attention in a positive manner.

Unfortunately, the government has seen fit to, instead, meddle in this income source through reducing the tax-free savings account limit, trying to cool the housing market, failing to reduce small business taxes, imposing a carbon tax, and enhancing the CPP. This will unduly impact the overall burden on some business activity in Canada by increasing the contribution rate that employees, employers, and the self-employed will have to come up with to meet the government's solution to a problem that is beyond them.

Taking money from hard-working Canadians' paycheques will make it harder for families to save for such things as vacations, children's post-secondary education, and purchasing a home. Likewise, employers will have to choose between hiring that extra hand or requiring their employees to do more for less.

We know that sunny ways in Canada means that the government wants to manage all aspects of how we live as Canadians, from cradle to grave. We know that there is nothing the government does not want to poke its nose and legislation into.

The enhanced CPP proposal is simply another tax to address a problem that really is not a problem. If we look at how society functions and decide there are specific items that a government ought to be responsible for, such as promoting rule-based free trade, ensuring the security of our communities both internally and from activities abroad, or allowing for the free movement of goods and people internally in Canada, then determining how much someone receives in retirement or insinuating that one person's pension is better than another's, and that is somehow bad, seems to be the least of our concerns.

In conclusion, let me finish by quoting Hendrik Brakel of the Canadian Chamber of Commerce. On May 31, 2016, he stated:

...we’re worried a big tax increase is headed for the middle class like an elbow to the chest....This comes at the worst possible time—an economy reeling from weak commodity prices and slower consumer spending will be lucky to eke out growth of 1.5% next year. It’s difficult to stimulate the economy while pulling money out of the pockets of Canadians.

The government talks a big story and loves to use the catchphrase, “Helping the middle class and those who are struggling to join it”. Between the carbon tax and the CPP tax, that elbow to the middle class has bounced off the chest and is now a hit to the head.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Regarding the Canada Pension Plan, we're currently debating Bill C-26 in the House of Commons. We estimate that it could cost about $2,000 per employee, meaning $1,000 for the employer and $1,000 for the employee.

Do you think the measure will generate economic growth?

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

Mr. Speaker, I am pleased to contribute to the debate today on Bill C-26, often referred to as “big CPP” by the many Canadian small business owners who abhor yet another payroll tax being imposed on them by the Liberal government. As a former small business owner, I can speak firsthand of the many reasons I strongly oppose this legislation.

Let us be honest that no matter how we slice or dice it, this legislation would increase the cost to an employer of hiring a worker. It would also increase the cost to employers of the workers they already employ. Let us also be honest and recognize that job numbers coming from Statistics Canada are not encouraging. Likewise, we know that projections from the Bank of Canada are being lowered for economic growth at the same time the Liberal government is imposing a top-down national carbon tax that will drive costs up on employers and small business owners alike. Likewise, we know that the Liberal government has also reneged on its promised small business tax cut.

Let me recap. In a relatively short period of time, small business owners in Canada have had the costs of their existing workers increased by the Liberal government. The government has also increased the cost of hiring new workers. It will be increasing their operating expenses as a result of a national carbon tax, and it has not followed through on its commitment to business tax cuts. It has done all of this at the same time that job numbers are looking bleak and our economic growth is being downgraded.

This may sound like a bleak picture, but the reality is that everything I have just stated is factually accurate and true. It is no wonder that investment has also declined. It is also no wonder that the Canadian Federation of Independent Business strongly opposes this additional payroll tax. It is no wonder that close to 20,000 of the federation's supporters signed a petition opposing these Liberal-imposed increase in costs in general. We must keep in mind that many Canadian small business owners now compete with other small business owners in the United States, where there is no national carbon tax and where the government is not drastically increasing the costs of small business owners.

The Prime Minister looks down on small business owners. He has stated directly that “a large percentage of small businesses are actually just ways for wealthier Canadians to save on their taxes”. As a former small business owner, I can tell the House that this comment by the Prime Minister is, to put it into parliamentary terms, a foul smelling, crusty batch of nature.

The reality is that small business owners are not wealthy Liberal elites and, by and large, these people do not pay $1,500 a plate for private access to the finance minister. The fact is that many small business owners from time to time struggle just to meet their payroll, and some even work a second job. Typically, they do not have the luxurious benefits of the public sector. I mention this final point because we should never forget that it is from the private sector that we take so that we can afford to have the public sector. An expanded CPP would take money out of the private sector.

I just heard an argument that this money would ultimately return to the economy when workers retire. However, let us not overlook the fact that not everyone lives to age 65. For them, their families, and their estates, an expanded CPP would do very little. Likewise, even for those who only live a few years beyond 65, that transportability of CPP to loved ones, kids as an example, would basically be negligible. People could pay these hugely increased costs their entire working career and potentially get very little to no benefit from them whatsoever.

However, that is okay for the big CPP pension board, because the cost to administer CPP has basically gone through the roof. As the national columnist Andrew Coyne has recently pointed out, staffing has increased at the CPP Investment Board from five in 1999 to around 1,200 today. Likewise, operating costs have gone from $3 million in 2000 to $803 million in 2015. External management fees have risen from $36 million in 2006 to $1.25 billion in 2015. These are just a few alarming indicators.

To be clear, I am not being partisan about this. These things have happened under both Liberal and Conservative governments alike. However, under a Liberal government obsessed with consultations and reviews, it is curious that this big CPP is being imposed on Canadians with zero consultation with groups like the Canadian Federation of Independent Business, and no review as to how administration and expenses are rising so dramatically for the CPP.

Of course, we have heard the finance minister and the Prime Minister tell us that Canadians are not saving enough for their retirement, which is why they believe having the government do it for them through this big CPP is the answer. When the Liberal government reversed the $10,000 annual maximum contribution to the tax-free savings account, it did so arguing that down the road they were worried Canadians were in fact saving too much.

Now here is the thing with the tax-free savings account. Unlike the CPP, with the tax-free savings accounts, those funds, lifetime savings I might add, are fully transportable. This means that one's kids, spouse, and family all benefit from one's lifetime of savings instead of having that money sucked into the growing administration a of big Canada pension plan. To be clear, a tax-free savings account did not penalize employers who are job creators. Therefore, in reality, we have a Liberal government that one day says it is worried Canadians are saving too much so we better cut back that tax-free savings account, and then a few days later it says that Canadians are not saving enough so we better bring in big CPP.

It is not unlike what the current government has recently done with new mortgage qualification rules. People in Summerland and West Kelowna, in my riding, have phoned me and emailed me and said that this makes home ownership a goal that has been stretched down the line. This is a sad thing, because people work hard. They want to succeed in life, and home ownership is one of the ways we can do that.

Let me be clear. A home is how one can build equity for retirement. If anything, the government should be focused on measures that increase the supply of housing to help increase affordability. More home owners mean more equity for those home owners down the road, and less need for an expensive payroll tax like big CPP.

One final point I would like to raise, going back to the government's argument that people are not saving enough and thus let us impose big CPP to do it for them, is whether it has ever occurred to the Liberals to ask why people are struggling to save. Well, I have an answer, and for a growing number of Canadians, the answer is too much taxation. Governments, at all levels, continue to add more and more taxation, leaving less take-home pay.

In the irony of ironies, the tax-free savings account which, let us not forget, is entirely funded by our net after-tax pay, has now been reduced by the Liberals. It is like the current Liberal government and the Prime Minister have created what I believe is a war on equity. At the same time, let us not forget that it is the same Liberal government that is adding massive amounts of new debt.

Yes, I know the finance minister loves to the use the term “investing”, but regardless of how we wordsmith it, that investing that has created this massive pile of new Liberal debt will down the road have to be paid. Each month we pay interest on our debt. In fact, the amount of the federal government interest on the debt we pay right now is close to what the Canada health transfer is to the provinces. While provinces all squabble for more health care transfers, we can all collectively look the other way, but that interest on debt is rising at alarming levels.

Therefore, down the road, we are going to see a problem, collectively. Either we are going to see more increases in taxes, reduced government services, or possibly a combination of both. That is maybe the real reason that the Liberal government supports big CPP, so that our future retired Canadians will have more capacity to absorb inevitable increased taxation as a result of today's Liberal debt being added to at near record levels.

The bottom line is that I would like to ask all members in this place a simple question. Where exactly will small business owners get the money to pay for these dramatic increases in labour costs?

The reality is that for small business to stay in business, we all know that income has to exceed expenses. In a small business, one's income comes from one's customers. When one's costs rise without a corresponding increase in sales, one goes out of business. That is the message that the government is sending to small business owners across this great country.

I would ask all members in the House to listen to the objections of the CFIB and oppose this damaging measure that would harm employment. Those who are unemployed do not contribute to CPP because they draw down from EI and other government-funded programs. Now is not the time to be expanding big CPP, and that is why I strongly oppose the bill.

[Kevin Sorenson, Conservative, Battle River—Crowfoot, AB]

Mr. Speaker, I was starting to wonder if it was something I had said or done, but thank you for allowing me to come back and say some more about the important debate we are having today.

I introduced it by saying that this is another tax increase. It is a payroll tax increase. We will go into that a little later. I want to talk about why we would say that.

Perhaps the Liberals have read the reports. I mentioned previously in my question the McKinsey report finding that four-fifths of Canadians are on track for a good, adequate retirement income. The report also says this compares very favourably with other developed countries. However, the Liberal government has said, “We have one-fifth of the people that we can help, but let's hit everyone with the tax. Let's hit small business and every employee, and let's see the coffers go up in the CPP investment. We will just do what we can to increase taxes.”

This is at a time when our economy is faltering. The problem is timing. Is this a good time, over the next five years, to invoke new taxes and hit the pocketbooks of employers and employees? I would say it is not. In fact, every time we turn around there is another story in the papers about our finance minister meeting with economists, trying to figure out why our economy is not growing.

Is there a retirement crisis in the country?

The Canada pension plan is but one pillar of a very strong, strategic pension retirement strategy that every Canadian should have and that the government believes Canadians should have. The first pillar is a strong, solid CPP.

The second pillar is the OAS and GIS. This pillar is there for lower-income Canadians. In fact, our government enhanced the guaranteed income supplement. This government has said it is going to do the same. Those are areas where we can effect change for that other fifth, or that other 3.7% who are living not in poverty but below where we would like to see them living in their retirements. Is there a crisis with CPP? I think there is not.

The third pillar, I never hear the Liberals and New Democrats talking about. That pillar is personal private investment. It is things like RRSPs and tax-free savings accounts.

I was privileged to serve with Minister Flaherty and Minister Oliver on the pension file and dealing with CPP. Our government wanted to be certain that Canadians had a dignified, secure retirement, so we did things like bring forward the pooled registered pension plan, where those 60% of Canadians who do not have a pension plan could be part of a pooled pension plan that would be administered by the provinces.

We brought forward things like the tax-free savings account, making certain that Canadians could put $5,000 a year in a TFSA and watch it grow. They could watch the power of compounding interest. Then we saw that 60% of Canadians earning under $60,000 were topping up their tax-free savings account, so we doubled it. We took it to $10,000. By far, a large majority of the people investing in the tax-free savings accounts were pensioners, seniors. They were putting their savings in there and watching the power of compounding interest work for them.

We also brought forward pension income splitting for seniors, and pension income splitting. All of these the Liberals said they would either cut back or eliminate. They are going to get rid of the way people save. Why is that? It is because the Liberal way is the big government way: let the government look after them in their retirement.

I have fears about what will happen, even now with some enhancement, if people stop saving.

In 2013, the total household net worth of Canadians was $7.7 trillion, split almost equally among pension assets, CPP, QPP, RRSPs, employer pensions. Also included in that were real estate equity and other financial and non-financial assets. It was pretty diversified. Most Canadians had a good portfolio when it came to their retirement.

However, I have heard over and over today members say that people are scared about their retirement, that they are uncertain about their retirement. That may very well be the case, because who knows how long one will live? Who knows how much money is enough?

I know people who will actually do better in their retirement than they have done through many years of working if they sell their home and downsize. They will have a better income in their retirement, but they are still fearful. One does not know the amount of time or the amount of money needed.

This bill would take money out of the pockets of those Canadians over 40 years and it would leave them with very little. It is not like another pension plan where, when I pass away, all my savings from CPP go to my wife. That is not what happens. She gets a very small portion of the dollars I may have invested in it over 40 years. Then, when she passes away, how much out of this pension plan is passed on to our estate, to our children? Zero. It is not the greatest pension plan in the world when we compare that with just about everything else.

Is it a needed pillar? Absolutely. There are some who depend on it, and we absolutely want that pillar strong.

The Liberals feel they can solve the pension crisis when there is no pension crisis and they will do it by taking money from everyone and putting it into a fund. When I am gone, it goes back into the CPP and it stays there. It is certainly not the best investment for our retirement.

Currently, CPP premiums are set at 9.9% of an employee's pensionable earnings, between $3,500 and $54,900 per year, up to a maximum contribution of $4,959.90 per year, split evenly between the employee and the employer. Eighty-three per cent of Canadians households are on track to maintain their current living standards according to the study by McKinsey, which I already referenced.

According to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in the late 1970s to 3.7% today. It is among the lowest in the world. We should be encouraged. The member for Newmarket—Aurora says that if there is only one senior living in poverty, we need to do something to help. However, we can actually be proud of this.

Do we have to help the 3.7%? Yes, but let us do it in a measured way. Let us do it in a way that will not hurt our economy more than what we have right now. When I was in cabinet, that was one of the other things we were encouraged by with Canadians.

Canada's savings rate has climbed from 7.7% of pay in 1990 to 14.1%, today. That is according to C.D. Howe. People are starting to realize that if we encourage them toward their own private portfolios, the tax-free savings account, the RRSPs, pool registered pension plans, they will invest in those things.

The Liberals cut back those measures. Why? I am thankful they did not cut the pension income splitting for seniors like they had said they would do However, they do not believe that personal incentive and initiative should count, that big government will look after them. It is a typical socialist plan and strategy to have people sit back and let government look after them. However, Canadians are catching on and savings rates are going up. We need to ensure that the poorest Canadians are looked after with a strong OAS and GIS.

Finance Canada's analysis shows that the higher CPP premium will hurt the economy. I want to speak to that for a few moments. Right now our economy is hurting. In Alberta, right now we have a crisis not only in the gas and oil sector, but we have a crisis in agriculture where 40% of the crop is under snow. We saw a little of that many years ago in September, but when we come into November, there may be a writeoff of many crops that are under snow. Be aware of that.

Small businesses are being hurt by the low price of gas and oil. They know that many of the businesses are laying off employees and employers are scrambling with incentives to stay such as job sharing, and so on. They are frustrated that their incomes are dropping and that they cannot keep their employees busy. Then they hear the government is coming in with a new carbon tax, a tax on everything.

We heard where 100,000-head feedlots were shutting down and one of the reasons they were shutting down was because of the red tape, the carbon tax, all these extra taxes that the government was throwing at them. Now the Liberals have come with another scheme with the CPP. It will cost every employee more. It hurts the economy.

In many of the discussions we had with finance ministers from across the country they all said that we should wait until our economy was strong, that we should move forward with CPP enhancement when the economy was strong. Our finance minister meets every week with economists who keep trying to explain to him why our economy is slowing down and not meeting expectations. The Liberals' answer to that is another tax.

It is poor strategy in my opinion. It is a strategy that will not help seniors. I have seniors who call to tell me they think it is all right to have a CPP enhancement. I tell them that not one nickel will go to them, that it will help them 40 years down the road. It will not reach the full enhancement until 2025. No seniors today or no one close to approaching their senior years will benefit from the bill. It is a bill that will help someone who is 20-years-old today and it will only help marginally and it will hurt magnificently. It will hurt because it will hurt the economy.

A CPP tax hike will reduce employment by 0.04% to 0.07%. The Canadian Federation of Independent Business represents over 100,000 small businesses. It said that if Liberals moved ahead with CPP enhancement, many of those businesses, and I think it was 60% of them, would either cut hours or cut employment. A high percentage said that they would not hire any new workers. If they have another increase in expenses, if they see another input cost expense, they will not hire new employees and they will cut hours or cut employment.

If people want a strong, dignified, secure retirement, they had better have a very secure and dignified job today. If people do not have a job, there is no dignified retirement. That is the problem. We have a government that is driving this economy into the ground and more and more people are being laid off and unemployed.

Our problem is that we have a government that does not recognize what we need to do to have an economy that moves ahead strong.

Finance Canada's analysis indicated there would be 1,050 fewer jobs per year for 10 years. It would reduce the GDP by 0.03% to 0.05%. It would reduce business investment. It would reduce disposable income of the average employee. It would reduce private savings by 7% over the long run. Why? Because there are Canadians today who will say that because of a CPP enhancement, they do not have to put money into my RRSP, or top-up they tax-free savings account, or save. The CPP, OAS, and GIS will look after them. That is not the message we want to give to Canadians.

According to the CFIB, a full 70% of small business owners disagree that the enhancement would be modest. They see this as having a big impact on their businesses. I would remind the government that 90% of the jobs created in our country are created by small and medium-sized business. They say this is not a modest increase.

Ninety per cent of small businesses think it is important to have a public consultation before anything on this is finalized. That is according to the Canadian Federation of Independent Business. A paper released by the C.D. Howe Institute shows that the Liberals' CPP plan would not benefit low-income workers, that they would see their premiums go up. Yet their net increase in retirement benefits would remain low since higher CPP payments would be offset by clawbacks in GIS benefits.

Canadians are unaware of the implications that this CPP enhancement would have. Angus Reid found that 9% were following the debate, and very few understood what was meant. The CFIB Ipsos survey found that the majority of Canadians did not know the design of CPP and how it worked. In fact, it found that many people believe that the government paid into CPP, whereas we know it does not. It perhaps pays into the GIS and OAS, but not into CPP. Many Canadians, we know, always like the idea of an enhancement until they realize the government is taking money from one pocket and putting into the other. It is stealing from Peter to pay Paul. Typically we do not have any complaints from Paul when that happens; it is usually Peter.

The government is determined to push Bill C-26 through. It is a majority government so obviously it can do that. The Liberals are going to go ahead without the consent of employees and employers. They are going ahead contrary to what the provincial finance ministers said, which was to wait until the economy was strong. There is more education needed for the average worker and for firms. There are many other alternatives, and I wish I had more time to speak on that.

Regarding the tax-free savings account, at one time many people asked why the government would even go there. They said that it could not work, that it would not work. We found out that 12 million people bought into it, 2 million people maxed out on it, and 70% of them made under $75,000 and 60% under $60,000. Low and middle-income Canadians were seeing the benefits of this. Why does the government not grab some of that and say that it can do these thing, but it will also enhance the way Canadians can save?

We want a secure, dignified retirement for all Canadians. These are not the measures that will get us there.

[Kevin Sorenson, Conservative, Battle River—Crowfoot, AB]

Mr. Speaker, it is indeed a pleasure to rise in this place to speak on behalf of my constituents of Battle River—Crowfoot against Bill C-26, known simply as the Liberal CPP tax hike. I think—

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Mr. Speaker, I want to thank my colleague from Laurentides—Labelle for his contribution today. He, like all members in the House, realizes how important Bill C-26 is to society and to ensure the growth of our economy well into the future.

Today many Canadians are worried that they will not have enough money for retirement. We all heard this when we were knocking on doors during the campaign. Middle-class Canadians I know who have worked hard their whole lives are working harder than ever but are still concerned that they will not be able to afford retirement. This is wrong. This is not a great policy for Canadians, and we should all make sure we make the necessary changes today so that retirement income exists in the future. That is what Bill C-26, in essence, is all about.

The facts tell the story. Fewer and fewer Canadians have workplace pensions to fall back on. The days of working for one company for 35 to 40 years, although a romantic notion, I am afraid are over. That is the reality we face. We can all harken back to Mad Men. I know everyone here enjoys Netflix, and I am sure everyone here has watched an episode or two of Mad Men. Those days of working for one company for an entire career are over.

That may be good or it may be bad, but the consequence of that reality is that there are no company pensions to look forward to at the age of 65, when we punch out of work on the final day, say goodbye to all our friends from those 40 years, get our gold watch from the boss we probably never really got along with, and ride off home into the sunset to put our feet up on the footstool, have a cold beer, and ponder the next 20 years of our lives, wondering when the kids are going to call. That does not exist. That is not the reality for so many Canadians.

Perhaps it should be, and perhaps we wish it would be, but wishing and hoping does not put food on the tables of seniors. We need to make sure that we are responsible as a government and make decisions today that, yes, are difficult and challenging, but they are decisions that will help in the future, and not only seniors.

I think we all hope to be seniors. Some of my colleagues already are, but I hope to be one some day. I want to make sure that I live in a society, a country, and an economy where everyone can live with dignity and can afford to not only buy the necessities of life but to contribute to the economy.

This is right, not just for social reasons but for economic reasons.

For businesses to thrive in any economy, they need consumers. Consumers need to have money. Seniors who do not have money cannot consume and therefore, small businesses, big businesses, and medium-sized businesses are limited in the amount of profit they can make, because the market is smaller than it ought to be. This is why Bill C-26 is important. This is about the future of Canada and Canadians, but it is also about the economy of the future, and I am happy to be part of a government that has introduced Bill C-26.

We made a commitment to strengthen the Canada pension plan to help all Canadians achieve a strong, secure, and stable retirement. Those three words are important. Strong means that people do not have to worry from day to day. Strong means remaining active participants in Canada's economy. Strong means not relying on our children, grandchildren, or food banks for groceries or asking someone to help pay our rent, keep our hydro on, or pay our monthly bills. That is important, I am sure we can agree, to Canadians.

Canadians also need a secure retirement. Canadians are living longer, which means that retirement will be longer. We do not want Canadians to be in a position of dreading that their money will run out before they do. That is not ideal. That is not a secure environment and is not what anyone in the House would want.

We also want a stable retirement, which in my opinion means that Canadians can enjoy retirement. Canadians who have worked for 40 years, who have grown our economy, who have put children through college and university, who have bought houses, cars, automobiles, washers and dryers, clothes and groceries, all the things that sustain and grow the Canadian economy, deserve to live with stability and peace of mind in their waning years. The sad truth is that too many Canadians are not living under these circumstances today. That is what Bill C-26 is trying to address. We would be hard pressed to find anyone in this House who does not agree with at least the goal of Bill C-26, which is to ensure a stable, strong, secure retirement for Canadians and a strong economy well into the future for Canadians.

The other issue is that demographics are making this more urgent than ever. More than one-quarter of Canadian families nearing retirement today, which is 1.1 million people, will face a drop in their standard of living and will not be able to retire with the dignity they deserve. This demographic reality should make all of us realize that something needs to be done. In my opinion, Bill C-26 does exactly what needs to be done.

There is always change, but it needs to be done moderately and modestly. This bill achieves those goals. We want to make sure that these changes are affordable. We will phase them in slowly over seven years, from 2019 to 2025, so that the impact is small and gradual, which is an important component of this bill, one that ought not be overlooked.

This deal will boost how much Canadians would get from their pensions, from one-quarter of their earnings now to fully one-third, which I think is an important facet of the new legislation that needs to be fully appreciated. It makes this bill strong social policy and strong fiscal and economic policy.

We know that this deal came about because of the agreement in principle reached among all the provinces, with the exception of Quebec, which we hope will be working toward something similar. This is important. It is an important element of today's debate that we could get an agreement in principle, with the number of provinces and our diversity and diverging points of view on so many policies. With many topics in Canadian life today, it is hard to find any consensus. I will not say that it was easy, but we have reached an agreement in principle now, and that needs to be given some weight when we consider how we will vote on Bill C-26.

Whether we live in B.C., Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and Labrador, or any of the three territories, I think we can all agree that we deserve the right to retire with dignity. We deserve the right to retire with stability. This is inarguable. I think the best approach to get there is what we see in Bill C-26.

I would submit that anyone who cares about seniors today or tomorrow, who cares about Canada's economic integrity well into the future, and cares about Canada's economic integrity well into the future, would be hard pressed to vote against Bill C-26. Every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Through this enhancement, we have taken a powerful step to make that happen. Let us not lose this chance, this historic opportunity, to make sure that all Canadians, today, tomorrow, and well into the future, retire with the dignity they deserve and have earned. To do anything else would be foolhardy.

[David Graham, Liberal, Laurentides—Labelle, QC]

Mr. Speaker, I will be sharing my time with my colleague from Newmarket—Aurora.

The average age in my riding, Laurentides—Labelle, is among the highest in the country. According to the 2011 census, the average age was 49.5. It will surely be more than 50 according to the 2016 census. In some communities, homes are listed at less than $40,000 and are not even selling at that price. Young people are leaving the region in droves and seniors are only staying in retirement. We have many challenges and we welcome many changes for seniors. As a government and as a party, we like to plan for the long term and not just for tomorrow.

Therefore, I am very pleased to speak to Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act. There are several reasons for that.

This bill is the promise of a better future. It also reflects the government's commitment to help Canadians achieve their dream of a more secure retirement. This is a long-term project. It is a project for the future and for young people who are currently preparing to enter the labour force. This next generation will also be assured of a dignified retirement. We are acting for a future that goes beyond any election cycle to help those who will come after us.

We are building on what was accomplished by the decision-makers of the 1960s who created the Canada pension plan, enhanced old age security by creating the guaranteed income supplement, and implemented measures that, in the long-term, would significantly reduce poverty among seniors. What is more, we are here in a true spirit of federalism because the agreement to enhance the Canada pension plan or CPP comes from a real spirit of co-operation with the provinces, who approved the approach.

Is the enhancement of the CPP necessary? Absolutely. It is essential, and I will explain why.

Middle-class Canadians work hard, but they still do not feel as though they are making any progress. One in four families who are approaching the age of retirement may not be able to save enough money to maintain their current lifestyle when they retire. That represents 1.1 million families. We had to take action.

We also have to accept the fact that fewer and fewer companies are offering defined benefit pension plans and that fewer Canadians have such a plan. It is a major challenge for Canadian families and it is time we dealt with this.

The agreement we reached with the provinces will increase the retirement income of Canadians who are in this difficult situation, and also promote economic growth and create jobs.

How will the CPP expansion work? There are two key things to keep in mind.

First, the CPP currently replaces a quarter of Canadians’ average annual earnings. The new CPP will replace a third. Future retirees will therefore have more money in their pockets. Take Mila for example. She is a mother who has earned on average $50,000 a year during her working life. Under the current plan, she will get $12,000 when she retires. Under the new plan, Mila could get a little more than $16,000.

Second, the maximum level of pensionable earnings will go up 14% by 2025. That means the maximum annual CPP benefit, which is currently $13,110, would go up to $20,000 in today's dollars. Under the enhanced CPP, the maximum benefit will go up by almost 50%. It is clear that these changes to the CPP will make life better for retired Canadian workers and will help them achieve their goal of a strong, secure, and stable retirement.

How much will this cost? For most Canadians, the contribution rate will rise by just 1%. Take Kevin, for example, who earns about $55,000. His contributions will increase by $6 per month in 2019. Once the progressive implementation is complete in 2025, Kevin's contribution will have gone up by about $43 per month. That minor increase will be largely offset by his higher retirement income. With the enhancement, Kevin will collect approximately $17,500 per year in today's dollars in CPP benefits, which is about $4,400 more than under the current plan.

I should also mention that contributions to the enhanced portion of the CPP for wage earners like Kevin will be tax deductible and that a tax credit will continue to apply to employees' current CPP contributions.

We can therefore proudly say that Canadians will have more money in retirement thanks to the new CPP. Furthermore, the budgets of low-income workers will not be affected, because the working income tax benefit will also be increased to offset the premium increases.

I would like to add that our government has decided to give everyone time to prepare for the new provisions. The changes will implemented gradually over seven years, from 2019 to 2025. This is the responsible way to go, to make sure that businesses and workers have time to adapt.

We are taking into account the problems that exist at the provincial and national levels. We have engaged with each province to discuss their particular situation, and we will continue to do so. We took steps to ensure that we could implement these measures in a way that will not hurt businesses, because we want the owners of businesses of all sizes to be assured that the government will implement these changes to CPP without harming the functioning of the Canadian economy.

As I said in my introduction, the government is creating a better future for Canadians, especially the middle class. This will have a much broader impact on all Canadians, because it is important to have a long-term vision. Higher CPP benefits will lead to greater domestic demand, which will stimulate the Canadian economy. Since savings will grow, more money will be available for investment, also thanks to the new CPP.

As a result, we expect the gross domestic product to increase by 0.05% to 0.09%, which represents approximately 6,000 to 11,000 new jobs. Quite simply, an enhanced CPP means more savings and a better retirement.

Middle-class Canadians will then be able to focus on what matters most, such as spending quality time with their family and friends, rather than worrying about not being able to make ends meet. It is important that we plan for the future.

[Rachel Blaney, NDP, North Island—Powell River, BC]

Mr. Speaker, I am happy to rise today to speak on Bill C-26. I will be voting in favour of it.

I am very proud to represent the riding of North Island—Powell River, which is full of hard-working people from many sectors, largely the resource sectors. It is in a wonderful place of transition right now. I do know that all the hard-working people in my riding work hard towards a good retirement. That is a priority for all them.

In my riding, I take a lot of time to speak with seniors. Earlier this year, I was really proud to travel around Campbell River and go to several different seniors centres the day before Canada Day. I have to say that I really appreciated Carol Chapman and the Canada Day planning committee who worked so hard to allow dignitaries to go into these homes annually and to be with the seniors the day before, and really get an opportunity to speak and chat with them.

It was heartbreaking in some cases to talk to senior constituents of mine who have multiple challenges as they age, including concerns about how they are going to make ends meet and afford their medication. That is a reality in this country and my riding.

This bill will take 49 years to reach full implementation. My son just turned 16 in June, and he will be experiencing the full benefit of it. However, the reality now is that many seniors are living in poverty, and that number is growing in my riding. On a weekly basis, constituents are contacting my office to share their real challenges. The truth is that Bill C-26 will not address these issues. My office hears about seniors who are making choices between purchasing medication, buying food, paying for the heat, or figuring out how they are going to pay for transportation.

This is not a discussion that seniors should be having in a country like Canada. In the numerous town halls I have held on seniors issues in the riding, seniors say that what they really want to see is a national pharmacare program. These seniors were very clear that affordable medication would be a real change for them and would make a real difference.

There was also a clear demand for a national seniors strategy. I can see why. Nationally, we know what is happening. There is a Broadbent Institute study and analysis of the economic circumstances of Canadian seniors, and it tells us a startling story. The study found that 47% of Canadians aged 55 to 64 are without an employer pension plan. It also found that roughly half of Canadians aged 55 to 64 are without a workplace pension and have less than $3,000 saved for retirement. The poverty rate of seniors has increased from a low point of 3.9% in 1995 to 11.1% in 2013, or to one in nine seniors.

One of the particular privileges of being a member of Parliament is that we get to speak to and be in our communities. I was heartbroken when one person who had worked with the homeless population for over 30 years made time to come to see me to tell me that in the last three years he had seen a startling change. For the first time, seniors were walking through the door, telling him stories of being at risk of homelessness. Seniors, people in their 70s, were couch-surfing.

How can that be in Canada? How can it be that seniors are now seeing homelessness as one of the options they have to face at a time when we should be taking care of them?

In my riding of North Island—Powell River, we are seeing these issues increase. For example, in Campbell River, where the overall population is projected to increase by about 16.3% by the year 2030, the population of people 75 years and older at the same time is expected to increase by 128%. In the Comox Valley, where seniors 80 years and older are currently 4.7% of the total population, there will be an increase to 7.4% by 2031. Most startling, in the regional district of Mount Waddington, the overall population is expected to decrease by 9.8% by 2030, while the population of seniors 75 years and older is expected to grow by 263%.

Powell River, with 23% of its population aged 65 and older, has the ninth largest population of seniors out of 10 locations across Canada. The issues of seniors in my riding are real and growing.

This bill is a start for my child, but it is not a solution for the people I serve. We know that only 11.5% of CPP recipients currently receive the maximum benefit, and for women it is only 4.5%. These numbers are telling us an important story why we need to see a CPP increase. As Susan Eng, the former executive vice-president of advocacy at CARP, said:

So why is a CPP increase needed again? Canadians are not saving enough for retirement and government can help. Those braying “Too bad for them!” need to realize that every pension dollar reduces the need for taxpayer-funded payments like Old Age Security, Guaranteed Income Supplements or even welfare.

The other reality is that young workers are facing a more precarious work environment than ever before. Many people are facing the reality of a patchwork approach to employment. Seasonal, part-time, and temporary work is precarious work, and people are putting these kinds of jobs together to try to support themselves and, in many cases, their family.

The reality is that only four out of 10 people have a workplace pension plan. I have had young families speak to me about the debate they are having whether to save for their children's education or for their own retirement. That is shameful in this country. The majority save for their children's education. They should not be having this debate.

Sadly, I also have constituents who have to go to the food bank weekly just to feed their family. They cannot afford food and have challenges paying for their housing and everyday costs. How will they put away money for retirement? A tax-free savings account will not make their life easier.

I spent many years in the non-profit sector. The people who work in that sector are tremendously passionate about the people and organizations and services they provide, but very few of them have workplace pensions. When we look at the return on investment we get from those non-profits, it seems the right thing to make sure that the people who work for them get a return on investment for their retirement.

Poverty is also not very good for business. In the world in which we live today, with so many financial challenges, there will continue to be challenges for many in the future, such as small businesses. People who have lower incomes spend money locally. This bill would mean less abject poverty in the future, and that would result in more local spending.

Bill C-26 is a start, but I still have many concerns. I want to know how the current government is going to address the erosion of workplace pensions in Canada. How will the current government address the increasing levels of poverty among seniors while we wait for these enhancements to take place? This bill would not address the 30% of single female seniors who are currently living in poverty. How do we lift them out of poverty now? Seniors deserve better. This is a step in the right direction, but it can be better. The people of Canada and the people of my riding deserve it.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I will be sharing my time with the excellent member for North Island—Powell River.

Today I am pleased to rise in the House to speak to Bill C-26, an act to amend the Canada pension plan and other acts.

Today is a very important day. Every day spent in the House of Commons is very important, but today is especially important because we are talking about our seniors and how to show them the proper respect. They are the ones who built our country. They are the ones who raised our families. They are the ones who created and protected our culture. It is very important to show them the respect they deserve.

Every year, I tour the seniors' residences in my riding and I am always saddened to hear seniors talk about how worried they are about their precarious financial situation. They tell me they worked their entire lives and now they are receiving the minimum, roughly $1,000 a month. It is incredible to think that after working their entire lives, seniors are receiving barely $1,000 a month. That is why it is very important to talk about it and to do something about this situation.

Therefore, I would like to congratulate the Liberal Party for finally understanding, as did the NDP, that the retirement age had to be brought back to 65. The Conservatives wanted to increase it to 67. As a result of the NDP's many efforts, the Liberal government understood that that was not the way to go. Therefore, it changed the retirement age back to 65, which is a good thing.

Although it would have been possible to do better, we should mention that enhancing the Canada pension plan is an important first step in improving retirement security for young Canadians. We congratulate everyone who was involved in improving the CPP, especially the unions, who worked very hard to lay the foundation for this agreement. Nevertheless, steps must be taken now to help seniors and Canadians who will be retiring soon and who will not benefit from these measures. The government must examine this issue. It must build on the enthusiasm created by this agreement and take the steps required to improve the long-term security of today's workers when they retire.

We also need to start paying attention to something else, namely, retirement insecurity, which is beginning to reach crisis proportions in Canada. In fact, many Canadians have not saved enough to maintain their standard of living in retirement, and for various reasons. Sometimes their wages were too low, so they could not save. My constituents are asking me a lot of questions these days about the fact that people who work full time at minimum wage cannot make ends meet.

If you really think about it, that is a very serious problem. Some people work full time at minimum wage and are forced to turn to charities in order to provide for their families. That is not normal, and that is why it is important to have a closer look at this issue.

Much of the problem can be attributed to the erosion of pension funds offered by employers, to the point where, at present, six out of ten Canadians have no pension plan from their employer. Of course, some can set money aside through RRSPs, but not everyone can do that. As I just mentioned, some people who work full time for minimum wage are having a hard time making ends meet and providing for their families, so they cannot invest in RRSPs, and these are people who are working—they are not lazy. Instead, they sometimes have to turn to charities for help. Unfortunately, this is a very real situation that needs our attention and must be dealt with.

As I said earlier, the maximum pension benefit is $1,092 per month, or $13,100 per year, which is really the bare minimum for survival. People who collect that much in a year do not live high off the hog. Far from it. They live below the poverty line and have trouble making ends meet.

As I said, seniors are people who devoted their lives to our country, to raising Canadian families, and to sharing our culture. When we see what is happening to them, it is clear that they are not getting the respect they deserve, unfortunately.

We would also like the government to further enhance the Canada pension plan to offer our seniors a more dignified retirement. That is really important. The NDP is also calling on the government to stop trying to convert public sector defined benefit pension plans into undefined pension plans. People work very hard and expect a decent retirement income, but they are being offered undefined pension plans, which can increase or decrease in value depending on the vagaries of the stock market.

That is a problem. Look at what happened in 2008. That did not seem to wake anyone up because the measures that should have been implemented to prevent such situations have still not been adopted. Unfortunately, this could happen again. That is why it is important to have secure pension plans to ensure our seniors' well-being, as well as our own well-being in the long term.

We also need a long-term vision for our seniors, not only when it comes to the Canada pension plan but also when it comes to health. Right now, the Liberals are maintaining the Conservatives' bad decision to cut $36 billion in health transfers over the next 10 years.

As they say, as you get older, your body starts to give out. Seniors have more and more health problems. That is to be expected, but we need good health care services. The Liberals are not going to achieve that by making $36 billion in cuts, like the Conservatives planned to do, quite the contrary. We need to think about seniors. We need to think about our family caregivers.

I always think of my mother and my sister, Suzanne Brodeur and Maryse Choquette, who do amazing work with the elderly in a seniors' residence. They are so devoted. I often say that an MP has to be devoted, but what those women do in the health care field is true devotion.

Housing is another factor. Thirteen thousand dollars a year does not cover much in the way of housing. That makes access to affordable housing extremely important. I know that the Drummondville municipal housing office is working hard to find more housing for seniors. Without accessible, affordable housing, how can seniors survive on such a low income?

According to the Federation of Canadian Municipalities:

Some cities are already showing a significant and growing need for seniors’ social housing. Seniors are on social housing waiting lists and are at risk of becoming homeless.

Some seniors may even become homeless because we failed to take proper care of them.

I would like to congratulate the Liberal government on taking the first step toward making things better for seniors by lowering the pension eligibility age to 65 at the NDP's urging. I would also like to congratulate the government on enhancing the Canada pension plan, again at the NDP's urging. However, there is still a lot of work to do. The government needs to see the big picture and further enhance the Canada pension plan right away for everyone currently living below the poverty line. Housing and health care have to be part of the equation. The Liberals should cancel the $36 billion health care cut immediately because it is totally unacceptable.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Mr. Speaker, I appreciate the time today to speak on a topic that is very important to many Canadians.

During last year's general election, I knocked on many doors and visited with many residents, and many asked about the enhancement of the CPP. After years of hard work, Canadians have earned a secure retirement, but because of continued escalations in the cost of living, many wonder if that secure, dependable retirement will be possible in the future. As the costs of bills rise, fixed incomes stay stagnant. To address this disparity, we made a commitment to Canadians to strengthen the Canada pension plan to assist in securing a strong, secure, and stable retirement.

In order to make meaningful changes to the CPP, we need a significant change in the approach from the previous government of the past 10 years. The more than one-quarter of Canadian families approaching retirement and 1.1 million families who are facing a drop in their standard of living will be able to retire with dignity and confidence as a result of the enhancement to their CPP provided for in Bill C-26. This first major reform of CPP benefit levels since the establishment of the CPP in 1966 is without a doubt timely in its design to address the futures of our children and grandchildren.

Seniors today are benefactors of prudent planners of the Pearson government in the mid-1960s and of the Paul Martin government in 1997, who realized that times and opportunities were changing. They accordingly made adjustments to retirement funding and investment therein for seniors.

The first CPP in 1966, the GIS in 1967, and the CPP Investment Board in 1997 were pivotal changes to simplistic tax-based earlier plans initiated in 1952 with the inception of Canada's first pension called old age security. Now it is time to adapt our pension to the fluctuating, unpredictable conditions that prevail in everyday life, conditions that will dominate the lives of those approaching retirement and the experiences of our young people.

Contemporary global economic and social conditions have been radically altered from those experienced and encountered by current retirees when they were in the workplace or raising young families. An evolution of financial and social conditions, even for my peers, has rendered some of their future economic planning ineffectual and erratic.

Our young people, as we often hear, frequently make due with contract jobs, short-term jobs, if they are lucky, or jobs below their education with sometimes no benefits. They face expensive, almost unattainable housing; an inability to save regularly or under-saving; no stable retirement plan beyond RRSPs, which they cannot afford to tend; and relatively low rates of interest on any savings.

Bill C-26 would help young people address those challenges and cope with the ever-changing, unstable conditions of life by shaping a firm, reliable pension plan with a reasonable enhancement of the current plan. It is something they can count on. An updated CPP is one way that the government can assist these young people in arranging for their senior years with a fully national plan.

Already this government returned the retirement age to 65, as the right place for a meaningful retreat from the workplace. Young Canadians just entering the workforce will see the largest increase in benefits. This is the right place for a meaningful phased-in enhancement, as these young adults and their descendants will be the most vulnerable to the labour market in the 21st century.

The provisions of the enhanced plan would increase how much Canadians will get from their pension, ultimately, from one-quarter of their earnings to fully one-third. This will be a good boost for many Canadians who do not have workplace pensions to look forward to.

The previous government, for over 10 years, refused to address the needs of our most vulnerable, but this government sees the enhancement as a priority and has set it up in a logical, progressive way.

Bill C-26 is easy to support in the way that it sets up the enhancement. With this gradual phased-in approach, contributions are shared by both the employee and the employer based on the yearly maximum pensionable earnings of the employee with the specified contribution rates. By 2025, the enhancement would be fully phased in, as the making of the additional contributions is provided for in the bill commencing in 2019.

The vision of this government in establishing the provisions of Bill C-26 is level-headed and logical, balancing modest increases of contributions by employees and employers with stable results and appropriate counterbalancing taxation deductions for all participants. In Bill C-26, this government understands economic vulnerability, especially of our children and grandchildren, to the consequences of societal change. Accordingly, it focuses its priorities on pension remediation with an equitable realistic approach.

So far I have addressed the Canada pension plan alterations, as well as concurrent tax changes represented in Bill C-26. The third aspect that is the subject of amendment in Bill C-26 is the Canada Pension Plan Investment Board Act. The amendments for the investment board are necessitated by the practicalities of the other two changes. Because of the alteration to the mode of acquisition of pension funds, the staging of additional contributions, it is necessary to supply suitable instruments and modus operandi to provide for the transferring of increased contributions and in the preparation of statements.

Bill C-26 links the board to the new additional Canada pension plan account. This alteration, however, is a reflection of the positive outcomes of the enhancement phase. The investment board, an arm's length independent entity accountable to Parliament, is responsible for the workability of the plan. The board is in charge of the investment, the monies, and the contribution phases of the enhanced plan, as well as the regular contributions.

With the enhanced plan, there would be more money to invest because more has been contributed. Accordingly, pensions would increase. The Department of Finance has declared that once fully in place, the CPP enhancement would increase the maximum retirement benefit by about 50%. For example, the current maximum is $13,110. Compare that with the enhanced CPP with a maximum benefit total of nearly $20,000. Whereas early quasi-pensions in the 1950s were funded by taxes, current ones rely on good, long-term investments of employee and employer contributions.

It is a big contrast from the $40 a month or $480 a year, even in 1952 dollars. Investment is how all Canadians can save for retirement today and sustain the CPP through the instruments the government initiates and modifies. Bill C-26 would confirm the adjustments to the role of this board that is so instrumental in helping Canadians have a decent retirement.

The enhancement of the CPP is vital and most helpful to our youth. lt would also significantly reduce the share of families at risk of not saving enough for retirement. Canadians are assured of a dignified retirement.

The enhanced CPP would provide for the first substantive change to our national retirement scheme. The time has finally come to do something about retirement security. Yes, the time has come for the House to adopt this well-conceived and formulated bill. In all respects, I stand behind Bill C-26.

The House resumed consideration of the motion that Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, be read the second time and referred to a committee.

[Terry Duguid, Liberal, Parliamentary Secretary to the Minister of Families]

Mr. Speaker, I will be splitting my time with the member for Brampton East.

Let me start by saying I am so honoured to rise in the House today to speak to Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act.

To begin, here are a few basic facts about this program that has served so well for decades. It is a mandatory, contributory, social insurance program that provides partial income replacement for workers in Canada and their families in the event of retirement, disability, or death.

It began operation in 1966, and is overseen by federal and provincial finance ministers. Half a century ago, it took vision, diplomacy, and negotiation to reach this historic agreement. The then minister of national health and welfare, the hon. Judy LaMarsh, was the champion of this program, a senior member of the Lester B. Pearson government that brought us so many of our modern-day social programs.

The CPP covers employed and self-employed Canadians. Quebec has the separate but comparable Quebec pension plan. Contributions are collected on earnings above the year's basic exemption, $3,500, and up to the year's maximum pensionable earnings or $54,900 in 2016.

This is not the first time the CPP needed modernization. In the 1990s, as life expectancies began to lengthen and unfunded liabilities increased, the need to make important adjustments became clear. This change also required significant co-operation. Then federal finance minister, the Right Hon. Paul Martin, helped by his Winnipeg parliamentary secretary, David Walker, worked with provincial counterparts to do what was in the best interests of Canadians, and the CPP was significantly improved.

Today, again, we face the need for change. The proposed enhancement makes a couple of important changes. We will increase the amount of retirement pension from one-quarter to one-third of pensionable earnings, as well as the survivors' and disability pensions, and the post-retirement benefit, subject to the amount of additional contributions made and the number of years over which those contributions are made. We will increase the maximum level of pensionable earnings by 14% as of 2025. We will provide for the making of additional contributions beginning in 2019 and phased in gradually over seven years.

What is the reason for this change? Why have we brought forward the need to modernize and enhance the CPP?

First, a significant minority of Canadians approaching retirement age are not saving enough. Many middle-class families without workplace pensions are at risk of facing financial insecurity in retirement. Only 15% to 20% of middle-income Canadians are retiring with enough savings, according to a study from the Broadbent Institute. These individuals, now age 55 to 64, will face a dramatic drop in their standard of living, and many will fall into poverty.

Furthermore, most working Canadians today do not have a workplace pension. This suggests that in the not-so-distant future, more retiring Canadians will be at risk of falling into poverty as well. The bottom line is that the average CPP benefit is simply not enough to ensure Canadians the secure and dignified retirement they deserve. The previous government did not act, even though the writing on the wall was clear.

Second, the economy of today continues to undergo significant transformation, rendering a far different landscape than the one for which the original CPP was designed, most notably, the decline of workplace pension plans, as I have already mentioned, low interest rates on savings plans, and the changing nature of work. The latter refers to increasingly contract-based job markets.

We must recognize these changes and ensure that our social insurance programs address the ever-changing needs of Canadians. On June 20, 2016, Canada's finance ministers reached a historic agreement to make meaningful changes to the CPP. These will allow Canadians to retire with more money in their pockets. The bill would make the necessary legislative changes to implement this historic agreement.

The enhancement would be fully funded, which is a requirement of the existing CPP legislation. As a result, the enhanced portion of the retirement pension would accumulate gradually as additional contributions are made. The full replacement rate of one-third of lifetime pensionable earnings would be reached after 40 years of additional CPP contributions. It is important to note that the proposed enhancement represents a separate addition to the CPP. Benefits under the current or base CPP would continue to be paid as before, based on a contribution rate of 9.9% on earnings. The new or additional CPP benefit amounts, based on two new contribution rates of 2% and 8%, effectively serve as a top-up to base CPP benefit amounts.

Importantly, the bill would be phased in slowly over seven years with the fully adjusted contribution requirements not coming into force until 2025. This would allow businesses the flexibility and long-term planning required. Total benefit amounts would be calculated using the same formula as under the base CPP.

These changes are long overdue and were promised in our election platform, thus representing the fulfilment of the needs of Canadians to secure their retirements and to provide greater financial security to vulnerable members of our society.

It is important to note that Canadians back this change. According to a recent Forum Research poll, over 65% of Canadians support making changes to the CPP.

I look forward to continued debate on the proposed legislation and to working with members on all sides of the House to ensure its passage. Given the buy-in from provincial ministers across the country, nine out of 10 provinces, this truly represents a non-partisan, national consensus, one which I hope all my hon. colleagues can get behind and support.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Mr. Speaker, it is an emotional thing for me to speak to this bill in the House because it is the first time I am rising as the official opposition finance critic.

Last week, I had the pleasure of asking the government a number of questions, but I did not get any answers.

On this matter, let me pay my respects to the hon. leader of the official opposition for her confidence in giving me this crucially important role in the caucus and this democracy.

When we are talking about finance, we are talking about the heart of the country, because everything depends on our capacity or lack of it to pay for policies.

Also, I am very pleased to succeed, as well as I can, the MP for Milton who served so well as critic. We all know how well she served as a senior cabinet minister in the Harper government.

Bill C-26 does have one thing going for it: it shows just how far apart philosophically the current government and my party are.

That difference is crystal clear to us, because this proposed policy and bill show the Liberal vision for public money. For the Liberals, it is a good way to pick up money from the wallets of hard-working people. It is a good way to pick-up money from entrepreneurs and those who create jobs and wealth. However, Conservatives prefer to leave the choices and give the tools to citizens to have money in their pockets, to have money to put to other purposes, and especially to put money aside for their retirement.

The good thing about Bill C-26 is that it clearly illustrates the difference between our Conservative vision and that of the Liberals. The Liberal Party thinks it is a good idea to take more money from people and from entrepreneurs, but we think it is better to give people the tools to save money and put some aside for retirement.

What is this bill about? Basically, it would increase workers' contributions from 9.9% to 11.9%, and it would be 40 years before those workers see any tangible benefit.

That is what this bill would do. I summarized it pretty briefly, but since this is about pensions, and since anyone filing a tax return knows how tricky things can get when the time comes to pin down exactly what kind of room to manoeuvre the government has and what the rules are, I will talk about the specific rules in the bill.

At the moment, Canada pension plan premiums are set at 9.9% of pensionable earnings per employee, that is, between $3,500 and $54,900 annually, up to a maximum contribution of $4,959.90 a year, to be shared equally by employee and employer. I will come back to this a little later. It does not stop there, because over the next 40 years, CPP benefits will rise from 25% to 33% of income replacement in retirement in eligible cases. In order to fund those benefits, as I mentioned earlier, the government is going to raise pension plan premium rates from 9.9% to 11.9% beginning in 2019. In addition, the maximum yearly rate for pensionable earnings will rise to $82,700 in 2015, and earnings between the current and future annual maximums will be subject to a contribution rate of 8%. As a result, premiums, which are divided between employer and employee, will rise to $2,200 per worker. Obviously, those are a lot of figures and data. Many factors are at play here, so it is important that we do this right.

Now that the table has been set and everyone has the figures, let us really get to the heart of the matter and look at why, from our point of view, this bill is a bad idea. Increasing the Canada pension plan will leave Canadians with less money in their pockets. As we have shown, it could mean as much as $1,100 for some employees. That is the employee's share, but the employer's share will double that amount, for a total of $2,200 per employee who works in a plant, office, or any business. Families with two working parents will have $2,200 less in their budgets to raise their children and will have to make certain choices.

Another thing: entrepreneurs do not exactly have an affinity for this government, which imposed the carbon tax. The Liberals promised to lower the corporate tax rate from 11% to 9%, but they broke that promise. Our entrepreneurs are paying even more.

With the Canada pension plan bill, entrepreneurs will now have to spend more than $1,000 per employee. If this amounted to anything then at least we could say that everyone is doing their part. The problem is that it will take 40 years before this truly comes into effect. This changes nothing in the immediate future and does nothing for seniors who really need help immediately.

That too is the crux of the matter. There is nothing wrong with having a long-term vision for the Canada pension plan. We all know that there will be far fewer workers in the job market five, 10, 15, or 20 years from now, or so the demographics suggest. We have to take the necessary measures.

However, the necessary measures being proposed by the current government seek to take even more money out of everyone's pockets. When we formed the government, we implemented positive and constructive initiatives that were based on individual choice. That is the big difference.

Whereas this government thinks it knows what is good for people, we think that people know what is good for them, and we give them the tools to save. The TFSA is one such tool, and I will come back to that later. These two visions are completely different. What is good about this bill is that at least the burden is appropriately shared.

Let us take the example of Mr. Smith or Ms. Smith, who is employed, or even my son-in-law, whom I saw on the weekend, and who is a nice guy by the way. Some households will pay up to $2,200 more per year.

Those just getting started in life—as we refer to those who have just finished school—all have a bit of student debt, and that is not unusual. However, when they enter the job market, they want some help. They do not want to have less money in their pockets. They definitely do not want a government that imposes new rules and that will take $1,100 out of workers' pockets. That is what the government will do.

This bill is not good for young people entering the job market who have to pay back student loans. It will also be harder for young families to save enough money to go on vacation and enjoy life with new babies and so on. It will definitely be harder for businesses to create jobs and give their workers raises because they will have to shell out an extra $1,000 for each employee.

That is $1,000 less that could have gone to pay raises, $1,000 less per employee that could have been spent on training; and $1,000 less per employee that could have been spent on productivity-boosting equipment. It is also $1,000 less toward hiring people, creating jobs and wealth, making businesses even more productive, and enabling them to share all that talent and potential with the world given that our country basically relies on export. Companies will have $1,000 less to invest in their future and the future of their employees.

Our vision, which I clearly described earlier, is to trust people. We are aware of that issue and so was our government. Our predecessors, former finance ministers Jim Flaherty and Joe Oliver, considered the situation and took steps to implement measures to allow people to save and make the choices they felt were necessary, rather than having the government impose a system on them. That is the big difference between our vision and that of the current government.

Obviously, that is why we decided to increase the guaranteed income supplement. This year, the government implemented that measure. That is a good thing. Well done. It does not happen every day, but I am pleased to say that the government followed the path that we laid out when it comes to the guaranteed income supplement for seniors. That was the right thing to do and the government implemented that measure in the budget.

I remember that we were doing a lot of interviews after the budget was tabled and a reporter told me point-blank that there must be something good in this budget. In that sort of situation, it is not always easy to come up with an answer and one has to think quickly. My thoughts immediately went to our seniors, because we knew that it would be a good thing to help them by increasing the guaranteed income supplement. That is what we did and the current government implemented that measure. Well done.

Another difference between our vision and that of the current government is that we invented what is called the tax-free savings account or TFSA. We are very proud of that. I remember quite clearly the moment that this measure was announced. I can still see my colleague from Bellechasse—Les Etchemins—Lévis, who by the way announced yesterday that he would be running for leadership of the Conservative Party. I wish him every success in that endeavour.

When he was minister, he said that people would really want that, especially people in Quebec. He was quite right, given that the tax-free savings account was one of our government's finest achievements to encourage people to save. This helped make progress on old age pension amounts. That is why we support incentives aimed at helping people save for their retirement.

The proposed measure means that the government will have to manage between $2,000 and $2,200 from the employer and employee. Can we really trust the Liberal government to manage our money? Need I remind everyone that this government was elected on a promise of small $10-billion deficits, but then presented a budget that will create a $30-billion deficit? TD Bank estimates that it could even reach $34 billion. Last week the Prime Minister said he was not really sure how this was all going to turn out in the end. Business owners are being asked to shell out $1,100 more per employee. I am not convinced that the Liberals are in the best position to properly manage public funds.

That is why we think that it is much better to trust people and allow them to make their own choices, critical choices for the future, than to take $1,100 per worker per year directly out of the employers' pockets.

If the government ever moves forward with this bill, the increase in CPP contributions will hurt the economy. There will be an estimated 0.4% to 0.7% reduction in employment, or 1,000 fewer jobs per year for 10 years. These estimates come from the Department of Finance Canada, not from a right-wing think tank.

The gross domestic product will drop by 0.3% to 0.5%, business investment and disposable income will drop by 0.3% to 0.6%, and long-term private savings will go down 7%.

That is not what we would call an economic stimulus for creating employment and wealth. It is hard to do worse than a reduction in employment, GDP, investments, disposable income, and private savings. All these economic development factors appear together in the same sentence and it is all bad news. It is hard to do worse when it comes to creating wealth and employment.

The Fraser Institute found that a 1% point increase in the CPP contribution rate reduces private savings by nearly 1%.

When Canadians workers who get up in the morning, work hard, and want value for their money realize on Thursday that they will now have $1,000 less a year in their pockets because of the government and its changes to the CPP, they will certainly not be inclined to save. We are not the ones saying it. It is the Fraser Institute.

The less people save, the more at risk they become. That is the difference between our vision and the Liberal government's. The Liberal government is telling people what is good for them. We trust people because we believe that they know what is best for themselves.

Let us talk about entrepreneurs. According to the Canadian Federation of Independent Business, 70% of small business owners do not agree with the proposed CPP hike, which could have a direct impact on their business. The Canadian Federation of Independent Business, meaning the entrepreneurs who create jobs and wealth and know how to manage a company, are telling us that this is not a good idea.

Furthermore, 90% of small businesses believe it is important that public consultations be held before finalizing any agreement. Where, how, with whom, and how many times were public consultations held? We did not really get much of an answer.

A C.D. Howe Institute report indicates that the Liberals' plan will not benefit low-income earners. This independent economic institute says that their contributions will increase, but the net increase in retirement benefits will be low because the higher CPP benefits will be offset by a clawback of GIS benefits.

In other words, what the government takes with one hand, it may not necessarily give back with the other. That is the problem. That is why we established the guaranteed income supplement, and it has been a big help to those in a difficult situation. That was a positive move.

The Liberals are so much in agreement that they adopted our approach. Well done. However, Bill C-26 will take more out of people's pockets, which will put them at greater risk.

That is why Canadians do not like this bill. According to Angus Reid, only 9% of Canadians have been following this debate. That is worth noting. We are not talking about something that might happen at some point. This will affect all Canadians and all workers, yet a mere 9% of them are aware of what is going on in the House right now.

According to a poll conducted for the Canadian Federation of Independent Business, the majority of Canadians know nothing about the funding structure of the Canada Pension Plan. It turns out that 70% of working Canadians oppose an expanded CPP. More than one-third of employed Canadians say they cannot afford the proposed hikes. More than 80% of Canadians want the government to hold more consultations before making a decision.

That is the reality we are dealing with today because this measure will affect all Canadian workers. We have to do something to ensure that people at least know what this is about. We need to take our time and debate this important issue thoroughly.

Let us look at the situation facing seniors. According to the McKinsey firm, 83% of Canadian households should maintain their current standard of living in retirement. According to Statistics Canada, the number of low income seniors has dropped from 29% in 1970 to 3.7% today. That is the lowest poverty rate in the world. This very interesting fact deserves to be recognized.

According to the C.D. Howe Institute, Canada's savings rate has climbed from 7.7% of one's salary in the 1990s to 14.1% today. Poverty among seniors is therefore declining, twice as many Canadians are saving, and the savings rate is double what it was 20 years ago. Those are all good things.

Poverty rates among seniors have dropped and Canadians are saving more. We believe in reasonable, positive incentives to encourage saving, rather than coercive measures that take money out of taxpayers' pockets.

That is why Dan Kelly, president and CEO of the Canadian Federation of Independent Business, said that it was extremely disappointing that the Minister of Finance is putting workers' wages, hours and jobs in jeopardy.

The chief economist at the Canadian Federation of Independent Business said that the agreement would have a serious adverse effect on workers and the Canadian economy. According to him, the announced changes, including higher contributions, could put salaries, working hours, and Canadian jobs in jeopardy. This is not good for the economy.

Yves-Thomas Dorval, from the Conseil du patronat du Québec, says he is concerned about the new direction of the Canada pension plan and its impact on the Canadian economy. He says that there is no universal solution for encouraging retirement savings. On the contrary, this could have an adverse effect on economic activity, employment, and salaries.

As far as seniors are concerned, Charles Lammam from the Fraser Institute wrote that instead of spending political energy debating CPP expansion by falsely believing that many middle- or upper-income Canadians are not saving enough for their retirement, the focus of public debate needs to shift to finding better ways to help financially vulnerable seniors.

That is why our party opposes this bill. We do not think it is a good idea to take even more money out of workers' pockets and to force businesses to give even more money to the government.

We think that the best way to encourage people to save for a decent retirement is to give them the tools they need to make the choices that affect them. They are the ones who are in the best position to know what is good for their retirement, not the government.

That is why our government implemented positive measures, such as the guaranteed income supplement and the TFSA, which allow people to make their own informed choices. Rather than imposing a new tax on Canadians, we helped them to save for their retirement.

All this government wants to do is meddle in people's lives even more and take money out of taxpayers' pockets. We trust Canadians' good judgment. That is why we oppose this bill.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Mr. Speaker, I really do not have to go that far to find an example. My mother, a single mother who has worked for over 30 years in this country, is not that well off in retirement.

The increase in the guaranteed income supplement introduced in the budget has helped, but there is certainly a lot more that we need to do with respect to housing. It is a commitment that we as a government have. I believe that $20 billion is going forward for housing. Ideally, that will go toward senior housing as well.

The issue of income security for seniors is top of mind for us. It is one of the first things we did as part of our commitment to increase the guaranteed income supplement. Rolling back the age of eligibility for old age security from 67 to 65 will help seniors in the future. Certainly, the increased CPP from Bill C-26 will also assist.

Therefore, a combination of these programs will definitely assist, but I do share my friend's concerns.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Mr. Speaker, I am proud to speak this afternoon about Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act. I am proud to stand today in fulfillment of one of the key election promises that Liberals made about a year ago. These changes would make life better for a new generation of retirees.

In today's dollar terms, passage of this bill would mean that the maximum CPP benefit would go from $13,110 to nearly $20,000 per annum. This would represent the single largest change in the CPP in a generation. A change of this magnitude requires the consent of seven out of the 10 provinces, and we have that.

This proposal is a long time coming. On June 10, 2010, the former minister of finance for Ontario, Dwight Duncan, wrote to the then minister of finance seeking expansion of the CPP. I would like to quote his letter, which states, “Ontario supports a pan-Canadian approach to the reform that will provide tomorrow's seniors with better, lower-cost tools to maintain their standard of living in retirement.” Notwithstanding repeated requests for action, the previous government simply failed to advance this issue federally.

The Province of Ontario decided to go ahead on its own, with the Ontario retirement pension plan. As the program was rolled out and ready for implementation, our Minister of Finance took charge and developed a newly expanded CPP program.

This is a historical development for our country. While it is not the solution for all of our pension and retirement woes, it certainly is a great leap forward. The next generation of Canadians needs to live with independence, dignity, and pride in retirement.

I would like to take this opportunity to commend and thank our Minister of Finance and all of his provincial counterparts for reaching this historic agreement on retirement security for Canadians.

Under Bill C-26, contributions would gradually increase, starting in 2019, to a total of an additional 1% of earnings for employees and 1% of earnings for employers by 2023. For self-employed persons, contributions would also slowly rise to a total of 2% of earnings by 2023. Employee contributions would be tax deductible. For the first time since 1965, income from the CPP would increase from 25% to 33% of a person's pre-retirement income, to a maximum income threshold of $82,700.

In addition to the changes to the CPP, our government has already implemented two key changes that would help retirees. First, we increased the guaranteed income supplement for single seniors by 10%, to a maximum annual top-up benefit of $947. We know that Canadians work hard and deserve to retire in a timely manner, and, as such, we rolled back the eligibility for old age security from 67 to 65 years old. Even then, for many, the thought of retirement itself is highly stressful because many will not able to maintain their pre-retirement standard of living.

I want to take a moment to review the current options for retirement income. There are essentially two types of retirement funds available for Canadians. One is provided and administered by governments and the other by individuals and corporations. Most Canadians have an element of both. The public scheme includes the guaranteed income supplement, old age security, and the Canada pension plan.

I will focus on the second option, which comprises a range of registered employer programs, often set up by employers for the benefit of their employees and a host of private investment options, such as RRSPs, TFSAs, and other investment instruments.

For the generation before us, retirement was part of the life cycle. If you had a well-paying, secure job, you took retirement for granted. Workplace pensions were the norm, but with changes to the global economy, fewer and fewer Canadians now work in jobs that have registered pension plans. In fact, since 1993, the percentage of Canadians with workplace pension plans has dropped from 30% to just over 23% today. This downward trend is likely to continue.

Additionally, the trend has been away from defined benefit plans, like the CPP, which guarantees set payments, to defined contribution plans that provide pensioners with much less security. Now many Canadians are on their own for their retirement. They have to use RRSPs, TFSAs, and private investments through multiple investment vehicles, and that is if they are lucky.

The private options have several limitations. First, the current challenge in the job market is not the same as it once was. It is much more difficult for people in their twenties to find a job, let alone one with a good pension plan. In 2012, the unemployment rate for youth in Ontario was a staggering 16.9% and in some communities, including mine, it was much higher than that. If the youth in our communities have to work in low-paying jobs in which they cannot earn a good living until they are in their late twenties or even in their thirties, how can we expect them to start saving for their retirement?

Second, even if an individual has investments, they have faced a very vulnerable market in recent years. Members will recall the financial meltdown in 2008. As a lawyer at that time, I met many families who were exceptionally stressed about their future. They were worried about losing as much as 40% of their portfolios. Many, in fact, have still not recovered from that loss.

Third, there is the issue of historically low interest rates. Today, we have many retirees who saved up, were diligent, and are now facing a decade of historically low interest rates. I searched the popular portals for the best possible advertized interest rates today. The current maximum payout is 2% per annum. They are the lucky ones. For a family that worked hard and was able to save $500,000 and placed it into a bond or a GIC, the maximum payout is $10,000 per year. The chances are that historical low interest rates will be around for a while, so those with modest or even good savings will not be able to meet their needs.

I think it goes without saying that one of the major benefits of the CPP is the exceptional management provided by the CPP Investment Board. Even in these most volatile times, the CPPIB is one of the best run investment firms in the world. They have managed Canadian retirement funds for 50 years with prudence, and yet in the last five years alone they have yielded an annualized return of 10.6%.

I know that my friends opposite feel that the changes to the CPP will be an additional burden on our employers and may limit job creation. Up until last year, I ran a law firm with about 20 employees at the peak of my practice. I prided myself in making payroll each and every pay period. For most small businesses this is often the test. I ran the firm for 10 years, and during this time my employees were the reason for my success. Without employees, I would not have been able to succeed, and I can assure hon. members that all small business succeed because of who they have working for them.

Most small business cannot afford to set up private defined benefit systems or extended health coverage. Most of us rely on our publicly funded and administered programs, which are the envy of the world. Between student loans, the high costs of housing and transportation, and the day-to-day expenses of running a household, there simply is not enough money to save for retirement.

That's why an expanded CPP system is good for small business. They can continue to retain good staff, be good employers, and be assured that a well managed investment board is the custodian of their and our future retirement. I contend that the peace of mind and security of a better retirement will ensure a more productive workforce.

After a lifetime of working, we must do more to ensure that people are able to retire with dignity. We cannot leave this to the marketplace alone. Governments, especially, the federal government, must lead in filling these gaps.

Today 24% of families nearing retirement age are at risk of not having enough savings to maintain their standard of living when they retire. With Canadians living longer than ever, many Canadians also risk outliving their retirement savings. By enhancing the CPP, we will reduce the number of Canadians without sufficient retirement savings.

In closing, I would like to applaud the Minister of Finance and departmental officials for introducing a bill that is so well thought out. It is a piece of legislation that is truly good for Canada. When people look back on this Parliament, the enhancements made to the CPP will certainly be one of its legacies. By taking the steps now to improve retirement security for Canadians, we can ensure that more Canadians can retire with peace of mind.