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.

Bill C-26--Time Allocation Motion

[Bill Morneau, Liberal, Minister of Finance]

Mr. Speaker, time allocation is the only tool that exists for a government to advance legislation when a stalemate exists. We have a duty to move forward all legislation, including important financial legislation, to make sure we move forward on the agenda that we have for Canadians.

I would like to just respond to some numbers. Including today, we have had eight days of debate on Bill C-26 at second reading. On Bill C-26, this has allowed nearly 70 members of Parliament, including nearly 40 Conservatives, to participate in debate so far. This represents nearly one half of the Conservative caucus.

Our government is committed to helping Canadians to achieve their goal of a safe, secure, and dignified retirement. We know that Bill C-26 would move forward that agenda in a way that would make a difference for all Canadians across this country. We are moving forward in a way that allows us to do what we know is right for Canadians.

[Bardish Chagger, Liberal, Leader of the Government in the House of Commons and Minister of Small Business and Tourism]

Mr. Speaker, I move:

That in relation to Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, not more than one further sitting day shall be allotted to the consideration of the report stage and one sitting day shall be allotted to the third reading stage of the said bill; and

That fifteen minutes before the expiry of the time provided for Government Orders on the day allotted to the consideration of the report stage and on the day allotted to the third reading stage of the said bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and in turn every question necessary for the disposal of the stage of the bill then under consideration shall be put forthwith and successively without further debate or amendment.

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

Mr. Chair, we've been very supportive of the NDP for raising their views and not having debates shut down as it was in previous times. That being said, this particular motion is exactly the same motion they put forward to try to steal the thunder of the NDP. They raised an issue they thought had resonance. This is more a fight between the Liberals and the New Democrats to show who cares the most about these kinds of issues. We've already made our comments very clear on Bill C-26. We're just going to step out and let the Liberals and NDP deal with one another on this matter.

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

I question the relevance of studying this motion when we haven't finished discussing or ruling on the other motion. I also think the motion doesn't mean much since it repeats what we hear during the question period.

The federal government and the provinces meet to discuss the enhancement of the Canada pension plan. I've already seen these meetings. In fact, I've already attended these meetings, not necessarily from the inside, but at least from the outside. Details such as the issue of child-rearing and disability dropout provisions are not discussed at these meetings. A general agreement is reached on the key principles specifically.

One thing is clear in this case. When drafting Bill C-26, the government made an error that excluded these elements. There's no need to bring this matter to a federal-provincial meeting. Instead of discussing this motion, I want us to finish dealing with the motion submitted, and even amended, by my colleague, Scott Duvall. Otherwise, I would consider this matter more a political game than anything else.

The House resumed from consideration of Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, as reported (without amendment) from the committee, and of the motions in Group No. 1.

Bill C-26—Notice of Time Allocation Motion

[Bardish Chagger, Liberal, Leader of the Government in the House of Commons and Minister of Small Business and Tourism]

Madam Speaker, I would like to advise that agreements could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the report stage and third reading stage of Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

Under the provisions of Standing Order 78(3), I give notice that a minister of the crown will propose at the next sitting a motion to allot a specific number of days or hours for the consideration and disposal of proceedings at those stages.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Madam Speaker, I am rising once again 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, at third reading. I feel strongly that this will be one of the largest tax increases in Canada's history and it will disproportionately impact middle-class Canadians.

During the second reading debate, I was asked a question by the member for Avalon concerning my comments made at that time, that this CPP increase was a tax hike given that if contributors to the program died before they were eligible to claim CPP benefits, the entirety of these accrued benefits would not flow to their partners or their dependents.

The member for Avalon pointed out that because he, a sitting member of parliament, was receiving CPP survivor benefits, this major CPP contribution rate hike was not a tax.

I would like to make a couple of observations regarding the member's assertion.

Only persons who are not collecting CPP pensions are eligible for the survivor benefit. These individuals can qualify for up to 60% of the contributor's retirement pension if the surviving spouse or common-law partner is not receiving other CPP benefits.

Even under the most generous of circumstances, the spouse or common-law partner of someone who had paid into the CPP his or her entire working life would only be able to collect a maximum of 60% of his or her pension, and this would not be done as a lump sum payment but rather in installments.

If a family experienced a tragedy where both the contributor and his or her spouse or common-law partner were unable to collect CPP benefits, these full benefits would not be passed on to the children or grandchildren.

On the other hand, if that same person had consistently contributed to a registered retirement savings plan, the entire value of those contributions would be passed on to his or her next of kin, regardless of whether that person had his or her own CPP pension.

As the member knows, RRSPs invest in securities that hold similar risk profiles to investments made by the CPP Investment Board, so the risk of losses are comparable to the CPP.

I would assert, once more, that this is a tax hike. There is really no way way around that.

For greater clarity, let us look at the dictionary definition of the word “tax”, which is “A compulsory contribution to state revenue, levied by the government on workers' income and business profits”.

The CPP contributions are compulsory. They are being levied by the government on income, and they are going to be used by the federal government to provide for pensions. Therefore, it is a tax.

Also, the Liberals are not being forthcoming with the actual size of the increase in CPP premiums they would be imposing on contributors. The Liberals should call a spade a spade and admit that it is a tax hike and tell folks making more than $54,000 just how much more they will have to pay out of each paycheque.

Today, Canadians are contributing 10% of their income between the basic exemption, which is $3,500, and the maximum pensionable earnings amount, which is $54,900, into the CPP. When the bill is fully implemented, contributions on income between the minimum threshold and $54,000 will increase from 10% to 12%. CPP contributions on income between $54,000 and $82,000 will increase from zero to 12%. CPP contributions on incomes of $82,000 and above would increase from zero to 8%. That is hardly a gentle push to save more.

This would one of the largest single-year increases in taxes for middle-class Canadians in Canada's history, and it would be middle-class Canadians who would be bearing the largest increase in premiums relative to their income.

Every Canadian making more than $54,000 would see the percentage of each paycheque that would go to the CPP increase by significantly more than 2%.

Many will see their contribution rates rise by up to eight percentage points. That is 8% more of each paycheque they will not take home. Anybody who claims that increasing CPP contributions by eight percentage points will not have an impact on a family's bottom line is just wrong.

In a country like Canada where credit is fairly easily available, people can replace the income they will lose from the increase in mandatory contributions through greater borrowing. There are a number of Canadians who will not be able to reduce their overall household expenditures by 8% to maintain a balanced budget and may be put in the position where they have to borrow in order to continue to afford their mortgage or car payments, for example. While it is unwise to borrow money to offset any decrease in income by an increase in CPP premiums, it probably will happen.

For folks making above $54,000 per year looking to pay off their mortgage as quickly as possible, or individuals who may be looking to pay off their student loans earlier, the reduction in take-home pay will have a real impact on how quickly they can pay off their debt. Are people really better off if they are putting aside more money for retirement instead of paying off their mortgage or their debts more quickly?

This legislation would not increase take-home pay. It would not create new money. Therefore, an increase in payments in one area of household expenditures necessitates a decrease in another. Unfortunately, with the recklessness that the Liberals are entering Canada into long-term structural deficits, they do not seem to realize that families have to stick to a budget and make ends meet. The buck stops there.

Folks in my riding have also pointed out that higher payroll taxes negatively impact the competitiveness of businesses. One area it will really hurt is self-employed individuals who will have to pay both the employer and employee portion of the CPP. Therefore, they will have less capital to put back into their businesses.

A financial planner from Martensville made the following point to me, which I hope the finance minister will take seriously. He said that he encouraged those young people who came to him for financial advice to start saving even just a small amount for their retirement while they were young. However, he said now these same young people would be forced to divert that small amount to the CPP rather than their own savings and retirement plans.

With this CPP tax hike, the Liberal government is actually discouraging young people from saving by taking the small amount that they might have been able to put into a TFSA or an RRSP and taxing it away. If we want Canadians to save for their future, why would we take away their choice on how to do just that?

I am hopeful that all those new nominally independent senators will undertake due diligence and not simply rubber stamp what is clearly ruinous legislation to middle-class Canadians. The CPP is a contribution program. An increase in benefits is only made possible by a corresponding increase in contributions. Depending on their circumstances, Canadians may or may not get back what they put into the program, as I mentioned earlier in my comments. Every household will have to adjust to the reality that the government does not trust it enough to save for its retirement and can only begin to worry about what the Liberals plan to do next to make Canadians, who knows, eat more vegetables, exercise more regularly, and the list goes on and on.

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Madam Speaker, for many years now, the NDP has been fighting tirelessly for improvements to the Canada pension plan, so I can only be happy that it is finally happening. I would like to say that I will be supporting the main motion at report stage. However, I have to oppose the Conservative motions seeking to remove practically every clause in the bill.

Retirement insecurity is reaching crisis proportions in Canada, since many Canadians have been unable and are still unable to save enough throughout their lives to maintain the same standard of living once they retire. At the end of the day, over 6% of seniors are living in poverty. We in the NDP believe that this increase is crucial in order to ensure that our seniors can retire with dignity.

Bill C-26 proposes adding a separate new tier to the current CPP. This new CPP tier would be implemented gradually over the next nine years, until 2025, and basically does the following two things: first of all, it raises the income replacement rate from 25% under the current CPP to 33%; second, it raises the earnings ceiling from where it is today at $54,900 to $82,700.

Once the transition period is complete in 2025, it will still be 40 years before people receive the full enhanced benefit. The first workers who will receive the full benefit are now 16 years old. Someone who is 59 in 2019 and who makes higher contributions for six years before retiring in 2025 at the age of 65 will receive no additional benefit.

It will take time for the changes to come into effect. The NDP believes that certain measures should be taken immediately to help seniors and Canadians on the verge of retiring who will not benefit from these changes.

The government needs to leverage the energy generated by this agreement and do what it takes to improve long-term retirement security for today's workers. It must respond to Quebec's concerns about the impact of this enhancement on low-income workers.

The NDP will keep fighting for other increases to the guaranteed income supplement and old age security as well as the national pharmacare program and the program to improve home care and palliative care.

As is often the case with the Liberals, when we take a closer look at their proposals, we quickly realize that everything is not always perfect. In fact, we need only look at some of the details of this bill to realize that some things are not as we would like them to be. One of them is the child rearing drop-out provision. That is a failure. As the NDP critic for families, children, and social development, I am having a great deal of difficulty understanding and accepting that the Liberals have not kept this child rearing drop-out provision, which is currently in the CPP. This measure ensures that women are not penalized for having left the labour market for a period of time in order to raise children. The Liberal bill also eliminates a similar clause for people who have received disability benefits under the CPP.

It is all very well to increase CPP benefits, but that is not all that should be done. The NDP worked very hard for the CPP to become a reality, and we are going to work very hard to ensure that this bill is not inequitable.

Do members know why I am talking about inequality? It is because women are penalized for having children. Only 4.5% of women receive the maximum amount of benefits. I was really shocked to learn that because we have a Prime Minister who brags at every opportunity that his government supports women and that he is working hard to improve gender parity.

The Prime Minister is squandering an opportunity. I think it is safe to say that he has missed the mark. On the contrary, his government's bill is creating more inequality. It is not right. The fact that the Liberals do not even see the problem makes even less sense.

What we need to keep in mind is that 63% of low-income seniors living alone are women. Does the House understand how high that number is? We in the NDP think that this is unacceptable.

I see this reality in my riding. I see many seniors struggling to make ends meet at the end of the month, and they only make it thanks to the incredible commitment of community organizations back home such as St-Hyacinthe volunteer centre or the Acton Vale volunteer centre. They help our less fortunate seniors every day. Through their engagement and drive, these volunteers make seniors feel less isolated, get them to socialize, and help them continue making an invaluable contribution to the community, which in turn helps improve their quality of life and that of all our fellow citizens. Through their work, they constantly reflect the values of our wonderful community: independence, sharing, caring, loyalty, respect, dignity, and solidarity.

These two volunteer centres have been working with all of the other organizations in the Saint-Hyacinthe region for many years in order to promote volunteer work and help overcome the many challenges associated with meeting the community's growing needs. It is their desire to always want to do more for others that makes such a big difference.

It is time that the Liberal government followed suit. As the Prime Minister has said, in 2016, we cannot allow women to receive fewer benefits because they had to leave the labour market for a time to go on maternity leave. Allowing this to happen basically amounts to gender discrimination. It is unthinkable to give senior women 30% lower benefits than men.

Enhancing the CPP is one step, but more must be done to correct its flaws and injustices. The NDP wants to do more for people. That is why we believe in developing a holistic vision and improving Canada's socioeconomic safety net. That is what we are trying to do with my Bill C-245, which would create a national poverty reduction strategy to make things better for our seniors throughout their lives, not just in retirement.

That is the kind of holistic vision we need to develop to achieve a more inclusive and just society that leaves nobody behind. Doug MacPherson, national coordinator for the Steelworkers Organization, agrees. He welcomes the proposed CPP changes, but says they are an inadequate response to the critical situation facing many working Canadians when they reach retirement. He added that the government, which prides itself on passing evidence-based legislation, obviously failed to see the situation clearly this time around. Mr. MacPherson also said that it should be clear the current system has some serious flaws that the proposed Canada pension plan changes will not fix.

Let us work together to help all seniors, but above all, our senior women.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Thank you, Mr. Chair. I know there are a few members of the committee who are anxious to shut this down in a hurry, as we did Bill C-26, but I think this is so important that I thank you for making this exception.

Mr. McGowan, it was obvious when the minister was here that he was, I would say, unaware of this or certainly wasn't well briefed on it. I'm not going to try to speculate why, but I can tell you that our inboxes are full. We had two very impressive presentations before this committee last week, which fell on deaf ears.

With all due respect, and with all due respect to many of my lawyer friends, I don't think a partnership of lawyers who may practise in different areas of law is in any way similar when compared with what we're talking about: these medical structures, which are designed not as tax dodges, but are designed to recruit some of the best minds in the world to come to Canada. They're also designed, if we were listening to the testimony, in such a way that many of these partners perform work that is not necessarily billed, because we're talking about a publicly paid billing system. It would seem to me that for you to compare dentist and lawyer partnerships with this particular type of partnership is blatantly unfair.

I think the finance department—which this obviously originated in, because the minister certainly didn't originate it—is taking a pretty bull-headed approach to something that I think is plain wrong. You, as a finance department official, are not going to pay the price, but my Liberal colleagues across the way are going to pay the price at the ballot box next time, because what you are doing here is, in my view, taking away something that in our country we've been trying to encourage our health care professionals to do: to work more as teams.

This is going to break them up. You're going to have a whole bunch of individual practitioners or smaller partnerships. Finance will get no more money at the end, as pointed out to the minister earlier by my colleague. It seems that all we're hearing is that this seems to be falling on deaf ears, and I'm saddened by that.

[Erin O'Toole, Conservative, Durham, ON]

Mr. Speaker, it is an honour for me to rise today in the House of Commons from my new perch here in the back row. It is my first speech, since taking this spot, to engage with more Canadians. As I said when I was first elected and sat in the corner over there, any seat in this chamber is a true honour to occupy, and I think all members on all sides would agree with that.

I am glad to be speaking again about CPP reform and specifically about Bill C-26, because this, yet again, is an example of a government absolutely disconnected from the reality of the economy.

We have a jobs crisis in Canada right now, and this legislation would lead to fewer jobs. The finance department has confirmed that.

It is a jobs crisis of epic proportions, and the Prime Minister and the finance minister have done nothing. In fact, they have made it more difficult for employers to hire people, and I will spend a few moments talking about that.

Where is the crisis most acute? It is in Alberta, where 200,000 Canadians, families, are without the certainty and the confidence a job provides. If that alone is not a crisis, I do not know what is. I am very proud of my colleagues from Alberta who have been raising this in the House daily for the last year. We have yet to see a plan of any sort from the Liberal government.

The epicentre of our jobs crisis in Canada is in the west, which we have to remember kept Canada moving forward through the great recession of 2008-09, when Canada led the G-7 in economic growth and job creation after the worse recession since the thirties. We relied on family members in Alberta, Saskatchewan, British Columbia, and Manitoba, and now the government is turning a blind eye to that crisis.

In Calgary, the unemployment rate is 9%. People were coming from around the world to work there because of the opportunities in the last generation. The government has no plan. The unemployment rate in Edmonton is roughly 8%, and there is not even an acknowledgement, in a serious way, of that prolonged state of affairs.

Let us look at whether this is just a global commodity cycle, which I have heard members of this government sometimes suggest, instead of their inaction. Let us look at the parliamentary budget officer's recent report on the labour market. Let us look at what the PBO found on job creation in Canada. I will quote from page 1, which really summarizes the PBO's report,

The Canadian economy created 96,000 (net) jobs from Q3 2015 to Q3 2016, which is half the average annual gain of 192,000 over the previous five years.

That is when our party was in charge of the economy, so the Liberals are not even batting half our average. I will continue.

Job gains from Q3 2015 to Q3 2016 were entirely part-time and mostly in the private sector. Full-time and public sector employment contracted.

Does that not underscore the crisis we are experiencing? Is that not a call to action for the Liberal government? When is the government going to come to grips with the economy?

The $30 billion the Prime Minister has spent to put us in deficit has created zero full-time jobs. We will hear the Minister of Innovation and the ACOA minister, who is in Mississauga, I might add, speak about jobs, but they are part-time jobs.

We remember the election, when the Prime Minister, the third-party leader at the time, said that Canada was in a recession. That was false then, and it was proven false afterward. He said he would spend no more than a $10-billion modest deficit. That was another false claim. He spent $30 billion. Why did he say he was going to go into deficit? It was to stimulate job creation. That is false. He has created zero full-time jobs, according to the PBO. This is the job crisis we are in, yet the Prime Minister is going around the world, spending our money elsewhere, and has no plan for job creation at home.

The last time I rose in the House to speak on this very subject, 2,000 jobs at Bombardier were lost, so this is not just a job crisis in western Canada; it is a Liberal job crisis.

What is worse, the unemployment rate for young people has remained fixed at 13%, which is unreasonably high. What was the response of the finance minister? It was that our young Canadians should get accustomed to job churn. That is shameful absence of leadership. In fact, I think it is the modern equivalent of “Let them eat cake”, a comment that is disconnected from the reality our young people are facing. Rather than saying “We're working on innovation jobs, working on clusters, and making sure there are more people going into the STEM fields and coding”, he said, “You'd better get used to unpaid internships and being underemployed”. That is a failure of leadership.

Why are we in this crisis? Taxes are going up on job creators and entrepreneurs, who are highly mobile. Taxes are going up on small and medium-sized businesses that have had their previous tax reduction decreased. We have a carbon tax, which on the weekend the environment minister said would make our economy more competitive, showing the height of her disconnect from reality. Today, we are discussing a payroll tax. In one year, the run up in the deficit and the taxation of people, businesses, and consumption is unparalleled in Canadian history. In fact, it would take multiple Liberal governments of the past to introduce so many different types of tax increases all in one year.

Getting back to Bill C-26, what did Finance Canada's own report say about the CPP reforms? It said that 10,000-plus job losses would result from these reforms in the bill in the coming years. We are in a job crisis. We are creating a carbon tax that would raise the import costs of manufacturers in Ontario, and the costs of farmers in the west and across the country, and of people who are hauling lobster and trying to get it sent over to Europe to be sold, and of the lumber industry. Higher costs on all those people translates into higher costs for families and seniors. Now we are doing a payroll tax that the minister's own department has said will lead to 10,500 job losses in the coming years. His own department has said so. It is staggering.

What have the leading groups that work with employers said? The Canadian Chamber of Commerce and the Canadian Federation of Independent Business have both implored the government not to bring in a payroll tax at a time when we are trying to get corporations, small and large, to use some retained earnings to hire one or two more people. We are putting a payroll tax on them and stopping them from hiring more people, whether by a 1% increase in premiums today or a 4% increase in coming years.

As I have said many times in the House, there is no crisis in retirement savings. In fact, who claimed the media was “fear-mongering” with regard to a retirement crisis? It was the finance minister in his book with his actuary at Morneau Shepell, Fred Vettese, in a book called The Real Retirement. They said it was fear-mongering. Well, the finance minister is now relying on that fear-mongering to bring this bill forward.

Who will it help? Ipsos Reid showed that 70% of Canadians do not realize that retirees and people near retirement will not benefit. In fact, Fred Vettese, the chief actuary at Morneau Shepell, has said it will only help 8.7% of middle-income Canadians boost their retirement income. It will not help people on the low end, those we were trying to help when we were in government, with GST reductions and other things, and not people at the high end. It will only help 8.7% of people in the middle. That translates into 5% of Canadians who in the future might have some modest increase in retirement income, if they do not use RRSPs, if they do not get the value from their home, and if they do not use the TFSA that minister Flaherty brought in. Therefore, potentially 5% would benefit while 95% of Canadians would pay, and employers, whom we are imploring to hire more people, are forced to pay premiums for every new person they hire.

It is shameful, in the midst of a jobs crisis, the government is introducing yet another tax that would lead to more Canadians being unemployed.

We must stop it here. We have to focus on job creation for the future.

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

Mr. Speaker, I welcome the opportunity to speak today to Bill C-26, because it has the potential to address an issue that is so very vital to our identity as Canadians. The manner in which we care for each other is the measure of who we are as a people. We have much work to do in many areas to ensure accessible and affordable health care, child care, education, and housing for every Canadian so that none of us is left behind. We must address the shameful colonial legacy of inequality forced on this nation's indigenous peoples and ensure, as the bill before us today purports to do, that every Canadian is able to retire in dignity and security.

While the measures outlined in Bill C-26 represent incremental progress in providing retirement security for Canadians, they fall short in many aspects and completely fail in one critical regard. I would like to speak to these shortcomings in the time I have here today, in the hope that the current government will do the right thing and fix the very serious flaws in this bill.

We know that Canadians take pride in their work, the proceeds of which allow us to care for our families, raise our children, and pursue our dreams. Whether in the private sector, public service, or the military, the work of Canadians contributes to our economy and weaves our social identity. It is reasonable to expect and to hope that in a country as rich in resources as ours, when Canadians come to the end of their working careers they are able to retire in dignity and security. This is the reason we created the Canada pension plan, a system so successful that it is considered the international gold standard. We extend our gratitude to Stanley Knowles, an incredible former member of the House who proposed the Canada pension plan and pursued it so that Canadians could be safe in their retirement years.

We know, however, that the CPP as it currently stands falls short of providing full retirement security for Canadians. That is the reason New Democrats have called for what we know are affordable and sustainable enhancements and improvements to the CPP in order to ensure that Canadians are able to retire in dignity, not just now but for generations to come. New Democrats stand with the Canadian labour movement in calling for a doubling of CPP so that it will provide benefits set at 50% of pre-retirement income. That is sustainable, affordable, and necessary, especially when we consider that defined pension plans from employers, including the Government of Canada, are under serious attack.

Many Canadians do not have adequate savings to maintain their lifestyle upon retirement and the need to address income insecurity is becoming ever more urgent. A large part of this problem is fuelled by the erosion of workplace pension plans to the point where only six in 10 working Canadians have one. According to the finance minister himself, young people today face a future of precarious work in which the odds of staying in a job long enough to benefit in retirement from a private pension plan, if one exists, are slim.

The enhanced CPP is a plan that would benefit a new generation of workers entering the workforce, but would do little to alleviate the retirement income crisis of those approaching retirement today. The New Democrat platform includes a national seniors strategy to address the issues of affordable housing and home care, pharmacare, and health care, as well as income security. My Motion No. 21 calls on the government to adopt that strategy. The New Democrat member for Saint-Hyacinthe—Bagot has introduced Bill C-245, outlining a poverty reduction strategy for all of Canada. I encourage the government to consider the informed and considered proposals put forward by New Democrats on these issues, supported by extensive community and expert consultation.

Now I would like to move back to the bill that we have before us today and address the major failure of Bill C-26 to include dropout provisions for the enhanced portion of the CPP benefits it proposes.

As an activist who has fought for equity and equality of access for women my whole life, I am appalled at the backsliding that will penalize those who drop out of paid work to raise children or as a result of disability. More often than not, those penalized workers are women.

Under the current system, women receive CPP payments that are 13% less than men's. Without the child rearing dropout for the enhanced benefits, that gap will grow. The narrow eligibility criteria and cumbersome application and appeals process create a system in which CPP disability benefits are extremely difficult to obtain. People who manage to collect CPP disability benefits should not be penalized because they have dropped out from making contributions due to disability.

Women and persons with disabilities are more reliant than other Canadians on public pensions like the CPP, after having faced a lifetime of economic disadvantages. They earn less than their male counterparts and when they raise children they have fewer dollars to contribute to the CPP and are penalized as a result. They receive far less from the CPP because it favours higher income workers. Seniors with disabilities have higher than average expenses, and it is criminal to overlook their needs.

The special dropout provisions correct some of that systemic discrimination and are an important equity feature of the Canada pension plan. The current dropout provisions introduced in 1977 by a certain Monsieur Trudeau, and lauded as recognizing child rearing as a value to Canadian society and our economy, do not apply to the additional or enhanced benefits that would be created by this particular legislation. One has to wonder whether the Liberals of 2016 value child rearing and child care even less than their predecessors.

Women and persons with disabilities will suffer a penalty as a result of Bill C-26, and this discrimination will be most severe for women with disabilities. Are these the sunny ways our Prime Minister mentioned or is this part of his declaration as a feminist?

The Liberals may try to cite costs as a factor in their decision to omit the dropout provisions from the new enhanced benefits, but our very preliminary calculations show that the costs would be very low. Using the available information, the estimated cost of dropout provisions for each employee and each employer would be just 0.2% of a worker's average salary. This is a small price to provide such an important and significant benefit.

Failure to fix this problem would cost parents significantly. Calculations based on figures from Service Canada's website indicate that a mother who spent six years raising children will get between $800 and $1,200 less per year than she would with the dropout provisions in effect for her enhanced contribution.

New Democrats fought hard for changes to the CPP and for increases in CPP benefits. We welcome the changes tabled by the government, but we can and should do better. We need to address the needs of seniors today, as well as those of future generations. To that end, in addition to the measures I have already outlined here, we will continue the fight to stop the clawback of GIS benefits. New Democrats call on the government to follow through on its promise to develop a seniors price index as soon as possible.

We can do better. We must do better. Our future is literally at stake. Our reputation as a progressive society is on the line.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Mr. Speaker, my colleague made a couple of statements on what the bill would do for our grandchildren and children going forward. He gave us a little bit of a history lesson about when the CPP was introduced in 1966, but he never mentioned the 1977 ruling when the Liberal government at the time introduced legislation so that people dropping out of the workforce to raise children and those living with disabilities would not be penalized as a result.

Now, in 2016, Bill C-26 calls for enhancements to the CPP, but it eliminates the drop-out periods for people in the future. What will that do to our grandchildren and children, and why was it omitted?

That is the main question: why was it omitted?

[Jati Sidhu, Liberal, Mission—Matsqui—Fraser Canyon, BC]

Mr. Speaker, it is an honour to rise in the House today to express my support for Bill C-26. I am speaking today because I believe Bill C-26 will benefit my constituents in Mission—Matsqui—Fraser Canyon.

As members know, a strong Canada pension plan was a core element of our government's bold plan to put people first and to help the middle class, because we understand that a strong economy starts with a strong middle class. That is precisely what we are doing by enhancing the Canada pension plan.

Middle-class Canadians in my riding are working harder than ever, and many are worried that they will not have set enough money aside for their retirement. The Department of Finance has examined whether families nearing retirement are adequately prepared for retirement. About one in four Canadian families approaching retirement, or about 1.1 million families, are at risk of not saving enough to maintain their current standard of living.

The risk is highest for middle-class families, families without workplace pension plans are at even greater risk of under-saving for retirement. A third of these families are at risk.

I spoke with many seniors in my riding during the last election who were concerned that they will not be able to afford basic costs before they receive their next guaranteed income supplement cheque. Our government has to address this by substantially increasing the GIS, and also honouring our campaign commitment to lower the age of retirement from 67 to 65.

However, they were more concerned about their families' futures. They wanted to know their grandchildren would have the same security going through life that they had. Hearing that on the doorsteps from residents of Mission—Matsqui—Fraser Canyon is why I support Bill C-26.

Younger Canadians across the country and in my riding, who tend to have higher debts than the previous generation and in most cases will live longer than the previous generations, face the challenge of securing adequate retirement savings at the time when fewer can expect to work in the jobs that will include a workplace pension plan.

We are aware of the need to help Canadians save more. Saving more will mean they are more confident about their future and about their ability to secure a dignified retirement.

I am proud to be able to say that we are delivering on our commitment to do just that. Working in close collaboration towards a common purpose with governments across Canada, we reached an agreement that will give Canadians a more generous public pension to help them retire with dignity. The goal of a stronger CPP is truly a high priority, which is shared by Canadians from coast to coast to coast, with 75% in favour of a strong public pension plan.

The challenge that government faced in drafting an enhanced CPP was that the current plan was not accumulating benefits quickly enough to meet the future needs of Canadians in the world where workplace pension coverage continues to decline.

The enhancement that the Canadian government agreed on would do two things to address this. First, it would boost the share of annual earnings received during retirement from one quarter to one third. For example, an individual making $50,000 a year in today's dollars over his or her working life would receive about $16,000 per year in retirement instead of the roughly $12,000 they receive today.

Second, the enhancement would increase, by 14%, the maximum income range covered by CPP. This means, once fully in place, the enhanced CPP would increase the maximum CPP retirement benefit by 50%.

In other words, the current maximum benefit of $13,110 in today's dollar terms would increase by nearly $7,000 under the enhanced CPP, bringing the maximum benefit up to almost $20,000.

The legislation also includes enrichment to the CPP disability and survivor benefits. For most Canadians these increased benefits would come from just a 1% increase in contribution rates. This enhancement is set to help young Canadians just entering the workforce the most. They would see the largest increase in benefits. This means that young people throughout my riding and across Canada would have a Canadian pension plan that fills the gap for those who do not have a workplace pension plan.

Having grandchildren myself, this is important for me, knowing that young people today will have a CPP that ensures their security when they grow older and eventually retire. We are also making sure to give individuals and their employers plenty of time to adjust to this modest increase, making sure it is small and gradual starting in 2019.

Today's legislation as agreed upon with the provinces and territories would ensure that low-income Canadians are not financially burdened as a result of their extra contributions. It would do this by enhancing the working income tax benefit to roughly offset incremental CPP contributions, leaving eligible low-income Canadians with little to no change in disposable income, while still securing a higher retirement income for them.

The enhanced CPP would simply build on the core existing CPP benefits, in a smart, carefully targeted, and effective way that reflects the extensive research that governments brought to the table in crafting this enhancement to the benefit of working Canadians. Taken together, it is a comprehensive package that would increase CPP benefits while striking an appropriate balance between short-term economic considerations and longer-term gains.

What does Bill C-26 mean for my constituents and Canadians across the country? Enhancing the CPP means first and foremost there would be more money from the CPP waiting for Canadians when they retire. This means they would be able to focus on the things that matter like spending time with their families rather than worrying about making ends meet. It means reducing the share of families at risk of not saving enough for retirement as well as reducing the degree to which Canadians are under-saving.

A stronger CPP is also the right tool at the right time to improve retirement income security of young workers. It is an opportunity for today's hard-working Canadians to give their children, grandchildren, and future generations a more secure retirement. Since I was elected last October, I have had the honour and great responsibility of representing my constituents in Ottawa. I have enjoyed time with young people in my riding, local schools, community groups, and other events. Their ability to save money for a secure and comfortable, dignified retirement is very important to me.

This enhancement of the CPP and this investment in Canadians would ensure future generations are secure in their retirement. This is why I will be voting for Bill C-26 and I encourage my colleagues from every party to do so as well.

[Sylvie Boucher, Conservative, Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix, QC]

Mr. Speaker, I rise in the House to speak once again to Bill C-26, which seeks to expand the Canada pension plan.

We have always known that the Liberals do not listen to anyone except their cronies. Although they like to stand up and tell us that they are defending the middle class, I have my doubts. In fact, the more they talk about defending the middle class, the more they raise taxes, and the more money they take from taxpayers' pockets, which does not help the middle class.

Every time the Liberals introduce a new bill, we can expect taxpayers to be forced to fork out more for a new tax. We all pay taxes. The government is taking even more money out of taxpayers' pockets.

The Liberal mindset is this: I am, I demand, and I think for Canadians. We on this side of the House believe in Canadians and the middle class. We believe that taxpayers need their money. We know perfectly well that Canadians, not the government, are in the best position to manage their own money.

If the Liberals had listened to what anyone other than their cronies had to say, they would realize that not everyone agrees with them.

I have some quotations from certain people to share. On May 31, 2016, the senior director of economic, financial and tax policy at the Canadian Chamber of Commerce said:

...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.

On June 20, 2016, the president and CEO of the Canadian Federation of Independent Business said:

It is tremendously disappointing to see that finance ministers are putting Canadian wages, hours and jobs in jeopardy and willfully moving to make an already shaky economy even worse.... It appears that jobs and the economy are not particularly high priorities for the governments that have signed off on this deal.

We have been talking about seniors a lot. The basic principle is not a bad one, but seniors who are 70 years old now will not need help in 40 years. They need help right now. Seniors who are 70 now will never get this help because it will not be available for another 40 years. The Liberal government is bringing in a law that will not take effect until 2019, which is so interesting because that is when the next election happens. That is a very Liberal way of doing things. The Liberals never really cared about the middle class. They cared, as always, about themselves.

It is one thing to hold $1,500 fundraising cocktails and invite a bunch of millionaires, but the middle class is having a hard time making ends meet. The economy is faltering. All of those grand Liberal principles are just a smokescreen. The Liberals talk about giving this to people, and they think we are not politically savvy enough to see through their little game. If changes are to be made, it should not take 40 years.

It is good to think about the long term, but we also need to think about our seniors who need help now, not 40 years from now.

That is why I will be voting against this bill. It is full of holes. It is not what the Liberals say that worries me. It is what they never tell the public. They give nice speeches and make headlines, but what scares me the most is what the Liberals are not saying.

Middle-class families are being taxed to death and are struggling to make ends meet. Many of them will now have a harder time. For example, it will now be even more difficult for new graduates to pay back their student loans or buy their first home. The Liberals did away with the old rules, and now young families will be unable to buy their first home. It will also be more difficult for companies to create jobs and increase wages.

Every time I hear the Liberals talking about their plans, I worry about what they are not saying because that is what is dangerous. No one is against virtue, but the bill before us says in black and white that it will take 40 years for the system to work properly. Not even I will see that money, and I am in my early 50s. In 40 years, I will probably be too old to remember that the Liberals implemented this measure. Our seniors need help today, not in 40 years.

What is more, the same question keeps coming up: where are the Liberals going to find this money? The Liberals are giving out money hand over fist to everyone right now. However, as far as I know, money does not grow on trees. Everyone dreams of a better future, a better life, and a better situation, but that takes money. It is not always pleasant to live on credit. As taxpayers, if we were to live on credit, the bank would not hesitate to come and take our money and our assets when the bill comes due.

I would therefore like someone to explain to me what the Liberals do not understand. We will not vote for this bill as long as it does not produce an immediate effect. The effects of this bill will not be felt for a very long time. However, our seniors need help now, not 40 years from now.

[Kamal Khera, Liberal, Brampton West, ON]

Mr. Speaker, Bill C-26 would benefit all Canadians. Canadians deserve a strong, safe, and secure retirement. Our government has demonstrated and illustrated an unwavering commitment to creating equality and opportunity for women and persons with disabilities. We are aware that more could be done with respect to the drop-out provisions for disability and child rearing to make sure that this expansion is as inclusive as possible.

However, as my colleague also knows, to make any changes to the plan, we need agreement with the provinces. The Minister of Finance will raise the drop-out provisions at the next provincial and territorial finance ministers meeting in December in the context of the triennial review of the Canada pension plan.

Canadians are asking for a secure retirement, and our government is committed to delivering on that.