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.

[Joy Thorkelson, President, United Fishermen and Allied Workers' Union – Unifor]

Thank you.

I'm the president of the United Fishermen and Allied Workers' Union, which is also known as UFAW-Unifor. Our union represents some, although not all, fishermen in all the wild fisheries in British Columbia.

Our membership is made up of active fishermen only. Those of you who are from Newfoundland and Labrador will know of the FFAW, the fishing union in that province. We are both Unifor and therefore the FFAW is our sister union. We both represent fishermen and plant workers at opposite ends of the country. That is where the similarities end.

Our fishermen's earnings are trending down while the FFAW fishermen's incomes are increasing. Part of that difference is the added costs our fishermen bear. Some 80% of the landed value in ITQ fisheries is taken out of B.C. fishermen's pockets; that income remains in the pockets of our brother and sister fish harvesters on the east coast. A community difference is also evident: B.C. rural coastal communities' processing capacity is diminishing, while in Atlantic Canada, significant processing capacity resides in rural areas.

I have worked for the union for 40 years and I've seen many changes in my career. I'm old. In fact, the majority of people in the B.C. fishing industry are old. The industry was very good to participants and we were able to make a great living, so that's why we all stayed. Now it's too late to leave with economic dignity.

We have a crisis. Old people want out but cannot afford to quit and young people want in but cannot afford to buy in. When I was young, most skippers owned their own licences and vessels. ln 1985, 20,000 fishermen took out personal fishing licences. By 2015, we had lost 15,000 fishermen and only 5,700 were left in British Columbia. The 2015 figure is the latest one published by DFO.

ln 1969, corporate ownership of the fleet was at 13.2%. Fifteen years later, processor and investor ownership of the seine licences, for example, had increased to 40%, and 20 years later, it was 55%. ln 1993, 39% of herring roe licences were owned by processors and investors. By 2012, processor and investor ownership increased to 51%.

ln 1993, one processor owned 27% of the processor-held herring roe seine licences. Now, due to corporate consolidation, this processor, 20 years later, holds 95% of the processor-owned landings. The influence of processors on individual active fishermen can't only be assessed by these ownership numbers. lt also has to be viewed through the lens of processor control.

The major salmon processor owns 37 licences that are attached to 20 non-fishing vessels—vessels that don't really exist, in many cases. They are called “stick boats” because they could be floating sticks. The company can and does lease these licences off their vessels to salmon vessels that need a licence to fish in an additional area.

ln a salmon ITQ fishery, this company can transfer the quota attached to these non-fishing licences to another vessel that is fishing, thereby stacking quota onto this boat. It can catch its own fish and the quota from the stick boat. This binds fishermen to the company. If they want future increased quota opportunities, thereby increasing their income, they will have to continue to fish for this processor. This not only happens on salmon, but it is worse on roe herring, with DFO rules requiring stacking of a minimum number of gillnet licences in order to fish. I can remember a couple of years when active fishermen, forced by DFO to lease licences, lost money because the lease price exceeded the value of the roe herring.

The union did a survey in 2016 of the salmon fleet. Out of 234 respondents, 84% did not think they would benefit from ITQs; 89% thought their costs would go up under an ITQ system and 86% didn't want ITQs in their fishing areas.

ln 2018, two years later, we conducted another study. We expanded it to include all fishermen and all fisheries, and we asked similar questions: “Do you think west coast licensing policy should benefit active fishermen?” Of course 94% polled yes; 91% supported owner-operator policy created to meet the needs of B.C. fishermen; 88% supported a fleet separation policy in British Columbia, and 66% thought the consequence of no change to licensing policy would be that rural coastal communities would continue to decline.

I have heard the RDG list the Pacific region's priorities: conservation, compliance, sustainability and economic viability, equitable distribution of benefits, and data collection. I heard Ken Hardie later on list the DFO's target, but he must have been mistaken, because he included sustainable livelihoods, regional economic benefits and sustainable communities. Those may be Atlantic coast targets, but they're not Pacific region targets, I can assure you.

In the Pacific region DFO separates licence-holders from fishermen. They want fishermen to self-adjust to changing times and to pay for the management of their fishery. There are no social objectives to have sustainable livelihoods for fishermen or regional economic benefits or sustainable communities. These are not in the Pacific region's lexicon.

The real truth is that DFO Pacific is consulting with fewer and fewer active fishermen. They consult with quota owners and licence-holders, who increasingly do not fish. Last spring I and our staff did a six-week coast-wide tour. We visited 21 communities. We walked onto over 800 boats asking fishermen what they wanted changed, if anything, in their fishery. Only a few were satisfied with how things are now. Everyone else wanted changes that would benefit working fishermen.

Not all agreed on the solution, but most agreed on the problem. Money is being siphoned out of working fishermen's catch and into the pockets of those who don't fish. Processors are gaining control of almost every fisherman through their control of quota movement.

Fishermen on the Pacific coast believe it is time for a change. We recommend that the minister hold an external licensing review in the Pacific region with the goal of creating viable commercial fleets and coastal communities, including first nations communities, that include as the foundation the basic principle that the fishery is a public resource and belongs to all Canadians. Licences provide privileged access to the common property resource. There should be fleet separation and owner-operator principles. The benefits of the fishery should go to fish harvesters and their communities, not to those whose involvement is in owning or controlling licences and/or quota. Licensing policies should encourage intergenerational succession, and adjacency principles should govern processing so that the value flowing from our fisheries, including processing, remains in local communities.

We support the social and economic goals in Bill C-26 for active fishermen, fish harvesters and their communities.

That is my presentation.

[Mark Janson, Research, Canadian Union of Public Employees]

Thank you, Mr. Chair, and thank you to the committee for having the Canadian Union of Public Employees here today. We're the largest trade union in Canada, with 650,000 members across the country in virtually all sectors of public work.

Obviously, Bill C-74 is a very large bill. We're not going to comment on every section of this bill, but focus on a few gendered aspects of the bill that we find particularly concerning.

The first one would be the lack of pay equity legislation. I know you talked about this in the earlier session today. This is something that we've been advocating for a long time. This government has been making very public commitments to a goal of gender wage equality. This is the simplest way for the government to take a step in the right direction. Your budget committed to doing this. It's been now two years since the Liberal-led committee studied this and recommended moving forward. The report was called “It's Time to Act”. They said we'd go forward within 18 months. We're now 24 months past that point. Your budget said this was going to be in the budget implementation legislation. It's not there. We hope that it will be there very soon.

I'd like to focus the rest of my time on the Canada pension plan drop-out issue. I know this was also mentioned at an earlier session. I was before this committee about a year and a half ago talking about Bill C-26, the legislation that implemented the federal-provincial deal reached in the summer of 2016 for a modest expansion of the Canada pension plan.

When we looked at this legislation, we were shocked to find that there were no drop-out provisions in the new CPP benefits for periods of child-rearing or disability. These have long existed in the CPP that we all know. Essentially, these CPP benefits are a function of how much you've earned through your working career, so if you have a period of zero or low earnings, that's going to pull your CPP benefits down.

Governments over the decades have recognized that it's appropriate to put in place what they call “drop-out provisions” for periods of child-rearing or disability in order to exclude those periods from the calculation of CPP benefits, so that you don't see a pension penalty for raising a child or for being disabled and unable to work. That's worked well for the 50 years of the CPP's existence, so we were shocked to find that it wasn't going to be part of the new tier of CPP benefits.

CUPE and the labour movement brought this to the attention of the government. The bill was passed as written, which we were quite opposed to. We thought the government should have done something at that point. We were happy to see in December of this past year, 2017, that the finance ministers of the federal and provincial governments said they were going to do something about this. They said they were going to add what's called a “drop-in provision” to the new level of CPP to deal with this child-rearing and disability issue.

The problem with the drop-in provisions is that they're clearly structured to deliver a significantly lower benefit than the traditional drop-out replacement would have done. When the government brought in these drop-in provisions, it said they were an improvement that would strengthen benefits. In our view, however, a large inappropriate cut was instituted that, to a certain degree, walks the benefits back. We don't see that as an improvement. We still see that as an unjustified cut.

We've asked the government for numbers on this. We wanted to find out what this was going to mean for individuals down the line, and what it would mean for the plan. We haven't seen any of those numbers, but these drop-in provisions are included in Bill C-74.

To me, to CUPE, this is an issue of major importance. Our position is that workers taking time out of the workforce to raise a child at home or because of a disability should not face any CPP penalty. I know that at earlier meetings finance officials were asked to get those data to you, and I certainly hope that you see those numbers and reflect upon them before passing this legislation.

Thank you, and I'll be here for questions afterwards.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

If you don't mind, I'll move to another subject, which is around the CPP.

Mr. McGowan, in Bill C-26, as you're aware, we had no provision for dropout provisions in the expanded CPP. I'm wondering if there were Department of Finance estimates or models around what the cost would have been for dropout provisions had they been included in Bill C-26.

Act Respecting the Federal Ombudsman for Victims of Criminal Acts

[Rob Nicholson, Conservative, Niagara Falls, ON]

Mr. Speaker, I am pleased to rise in the House today in support of the hon. member for Beauport—Côte-de-Beaupré—Île d'Orléans—Charlevoix and her private member's Bill C-343, an act to establish the office of the federal ombudsman for victims of criminal acts and to amend certain acts.

I am confident and hopeful all parties represented in the chamber will join me in resounding support for this bill, because it would ensure the protection, information assistance, and liaison services would remain in place for victims, much as they currently are for criminals from the office of the ombudsman for federal offenders. Having an arm's-length regulator in place for the victims of crime is the right thing to do, and I will speak specifically about the services offered by the victims ombudsman in addition to laying out the case to ensure that equivalent supports and services are accessible to victims of crime, as they currently are to offenders.

The mandate of the victims ombudsman would be to ensure that victims are informed, considered, protected, and supported. The service would offer victims of crime the opportunity to learn about their individual rights under our federal laws, learn what services are available to them, and if necessary, lodge a complaint about any federal agency in its dealings with victims of crime. In addition to this, the federal ombudsman for victims of crime would ensure that policies are made to reflect victims' needs and concerns. By being in communication with victims, the ombudsman would be able to identify the areas that may be of concern to victims or that may negatively impact victims, and when appropriate to do so, the office of the ombudsman for victims of criminal acts may make recommendations to the government.

The mandate relates exclusively to matters of federal jurisdiction and enables the ombudsman to specifically promote access by victims to existing federal programs and services for victims; address complaints of victims about compliance with the provisions of the Corrections and Conditional Release Act that apply to victims of crimes committed by offenders under federal jurisdiction; promote awareness of the needs and concerns of victims and the applicable laws that benefit victims of crime, including to promote the principles as set out in the Canadian Statement of Basic Principles of Justice for Victims of Crime with respect to matters of federal jurisdiction; and to identify and review emerging and systemic issues, including those related to the services by the Department of Justice or the Department of Public Safety and Emergency Preparedness that could negatively impact victims of crime.

I am proud of the Harper government's initiative to create the Office of the Federal Ombudsman for Victims of Crime as an independent resource for victims of crime. I was there in 2007 when the government launched this. I was very pleased with the support of people like Senator Boisvenu, who was not a senator at the time but was very interested and involved with victims of crime. I am sure that, regardless of what side of the aisle one sits on, all members would agree that this office has served an important role for all victims of crime.

At the present time, the ombudsman operates, as we heard, within the Department of Justice and therefore does not function as a completely autonomous body. This could prevent the ombudsman from conducting a formal investigation within the Department of Justice itself. Another example of this would be in a federal prosecution where a victim of crime felt that his or her voice was not afforded the adequate opportunity to be heard. This could ultimately undermine the confidence of victims towards the minister of justice and the Department of Justice. Other examples could be when a victim has not been invited by the Parole Board or the prison system to a hearing on the offender's release, when the federal crown and defence make a plea bargain without consulting the victim, or when a victim is refused the opportunity to make a statement before a sentence is given in court.

This illustrates the importance of the ombudsman to become a parliamentary officer answerable to the Parliament of Canada, because an ombudsman is a person with authority to conduct thorough, impartial, independent investigations and make recommendations to government organizations with respect to the difficulties and problems experienced in the case of victims.

Normally, an ombudsman will investigate in response to citizen complaints, but he or she can also investigate on his or her own initiative. In most cases, an ombudsman is appointed by Parliament and can issue reports and recommendations to government officials and ultimately to Parliament itself.

The same protections are offered to criminals through the correctional investigator as the ombudsman for federal offenders. If criminals are protected by their own autonomous ombudsman, it is only fitting and reasonable that victims of crime should be afforded the same rights. By the same token, it is only equitable to ensure that the ombudsman for victims of crime is equivalent to that of the position of the correctional investigator for offenders. This is in line with the Canadian Victims Bill of Rights mandate: information, protection, participation, and restitution for victims. Victims must be strongly and independently represented. This is a fundamental right that criminals have had since 1971.

At present, the federal ombudsman for victims of crime must table its annual report to the Department of Justice, meaning that if a recommendation and/or criticism is mentioned in the report that is not favourable to the Department of Justice, the minister could remove it. Such a possibility is not acceptable. It could have the effect of challenging the faith that victims of crime should have in our overall justice system. The ability to monitor, to make recommendations or necessary criticism is imperative.

I would like to highlight some of the more high profile submissions and the importance of this work.

The ombudsman submitted to the pre-inquiry design process in order to facilitate a national design process for the current national inquiry on missing and murdered indigenous women. The ombudsman also made recommendations for Bill C-26, which sought to make a number of changes to the Criminal Code and other legislation to address some issues related to sexual offences against children, including creating a new national public database containing information on high risk child sex offenders. The ombudsman has also made valuable contributions to the Canadian Victims Bill of Rights. I remember how important this was to my colleague, Peter MacKay, and the leadership he showed on this. These are just to name a number of them.

Ultimately, the mandate of the federal ombudsman for victims of crime is to inform, consider, protect, and support victims. It is the the obligation of parliamentarians to ensure that Canadians who are victims of crime can continue rely on their elected members of Parliament to ensure that they are adequately informed, that their needs are taken into consideration, that they are fully protected as citizens of Canada, and that they are fully supported by the federal government by the respective departments they represent. The only way to ensure that Canadians are fully and impartially represented is to put the ombudsman for victims of crime at arm's length from the Department of Justice.

I respectfully ask my colleagues in the House do the right thing by all Canadians and support the hon member from Beauport—Côte-de-Beaupré—Île d'Orléans—Charlevoix's bill to ensure victims are effectively and independently represented. Together, we will ensure that victims of crime in Canada will continue to be informed, considered, protected, and supported.

[Mark Janson, Senior Pensions Officer, National Office, Canadian Union of Public Employees]

Thank you, Chair, and thank you to the committee for having me today.

The Canadian Union of Public Employees is the largest trade union in the country. We represent 650,000 workers across the country, mostly in the public sector. Pensions and retirement security are issues we take very seriously. I'm a pension specialist with CUPE, so I'll be focusing on the income question before you today.

We see the same things everyone sees. We see that most Canadian workers don't have a pension at work and that the few who do are seeing the quality of those pensions under pressure from employers. We see that individualized savings systems such as the RSP and the TFSA predominantly benefit workers at the higher-income, higher-wealth end of the spectrum, and that as Richard Shillington told you yesterday, Canadians who don't have a pension at work—most Canadians—have wholly insufficient retirement savings.

This is why one in three seniors in Canada receives the guaranteed income supplement that keeps most, but not all, Canadian seniors out of poverty. We've actually seen Canadian senior poverty levels ticking up slowly, steadily, since the mid-1990s. The major attacks we've seen on pension plans have been relatively recent, in the last couple of decades. It takes a long time for that to work itself through the system and to be seen on the ground in future seniors, but the indications we're getting from research by academics and statisticians is that significant portions of the boomer generation have not saved enough for retirement. They are looking at a big drop in living standards when they retire, and the problem is projected to get worse for future generations.

This is why CUPE and the labour movement in Canada were so supportive of the government's successful expansion of the Canada Pension Plan in the deal that you reached last year. We recognize that this was not an easy thing to do, so we applaud you for doing it. We know it could have gone much further. We were essentially pushing for a doubling of CPP benefits; we got an increase of about one-third in CPP benefits. Much more could have been done there, but we applaud the work that was done. We should continue this critical campaign to improve the Canada Pension Plan and improve public pension plans in Canada.

A major shortcoming of the CPP expansion deal in the legislation that implemented that deal, Bill C-26, was the lack of child rearing and disability dropout provisions. Basically, a CPP benefit is a function of your lifetime earnings over your career, so if you have a period of zero or low earnings while you're working, that's going to pull your CPP benefits down someday. Governments realize this, and they realize there are some inequities in what we call the dropout provisions in the CPP. There's been a long-standing dropout for disabilities, meaning that if you were disabled and away from the workforce, those years were dropped from your CPP calculation and you were not penalized because you were unable to work. The same provision existed for decades for child rearing if you were at home raising a small child.

These provisions had long been part of the CPP, so we were quite frankly shocked to see that they weren't included in the CPP expansion legislation. They're going to continue to exist in the CPP we've always known, but they're not going to exist in the new benefits that are going to sit on top.

We don't think there's a rationale for this situation. We flagged it for government when Bill C-26 was tabled, but the government passed the legislation unamended and essentially punted this issue to the triennial review of CPP, 2016 to 2018. We urge the government to work with the provinces to fix this issue before these changes start to take effect.

The child-rearing dropout predominantly impacts female seniors. It's mostly women who take up that provision, and disabled seniors, obviously, people who have had a disability in their working career. These are among the most vulnerable future seniors in Canada, and they don't need more challenges in retirement. This is an easy fix. It's not a costly item, and we urge you to fix it.

I was going to make a point about how the old age security program increases over time, but I know Richard Shillington made it very eloquently on Tuesday. It's indexed to prices, not to wages. The chief actuary predicts that wages are going to go up faster than prices. He thinks prices are going to go up by 2% a year and wages are going to up by about 3%, so the old age security system will essentially be falling behind the standard of living by a per cent in every year that this situation is not remedied.

Other OECD countries peg their social security system to wages as well. There are different ways of doing this. This is a long-term problem for old age security. It's been around for a long time. If it's not fixed, we're going to see that program continue to shrink, compared to living standards as a whole.

I'd like to turn briefly to Bill C-27. This is federal legislation tabled by Minister Morneau about a year ago. It's still only at first reading. This is a bill we are strongly opposed to and that the labour movement is strongly opposed to. It would give federally regulated employers—banks, telecoms, airlines, crown corporations—a legal avenue to basically walk back on pension promises they've made to workers and retirees. They currently can't do that under pension law. This bill would give them the legal ability to do that.

I'm sure you've all heard the public outcry about Sears retirees not getting what they were promised. This is not something Canadians support. It's not something the labour movement supports. We're shocked that the Liberal government has tabled this bill. We call for it to be withdrawn.

Finally, I have just a few quick remarks. We can't have decent and secure retirements if we don't have decent and secure working lives. This government and all Canadian governments should be doing everything they can to improve the work prospects of working Canadians, particularly young Canadians, who are faced with increasingly precarious employment, low-wage employment, and part-time work when they want to be working full time. There are all kinds of things the government can be doing on minimum wages, employment standards, and universal social programs that could make working life better for Canadians, and that, in turn, could make retiring a whole lot easier.

Thank you.

Resuming debate

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, the debate concerning motion No. 14 is not about having a problem with working until midnight each evening—except, obviously, on topics raised by the opposition. I agree with what the Parliamentary Secretary to the Leader of the Government in the House of Commons said in the House yesterday, that most of us are already working every day on a similar schedule.

In my previous career, I was already used to long hours. When I ran a global business, my European colleagues began calling me at 4 a.m., and my days would often stretch until midnight. This was necessary so I could meet with my employees and people in the plants and businesses in the Pacific region I was responsible for.

As the head of a North American refining and petrochemical company, I realized that maintaining customer relations and meeting deadlines to submit applications made for very long days.

The Liberal government said it wanted to make Parliament more family friendly in order to encourage women to get into politics. I support encouraging more women to get into politics, but I do not believe that many women would choose to work until midnight each evening, away from their kids.

Now, why did this government introduce such a motion, when theoretically it should oppose it?

As I have said, I am not opposed to working long hours. I said earlier today, and will say it again, Einstein was quoted as saying that the definition of insanity was repeating the same action hoping for a different result. The government has not accomplished a lot in the way of legislation. If we think about the 19 bills that have passed versus 52 in the same time frame when the Conservatives were in power, really not much has been accomplished. There is no prioritization of what is coming forward.

I want to take a moment to talk about what has already passed because it shows something important.

So far in Parliament the transparency for first nations has been removed with Bill C-1. Bill C-2 gave back to the middle class $932 a year in taxes and then Bill C-26 increased their CPP payments by $1,100 a year, with no benefit. Bill C-10 gave Air Canada a deal to get maintenance jobs out of Canada and escape a lawsuit. Bill C-14, medically assisted dying, was passed without protecting the rights of conscience. Bill C-17 addressed environmental items for Yukon. Bill C-18 was environmental change for Rouge Park in Toronto. Bill C-30 was a CETA deal that now has to be renegotiated with Brexit happening. Bill C-31 was the trade deal with Ukraine. The rest were all maintenance budget items that needed to be done. That is all we have accomplished in 18 months of the Liberal government's agenda. Everything else is lost in process, being amended in the Senate, and not coming forward.

What is the government going to achieve by making us sit every night until midnight, which, as I said, I am fully willing to do? I really do not think it is getting anywhere. Why is it not getting anywhere? Because it does not listen to the opposition's points of view.

The job of the opposition is to bring reasoned and intelligent arguments on why a government proposal is not good for Canada and to make helpful suggestions about what would make it better.

When bills are sent to committee, the committee's job is to make helpful suggestions and amendments that would make them something all Canadians could embrace. That is really what is happening. The government is not accepting amendments, not listening when the opposition talks, and again and again, when things go to the Senate, the Senate comes up with the same amendments and spends more time studying them, doing exactly the same thing that committees of the House are supposed to do. That is one problem.

Another problem is that there has to be trust when parties work together.

I am going to compare the antics that I see happening here with what I see in the business world. In the business world, people work together. People have to be able to trust one another when they make deals. They have to be able to follow up on things as they said they would.

From what I have seen, the opposition House leaders are trying to work with the government House leader but she is not keeping up her end of what she has agreed to. Every day I watch her stand in the House and misrepresent to Canadians that she just has a discussion paper, when really a motion has been rammed through PROC. I have seen her avoid answering questions that she is accountable to answer.

I would suggest that there has been a huge erosion of trust in the government House leader and sometimes that cannot be fixed in order to restore the ability to work together. The government should really consider changing up that position and coming back to a place where we can work together and trust that agreements that are made, amendments that are suggested, and motions that are brought forward are as agreed. That is really important.

There is another point that I would like to make that has not been discussed much here. I have listened to the debate on Motion No. 14 and I have heard a lot about the blame game. I hear from the Liberals that when Stephen Harper's government was in place, it did this bad thing or that bad thing, or whatever. Honestly, two-thirds of the Parliament are new. Some of us were not here in the previous Parliament. We have an opportunity to do things differently now. If we think something was previously done wrong, we have the opportunity to do it differently in the future.

When items come up in the business climate, not everything needs the same amount of time to be talked about. I have sat in the House and heard Liberal members stand up and say they support such and such a bill and I have heard Conservative members and NDP members stand up and say they do too, and then we talk about it for days.

This is not the way we should be spending our time. If the government had not squandered all of the time in that way, we would have more time and we would not have to sit late. In the same way, there are things that need to be discussed longer that cannot be rammed through, things such as the budget bill that has been combined with the infrastructure bank. When comments come forward, the government needs to lead. It needs to separate those things out so that the things that can be quickly passed get passed on. When I say passed on, I am saying that if we all agree on a bill at first reading and we do not need to change anything, then the legislation should be sent right away to the Senate. Why are we spending time doing second and third reading and committee and everything else? We need to be able to update some of the processes here.

I am not about just criticizing without providing recommendations for how I think we could make this better. Here are my recommendations, which I think the government could use to change some of the things that it is doing and which would result in getting legislation passed through in a better way.

When it comes to the rules of the House, I see an opportunity to modernize those rules but a change would need to honour the tradition of Parliament and have all-party consensus or at least the consensus of a majority of members to change things, because those things influence our democracy and they are important. Doing some of those things would, as the suggestions I have made about passing things we all agree on and everything else, clear the legislative agenda in a way that would move things forward more positively.

I also would reiterate that you have to have someone working with the opposition leaders who can be trusted, and I think that trust is broken.

The other point I would make is about amendments that are brought forward and are agreed to by the opposition members. It is not often that the NDP and the Conservatives play on the same team and sing from the same song sheet. That does not usually happen but lately it has happened a lot. When that happens, it should be a signal to government that this is an amendment that Canadians want to see.

The government needs to say what it is going to do and then it needs to own up to it. Some of the credibility loss that has happened has happened because the government said it was going to do something and then it did not. The government maintained it was going to be open and transparent and then facts have been hidden or things have not been well represented. The government said it was going to be accountable but then every day when we stand up and ask questions we get the shell game. It does not answer our questions, and this would not be acceptable in the business world.

These are some of the things that would help to get the legislative agenda flowing through. As a member of the opposition, I want to see the right things happen for Canada and I am willing to work with the government to see that happen.

[Sally Guy, Director of Policy and Strategy, Canadian Association of Social Workers]

Thank you.

Good morning, everyone. On behalf of the board of the Canadian Association of Social Workers and our president, Jan Christianson-Wood, I thank you for inviting the social work voice to this important consultation.

When we considered the study's guidelines, we noticed that the words “new” and “innovative” emerged over and over again. Not to be cheeky in any way, CASW would propose that the first step to innovation is actually in better measuring and assessing existing systems and strategies so that we can build upon and lift up best practices and evidence.

To elaborate on that, CASW is often asked which provinces and territories are leading in poverty reduction. It is also asked where dollars allocated for social services through the Canada social transfer are being spent, or in an ideal world, where they are being most effectively spent.

We simply don't know. No one does. At present, there is no requirement that the provinces ensure recognition of the federal payments or provide information to the federal government about how the CST is spent. The dollars flow into general revenue.

With the introduction of the Canada Health Act, the government acknowledged that certain principles should be upheld across Canada in the delivery of health care services. Far from hard laws or regulations, the Canada Health Act serves as a set of guiding principles that are really just meant to ensure that Canadians have access to equitable, quality care wherever they reside.

This is why CASW is proposing a social care act as a piece of a national poverty reduction strategy.

I can see many of you looking at me. I know I probably have pitched this to you, individually, before.

As with the Canada Health Act, the proposed social care act would establish common principles to help comprehensively address poverty. These aren't new—public administration, universality, portability—and this would help set the stage for a framework for reporting on how the CST and other federal social investments are spent.

Enabling such a framework for reporting would not only provide the government with a record of return on investment. It would also serve as a catalyst for the sharing of best practices and evidence between the provinces and territories.

That being said, I'll move on to the study's specific questions, of which there are a number.

With regard to education, training, and employment, I'll go briefly back to the CST and accountability. We think the portion of federal dollars intended for post-secondary education should be separated in some way from the rest of the CST, which is really intended to address Canadians' dignity and basic needs. This doesn't necessarily mean separating it altogether, but rather delineating the funds' intended purposes, which would be, again, facilitated by something like a social care act.

We also would ask that the profession of social work be included under the Canada student loan forgiveness program, which currently includes nurses, for instance. Not only are social workers' skills greatly required in many rural and remote regions in Canada, but we also are trained mental health professionals whose expertise most often comes at a more cost-effective price point than that of psychologists or psychiatrists.

With regard to housing and homelessness, CASW wholeheartedly supports the Canadian Housing and Renewal Association's request to continue and increase direct supportive housing investments, noting that the 2016 federal budget introduced targeted funding to increase affordable housing for seniors and for victims of violence.

CASW recommends that these programs be continued beyond their two-year mandate. It also recommends that this program be extended to include other forms of supportive housing targeted to seniors, LGBTQ individuals, veterans, and also previously incarcerated individuals. Funding for these types of targeted programs would ideally be set a minimum of $150 million per year. It would also ideally flow through something like a social care act as a social policy framework.

With regard to government administrative savings and entitlement programs, we have a lot to be happy about, a lot to reward the Liberal government for. In tying the Canada child benefit to income, the Government of Canada took a bold step towards developing a comprehensive basic income for families with children.

Budget 2016 also enhanced the guaranteed income supplement, which combined with OAS—old age security—moves forward basic support for seniors. We commend this, and we encourage the government to continue progressively with the concept of a basic income for all, potentially.

We were also really pleased by the CPP expansion in bill C-26. We do remain concerned that it lacks those so-called dropout provisions for child rearing and disability, and we do hope the government commits to amending those as it has publicly promised to do.

On social investments, which is my last piece—I promise—we recently released a paper entitled “The True Cost of Capital”, which was on the potential of social finance in Canada.

Keeping in mind this government's mandate to develop a social innovation and social finance strategy, CASW urges that any approach be guided by social principles as well as economic ones, and that it implement strategies based on evidence and not only the assumption of efficiency and innovation, as ubiquitous as these assumptions seem to be.

Since social finance tools have the potential to impact the most vulnerable in our society, it's imperative that they are not further economically exploited by private investors.

On social finance, we would just advise that any initiatives meant to address poverty or vulnerable populations be guided by a social conscience, and use as a framework the principles proposed by a social care act, which are the same as in the Canada Health Act, namely, public administration, accessibility, fairness, effectiveness, accountability, and transparency, to name a few.

We also hope that the federal government will heed the view provided in the supplementary opinion on this committee's study of social impact bonds, which went on to say that it is important above all else to ensure that the government prioritize the needs and successes of vulnerable Canadians, meaning their needs and successes, not those of private enterprise.

Finally, I think it just needs to be said one more time, because it is so important, that private profit has no place in the provision of services to vulnerable Canadians.

I think I kept that short.

Thank you for your time. I look forward to any questions you may have.

Message from the Senate

[The Deputy Speaker, Conservative, Bruce Stanton]

I have the honour to inform the House that when the House did attend His Excellency the Governor General in the Senate chamber, His Excellency was pleased to give, in Her Majesty's name, the royal assent to the following bills:

C-2, An Act to amend the Income Tax Act—Chapter 11, 2016.

C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act—Chapter 14, 2016.

C-29, A second Act to implement certain provisions of the budget tabled in Parliament on March 22, 2016 and other measures—Chapter 12, 2016.

C-35, An Act for granting to Her Majesty certain sums of money for the federal public administration for the fiscal year ending March 31, 2017—Chapter 10, 2016.

S-4, An Act to implement a Convention and an Arrangement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and to amend an Act in respect of a similar Agreement—Chapter 13, 2016.

It being 4:53 p.m., the House stands adjourned until Monday, January 30, 2017 at 11 a.m., pursuant to Standing Orders 28(2) and 24(1).

(The House adjourned at 4:57 p.m.)

[The Deputy Speaker, Conservative, Bruce Stanton]

I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed the following bill: Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, without amendment.

Income Tax Act

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Speaker, I want to thank my colleagues who support the bill and who have spoken so well to the merits of it.

This legislation would help all seniors today by removing a punishing withdrawal structure that would harm the retirement savings of Canadians. Before I reiterate the specific benefits of the bill, I want to thank the member for Cowichan—Malahat—Langford, who spoke in favour of the bill during the first hour of debate. He said that he strongly encouraged support of the bill at second reading so we could at least bring it to committee, further study it, and hear from expert witnesses.

I also want to address comments made by the Parliamentary Secretary to the Minister of Finance and the Parliamentary Secretary to the Leader of the Government in the House of Commons, who both spoke in opposition to the bill in the first hour. Neither of them pointed out specific potential harms of this bill, but rather launched into lengthy platitudes about how great the government was for forcing the CPP expansion. Their argument is meaningless because supporting Bill C-26 and supporting Bill C-301 are not not mutually exclusive. The government members can support both bills without one impacting the other. I look at the member for Cowichan—Malahat—Langford for this example. He doing both, and he has not exactly burst into flames because of it.

The Parliamentary Secretary to the Minister of Finance elaborated on the benefits of the previous Conservative government's sensible lowering of the RRIF withdrawal rates in 2015. I congratulate him on this non-partisan behaviour and encourage him to continue to do this by supporting Bill C-301, which is the logical extension of the 2015 reduction.

In supporting the 2015 reduction, the member acknowledges that RRIF rates are out of touch with the changing realities of life expectancy and savings investments. Because government will never react enough to minimize the harms to seniors caught in the middle, the logical next step is to eliminate these rules entirely and stop punishing seniors for daring to have savings. I hope the member realizes his inconsistent logic in supporting the 2015 reduction but opposing this extension, and reconsiders his position.

He next made misleading arguments on tax deferral by implying that this legislation would allow Canadians to avoid taxes entirely. This is false and he is wrong. The government would get what it is owed. The only difference is that with Bill C-301, seniors would decide when it was best to withdraw their savings and be taxed. Government is not going anywhere and neither, by extension, is the tax man. Government can wait, especially if it means our seniors are better off.

The member then doubled down on his flawed tax-exemption argument, but it was also an irrelevant point. He said that the bill could motivate seniors to press for tax exemptions, which would be contrary to the basic principles of our fiscal policy. I am not certain what the member was trying to get at. I wonder if he is seriously basing his opposition around the idea that just maybe in the future some people might push for better tax treatment. I wonder what is next? Maybe the government needs to take money from seniors because some might spend it on beer and popcorn.

His last argument is just as nonsensical. He said that this bill would create major intergenerational disparity, and we heard that earlier today as well, because older seniors had been forced to withdraw their savings already. I am very much unclear on what the member is thinking. I think he may misunderstand the parliamentary system entirely. I just want to clarify for him that every law that we change affects Canadians unevenly.

The Liberals' own prized CPP tax hike would not benefit anyone for about 40 years, yet would raise taxes on several generations that would see zero benefit. Adding over $100 billion in debt for later generations to pay would do the same. His government is going to create the largest intergenerational disparity in Canadian history, but the Liberals argue against Bill C-301. I wish I could peek into the member's mind for a brief moment so I could witness the logic backflips he does to reconcile the support for the CPP tax hike and off-loading debt for future generations, but then opposes this sensible legislation because of intergenerational concerns.

Last, the parliamentary secretary to the government House leader said that he could not recall anyone from his constituency contacting him regarding RRIF withdrawals, that it was not a substantive point. It is probably because the member never asked. However, I asked, and CARP asked. We heard overwhelmingly that the bill was needed and wanted.

The bill would address real harms. Canadians are living longer, their investments are earning less, and the RRIF withdrawal structure is depleting the savings of our seniors at an unsustainable rate. These forced withdrawals negatively affect seniors in many ways, and disproportionately hurt low-income seniors. Forced withdrawals count as income, which needlessly triggers clawbacks of OAS, GIS, and needed provincial benefits. This matters for low-income seniors who rely on OAS and GIS for their daily expenses, but need to continue saving their RRIF for expected later-in-life expenses such as long-term care or care for their disabled children.

This bill is broadly supported. The Canadian Association of Retired Persons supports the bill because it would return financial control over savings back to seniors. It would not cost taxpayers a dime. According to the C.D. Howe Institute, it would probably benefit the treasury, not cost the half a billion dollars as made up by the other side.

This bill is badly needed. There is only one solution, and that is to eliminate the mandatory withdrawal and stop punishing seniors for saving. Let us allow Canadians to manage their retirement as they see fit. Enact this broadly supported and sound legislation. Let us send it to committee so Canadians can have their say.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Mr. Speaker, I want to thank the member for Edmonton West for bringing this private member's bill forward. Many times the member and I do not see eye to eye, but I certainly have a lot of respect for him, and I enjoy listening to him.

It is my pleasure to rise today to speak to the private member's bill, Bill C-301, an act to amend the Income Tax Act and to make a related amendment to another act, which will affect registered retirement income funds, otherwise known as RRIFs.

The NDP is supporting the bill at second reading because we feel it deserves to be sent to committee for further study. The issue of mandatory minimum withdrawal requirements is an important issue for retirees trying to maintain an adequate income in their retirement.

It is our view that a detailed examination of the rules regarding RRIFs is necessary to help ensure that seniors are not outliving their savings. Retirement insecurity is reaching a crisis level in Canada, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. Any measures that will make it easier for seniors to maintain an adequate income must be looked at.

Much more needs to be done to help our seniors live with the dignity they deserve. The high cost of housing and drugs, the clawback of the GIS, and the indexing of pensions are just a few immediate issues. The government also needs to keep its promise to introduce a new seniors price index to make sure that old age security and the guaranteed income supplement keep up with rising costs.

Of more immediate concern is that the government must immediately fix the flaw in its new plan for enhanced CPP benefits. I am sure that members have heard the discussion about the mistake that the government made in Bill C-26 and how the exclusion of dropout provisions in the bill would have a negative impact on those who take time to raise children, especially women, and on those living with a disability. The government will have its chance next week at the finance ministers meeting to fix its mistake. We will all be watching.

This private member's bill will remove the mandatory minimum withdrawal requirements from registered retirement income funds and will change the retirement income fund definition. Registered retirement income funds, known as RRIFs, can be thought of as an extension of a person's registered retirements savings plan, or RRSP. An RRSP is used to help people save for retirement, while a RRIF is used to withdraw income during retirement. RRIFs are similar to RRSPs in several respects. Each allows for tax-deferred growth, offers several investment options, and is government regulated.

A major difference between an RRSP and a RRIF is that with an RRSP, a person can make annual contributions as long as they have earned income and have contribution room available. Withdrawals are optional and will be taxed. With a RRIF, contributions are not allowed, and a person must make minimum minimum mandatory withdrawals each year. RRIF rules and withdrawal rates were introduced in 1978, and then increased in 1992.

In 2015, the Conservative finance minister lowered the mandatory registered retirement income fund withdrawal amount to 5.27% from the previous 7.38%. Also, previous to 2007, the age limit for converting an RRSP was 69. The 2007 budget changed the age to 71, in order to strengthen incentives for older Canadians to work and save. When RRIF rules came into effect, lifespans and time spent in retirement were much shorter than they are today. RRIF holders now face the considerable likelihood of running out of money in late stages of retirement.

The NDP has long been in support of lowering these rates. In 2015, the NDP pension critic John Rafferty introduced Motion No. 595. It read:

That, in the opinion of the House, the government should review the Registered Retirement Income Fund mandatory minimum withdrawal thresholds and amend them to ensure they do not unduly force seniors to exhaust their savings too quickly.

The problem with the RRIF withdrawal schedule is that people are living longer, and if the schedule is followed then it is very likely that an account holder will run out of savings by age 92. At that point, the person who had saved diligently throughout their life will see their quality of life decline at a delicate time, through no fault of their own.

There are also concerns that RRIF rules can cause clawbacks on people's benefits from OAS and/or GIS. We know that people are living longer, and this fact will have an impact on seniors and on their ability to have enough money to see them through their retirement. In this context, it is interesting to look at some facts about today's seniors.

The probability today of a 71-year-old female reaching age 94 has almost doubled compared to 1992, from 13% to 24%. The probability of a 71-year-old male reaching that age has more than tripled, from 4% to 14%. There are 265,000 Canadians who are 90-plus years of age today. With the baby boom generation reaching these ages, the number of people living beyond 90 is expected to rise dramatically. By 2021, there are projected to be 355,000 Canadians aged 90-plus, including 80,000 people over the age of 95.

Most Canadians do not have alternatives to private savings for retirements besides CPP, OAS, and GIS. When RRIF rules were first put into place in the 1970s, Canadian households saved about 15% of income. By 2011, the household savings rate plummeted by a factor of five, to just above 3% of income. Canadians between the ages of 65 and 69 today hold only an average of $40,000 in RRSPs, which is a very modest amount. In 2011, workers aged 55 years and over accounted for 18% of total employment, compared to 15% in the 2006 census. This was the result of an aging baby boomer generation and increased participation of older workers in the labour force. Mandatory minimum RRIF withdrawals are becoming irrelevant as women and men are living at least twice as long, and staying in the labour force longer.

As I said earlier, the NDP intends to support this bill at second reading, as we feel it should be sent to a committee where the issues of RRIF withdrawal and income security for seniors can be properly studied. I am disappointed to hear that our Liberal colleagues will not be supporting the bill and are not in favour of this issue getting further study. However, then again, maybe I should not be surprised. The Liberals have made some progress on the issue of retirement insecurity with their modest increases in the GIS and their modest increases in benefits in the enhanced CPP proposal. That being said, the government has also launched a tax on some Canadian pensioners. Its failure to include dropout provisions in the enhanced CPP is certainly an attack on women and those living with disabilities.

We also have Bill C-27, which is clearly an attack on every worker and retiree who has invested in a defined benefit pension plan. It is a policy on which the former Conservative government did consultations and eventually decided not to move forward with it. Now it looks like the Liberal government is going to finish the work that the Conservatives started. The current government's plans are inconsistent and confusing. The strategy for dealing with the retirement income crisis is uneven, inadequate, and at the end of the day will be ineffective. Canadian seniors will be hurt as a result.

I urge all members to support this bill, so we can refer it to a committee where we can study how to better help Canadian seniors live with the security and dignity they deserve.

Budget Implementation Act, 2016, No. 2

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

Mr. Speaker, I once again have the great pleasure of rising to talk about how successful the Liberal 2016 budget has been, along with Bill C-29 to implement it. It is a budget that plans for the future, invests where investments are needed, helps our seniors, returns science and innovation to its rightful place, lays the groundwork for our youth, and addresses the priorities of our regions.

At 19,694 square kilometres, my riding, Laurentides—Labelle, is the 46th largest riding in Canada. Our smallest municipality has 41 permanent residents; our largest has about 13,000. My home town of Sainte-Lucie-des-Laurentides, where I still live, is the median of our 43 municipalities with 1,024 residents.

Our communities are aging. In 2011, the average age was 49.5. This year's census data will be released shortly, and I can only imagine that the average age will be over 50, so this budget and the initiatives that will affect our region are important.

In this bill, we are making it easy for senior couples no longer able to live together to receive greater old age security benefits. We are helping seniors in the short term, and we are planning for future issues involving seniors through the changes we have already rolled out for a significant 10% increase to the guaranteed income supplement for single seniors; through lowering the eligibility age for old age security from 67 to 65; and also through Bill C-26 on the future of the CPP.

We have been here for only a year and we did all that. The three budgets remaining in this mandate can only be even better.

Speaking of the future, I want to take this opportunity to talk about our innovation agenda. Our budget puts billions of dollars into social, transport, and green infrastructure. Our investments in scientific research are finally back on, after years of having a creationist minister of science. We understand the importance of research, of science, and of being truly progressive. Progressive comes from progress. Progress is a forward or onward movement. Moving forward is what we do.

While the official opposition objects to even the most basic progress, when even the notion of switching to digital clocks in this chamber was pooh-poohed by the Conservatives when we had a debate on Standing Order 51, the rest of society moves ever forward.

Mr. Speaker, 2016 marks the 25th anniversary of Linux, the open source operating system started by Linus Torvalds and developed into a world powerhouse by tens if not hundreds of thousands of contributors from all walks of life and all corners of the globe.

I have been involved in the Linux and open source community for most of that time, mainly through the open and free technology community SourceForge and its predecessor organizations, Software in the Public Interest and the Debian community. It symbolizes to me what a community can do when it works together. Indeed, DebConf17 will take place next year in Montreal, and it is an excellent and concrete example of what that looks like.

We in rural Canada are still trying to figure out how to reduce packet loss on our TCP-over-smoke signal Internet connectivity and our UDP-over-carrier pigeon cell phone service. The rest of the world is not waiting.

Amazon, Google, and Facebook built their empires on Linux. Linux now runs 498 of the world's 500 fastest supercomputers, only one of which is in Canada. Even Microsoft recently finally joined the Linux Foundation this fall.

I believe it is very important to understand the lessons of the open source community.

In 25 years, Linux went from a university student's hobby to the software backbone of the Internet. Many people became very wealthy because of it, with it, and through it, yet all the while, the software, the product, was free for anyone and everyone to use, to modify, to take apart, and to understand.

While some people refuse to use a web browser other than Internet Explorer because its proprietary nature is seen as the only possible avenue to being secure, I see it as the other way around. Open source software, with its peer-reviewed scientific approach to development, tends to be the most secure option available. Getting open source logic into government can only see innovation improve.

With our innovation agenda, the options are there, but to get there, we need communications infrastructure. That we only have one of the world's top 500 supercomputers, and that it is 196 on the list, speaks to the need for infrastructure and investment in innovation. After a decade of the previous government dismissing science as an inconvenience, unhelpful facts in the way of an ideological agenda, the government we have today clearly believes in researching and preparing our way into the future.

In rural Canada, as I mentioned, Internet is our big file. Of the 43 municipalities I mentioned earlier, all 43 see the lack of proper, competitive, high speed Internet as among the top priorities. Without it, our average age will continue heading north. When our average age reaches retirement age, the social structure of our region will necessarily change.

To address this, we need to address the issues that are keeping youth away.

When I asked high school seniors who among them will stay in the region after they graduate, it was rare to hear one of them say yes.

When I ask them why they leave, the answers are always the same. They say that there is no post-secondary education, that there is not a lot of public transit, that the regional service covers 35 municipalities with a couple of retired school buses, and that there is substandard internet and cellular service. Without these, not much is going on. When newcomers see that their cellphones do not work, they do not think about buying a house in our region, moving there or making their lives there.

Internet access is only through slow and unreliable satellite service or by telephone. Surely members can remember that noise old modems used to make. Unfortunately, it is still the case for many of our residents. For the luckiest, it is a blurry image at the end of a Skype call with their grandchildren.

Our budget is beginning to tackle these problems. We are investing $500 million in digital infrastructure to help bridge this technical gap. The lack of internet means fewer young people, less immigration and fewer opportunities for those who stay.

In investing a half a billion dollars in digital infrastructure to begin with, we are creating opportunities for those who stay and some appeal for newcomers. We are also helping to keep young people in the region.

The bill also aims to improve the lives of our seniors and to even out the average age of our regions over the long term. It is a budget that plans for the future, that invests where investment is needed, that helps our seniors, that reinstates science and innovation to their rightful place, that paves the way for our young people, and that examines the priorities of our regions. I am proud to support it.

What I am most proud of in this budget is the Canada child benefit. It helps thousands of people in the country. Over 300,000 people will find more money in their pockets.

When I tour my riding, people will often stop me and say they have never been interested in politics, but they really appreciate what we have done for families.

Last Friday evening, someone told me that she became a single parent just before the change in policy, and that it has helped her directly. It also provides concrete assistance to the region’s youth and families. I am proud of everything we have done. We have be proud of this budget. I am proud to support it.

Report Stage

[David Lametti, Liberal, Parliamentary Secretary to the Minister of International Trade]

Mr. Speaker, it is an honour to speak in the House this afternoon on something that really is a centrepiece of our government's policy moving forward: the budget. The budget is important to Canadians in so many ways, but, in particular, because it represents a strong and courageous change in direction from policies that the previous government undertook that would have the impact of making my children and grandchildren and everybody else's children and grandchildren across the country a whole lot weaker for many years.

We plan to invest over $180 billion in infrastructure over the next 11 years. So many of these expenses will directly touch upon my riding, such as social housing. The previous government, over the past 10 years, completely abandoned its responsibility in the area of social housing. I am privileged to sit in the House next to the member for Spadina—Fort York, who greatly inspired our platform and, therefore, greatly inspired the budget as it now stands. I really would like to pay homage to him.

He has an urban riding in Toronto, which is much like my urban riding in Montreal, and the housing needs are glaring, in particular, because of the federal government's abandonment of its responsibility 10 years ago. We need better social housing, we need to renew co-op agreements, which are very important in my riding. We need to have the money available for those co-op agreements to be renewed, and for those co-operative housing arrangements to reinvest in their own infrastructure, such that the buildings do not become dilapidated and continue to be vibrant communities moving forward.

My riding straddles the end of the city and the beginning of the suburbs, and there is the question of affordable housing as well. We need to be flexible to allow homeowners to repair their own homes and for landlords to repair their rental properties, particularly at the lower end of the rental scale, such that tenants will have a good stock of affordable housing. The fact that we have had the courage to say we will run deficits in order to improve our stock of social housing and infrastructure generally, I think, is an important change of direction.

There is also money in infrastructure for social innovation and technological innovation, two things that are very dear to my heart. I taught intellectual property for many years and have had to follow, for professional reasons, quite happily, I might add, the whole digital revolution. The world has changed immensely since I started teaching intellectual property in 1998. It has been unbelievable and the possibilities created for both economic advancement and the reshaping of society through the digital revolution are breathtaking.

I have, and I hope to have, social innovation projects accepted for my riding, as well as trying to bring some of the fruits of the digital revolution into my riding to create good middle-class jobs, but also to allow people to live closer to where they work and allow the community to thrive in that manner. It is a new generation where people do not necessarily want to commute for a long time in order to get to work. I hope I have the ideal riding for that possibility. By investing in infrastructure, particularly in these kinds of digital areas, we might be able to create those possibilities.

My riding is also blessed with two jewels, the St. Lawrence River and the Lachine Canal, both of which could profit greatly from investment in green infrastructure. The Lachine Canal is, for many reasons, so historically important in the history of Canada, in the development that occurred along that canal. Now we need to re-deploy the Lachine Canal as a recreational space. That requires infrastructure spending not just on the canal itself, such as the walls of the canal, and its development into a 12-month-a-year recreational facility, but also for decontamination.

All the lands in the southwest of Montreal are effectively contaminated because of their industrial history. Moving forward on any kind of project, whether around the Lachine Canal or whether a social housing project in Verdun or in Ville-Émard, we need to be thinking about funds for decontamination in order to make our infrastructure projects work.

Let me open with the following, because we are talking about the environment, and it is something that I feel needs to be said in the House as regards the price on carbon. People who speak out against a price on carbon seem to think they have a right to pollute. It used to be treated in the economics literature as an externality, something a property owner or business owner did not have to think about. It was external to his or her thinking. However, that kind of analysis is completely wrong. No one has the right to pollute. No one has the right not to consider these externalities of their own business activities. It is their responsibility precisely to consider the environmental impact of everything they do. It is part of the responsibility of being a property owner. It is part of the responsibility of being a business owner. I spent the better part of 20 years as a property theorist arguing just that. Therefore, it is not unjust to price carbon. In fact, it is equitable and just, and it is righting a historic wrong, whether in terms of analytical thinking or in terms of justice itself.

One of the most courageous things we are doing in this budget is the idea of an infrastructure bank. This is precisely in recognition of the fact that some of our infrastructure needs are so great that we need to turn to pools of investment capital in Canada and throughout the world to realize these kinds of projects.

There is a project currently being conceived in Montreal for a high-speed rail. Funding for that would come from Quebec's massive investment from the Caisse de dépôt et placement du Québec. This is the kind of project that the investment bank would target. They are projects that have some income stream that an investment fund or pension fund might want to invest in over the long term, with a stable and steady rate of return for its investors.

Why not tap into this? It makes possible all sorts of projects that will help my children and grandchildren move around the city of Montreal, should they choose to stay there, or anyone else. It really takes courage. We envisaged this in our platform, it was in our campaign booklet, and we are bringing this to reality. It is going to be fantastic.

Finally, I need to speak about the families in my riding, both the young and the old.

The Canada child benefit will help many families who live in my riding who are struggling to make ends meet. This non-taxable benefit, which is much more generous than the previous benefit, will certainly be an advantage over what we previously had, a miscellaneous mumbo-jumbo of tax credits and whatnot that was far less generous than our single, clear program.

When the future Prime Minister announced this in Montreal at the Olympic stadium, it was pointed out that the 70,000 seats in that stadium matched how many kids in Quebec would be raised out of poverty by this measure. I am proud to be part of that.

Finally, for the seniors in my riding, reducing the age for eligibility for benefits to 65, increasing the old age supplement, in addition to what we are doing in Bill C-26 on the CPP, means that our benefits for seniors are going to give them a dignified retirement. It will help, in particular, those who are really struggling, and believe me, I met many of them at the door.

There are measures in here to help veterans. There are measures in here as far as employment insurance goes. It would take another two or three days to recite these, but I am happy to conclude at this point by saying that this is a courageous budget. “Courage” is the word that characterizes it. We have had the courage to come forward to take these measures, put them in place for our kids and our grandkids, and I am proud to be part of it.

Business of the House

[Candice Bergen, Conservative, Portage—Lisgar, MB]

Mr. Speaker, we certainly do hope there will be a withdrawal of that comment.

Before I ask the usual question, I would like to ask the House leader if she would consider an idea, and that would be to be more generous with allocating debate for Bill C-29, the budget implementation bill, than she was with Bill C-26, which she well knows was allocated the minimum amount of time possible. Worth noting is the House leader's predecessor committed five sitting days to the same stages of the budget implementation bill on this watch. Since she was appointed—

Poverty Reduction Act

[Sheri Benson, NDP, Saskatoon West, SK]

Mr. Speaker, I am proud to rise today in support of Bill C-245, sponsored by my colleague, the member for Saint-Hyacinthe—Bagot, which would establish a national poverty reduction strategy.

Poverty is, sadly, still very much a growing problem in Canada. Since the unanimous motion by Ed Broadbent in 1989 to eradicate poverty in Canada by the year 2000, very little has been done by successive Liberal and Conservative governments to actually reach this goal.

In the intervening years since 1989, Canada has been proud of its position as the ”best” and “second best” country in the world in which to live, according to various United Nations measurements. However, Canadians living in poverty, including an alarming number of children, are no better off than they were in 1989.

How can this be in a country as blessed as Canada, with natural resources, a skilled and educated workforce? How can we tolerate a situation where our neighbours are struggling to find shelter, put food on the table, and take care of their families?

In my office is a poster that say, “All it takes is political will”. That poster was created to commemorate Ed Broadbent's motion in 1989, which every member of Parliament voted to support. Yet here we are in 2016 and very little has changed. We obviously did not have the political will. Our governments have failed to make poverty reduction a priority.

Poverty reduction is a complex and challenging issue, but we must not let that paralyze us. Too much time has already been wasted by hand-wringing and repetitive consultations that do not produce any discernible improvements for people living in poverty.

Bill C-245 offers a turnkey proposal that the federal government can readily adopt and implement. It calls for the creation of an officer for the commissioner for poverty reduction, as well as a national council for the elimination of poverty and social exclusion.

These are concrete steps that would focus efforts in poverty reduction in a way that is measurable, accountable, and cumulative. Governments have often said that we cannot afford to do any number of things that would reduce poverty. On the contrary, we cannot afford to not do anything.

I would like to give credit where credit is due. The government has put in place the Canada child benefit and increased the guaranteed income supplement by 10%. Unfortunately, these measures, by themselves, are not sufficient to eradicate poverty in Canada in any meaningful way. The Liberals' Bill C-26, which is supposed to increase retirement security for all Canadians by improving the Canada pension plan, actually omits some of the most vulnerable from the enhancement: women who take time out to have kids and people living with disabilities. Whether this omission was an oversight or deliberate, the Liberals have refused to fix the bill, thereby doing absolutely nothing for two of the most vulnerable groups in society.

I come from the great riding of Saskatoon West, a diverse riding that, unfortunately, is no stranger to poverty, and there is a very high cost to poverty. In Saskatchewan, Poverty Costs, a coalition of community-based organizations, calculated that the economic cost of poverty in Saskatchewan was $3.8 billion a year.

Of course, the costs of poverty go beyond the dollars and cents spent on maintaining Canada's social safety net. The lost opportunity costs and the consequences of growing inequality among our residents impact all of us. In addition, poverty costs Saskatchewan $420 million a year in heightened health care service usage. Poverty also causes us to spend between $50 million and $120 million a year more than we would otherwise spend on our criminal justice system.

The same report also found that one in 10 of our population lacked the income needed to afford basic necessities. For a parent working full-time, minimum wage pays just over $20,000 per year. That is almost $15,000 below the poverty line for a family of four. Poverty affects us unequally and the numbers are shocking: 17% of Canadian children live in poverty, 33% of immigrant children, and 64% of first nations children.

Some of Saskatchewan's population, including women, children, newcomers, indigenous peoples, people living with disabilities, and those in rural areas are at greater risk of living in poverty and face systemic barriers that impede their efforts to rise above the poverty line.

Health disparities due to poverty are a direct result of substandard living conditions, inadequate access to nutritional food, and increased stress associated with making ends meet. The stresses of living in poverty can also be deadly.

In Saskatoon, low-income adults were 4.5 times more likely to experience suicidal thoughts and 15 times more likely to attempt suicide.

In Saskatchewan, and across the country, costs of living are rising, but wages and salaries are not necessarily keeping pace.

In 2012, Saskatchewan had the second highest inflation rate in the country, and yet, still had the second lowest minimum wage.

The good news is that, overall, there is an increased public understanding about the social determinants of health, and growing support for addressing the underlying causes of poor health. Some 94% of Saskatchewan residents support reducing poverty, with 89% supporting a provincial approach to poverty reduction in Saskatchewan.

Therefore, we had high hopes in Saskatchewan when the provincial government adopted a poverty reduction strategy in 2014. Unfortunately, the Saskatchewan Party has now backed away from this priority, at a time when it is needed most.

The evidence shows that working to reduce poverty in the first place costs less than paying to respond to the effects of poverty later. If we needed proof that poverty is growing instead of decreasing, we just have to look at last week's headlines.

According to HungerCount 2016, a comprehensive report on hunger and food bank use in Canada, Saskatchewan has seen one of the largest increases in the number of people accessing a food bank since last year. The percentage of children using food banks is highest in Saskatchewan. It represents 45% of everyone served.

Steve Compton, the CEO of the Regina Food Bank, added that a job is no guarantee against food bank use. Nearly one in six households helped in Canada are working, yet still need a food bank to make ends meet. A lot of this has to do with the fact that low-wage and precarious jobs with no benefits are the only job growth our economy is seeing. It is no wonder that Canadians continue to rely on food banks, and yet, the finance minister has said that we should all just get used to job churn.

The Liberal government needs to acknowledge that poverty is growing, and use the levers it has to encourage stable, long-term jobs, instead of shrugging its shoulders. A $15 federal minimum wage would be a good start.

I am very proud to say that in my riding, four progressive employers have already committed to paying their employees a living wage. A living wage makes a huge difference for families and individuals and their communities. A truly progressive government would understand this and act accordingly.

Last week, Campaign 2000 released its annual report card on child and family poverty. It is heartbreakingly sad that an organization whose goal it was to eradicate child poverty by the year 2000 is not only still in existence today but that they are farther than ever from their stated goaI. After decades of advocacy for children and families in poverty, Campaign 2000 is still calling on the federal government to create a national anti-poverty plan.

Its 2016 national report card, “A Road Map to Eradicate Child and Family Poverty”, provides the latest statistics on child and family poverty in Canada, and clear recommendations for federal government action and leadership to end child and family poverty.

Bill C-245 can be the first step. It has already been studied at committee, and the Minister of Families, Children, and Social Development has acknowledged it is an excellent bill.

The Liberals have stated many times in the House, and at various committees, that the federal government has a role to play in reducing poverty in Canada, and that Canada needs a long-term, collaborative strategy to combat poverty.

Safe and affordable housing, affordable child care, accessible health services, a living wage, and a basic income for everyone are all important factors that contribute to the well-being of all Canadians.

It is my hope this excellent bill will be passed without delay, and it will be part of a truly comprehensive and collaborative strategy that will finally tackle all the different factors that contribute to poverty in this country.

Canada Pension Plan

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, at the beginning of the debate, I was quite encouraged by the NDP's indication that it would support Bill C-26. I understand today that it will continue to vote in favour of Bill C-26.

However, I would express some disappointment, in the sense that New Democrats do not seem to realize that if we were to follow their advice on this, first, it would put into jeopardy the pension proposal, the legislation itself, for the simple reason that the Conservatives have made a commitment to kill the bill. In other words, they would indefinitely talk it out, which would in essence deny what we believe Canadians want to see.

Then with respect to my other point, maybe I would put it in the form of a question. Would the member not acknowledge that in coming up with enhancements to the CPP, we have to get the support of the provinces and territories to make the changes that we all want to see made. We have achieved that support.

In order to change the law, we have to get the provinces onside. That is the reason the Minister of Finance is going back to the table at a future meeting.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, I will be splitting my time with the member for Windsor—Tecumseh, and I thank my colleagues for allowing this.

I rise in the House today to speak at third reading of Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

In my remarks on Monday, I focused on how we in the NDP have found a mistake in the bill and our attempts to fix it. I described how the government had failed to include important provisions that would protect workers whose incomes are reduced because they take time to raise their kids and those whose incomes are reduced because of a disability.

The government either forgot to include those provisions or excluded them on purpose. We are not sure which it is. There are differing opinions on this matter. I must say that the government has been completely unwilling to shed any light on this matter. Government members have intentionally spoken around the issue, using the lines that have been written for them. I think many of them really do not know the answer. Only the minister knows the answer, and he has been the most unclear in his comments of any member on the other side of the House.

I then went on to describe the attempts by the NDP to get the government to fix the bill. Members on both sides of the House know the bill is flawed and needs to be fixed. We were encouraging members on the other side of the House to go to committee to fix the bill. We worked hard with the legislative counsel, and we developed the clauses and the language needed to put the necessary drop-out provision in the bill to fix the problem.

It is an easy fix via just two amendments and less than two pages of language that would protect those who take time off for child-rearing, mostly women, and those living with disabilities. What happened at committee was a real eye-opener to me. The Liberal members of the committee were whipped hard to shut down any attempts to amend and fix the legislation.

Even though we know that some of them understand that the bill was flawed and needed to be fixed, they all lined up and supported the use of procedural tricks to shut down debate, not once, but twice. They should be ashamed, and I truly think some of them are. The Liberals then had a chance to fix the flaw themselves when the bill came back to the House at report stage. However, the government made it very clear they it no intent or interest in doing that.

Here we now are at third reading of a bill that is still flawed, with the rights of women and those living with disabilities still in question. This leads me to talk about where we go from here. Once we pass this legislation into law, will the problems we have identified ever get fixed? Will provisions that protect women and the disabled ever get included in the legislation? That is unclear, and it is making our continued support of this bill very difficult.

We will vote for it at third reading because the CPP needs to be changed, as we have fought for a long time, alongside our friends in the labour movement, to have the government increase benefits for retirees. However, we are very concerned about the government's supposed commitment to fix the legislation after the fact. We have heard in the House that the government needs to get the agreement of the provinces.

Last week we heard the following from the President of the Treasury Board:

We are aware that more could be done in respect of the dropout provisions for disability and child rearing and, in fact, the Minister of Finance will raise these provisions at the next meeting of the provincial and territorial finance ministers in December in the context of a triennial review of the CPP.

Then the next day we heard this from the Parliamentary Secretary to the Minister of Finance:

Our intent is to pass the bill, as is; however, the Minister of Finance will then raise the dropout provisions at the next provincial and territorial finance ministers' meeting in December, in the context of the triennial review of the Canada pension plan.

Also last week we heard from the finance minister 's director of communications that:

We’re aware that more could be done with respect to drop-out provisions for disability and child rearing to make sure that this expansion is as inclusive as possible.... However, in order to make any changes to the plan we need agreement from the provinces.

He continued that the finance minister would bring up the omission when he meets with his provincial counterparts in December to review CPP, a routine process that occurs every three years.

Canadians need to note the lack of a clear commitment shown in these quotes. Saying the minister will raise or bring up the omissions is certainly no commitment. How hard would the minister push the provinces to fix the bill and include the missing provisions? We do not know the answer to that. I was hoping to hear a more clear-cut commitment from the minister this week. However, that commitment does not seem to be forthcoming. If anything, the most recent spin makes me think the government is spinning away from any commitment at all.

When the minister was asked yesterday by one of my colleagues if he would fix the bill, he would not even address the question. Instead, we got the most shallow spin possible. This is all the finance minister would say on the matter:

What we also recognize is that there will always be opportunities for continued improvement. Our job, in working together with the provinces, is to move forward on this agreement and then to consider other ways we can improve the Canada pension plan in the future to ensure that the retirement health of Canadians is always provisioned for.

Those are very inspiring words, but hardly a commitment to fixing the problem caused by the omission of the dropout provision in this bill.

What concerned me even more were the comments made by the member for Saanich—Gulf Islands yesterday during debate, when she said:

On the evidence we have before us, it appears that the bill will disadvantage women for no apparent reason other than an oversight. I did have a brief moment to discuss this with the Minister of Finance earlier this morning, and his position is that to do what the NDP asks now would result in a transfer of wealth from poorer women to wealthier women because of the way the calculation works. Unfortunately, I do not have the full facts on this.

We do not have the full facts on this, either. I told the minister that, when he tried to spin me with the same argument in the hallway after question period yesterday. I also told him that the argument makes no sense at all. In fact, I think the inverse is probably true, given that the elimination of the childbearing dropout for the additional benefit would presumably penalize lower and modest-income mothers, since women in higher-income households are better able to adjust.

Besides, the argument fails to take into consideration that the CPP is basically an insurance plan into which people pay benefits. Raising benefits at one level does not mean having to reduce benefits at another level. Surely, someone qualified to be the finance minister of Canada should know this.

I also have to wonder where the minister came up with the calculations he says his argument is based on. We have been told all along that no costing of the dropout provisions has ever been done. Where did the numbers come from? If the minister has numbers, will he share them with us? Will he share them with Canadians?

I fear that the finance minister's proactive spin in this argument may be our best indication yet of the government's spinning away from any commitment to fixing the dropout provision mistake.

What Canadians need is a clear-cut commitment from the finance minister. We need to know that he intends to come away from the December meeting with his provincial counterparts with an agreement in hand. The agreement must fix the problem with the legislation and include a dropout provision that would protect women and those living with disabilities.

Will the finance minister stand in the House and make that commitment?

The NDP will remain vigilant and be persistent in our demands that the government fix its mistake. The government and the minister should be aware that the NDP will not let up its pressure until they follow through on their commitment.

Canadians deserve no less.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, as the debate winds up, it is important to recap that in Bill C-26 we are debating the ability of today's generation of workers to have adequate retirement money through the CPP, one of the fundamental pillars of our social pension programs. The CPP, the OAS, and our guaranteed income supplement are things that Canadians truly believe in. The government has demonstrated very clearly over the last number of months that it supports Canadians in a very solid fashion, whether through budgetary motions, regulatory changes, or now with respect to the CPP. The changes to the CPP took a great deal of effort, working with the different stakeholders so we could arrive at this bill today.

Would the member not recognize that in order to have a holistic approach to dealing with the seniors of today and tomorrow, it is in the best interests of all Canadians that we pass this bill?

[Larry Maguire, Conservative, Brandon—Souris, MB]

Madam Speaker, I want to thank the member for Flamborough—Glanbrook for the opportunity to share his time today. allowing me to make some remarks on Bill C-26.

I rise today to add my voice to the many others who have grave concerns about Bill C-26, and the Liberal plan to further erode the disposable income of hard-working Canadians and its negative impact on job creators.

Every member of Parliament in the House cares about the well-being of seniors. I believe each and every one of us wants to implement policies that will improve the quality of life of Canadians, while also balancing out the costs associated with those changes.

Over the past 50 years, there have been numerous policies introduced with the aim of assisting Canadians in preparing for retirement, changes such as the introduction of the Canada pension plan, old age security, the guarantee income supplement, registered retirement savings plans, and our previous Conservative government's landmark decision to implement tax-free savings accounts.

Through various governments of different political stripes, great improvements have been made, and the poverty level of seniors has dropped dramatically. According to Statistics Canada, the share of Canadian seniors living on low incomes has dropped from 29% in 1970 to 3.7% today, which is among the lowest in the world.

I believe it is vitally important we recognize that the CPP was originally introduced in 1965. When it was introduced, it was a much different world than we live in now. Many families had to get by with only one source of income, and gender inequalities were far too common. Millions of seniors lived in poverty, and many communities did not have affordable housing options for those who struggled to get by. Probably one of the most significant differences was the lack of financial literacy and the available savings vehicles that are now offered by the private sector.

In 2016, millions of Canadians have opened their own tax-free savings account, or have invested in mutual funds or the stock market through online trading brokerages. I am pleased that Canada's saving rate has climbed from 7.7% in 1990 to 14.1% today. This is a testament of how investing money and saving for retirement is at the top of people's priorities.

According to the Fraser Institute, the vast majority of Canadians are putting enough aside for retirement. In a document published by the institute, Canadians now hold $9.5 trillion in assets above and beyond CPP.

While the Liberals think they have the best of intentions, their policies to date have not grown the economy. They have put jobs at risk, and Canadians are worse off today than before the Liberals took office. Canadians cannot trust the government with their pensions. The Liberals have not been able to keep promises they made a year ago, let alone ones they are making for decades down the road.

What the legislation before us signifies is that the Liberal government does not trust Canadians with their own money. It is awfully rich to force Canadians to control their spending when the Liberals have moved past their own deficit projections to the tune of billions of dollars. I can assure the Liberal government that millions upon millions of Canadians are being responsible with their own money and do not need to take lessons from my hon. colleagues across the aisle.

A study by McKinsey & Company has found that 83% of Canadian households are on track to maintain their current living standards in retirement. Now 83% is not 100%, but it does not justify the punitive measures being proposed in Bill C-26.

Before the government moves any further with Bill C-26, it should stop assuming that Canadians are as spend happy as its own Liberal finance minister. Perhaps it is time for legislation to force the Liberal government to stop putting Canada's future generations at risk. That is legislation I could support.

I believe it is wrong to force Canadians to put more of their hard-earned dollars into a government-controlled pension plan rather than allowing them the flexibility to make their own investment decisions. We have a good balance in place, and it should be upheld until such time that evidence suggests otherwise.

If the legalisation before us passes as written, it will literally take money out of the wallets and purses of hard-working Canadians and their employers. In fact, it is very possible that some households will be paying up to $2,200 more per year when the changes are fully implemented.

While the Liberals pontificate about their middle-class tax cut, most of the savings will be eaten up through this CPP tax hike alone. This does not include the carbon tax, which will be unilaterally imposed on provinces and taxpayers in the years to come.

It baffles my mind that Liberals want to force Canadians to put more money into CPP, while at the same time eroding people's investing power into investments of their own choosing. It seems like an oxymoron to me.

I can assure the government that any reputable financial adviser would be able to provide a far more significant return than the government-run pension plan. It is projected that any Canadian who was born after 1972 can expect a real rate of return from the CPP of only 2.1%. Regardless of how well the Canada Pension Plan Investment Board does, the next generation of Canadians had better not be planning on a CPP bonanza due to its rate of returns.

Moreover, Bill C-26 is just another attack on Canadians who do their own financial investments. It is an attack on those who want nothing to do with putting more money into their CPP, as they like the current system. They resent the fact that their government thinks it can do better in saving money than themselves. As we all remember, it was just last year the Liberals clawed back people's tax-free savings accounts and limited the amount of money that could be invested without paying capital gains taxes.

While it is true that some Canadians are not financially prepared for retirement, we on this side of the House do not think that a payroll tax hike is the best or sustainable approach to assist those most in need. The reason why many Canadians are not financially prepared for retirement has nothing to do with the CPP itself, but is due to the fact that they do not have employment or are underemployed. The best way for the government to help Canadians prepare for retirement is to create the right economic environment for the creation of new high-paying jobs.

One of the loudest and most vocal critics of this payroll tax hike has been the Canadian Federation of Independent Business. It has repeatedly asked for the government to apply the brakes, as 70% of small business owners disagree with the notion that this CPP increase is modest as the government suggests it is.

For many small and medium-sized businesses, this legislation would cost them thousands of dollars each and every year. It has the potential to further slow our economic growth, while doing nothing to help those most in need. As I stated, a CPP increase will not help Canadians without a job.

An analysis by the C.D. Howe Institute shows that the Liberals' CPP plan would not benefit low-income workers. While their CPP payments would go up, it would be offset by clawbacks in their GIS benefits.

This is the classic Liberal two-step: give one dollar in the left pocket and take one out from the right. This is why I am very skeptical, as are many Canadians, that the Liberal carbon tax will be revenue neutral. Looking at new innovative ways to assist Canadians to save, such as the tax-free savings account and improving financial literacy, are tangible benefits that are proven to yield results.

Far too often, the government brings out a stick when a carrot would suffice. Levelling a job-killing payroll tax hike, which would reduce employment and Canada's GDP, is quite frankly asinine in today's economic turbulence. Payroll taxes, carbon taxes, small business taxes, and burdensome red tape are hindrances to job creation, to name only a few of the Liberals' regressive acts.

It is abundantly clear the government has no plan for the economy. It is even more worrisome to see it plunge Canada back into deficit, while at the same time its deficit spending has failed to spur our economy. There is little justification that would result in such a heavy-handed approach.

There are alternative ways to assist those who need it the most, and the Liberals showed that when they copied our Conservative move and increased guaranteed income supplements. I should note also that the Liberals ran on a pledge to review the consumer price index, which is used to calculate inflation. There are many other ways to help Canadians save for retirement than forcing through a one-size-fits-all approach.

I will never vote for legislation that financially hurts Canadians. No matter the size of the bow wrapped around this change in policy, it still remains a tax hike. Bill C-26 would not help our most vulnerable seniors in need. It would not create new jobs or grow the economy. It is the wrong approach to take. I call upon my Liberal colleagues to stand up for what is right and oppose the legislation before its impact financially hurts their constituents.

The reason so many of my Conservative colleagues have spoken to this bill, and more would do so if closure had not been moved, is that it is necessary to try, as responsible opposition, to influence the importance of cancelling the bill to the Liberal members for the reasons I have just articulated.

[David Sweet, Conservative, Flamborough—Glanbrook, ON]

Madam Speaker, it is always a pleasure to rise in this House to represent my constituents in Flamborough—Glanbrook, all Canadians, and all taxpayers in this country, particularly on this bill.

Today, we begin and end a third reading debate on Bill C-26, an act to amend the Canada pension plan, legislation that I must oppose most vigorously for a number of reasons.

I must express that it is truly unfortunate the government has chosen to shut down debate to less than 90 minutes through its use of closure. This heavy-handed draconian approach is wrong-headed, which are pretty much direct quotes from my Liberals colleagues from the past Parliament, as members on this side of the House have a wide range of legitimate concerns that have gone unaddressed through the committee stage. These concerns should not be just read into the record but should actually provide pause to the government.

Unfortunately, the government is determined to ram this legislation through this chamber without any consideration for the consequences to so many responsible Canadians and small business owners. Bill C-26 expands the Canadian pension plan over the next 40 years in an effort to alleviate the financial burden of retired seniors, particularly those facing poverty.

I believe working toward the improvement of the lives of seniors is always a worthy endeavour. After all, they are the ones who built this country and made it great. However, where we profoundly differ from the members opposite is in how this is to be accomplished. In my view, these changes should have been more sufficiently studied and debated so that we do not trade one problem for another.

The bill mandates an increase in CPP premiums, a cost shared between employers and employees, to the tune of up to $2,200 per year. For families who already have to stretch their dollars in order to balance their household budget, these proposed measures will limit their ability to put money aside to save for their child's education, to purchase a new minivan, or to plan a much-needed vacation.

As an aside, neither the Minister of Finance nor the Prime Minister, both sons of millionaires, which in and of itself is not an issue, have had to make sacrifices to balance their household budgets, yet these are the masterminds behind Bill C-26, which will quite literally take money from the paycheque of every hard-working Canadians.

What is also very concerning is that the introduction of this bill, and its corresponding tax increase, comes at the same time that the government is imposing a carbon tax, which will drive up the price of everything. Under the carbon pricing scheme, residents in my constituency of Flamborough—Glanbrook will face higher fuel prices to make their morning commutes to work, and at the same time the price of everything from local produce to the costs of flights out of the Hamilton airport will go up. Perhaps most concerning is that the carbon tax will also increase the price of home heating. For my constituents, that is hard to fathom. Families young and old in my community are already tapped out. They can ill-afford the increased costs that are coming under the Prime Minister's carbon tax.

If the timing of two taxes is not bad enough, I must remind the House that Bill C-26 also comes at a time of massive deficit spending. As members know, deficits are simply the taxes of tomorrow. The government is borrowing billions of dollars and has not articulated a plan that would see the budget return to balance. This reality creates further uncertainty and concern for Canadians, because they know that in order to bring the budget into balance the government will either have to slash programs, raise taxes, or both. All of these initiatives come at a time when in my home province of Ontario energy prices are going through the roof. The experience of living under the Ontario Liberal government of Kathleen Wynne has taught my constituents to be skeptical of flashy new proposals that would see the long arm of government reach further into their pocket and take even more of their hard-earned money.

However, the concerns about Bill C-26, this CPP tax hike, go further than just bad timing. There is also significant concern that the bill effectively hinders the choice of Canadians as to how they save for their retirement. As a result, Canadians who are proactively saving for their future will be forced to invest more into CPP and less into the savings vehicle of their choice. Thanks to our previous Conservative government, Canadians now have an unprecedented number of savings options. Let us take, for example, the tax-free savings account that was implemented and then expanded. These accounts allow Canadians to save for large expenditures or for retirement with no strings attached. The money is available when it is needed, and the interest is accumulated tax-free. I would point out that, by far and away, it is middle-income Canadians who are making the greatest use of TFSAs. Plus, there are other ways to build up a nest egg. Some folks invest in the housing market, others store money away in RRSPs, while others contribute to a workplace pension plan or a pooled registered pension plan, which is yet another savings vehicle brought in by the previous Conservative government.

There is a wide spectrum of savings options available to Canadians who wish to supplement their retirement income and yet the CPP tax hike found in Bill C-26would limit the ability of Canadians who take the initiative to save on their own.

Take for example a single-income family with a couple of kids. One of the parents goes to work to bring home the proverbial bacon while the other parent stays at home to tend to the needs of the children. They pay to put a roof over their heads, food on the table, and clothes on their backs. They put gas in the tank, heat their home, put their kids into sports, and give to charity. If the money is there, they may splurge on a date night and enjoy a nice meal in a restaurant. And of course they pay their taxes. Once all the bills are paid the bit that is left over could be put into a savings vehicle, but under Bill C-26 that bit left over does not make it into a TFSA but rather is taken off their paycheque and is forced to be invested into the CPP. Rather than having that money available to them for their car or for the car repairs, the family will have to take on more debt, making it even tougher to cover their cost of living by the time the next month's bills arrive. At the very least, Bill C-26 limits choice. At the worst, it may contribute to a cycle of debt by skimming too much off the top.

Bill C-26 would not just impact modest-income families. It would also take the choice away from Canadians who save for their retirement and wish to leave their accumulated wealth behind for loved ones after they pass away.

I have served in this place for more than a decade now and over the course of my tenure as a member of Parliament many seniors have discussed their priorities with me. I have heard many seniors say two things as they plan for the end of their life: first, they hope not to be a financial burden to their family and second, if possible they would like to leave some of their savings behind for their loved ones. In Canada we have a retirement system that allows them to accomplish these goals.

Our retirement system is the envy of the world. Retired seniors have access to old age security, the CPP, and a raft of savings options that I mentioned earlier. After those sources of income, if seniors are still facing financial difficulty, the guaranteed income supplement is there to top up their income. Thanks to the Conservative government in the last session of Parliament, they could even make a good sum of money without it being clawed back.

Further, those who want to look at the data or parse the numbers should consider the following. Eighty-three per cent of households are on track to maintain their current living standards in retirement, according to a study done by McKinsey & Company. Statistics Canada shows us that the share of Canadian seniors living on low income has dropped from 29% in 1970 to 3.7% today. These facts demonstrate that the vast majority of Canada's seniors are able to save enough to have a dignified retirement and cover their end-of-life costs and are able to meet their goal of passing on some of their earnings when their time comes.

One of my core critiques of the CPP is that the money invested by an individual contributor cannot be accessed by a surviving family member. By forcing Canadians to increase their contributions to the CPP, they will have less money to put into savings vehicles that give them the choice to will their savings to their loved ones. It is no surprise then that fewer than 20% of Canadians surveyed by the Canadian Federation of Independent Business said that they would opt to put more of their savings into the CPP.

Back in the 1960s when the Liberal government of the day introduced CPP, minister Judy LaMarsh, who was responsible for establishing the program, had this to say about the intent of CPP, that it “is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans.”

Canadians who work hard for their money should be able to save in the way they choose and should be trusted to plan for their futures. Not only is Bill C-26 ill-timed and strips responsible Canadians of choice of their savings, it also negatively impacts small business.

As a former small business owner I have first-hand knowledge and experience of what it takes to battle the red tape and the cost of living to make sure that costs stay low in business. For small businesses it is going to be a choice of whether they continue to hire or invest in their business, having to deal with this expanded CPP tax. Two-thirds of all small firms say they will have to freeze or cut salaries and over one-third say they will have to reduce hours or jobs in their business in response to the CPP hike.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Madam Speaker, I want to pursue the question of my hon. friend from Windsor—Tecumseh to the hon. parliamentary secretary. I bemoan the fact that as we are now using time allocation for Bill C-26, one thorny point has not been adequately explained in this place.

I am looking for evidence that would tell me what happens with the drop-off provisions and how they will affect women, lower-income women, the ability to save for retirement, and taking time off for child rearing or illness.

Overall, Bill C-26 is a big step forward in expanding the Canada pension plan, but would the hon. member help me to see why the government has refused to accept what appeared to me to be reasonable amendments?

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Madam Speaker, my colleague spoke about the Liberal government's eagerness to hear what all Canadians have to say about the enhancements. However, once again today, the government has denied the opposition an opportunity to express its views. These are actually the views of the people who elected us to send a message to the government concerning its intentions with respect to Bill C-26.

This is the ninth time that the Liberal government has used time allocation since the beginning of this Parliament, and since it adopted its sunny ways. It was supposedly going to do things differently. However, it is now obvious that the Liberals do not like to listen to other points of view when they differ from their own and oppose the measures they want to adopt.

Does my colleague approve of the rather brutal way in which the government is muzzling members of the House in order to pass its bill?

[Bill Morneau, Liberal, Minister of Finance]

moved 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 third time and passed.

Business of the House

[Candice Bergen, Conservative, Portage—Lisgar, MB]

Mr. Speaker, I rise on a point of order to challenge our moving to the orders of the day this early in routine proceedings, a procedure that seems to be used habitually by the government when it is poised to close debate on important issues.

In this case, the government has already limited debate on the third reading stage of Bill C-26, which is scheduled today. One day is the minimum number of of days that can be allotted under the Standing Orders, and the government House leader chose as that one day, the shortest day in our calendar. I will not take up more of the House's time on that point before I get back to my procedural intervention, but I do want to say one thing. The House expected more than a minimal effort from this so-called new tone government House leader and we are very disappointed.

Back in the spring, the government moved and adopted motions to proceed to the orders of the day four Wednesdays in a row, skipping over all rubrics of routine proceedings. That was done on April 20, May 4, May 11, and May 18. Most recently, the Parliamentary Secretary to the Leader of the Government in the House of Commons moved such a motion on Thursday, November 17, and today the government is proposing to do it again for the sixth time.

I would argue that the government House leader is continuing where her predecessor left off in misusing this procedure. I refer to a Speaker's ruling on April 14, 1987. In his ruling on a similar matter, the Speaker stated:

Routine Proceedings are an essential part of House business and if they are not protected the interests of the House and the public it serves are likely to suffer severely.

He referred to a ruling of November 24, 1986, in which a motion having the effect of superseding a number of items under routine proceedings was inappropriate and excessive and was disallowed. However, the circumstances on April 14, 1987, were dramatically different and the Speaker allowed the government to move its motion.

I will compare those circumstances to today's circumstances and let you, Mr. Speaker, and the House draw its own conclusions. The Speaker observed that the opposition was significantly obstructing the progress of Bill C-22. He noted that seven divisions took place prior to the introduction of the bill, most of them resulting from the moving of dilatory motions under routine proceedings. Fourteen more divisions, with most of them again resulting from the moving of dilatory motions during routine proceedings, took place before the bill reached second reading on December 8, 1986. The bill was referred to committee and reported back to the House on March 16, 1987, after 24 meetings and 82 hours of debate. Numerous amendments were proposed at report stage and the House debated those amendments for four days.

On April 7, the minister of Consumer and Corporate Affairs gave notice of time allocation. Unlike the opposition in 1987, we have negotiated openly and honestly with the government. Since this Parliament began, only two dilatory motions have been moved by the opposition. In contrast, five such motions have been advanced by the government. Today will be the sixth. The Speaker in 1987 noted that in the British House of Commons, the Speaker has the power to refuse a dilatory motion if he believes it to be an abuse of the rules of the House. He also noted that the Speaker is empowered to allow them if he believes they are justified.

In comparing Bill C-22 in 1987 and any bill the Liberal government has proposed to the House in this Parliament, the opposition has not given the current government justification to proceed in this manner. The scale of obstruction in 1987 was extreme according to any standard, and only under those circumstances was the government permitted to move its motion. The government should not be allowed to routinely skip over all rubrics during routine proceedings without just cause.

As Speaker Fraser pointed out, routine proceedings are an essential part of House business and they should be protected as a vital component that serves the interests of the House and the public. There is no moral ground or rational reason here for the government to proceed in this manner. Speaker Fraser, in his 1987 ruling, added:

It is essential to our democratic system that controversial issues should be debated at reasonable length so that every reasonable opportunity shall be available to hear the arguments pro and con and that reasonable delaying tactics should be permissible to enable opponents of a measure to enlist public support for their point of view.

Clearly, the 1987 case involving Bill C-22 demonstrated unreasonable delaying tactics. This House has never seen such delaying tactics, and the government has never experienced this sort of sideshow from the opposition. The government's problems are self-inflicted and are not due to the opposition. The government has had the privilege of working with a generally co-operative opposition in this Parliament and has frittered away that goodwill. It has foolishly squandered it through its mismanagement of the House, mean-spirited tactics, and its minimalist efforts to make Parliament work.

While the government house leader was marketed as new, we now discover that we did not get “new and improved”.

Mr. Speaker, I ask that you consider my arguments and not allow the government to move its motion to proceed to the orders of the day until it has at least demonstrated that an unreasonable obstruction has taken place.

Canada Pension Plan

[Julie Dzerowicz, Liberal, Davenport, ON]

Madam Speaker, it is an absolute pleasure for me to be addressing the House on this issue of Bill C-26 on behalf of the residents of Davenport.

I love meeting with the residents of Davenport. I have, over the last few months and since I was elected, constantly met with them. The groups of people I most enjoy are seniors. They are not shy about letting me know what they are thinking, what they are worried about, whether for themselves or for their families. They always joke with me. They often say to me, “When is the Prime Minister of Canada going to give me a raise?” They talk to me about the increasing cost of prescription drugs. They talk to me about the increasing cost of everyday life. They also tell me that they are worried about their children. I also have spoken to many of the middle-class Canadians who work in my riding, and they tell me that their pension and saving for their pension is one of the things that most worry them.

That is where I am going to start, by just reminding us all of some of the facts.

We know that middle-class Canadians are working harder than ever and that many are worried that they will not have enough set aside for retirement. I have heard that time and again right across my riding, and I am sure that is a message that is heard right across this country in every riding. We know there has been extensive analysis conducted by our finance department and by provincial governments, and they have found that around one-quarter of families nearing retirement—some 1.1 million families—face a drop in their standard of living when they retire. This is absolutely something worrisome. We also know that, according to Statistics Canada, in 2014 only 37.9% of employees had a pension plan and that number was trending down.

We know from the Broadbent Institute, which put out a report earlier this year, that 47% of those aged between 55 and 64 have no accrued employer pension benefits, and the vast majority are retiring with inadequate savings for retirement. We also know from that same report that just 15% to 20% of middle-income Canadians retiring without an employer pension plan have saved anywhere near enough for their retirement. Therefore, we know that there is a huge worry. We see the statistics. We know that Canadians currently are not saving enough for their retirement, and we know that action needs to be taken.

There was a commitment from the Liberal Party in the last election that we were going to improve the Canada pension plan, and indeed that is what we are proposing. I am very proud that our Minister of Finance met with his provincial counterparts earlier this year, and in June came up with a way to enhance our Canada pension plan. I just want to say that it is not easy to be dealing with all the provinces. I note that the Ontario government had its own pension plan enhancement that it was planning to put into place. I know there were a number of other provinces that were further down the line in terms of what they wanted to do. I know this was a huge effort on the part of our Minister of Finance. It was a huge coming to the table by all parties, all finance ministers from all provinces right across the country. I just want to say that it was wonderful leadership and a wonderful show of co-operation right across this country to actually enhance the Canada pension plan and to really be thinking about the future of all Canadians in every province.

Next, I will take this opportunity to say what the enhancement of the Canada pension plan means and what changes are being proposed. I am going to be heavily using information from a wonderful CBC news article that I happened to be reading, because it makes it so easy to understand and I want to make sure I am explaining it in a way that makes it easy for people in my riding of Davenport and all Canadians to understand what we are proposing.

The first thing is that there would be an increase in premiums. The increase would be for both the worker and the employer. Under the proposed enhanced plan, the CPP would replace fully one-third of a person's pre-retirement income, up from the current 25% replacement rate, up to a maximum amount of earnings that would also rise quite a bit.

Currently, a worker and an employer contribute 4.9% of the worker's income to the plan. The proposed change would increase it by one percentage point. So, it would go up to 5.95%. It will be phased in over five years, beginning in 2019. By the time the higher premium is fully in place in 2024, a worker earning around $50,000 a year on average would pay roughly about $25 a month more in premiums, or almost $300 a year.

That is just an idea of what is going to happen to our premiums. There would also be a bit of an increase on the employer's side. We are working to try to better save for our future retirement.

What happens to benefits? How will Canadians benefit from this increase? What does this actually mean?

In plain terms, a middle-income Canadian entering the workforce and now earning around $50,000 a year would in the future receive a pension of around $16,000 a year in retirement, instead of what they would currently be receiving, which is around $12,000. That is according to Finance Canada.

I should note, though, that younger workers will be contributing at the higher rate for a longer period of time, the 5.95% I was talking about, but it is an investment in their future, as my colleagues have been saying, and they also stand to gain the most when they eventually reach retirement age.

I know that constituents in my riding of Davenport will be very sad that the current CPP enhancements will not be positively impacting them, but we do have a number of different programs we are putting into place that will be benefit them, moving forward.

There is one other thing I wanted to mention because I thought it was an interesting fact. There was some concern by a number of people that the increase in the CPP premiums would impact lower-income Canadians. As a result, the Minister of Finance and his provincial counterparts have agreed to an expansion of the existing refundable tax credit known as the working income tax benefit, to offset any higher premiums. The maximum payout for this program is currently $1,800 for a family earning less than $28,000 a year.

We want to make sure that we are protecting lower-income Canadians and so have been very thoughtful in trying to make sure that not only will this benefit future generations, including helping middle-class Canadians and youth to invest in their future and their retirements, but will also include protections for those on the lower end of the salary scale in Canada.

There has been a lot of concern about the impact on small business. I have a lot of those small businesses in my riding. I know they were very happy to hear that it would be implemented over five years. I think they appreciate that there would be enough time for them to be plan, organize, and arrange for the future. So while I believe there will be an impact, I think overall it would be beneficial to our businesses, to our workers, to our economy overall, and to Canadians in general.

In conclusion, I encourage everyone in the House to vote in favour of supporting Bill C-26. It would benefit youth, it would benefit families, and it would ensure that future generations would be more secure in their retirement.

[Ginette Petitpas Taylor, Liberal, Moncton—Riverview—Dieppe, NB]

Madam Speaker, I thank my hon. colleague for his speech. I would like him to elaborate on how Bill C-26 will help Canadians.

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

Madam Speaker, I thank my colleague for his speech, even though he spent half of it talking about other things. I have a hard time understanding why the Liberals think it is so urgent to pass Bill C-26.

They are saying that it is so urgent that we pass Bill C-26, that they had to move a time allocation motion. That is what the government did this morning. I did not support it. Nevertheless, there have been three or four Liberals who have spoken on the subject.

If Bill C-26 is so urgent, why do Liberal members keep rising to speak to it? I would like to know the reason for this double-talk.

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

Madam Speaker, I thank my colleague for his speech in the House on Bill C-26.

Does he think that the government has a duty to ensure that our seniors, most of whom worked hard and paid taxes all their lives, have a well-deserved retirement and can live with dignity at the end of their career, once they are retired? As a government, we must not let our seniors live in poverty.

Does my colleague think that a strong, solid public pension plan will in fact ensure a good standard of living for our seniors once they are done working and are ready to just enjoy life after many years of hard work?

[Bryan May, Liberal, Cambridge, ON]

Madam Speaker, through you I would like to thank the member for his continued support and passion for seniors. He definitely keeps them front of mind at our human resources committee, which I am thankful he is a member of.

I agree 100% that there are so many more things that we need to do. I do not think we have suggested that Bill C-26 or increasing the GIS will solve everything. However, they are pieces that will help move the needle in the right direction.

The hon. member knows that we are working diligently in the human resources committee on a study of poverty. He has ensured that seniors have been a key factor in that study. I look forward to continuing to work with the member on that study, and hopefully coming up with some ideas so that the individual he spoke of does not have to rely on all of these services and can live with dignity.

[Bryan May, Liberal, Cambridge, ON]

Madam Speaker, the Canada pension plan is the bedrock of our public retirement income system in Canada. Millions of Canadians rely on it today, and many millions more will rely on it in the future. It is one government program that touches virtually every Canadian.

It is our duty, as parliamentarians, to ensure that the CPP is not just in place for future generations, but also to ensure that it is strengthened so that all Canadians can retire with dignity. After a lifetime of hard work, Canadian families deserve to retire comfortably.

We know that the CPP is an integral part of many people's retirement plan. With fewer and fewer Canadians having a workplace pension to fall back on, its importance is only growing. Our government recognizes the importance of the CPP. That is why we have made a commitment to strengthen and enhance the plan. My hon. colleague, the Minister of Finance, worked incredibly hard with his provincial counterparts to reach a historic agreement to make important and meaningful changes to CPP. As a result, more than one-quarter of Canadian families nearing retirement, about 1.1 million more families, will be able to retire with dignity.

Every week, in my constituency office in Cambridge, my staff see seniors who are struggling to make ends meet. We try our hardest to ensure that they are receiving every benefit they are entitled to; but the fact of the matter is CPP needs to be enhanced. I know how much an expanded CPP would mean to the people of my riding. I can think of thousands of retirees who rely on CPP to fund their retirement and to stay productive members of our society.

I want to take a moment to talk through several key provisions of the bill and speak directly about how I would anticipate those changes enhancing and benefiting the lives of my constituents in Cambridge and, frankly, of constituents across this entire country. I think it goes without saying that CPP needs to be enhanced, in that it needs to see an increase in the amount of retirement pension that Canadians receive. With Bill C-26, however, the enhancements would go further than that. Canadians can expect to see increases to the survivors and disability pension provisions, as well. As our population ages, those survivor benefits ensure that a lifetime of paying into CPP still has benefits even after the death of a spouse.

The increase in Bill C-26 would ensure that the maximum level of pensionable earnings is increased by 14% by 2025. That level of support would be unprecedented in Canada, and it would arrive just as many more Canadians are retiring.

I know that these provisions come with additional costs, but they also come with additional spinoff benefits that would reach deep into our economy. In this case, the benefits would far outweigh the costs. As retirees are unable to participate fully in our economy and many withdraw more and more because of lack of retirement savings, those individuals are not full participants in everything Canada has to offer. This has some very direct issues; for example, not being able to afford things like food and medications. Those concerns are heartbreaking and well-documented, and one of the reasons there is currently a strong push for national pharmacare and increased support for food banks and other emergency social service providers. We see these cases in my office in Cambridge every single week.

However, not having enough retirement savings also causes many seniors to withdraw in many other ways, as well.

I can think of many seniors in my riding who choose to participate in fewer events, to go out less, and to stay in more because of lack of funds. These have several direct and negative effects. We know that seniors and retirees live better and longer lives when they socialize more and when they remain active. For many seniors, this means having the financial ability to go out, drive, and participate in events. Even if these events are low-cost, which many events for seniors are, it is critical that we create a society where they are financially able to continue participating for as long as they are able.

That activity or social time saves health care costs, mental health costs, and housing costs. More importantly, it allows for aging with dignity.

Since the Second World War, the number of company-provided pensions has fallen at a significant rate. This is due to a number of contributing factors, each of which is worth exploring but none of which is likely to be reduced in the short term. StatsCan says that in the 1970s about half of all men had defined benefit pension plans. Now, in 2016 we are at about half that number. That is a significant decline, but is even more significant when we consider the very large population bubble that we call the baby boom. When we consider the rates of company-provided pensions for younger people today who are not part of the baby boom generation, the rates are significantly lower.

I have used men as an example because the work dynamics were significantly different in the 1970s. Women have historically had fewer workplace pension plans and never crossed even the 50% threshold. We know this is causing an impending crisis, one this government is taking steps to fix. Enhancing CPP would allow the young people of today, those who are least likely to have a workplace-provided defined benefits plan, to see a significant increase in their retirement incomes.

It is also worth noting that this new plan would have no major infrastructure costs because the CPP infrastructure is already in place. This means that the new system would be much easier to put in motion, be more easily adopted by Canadians, and would fit within our existing policy structures. All of these reasons would make it cheaper, easier, and better to implement than many other ways to enhance post-retirement income for Canadians. I applaud the government for working to achieve increased CPP benefits.

We currently have more seniors than kids in Canada. I want to take a moment to go back to considering what happens when retirees and seniors withdraw from the system. The benefits and issues are not only in terms of mental health and health care, but also in terms of their significant impact on our economy. The longer a senior is able to participate fully, he or she is able to contribute to the economic robustness of our society. The longer seniors are able to participate fully, the more likely they are to volunteer and remain an economic force in our society. Obviously, solving these long-term demographic trends is not the duty of the CPP solely, but I believe it is the right place to start. It says that we are taking this seriously and are working toward solutions.

I have mentioned in the past that prior to my working in this wonderful profession that we find ourselves in, the people of Cambridge knew me from the YMCA. Prior to working for the YMCA, almost all my involvement was working with youth. The YMCA offers a number of programs for seniors. It is interesting because the span of the demographic that we call seniors can be as wide as 30 years. If we take that same age range and put it at the beginning of life, we are talking about infant, toddler, preschooler, school-aged child, teenager, young adult, and adult all within that same 30 years. We have to be thinking outside the box when it comes to seniors. They are living longer, but they are living differently as well. This approach that we have reached with the provinces is an amazing first step.

I will leave it with one final thought. No matter what the House decides on the CPP, and I am asking everyone to carefully consider supporting the plan laid out in Bill C-26, we will still have a long way to go toward ensuring that all members of our society are prepared for retirement.

[Shannon Stubbs, Conservative, Lakeland, AB]

Madam Speaker, I am pleased to speak to Bill C-26, which would have consequences for all people and communities across Canada with very real costs that would not deliver the promised benefits, and at a time when job losses are escalating with not one single net new full-time job created in Canada during the past year under the Liberals. Government must work with entrepreneurs, job creators, and employers and not against them.

The Liberals often claim to be committed to public consultations, so their failure to listen to Canadians about this bad plan is rich. The Canadian Federation of Independent Business recently confirmed that 83% of employed Canadians do not support this payroll tax hike, and more than 80% agree that they want the government to consult them on it. However, the Liberals are pushing it through, banking on Canadians believing the Liberal spin and misinformation.

According to the same CFIB study, 40% of Canadians think the government pays for part of the CPP, and 70% of Canadians believe current seniors would benefit, which is how the Liberals are selling it; but of course, both notions are completely false.

It is galling that the Liberals are exploiting the anxieties of young Canadians about their futures, the urgency of people nearing retirement who are worried about financial security in the next stage of their lives, and the challenges faced by retirees who are struggling now to make ends meet on fixed incomes, by selling this punitive increase as the responsible and shared value of helping people save for retirement and implying that it would help retirees now, while pretending there will be no negative or damaging consequences.

Both employees and employers would bear the cost of this hike that would take more away from job creators, harming their ability to grow their businesses and invest in their employees. As it would force small businesses to reduce staff or pay, in order to stay afloat, or increase prices for their products or services if they can, it is employees and customers, all of us, who truly pay for it.

The Liberals should walk their talk on fact-based decision-making. Many experts and extensive studies conclude that expanding the forced retirement pension plans on small business owners would likely result in a decrease in private sector investment, a decrease of labour force, and an increase in inflation. These are important warnings that government should heed, because in Canada small businesses comprise 97.9% of all privately owned businesses and employ 70% of Canadians working in the private sector.

In Lakeland, the people and businesses are struggling. Job losses are escalating, even though entrepreneurs are doing their best to keep going. The damage from the downturn and bad government policies is rippling through all sectors and across Alberta. This payroll tax hike would just make things worse and add costs for employers at an already enormously challenging time.

Small business owners across Lakeland oppose this expansion, because it is yet another tax hike. Whether it is an increase in employment insurance premiums, a carbon tax, or the proposed CPP hike, families and businesses in Lakeland cannot afford the Liberals' agenda.

The owner of a Vegreville window and glass company explained to me that not only would this be bad for the employee and the employer, but it would reduce our economy. Businesses cannot raise prices; the only way is to lower input costs, which is limited to the employee. Tough choices would have to be made, as every input cost is increasing: electricity, insurance, base product costs, which cannot be decreased. It would lead to fewer workers and fewer hours. Negative effects on our economy would be far reaching, as raising prices does not and will not work. Government would harm businesses and workers with this move.

It is clear that this plan would lead to wage freezes, reduced benefits, or even layoffs. Job creators in Lakeland are cautioning exactly what others all across Canada are telling the Liberals. This hike would hurt their ability to invest in and to expand their businesses, to hire and to compensate their employees, and to start new ventures. These consequences would ricochet through the whole economy.

A co-op grocery store in Vegreville might have to increase membership fees. A bookstore owner in Lloydminster might have to lay off a hard-working employee, and a student in Edmonton might not get that pay raise at work, needed to pay for school.

Each one of these situations has profoundly different impacts on communities. That membership fee increase at the co-op might be the last straw for a single mother, forcing her to choose between necessities for her family. That former bookstore employee, who volunteered with the Girl Guides of Canada, teaching kids important life skills and values, would have to participate less in order to look for more work. The student in Edmonton might have to take a second job, taking more time away from her studies, hampering her academic performance, and limiting her potential. This combined with a job-killing and price-hiking carbon tax would devastate communities even more.

What does this mean for average Canadian families and why should they be concerned? Studies show that some households will pay up to $2,200 more per year as a result of this hike. That is enough to take a course and upgrade credentials for work on the rigs, or to transition into something else, a season of minor hockey, or a once-in-a-lifetime bucket list vacation for two. All for what?

The consequences for businesses will not help seniors now, contrary to what the Liberals have been telling everyone. It will take 40 years for the CPP expansion to even provide marginal benefits, if the program even still exists. Businesses and families will be paying the price for this made-in-Ottawa disaster the whole time. I would understand of course if it helped seniors today but that simply is not the case. Canada's demographic transition is under way and the timing of this change will hurt both businesses now at the very worst time and will not even benefit baby boomers.

Reducing red tape and cutting taxes would help those who create the majority of Canada's middle-class jobs. If Canada is to maintain its competitive edge, increase productivity, and spur innovation, legislators must constantly strive to improve the conditions for doing business, not make them worse. This means understanding how government policies affect everything job creators, contractors, and entrepreneurs do. Increasing Canada's international competitiveness is also vital to the success of small businesses and their hard-working employees.

Our philosophy as Conservatives is that Canadians' money belongs to them and not to the government. Reducing and lowering taxes equals more jobs because the more than one million small businesses from across the country are unable to continue to expand, invest, and employ.

So far the Liberal philosophy of borrow, tax, and spend is failing. Earlier this month Canadians received the shocking news that during October, 23,000 jobs were lost. That is one job every two minutes. Canadians expect and deserve more from the government. The previous low-tax plan was stimulating growth, jobs, and savings, and not on the backs of future generations.

There are other measures the Liberals could have taken to help Canadians save for their retirement. They could increase RRSP contribution limits. RRSPs have been successful at allowing Canadians to save for retirement and prove that when we work with the private sector instead of against it, goals like secure retirements can be achieved.

The second is the tax-free savings account. If the government wants to encourage Canadians to save, why on earth would the Liberals reduce the amount they can contribute to the most versatile savings and investment tool? The flexibility of a TFSA recognizes that Canadians have different savings needs and can plan for their futures. We are not a one-size-fits-all country and a one-size-fits-all solution will not work.

The “Ottawa knows best” approach is failing. Despite what the Liberals think, Canadians are smart enough to make their own decisions when it comes to retirement savings and what solutions work best for them.

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Madam Speaker, I am pleased to speak to this bill, and I am especially happy to have this opportunity to rise in the House knowing that many members will not have a chance to express themselves because of the government's decision to once again limit the time for debate.

Apparently we will have to do like Chinese billionaires and shell out $1,500 to buy time with Liberal ministers to get them to listen to our concerns. That is really too bad, but that is what it has come to.

I would like to start with something we know to be true. People often say that Canadians are not financially prepared for retirement and could end up living in misery because they do not have enough money. They do not have enough cash in the kitty to fund the retirement they want, a retirement they can really enjoy that does not include frequenting soup kitchens.

This is a serious problem, one we need to tackle at its source. If Canadians are not investing enough for their retirement, perhaps it is because they do not have the means to do so. Although salaries have gone up over the past few decades and interest rates are currently very low, the situation is not perfect for Canadians. That is because such a large portion of their income is taken away by the various levels of government in the form of sales tax, premiums, permits, licences, and income tax. There is no shortage of words to describe how the government picks the pockets of the middle class.

If we want Canadians to be able to plan for their retirement, we need to give them the means to do so. I know this is hard for the members over there to understand. This means giving Canadians greater flexibility so they do not have to hand so much over to all levels of government, until they have almost nothing left to plan for their golden years.

The government loves being generous with other people's money. I would remind members that it is generous with taxpayers' money, including corporate taxpayers. Despite the Liberals' shameful $25-billion deficit, which has not created any wealth, they are not putting any tax dollars into this plan.

However, this will come at a cost to the Canadian economy. This is a glorified tax on businesses and Canadians. The Liberal government unilaterally decided what Canadians will do with an even bigger part of their salary. Our deficit experts are introducing yet another payroll tax.

Instead of working to create wealth, they are undermining it. In many cases, these costs mean the difference between profitability and hardship. Every business, big or small, will be affected by this measure.

I know what I am talking about. I am a businessman and have been a business owner for 21 years. I know all about costs and obstacles to hiring. The more governments drive up the costs, the less appetite there is for hiring. It is as simple as that.

That amount can be significant for large companies with several hundred employees. Production costs for the same output will go up by $100,000, $200,000, $300,000 or more overnight, and we haven't even talked about the carbon tax the Liberals are going to tack on. The future is not bright for our businesses. It is going to take a lot more than a Care Bear stare to grow our economy.

The finance minister's officials confirm our fears about the changes in Bill C-26: the proposed increased contributions will have an adverse effect on job creation. For a government that said it would base its decisions on science, facts, and sound advice from the public service, it is sad to see the Liberals act in this way. They are listening more to Kathleen Wynne that to experts on this. It seems that the Butts and Telfords of this world have more pull than finance department experts.

I have some examples. According to officials at the Department of Finance, the measures proposed in Bill C-26 will have an adverse effect on job creation.

Over 10 years, the drop in job creation will be between 0.04% and 0.07%. These are jobs lost, not created. There will also be a drop in GDP of between 0.03% and 0.06%. A drop in GDP is not synonymous with job creation. There may also be a drop in corporate investment of between 0.03% and 0.06%. When companies invest less, there are fewer jobs for Canadians. There will also be a decrease in disposable income of between 0.03% and 0.06%. Canadians with less money in their pockets means less money to keep our economy going. There will be a 7% drop in long-term private savings. Once again, this measure is supposed to encourage saving for one's old age. However, it will accomplish the exact opposite. People will have less money.

The government is gambling that by increasing taxes it can solve everything. The Liberal government is reverting to its old habits: it thinks that it should not let Canadians manage their own money because they will buy beer and chips instead of investing in their future.

On this side of the House, we believe that Canadians are smart enough to invest in their retirement if we give them the means to do so by cutting taxes. If they do not invest, it is because they do not have the means. If we give them the means, they will invest.

The Fraser Institute reports that a one percentage point increase in the CPP contribution rate reduces private savings by 0.9%. The Liberals' measures only shift the problem rather than resolving it. It is worrisome that 70% of small business owners do not agree that the proposed increase is a modest one and that it will have a limited impact on their businesses. SMEs are Canada's main employers. Could the government listen to them?

The decision to increase contributions was made without consulting Canadians. It would be interesting to consult those who are going to pay for this decision: the public and the employers.

In short, to resolve the problem, the government is proposing to take money away from Canadians who already do not have enough to make ends meet.

I would like to read a quote by Hendrik Brakel, the senior director of economic, financial, and tax policy at the Canadian Chamber of Commerce. On May 31, 2016, he said:

Here at the Canadian Chamber of Commerce, 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.

These people need the government to give them a break, not foist another tax on them.

[Sheila Malcolmson, NDP, Nanaimo—Ladysmith, BC]

Madam Speaker, I rise today to speak somewhat in support of Bill C-26, though New Democrats have some serious concerns and amendments that we would like to once again raise. It is unfortunate that this debate is happening within the framework of the government once again invoking time allocation, which is shutting down debate. New Democrats have identified a serious error in this legislation. We wish the Liberals had acted on our suggestions to amend and that we had more time to discuss why they are reluctant. However, I will start with the positive.

Bill C-26 incorporates the recent agreement reached with the provinces to enhance Canada pension plan benefits. It is a very important step in improving retirement security for young Canadians and we congratulate everybody, especially our friends in the labour movement who worked very long and hard to lay the groundwork for this agreement. This is a success.

When fully implemented, the new CPP expansion would replace 33% of pre-retirement income. That is up from the current 25%. This action is needed. Retirement security is reaching crisis levels. Many Canadians do not have adequate financial security to maintain their lifestyles upon retirement, and this is particularly fuelled by the erosion of workplace pension plans, to the point that six in 10 working Canadians have no workplace pensions.

New Democrats have fought consistently for increases to the CPP, old age security, and the guaranteed income supplement. This bill would benefit a whole new generation of workers entering the workforce, but more is needed. This bill does little to alleviate the retirement income crisis of those now approaching retirement and the full effect of the changes would not be felt for 49 years.

Much more needs to be done right now to help lift seniors out of poverty and to help them live with the dignity they deserve. There are high housing costs, high drug costs, the clawback of the guaranteed income supplement, and the indexing of pensions. New Democrats want the Liberal government to keep its promise to introduce a new seniors price index, to make sure that old age security and the guaranteed income supplement keep up with rising costs and, in particular, to recognize that single elderly women are particularly living in poverty in this country, which is shameful.

Here is the big mistake in this bill. Bill C-26 does not contain the child-rearing dropout provisions that exist in the current CPP, so that parents, mostly women, are not penalized for time taken out of the workforce to raise children. The Liberal bill also fails to replicate a similar existing dropout provision for people who receive CPP disability benefits.

This is how the CPP already works in this regard. The benefits that people receive are based on an average of earnings from the time people are 18 until they retire. To accommodate periods where people may have low or zero incomes, the plan now allows for the lowest eight years of earnings to be dropped from the calculation, and that exemption is referred to as a dropout. That rule applies to everyone. Everyone who now qualifies for that will continue to. They should be assured that nothing will change for people already in this category.

Right now, on top of this basic exemption, there are two other specific dropouts. One is for disability, so that people receiving disability benefits are allowed to drop up to eight years out of their calculations. The other dropout is for child rearing, where people can drop up to eight years, while they were bringing up their children and their income was reduced or zero, from the calculations of their benefits. However, in the new plan that we are debating today, these dropouts would simply apply to the calculation related to base benefits, not to the calculations of the additional or enhanced benefits.

The original dropout provision for child rearing was introduced with much fanfare in 1977 by the government of Pierre Trudeau. The Liberal government of the day included this line in its 1977 throne speech:

You will be asked to consider amendments to the Canada Pension Plan which would further recognize the value of the contribution made to the family and society by both marriage partners, in the event that one remains at home to raise children while their partner works outside the home....

My friend, Iris Taylor, from Nanaimo described this. She said, “My sister Diane Wiebe along with her husband Art, raised three wonderful, hard-working, well-educated taxpayers. Diane was a stay-at-home mom until the youngest left home. Neither parents had jobs with pensions, so when they retired they solely lived on savings, CPP, and OAS. In fact, both worked part-time to cover living expenses until their passing at 70 years. My sister was always appreciative of CPP factoring in her years at home with children into her CPP pension payment.”

The effect of losing this could be significant, especially for women who are overwhelmingly the ones who applied for the child rearing dropout and presently receive a much lower average CPP benefit. The NDP ask was that the government restore it for the new CPP enhancements and that it do it now. We have debated every day in the House, asking the government if it would work with us to get this fixed. My colleague from Hamilton Mountain basically laid out all the groundwork at committee. All the Liberals needed to do was pick it up and run with it, but they chose not to.

In the House, we invited the government to amend its own bill. At committee, the New Democrats moved two motions to include the dropout provisions for women and those living with disabilities. However, the Liberals were not reasonable in looking at our amendments and ruled them out of order. When we tried to make a motion to have the committee recommend to the House that the provisions be put into the bill, the Liberals moved to adjourn debate. They kind of cut and run. It was very strange.

In case the Liberals might try to cite cost as a factor in their decision to omit the dropout provisions from the new enhanced benefits, our very preliminary calculations show that the cost would be very low. Using available information, it looks like the dropouts might cost each employee and each employer 0.2% of a worker's average salary. That is a very cheap price to pay to provide such an important and significant benefit.

On the other hand, looking at the calculations on Service Canada's website, the failure to fix this program could cost parents significantly. A mother who spent six years raising children would get between $800 to $1,200 less each year than she would otherwise.

Again, we have time allocation on the bill so we are not able to debate this fully. Again, this is inconsistent with previous Liberal positions. Here is what the Minister of Transport was quoted in Hansard in 2012 as saying:

Slowly but surely, Canadians are beginning...to question what the government meant when it promised...to be open, transparent and, most of all, accountable. I believe Canadians are beginning to feel that there is a contradiction between what has been promised and what is actually being done by the government.

This is déjà vu. That was the Liberals talking about the Conservatives, but now this is just how the Liberals are acting. It is very disappointing.

Hammering home again how important this program has been for Canadian women, June Ross from Nanaimo wrote to me and said, “The credit for my child rearing years was seven years. That credit helped my pension to increase. ln my view, the child rearing credit should have also been applicable to the old age pension as well. The woman who did not work outside the home and therefore was eligible for only the old age pension is punished yet again. As you are no doubt aware...we women have lesser pensions than our male counterparts because our work outside the home had very little value placed on it. Our hourly wages were very low...therefore, our pensions are much lower”.

Again, the Prime Minister likes to call himself a feminist, but when we point out that the Liberals' legislation is penalizing young women workers who would qualify for this in the future, they suddenly have nothing to say. The Liberal government should immediately agree to our proposal and live up to its feminist rhetoric. It should amend the bill so future generations of stay-at-home mothers and the disabled are not penalized. Please do the right thing, amend your bill and I will vote in support of it.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Madam Speaker, I thank my colleague, who has just given a very good demonstration and a very good speech on what motivates the official opposition to oppose Bill C-26.

During the previous speech, our government colleague from Winnipeg North said that the Conservatives were, to use his words, “out of touch” with Bill C-26.

We are indeed out of touch because Bill C-26 is totally out of touch with seniors and the people it is supposedly designed to help. In fact, it will be 40 years before Bill C-26 produces any results. The results will not come right away.

The government is in such a hurry to pass a bill that will have an impact 40 years from now that we have once again been presented today with a time allocation motion. In tabling yet another time allocation motion to get its legislative agenda through, the government is demonstrating its incompetence. It is also demonstrating a real lack of respect for parliamentary procedure and, ultimately, for Canadians. The government continues to try to prevent members from participating in the proceedings of the House of Commons and from representing their constituents in this place.

It was well put, was it not? Those were the words of the member for Winnipeg North. He said them when he was in the opposition and the government tabled time allocation motions. This member talks a good deal in the House, so much so that he seems to forget what he said in the previous parliament. Today, what used to be good for Peter is no longer good for Paul. That is what it looks like.

Regardless of what was said by the member for Winnipeg North, we must remember that this government was elected on a loud and clear affirmation that it would be a different government. It is succeeding, because it will probably become the government that has reneged the most on its promises in the entire history of the Parliament of Canada. That is where this Liberal government is headed.

First of all, this government will impose a Liberal tax on carbon, which is going to be very expensive, in addition to costing thousands of jobs in companies of every sector. Despite having committed to reducing corporate income taxes from 10.5% to 9%, this government does not seem the want to act on or keep that promise—not in the slightest.

The government had promised just a small deficit of $10 billion, as if $10 billion could be a small deficit. It was already a very big deficit, and we are now being told that it will not be a very big deficit of $10 billion, but rather an enormous deficit of $30 billion. What is more, the finance minister is unable to tell us when we will get back to a balanced budget.

With Bill C-26, not only has the government enticed seniors with visions of their pension plan being enhanced now, but it has also made them believe that it has their own good at heart. Their own good and their own property, which the Liberals have gone after so they can administer it themselves. The government is giving them nothing right now, since it will be 40 years before the system works.

In a document released by his office entitled “Open and Accountable Government”, the Prime Minister himself has laid down certain ethical rules and rules on gaining access to ministers in order to represent any views. This is known as preferential access, and this government is very clear on this matter: there must be no preferential access, or presumption of preferential access, to ministers.

Unfortunately, what we have seen from the start is that the Prime Minister himself is breaking his own rules. I understand that seniors unfortunately do not have the money required to go and meet the members of this government in order to present their views, for it seems that is the way to get responses and results. That is the new Liberal tax, the tax on meetings with ministers. That is what one might call this new policy, this new method of getting what one wants from the government.

Let us return to Bill C-26. Seniors were promised that the Canada pension plan would be enhanced. That promise has been kept, but we have to read between the lines, as we have to do every time the government presents us with something. The reality is that this measure will take full effect not in two, five, 10 or 20 years, but rather in 40 years. In 40 years, I will be 90 years old. Life being what it is, many of my colleagues will no longer be here, like most of the seniors who are expecting an increase to their pension plan.

In the 2016 fall economic statement, the government laid out “a plan for middle class progress”. In that program, we read about Maya, an example of a Canada pension plan success story. To reach people more effectively, the government decided to use concrete examples. According to this document, Maya is a young graphic designer who is working hard to establish herself in her field. She earns $55,000 a year, and thanks to the CPP enhancement announced in Bill C-26, in about 40 years, when she retires, Maya could receive $17,500 per year.

In other words, since Maya will have benefited from an increased Canada pension plan and she will have been told not to save, because the CPP would do that for her, once she has worked all her life and contributed to our economy, she will receive $17,500 per year. Maya is a success story in the eyes of the Liberal government, but in fact she is an example of Liberal failure.

What Maya is being told is that the government will manage her retirement savings for her and enhance the pension plan, and thanks to the government, instead of earning $55,000 a year when she retires, she will earn $17,500 a year. They say that will afford her a decent living and that this is an example of a Liberal success story. On the contrary, it is a failure caused by their desire to manage every aspect of people's lives.

Consequently, when we see the term “success story” in the government’s fall economic statement 2016, that is to be taken with a grain of salt. If people follow Maya’s example, in 40 years young hard-working middle-class Canadians are going to have difficulty making ends meet, because they will have put their entire fate in the hands of the government, even though it is common knowledge that no one is in a better position than we ourselves to manage our own money.

Bill C-26 also wants to increase workers’ current contributions to the Canada pension plan. At present, that plan takes 9.9% of our income, and this bill will increase that rate to 11.9%. In clear terms, that means that the average worker is going to pay up to $1,000 more every year. That means an additional expense of $1,000 per employee for every small business.

Despite all that, a study by the government’s own finance department shows that these increases would have harmful impacts on all economic vectors and not just on one small component. It predicts a drop in employment, gross domestic product, private investment, disposable income, and above all, personal savings, of which I have spoken from the beginning.

Those, then, are the consequences of Bill C-26. In addition to taking $1,000 more from people’s pockets and imposing on business people an additional burden of $1,000 per employee, this bill is going to affect the economy, job creation and savings. Finally, it is going to compromise wealth creation in Canada. That is what we are denouncing.

I could talk about the government’s position on plenty of other things, but I must conclude by saying that we are going to object to Bill C-26.

[Alice Wong, Conservative, Richmond Centre, BC]

Madam Speaker, what small businesses would not like to see right now is a payroll tax hike. There are other taxes the Liberals promised to reduce, like the small business tax, but they did not follow up on their promise. Small businesses are having a tough time paying more taxes, and there is now yet another one.

These job creators are not being given the opportunity to reinvest. We are not giving them opportunities to hire more people. These are our job creators. Bill C-26 simply does not help small business people at all.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Madam Speaker, I have a lot of respect for my colleague's opinion in this area, because she was the minister of seniors previously and is now the critic for small business.

I am interested in understanding what impact she sees Bill C-26 having on small business.

[Alice Wong, Conservative, Richmond Centre, BC]

Madam Speaker, this is exactly what I said in my speech. We need to help those seniors who are in poverty. One reason is that some have not even applied. Second, they are not able to administer their own funds. That is why I empowered the cities to look for these seniors, including women who are in great need and are on the poverty line.

Unfortunately, the current government does not even have a minister who can speak on behalf of the women, on behalf of the seniors, who really need the help. That is exactly why we are fighting against Bill C-26, which would not help those women at all.

[Alice Wong, Conservative, Richmond Centre, BC]

Mr. Speaker, I am pleased to rise again to speak to Bill C-26 and the proposed changes to the CPP, as this is not only a very important issue to me personally, but also to my constituents and the very many business owners I have consulted across our country.

The government has failed to recognize the negative impacts this change would have on our economy. The CPP tax hike will take money from the paycheques of hard-working Canadians, put thousands of jobs at risk, and do nothing to help the seniors who need it.

Let me explain what is happening with regard to Bill C-26. The Liberals are encouraging misconceptions that these changes would help our seniors, our youth, and our businesses. This could not be further from the truth. I have heard from small business owners across Canada who have stated that changes to the CPP will mean that they will hire fewer people. They will opt to spread the workload across the current number of employees to offset the increased cost of payroll. When I hear from our job creators and community builders that further increases to payroll costs will mean they will hire fewer workers, it means we must listen. Our economy cannot afford to lose more jobs.

I met with young entrepreneurs in the summer soon after the proposed changes were announced. Already these young leaders saw what the payroll tax would do to their own incomes and employee paycheques. Our young people are struggling to pay off school debt and make ends meet. Reducing the amount of money they are receiving today will only magnify this problem.

We absolutely need to encourage our young people to invest, but let us equip them with long-lasting tools and knowledge that will empower them to save through many different means.

As I mentioned in one of the questions I asked in the House, a study by the Fraser Institute from May 2016 projected the real rate of return for CPP investors to be only 2.1%. It states, “Canadian workers retiring after 2036...can expect a real rate of return of 2.1 percent from the the CPP”. This means that the majority of our workforce contributing to the CPP is only making a real rate of return that is barely above inflation. To make matters worse, when they withdraw those CPP funds, they once again will have to pay income tax on them.

Finally, I would like to talk about Canadian seniors. My colleagues know that our seniors are very important to me. As the minister of seniors in the former government, I spent five years working with organizations, health care workers, and hearing from seniors themselves on actions the government needed to take to assist them.

One of the primary ways seniors have chosen to save and the option many have found most helpful is the tax-free savings account. Unfortunately, it has now become very clear that the Liberal government did not consult our seniors when they chose to scale back the TFSA. Now the Liberals claim to be assisting our seniors when the reality is that the proposed changes to the CPP will not provide a single cent to our current seniors.

One common argument for these changes is that they will assist some of our seniors in poverty. These changes will do nothing to reduce seniors' poverty.

In June, a writer of the Financial Post stated:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get.

The writer goes on to explain that fewer than 5% of seniors who fall under the poverty line are those who either are not eligible for old age security or who have not applied for the guaranteed income supplement.

It is exactly for these reasons that when I was the minister for seniors in the Conservative government, I empowered the cities to look after homeless seniors and help them apply for OAS and GIS and to administer the funds for them so that these seniors would have food on their plates and roofs above their heads. With the Liberal government, this good policy has gone.

We know that the CPP is not a means to solve poverty, and we know that TFSAs help our seniors save. Why is the government choosing to do the exact opposite of what our seniors need?

Canada's retirement system is based on three pillars: first, the CPP; then the OAS or GIS; and finally, tax-assisted savings. It is important that each of these pillars is put to Canadians. When we place too much emphasis on one, the system becomes unbalanced and does not effectively serve those who need it.

Canadians are good at saving their money for retirement. McKinsey & Company state that 83% of Canadian households are on track for retirement savings, and the C.D. Howe Institute reports that savings rates have nearly doubled since 1990. What seniors need now is protection from financial abuse, an enhancement of their financial literacy, and the ability to live within their means. What they do not need is a carbon tax, which will increase their cost of living, including heating their homes, buying groceries, and meeting other basic needs.

Let me complete this debate with what I have heard from women entrepreneurs from coast to coast to coast. They want their significant others to be able to share the rewards of their hard work when they retire. A CPP increase will not help them do that. Putting their money into sound investments will.

Young people in Vancouver hope to save enough money to buy their first home. Taking home less money will never enable them to do that.

In summary, the proposed CPP will provide none of the solutions the Liberals claim it will. Instead, our job creators will be forced to hire fewer workers. Our young people will have a harder time paying down debt, and our seniors will continue to be left out of the equation.

I know that members on this side of the House will continue to fight for our job creators and evidence-based policy. I cannot say the same for the members opposite, and I will vote against Bill C-26.

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

Mr. Speaker, it is a pleasure to rise in this House today to speak about Bill C-26. Obviously, there are philosophical differences that the government has with the official opposition. As always, I try to add something to the debate; hopefully, something that stimulates a better understanding of both sides. This place is Parliament. We are here to discuss various points of view and, at the end, there will be a logical conclusion; one that obviously serves the country. Democracy is a great thing, but it is important that people are heard.

I would like to suggest, before I get to the actual business at hand, that the government has quite a big job ahead of it, particularly as many of its policies are going to require economic growth.

As Canadians, we know we are getting older. We are living longer. Obviously, things like pension reform are always important. It is something the previous government tried to do, albeit by different means—and I will be looping back to that in just a moment.

First, I would like to again go back to the point that, if there were a stronger economy, many of the concerns we have heard from small business owners with respect to adding more payroll taxes might have been alleviated.

As we all know, it is tougher and tougher to run a business when the economy is not producing well. Of course, all of us here would like to see more jobs in our ridings. We want to see people being able to provide for their families. However, that is not always the case, particularly if the economy is stagnating.

We have seen Mr. Poloz, the governor of the Bank of Canada, downgrade his expectations for Canada's growth, on behalf of the Bank of Canada.

I think it is important that we just acknowledge that as being a fact because, as the PBO has said, the job reports are not coming in as strong as we would like, and neither is the economy.

If we are going to ask people to pay more, whether it is into a system 40 years from now or into the coffers of the government today, we always have to remember that there is only one taxpayer. If people are struggling to pay their mortgages, if people are struggling to get into the market, and if people are struggling to pay their bills and suddenly they have less money at the end of the day, they will not give to charities. They will not put money aside for savings for their children as easily because there just is not the money there.

Whether we are talking about carbon taxes, whether we are talking about CPP increases, whether we are talking about perhaps—and I have heard in the pre-budget consultations at the finance committee that some members are thinking of a sugary drinks tax or perhaps some other taxes that we have not yet thought of—at the end of the day, there is only one taxpayer, and we always have to keep in mind the ability to pay for it.

We heard from the Macdonald-Laurier Institute during the study of Bill C-26 at committee, from an economist named Mr. Philip Cross. Mr. Cross simply pointed out what we know to be true: that while there are some concerns that certain segments of our society are not saving enough—and that is usually higher earners who are just choosing not to save, and then there is also a number of, usually, single female seniors who, because they did not participate in the labour market and have lived long enough to get to a point where now they do not have things like Canada pension plan because they did not contribute as much—those measures are not there for them.

As we have seen in the previous budget the government put forward, there was some allocation to that. In fact, in the previous election, many of us on the Conservative side ran on a pledge that we should introduce a tax credit specifically for single or widowed seniors. That was all, again, to make that targeted toward those people who are greatest in need.

Mr. Cross said that these things can be addressed through targeted programs and they can be addressed through other voluntary means. There is not a savings crisis now or predicted in the future in Canada, which is something we should be proud of.

We have a multi-pillar system. Conservatives believe, unlike the NDP and the Liberals, that there should be greater choice.

Again, we have heard time and time again from the Liberal side that the Conservatives do not care about pensions or pensioners, which is not true. We just believe that people should be able to voluntarily put their money into an account that would be there to support them, and it should be of their choosing. It should not be by a forced government program.

Again, I would go back to those many seniors who visited me. They and their spouses contributed the maximum amount to the CPP but their spouses died early, so now they, the surviving spouse, are not able to access the money they expected would be available to them, that they had socked away through the CPP system, because they are already receiving the maximum CPP allowed for an individual. These individuals get no survivor or spousal benefit. If, instead of putting that money in a government-mandated system, that same couple had put it in a tax-free savings account or an RRSP that eventually became a RRIF, and one partner were to die, the other one would have immediate access to that capital. We would all expect that.

The Macdonald-Laurier Institute said we should really be calling the argument what it is. There is an ideological agenda by the government. Just remember, “ideological” is not a dirty word but it is something that we need to acknowledge. We need to acknowledge it when we see the world presented in a certain way to come up with a certain solution. The Ontario Liberals ran on a pledge to create their own Ontario retirement pension plan that would be enormously costly and not in fact complement the federal CPP but would increase costs, with fewer benefits for people. The Ontario Liberals and the federal Liberals said they would fix it by going to the other provinces and basically eschewing any other efforts.

Mr. Speaker, I know you do not hail from Ontario, but I would remind you that it is important to notice the following. When we talked about pooled registered pension plans as a means for having voluntary portable pensions that anyone could take anywhere and employers could voluntarily put money towards if they wanted to participate, Ontario, unlike British Columbia, Alberta, and Saskatchewan, did not go ahead with those. I would encourage the Province of Ontario that, despite this piece of legislation going through, there is still more to be done and that pooled registered pension plans were something that all finance ministers across this great country agreed to. That does not happen often.

I just want to take a minute to step back and talk about young people. We had witnesses at committee who said they understood that most seniors would not benefit from this bill. We are thinking about future generations, and that is an important consideration. But we see that young people are now going on to higher education with higher bills and graduating with higher bills. They are being asked to pay those student loans back while trying to get a job. This is a very difficult time. Now they are being told they should get used to precarious work. The reason work is precarious is that employers do not have confidence.

The Liberals have to understand that when they tell people they will be adding a carbon tax and payroll taxes, those taxes make it less attractive for people who want to hire, especially if they hear that the government and the Bank of Canada say they are downgrading the Government of Canada's economic outlook. This again makes it more difficult for businesses to hire young people. Then the Liberals are telling young people that even if they can pay their student loans, even if they can squirrel some money aside, they are going to have less take-home money that could help them buy a home. Of course, the new rules by the department of finance for mortgage qualification make owning a home very difficult.

To sum up everything I have said, the government is in a real pickle on this one, simply because it wants to have an agenda in which it is doing a lot of things that are probably well-intentioned, but in an environment that does not sustain them. At the end of the day, we are asking more of that one taxpayer, and remember there is only one taxpayer, to put up more than he or she is able to bear. If we do that, we risk what I have mentioned. It is the reason I oppose this measure at this time.

The House resumed 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.

Report Stage

[Marco Mendicino, Liberal, Eglinton—Lawrence, ON]

Mr. Speaker, we are not shutting down debate on the bill. As a matter of fact, there are 55 sitting days between September and December. We have allocated a substantial amount of that time for debate on the bill. We have heard from more than 70 members on the opposition side. We continue to listen for new arguments, which we have yet to hear, but I am quite proud to say that we have had a robust debate. We will continue to have a robust debate, and I look forward to the contributions from the opposition as to how we can continue to enhance long-term retirement security; and it begins by supporting Bill C-26.

[Marco Mendicino, Liberal, Eglinton—Lawrence, ON]

Mr. Speaker, it is an honour and a privilege to rise to speak in support of Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

Let me outline the purpose of the bill.

It would, among other things, 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 were made. It would increase the maximum level of pensionable earnings by 14% as of 2025. It would provide for the making of additional contributions, beginning in 2019. It would provide for the creation of the additional Canada pension plan account and the accounting of funds in relation to it. It would 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.

For the benefit of the House, let me provide a number of reasons why the government has put Bill C-26 forward.

We are concerned about the long-term retirement security for those Canadians who have worked hard all of their lives and expect, rightfully, that they will enjoy security in their retirement years.

The fact is that middle-class Canadians are working harder than ever, but many are worried that they will not have put away enough money for their retirement. Fewer and fewer Canadians have workplace pensions based on defined benefits or defined contribution plans to fall back on. To help those Canadians achieve their goal of a safe, secure, and dignified retirement, in the face of these challenges, the Government of Canada is committed to working with the provinces to strengthen the CPP.

Co-operative efforts as joint stewards of the program led to Canada's Minister of Finance reaching a historic agreement, in principle, on June 20 to enhance the CPP. All of my colleagues on this side of the House were very proud of that accomplishment.

What would this agreement mean in principle for Canadians?

Once it is fully in place, the CPP enhancement will increase the maximum CPP retirement by about 50%. Right now, the current maximum is just a little over $13,000, which is not enough by most living standards across the country. In today's dollar terms, the enhanced CPP would represent an increase of nearly $7,000 to a maximum benefit of nearly $20,000. Enhanced benefits will accumulate gradually as individuals pay into the enhanced CPP.

Young Canadians, and this is a group about which I know all members of the House are concerned, just entering the workforce would see the largest increase in benefits.

To fund these enhanced benefits, annual CPP contributions would increase modestly over seven years, starting in 2019. For example, an individual with earnings of about $54,000 or $55,000 would contribute about an additional $6 a month in 2019, an amount that should be manageable for most hard-working Canadians. By the end of the seven year phase-in period, contributions for that same individual earning that same income amount would be about an additional $43 per month.

To ensure that eligible low-income workers are not financially burdened as a result of the extra contributions, the Government of Canada would enhance the working income tax benefit, an existing benefit that is designed to keep people in the workforce and encourage others to join it.

Enhancing the CPP will significantly reduce the share of families at risk of not saving enough for retirement and a degree of under-saving.

The CPP will always be there for Canadians because it helps to fill the gap for those who do not have a workplace pension plan, and it is portable across jobs and provinces.

Canada's retirement income system provides a balance of mixed public pensions and voluntary savings opportunities to enable Canadians to save for their retirement. The retirement income system is based on three pillars.

The first is the old age security program, which was altered under the last administration in an attempt to extend the age of eligibility to receive the full benefit and appreciation of that plan to age 67. Again, I am very proud to say that among the first measures this government took was to rescind that extension and restore the old age security program eligibility age to 65, something that was met with great support in my riding and, I dare say, right across this country.

The CPP and Quebec pension plan is the second pillar. They provide a basic level of earnings replacement for workers. They are financed by contributions from workers, employers, and self-employed individuals.

The third pillar is a voluntary tax-assisted private savings opportunity. Some examples include registered pension plans; pooled registered pension plans; registered retirement savings plans, commonly known as RRSPs; and tax-free savings accounts. Individuals and their employers may contribute to these savings vehicles on a voluntary basis.

In addition to saving through the retirement income system, Canadians may also choose to draw upon other financial and non-financial assets for retirement income. These include, for example, financial assets held outside of tax-assisted registered plans, housing equity, and small business equity.

Let me say a few more words about the current Canada pension plan. The CPP is a contributory public pension plan that provides a basic level of earnings replacement. With these revisions, as I have said before, we would see modest increases gradually over the course of a number of years at a pace that most hard-working Canadians would be able to absorb.

Let me say a few more words about why it is that we are enhancing the CPP. As we have looked closely at the situation of Canadians as they approach their retirement, we understand that middle-class Canadians are working harder and harder. The Department of Finance has examined whether families nearing retirement are adequately prepared for retirement, based on household income and wealth data from the 2012 Survey of Financial Security. Families are considered to be at risk of under-saving for retirement if their projected after-tax income at retirement does not replace at least 60% of their pre-retirement after-tax family income.

Although Canada's retirement income system has served many Canadians well, the Department of Finance has estimated that almost 24% of families nearing retirement age are at risk of not having adequate income in retirement to maintain their standard of living. This suggests that roughly 1.1 million families approaching retirement age will not have enough money to maintain their standard of living when they retire; hence the enhancements.

I will just take my last few moments to indicate to the House that recently the Minister of Finance had the occasion to come to my riding of Eglinton—Lawrence to meet with my constituents to speak personally about this historic achievement. What was most distinguishing about this visit was that we visited with constituents who are on either side of the age continuum. We visited first with seniors to speak about enhancements to the old age security program and to the GIS program. Then we went to visit with high school students at Lawrence Park Collegiate Institute.

It is truly for them where the focus of this program lies, which is the future, to provide retirement security not only for present day seniors but also for hard-working young Canadians, and I am proud to say that by passing Bill C-26 we will have accomplished that goal. I urge all of my colleagues to support it.

[Dave Van Kesteren, Conservative, Chatham-Kent—Leamington, ON]

Mr. Speaker, thank you for this opportunity. It is a great honour to speak to initiatives that are very close to a lot of our hearts. I know it is close to mine. We are talking about the proposed changes in Bill C-26.

I think it should be noted again that these changes will not take full effect until 40 years have passed and will take money out of the paycheques of hardworking Canadians and put thousands of jobs at risk.

It needs to be re-stated that these changes will not provide relief to our seniors. If we want to give relief to our seniors we could start with the high cost of electricity in the province of Ontario and the failed policies that have resulted in those things. Those are the real issues that are causing poverty among our seniors today.

We are going in a little different direction. I have not heard this said yet, so I will talk about someone else the bill will hurt. We know it will hurt employers. Employers are the ones that do the hiring. They are the ones who make those higher CPP payments. It will hurt employees, because they will not longer be employed. They will not get those job opportunities. The one group of people who will really hurt the worst is the the poor. I have not heard that discussed by the opposite side, and surprisingly by the other party on the left.

What about the poor? The poor are the ones who need jobs. We talk so much about how we need to help the poor today, but if we want to help a poor man or a poor woman, give them a job. This particular legislation puts a death knell to that.

We have a good organization in my riding of Chatham-Kent—Leamington, the Chatham-Kent Workforce Planning Board. We had a meeting with them. They are involved in job creation and are doing their part. We heard some encouraging statistics, because the rate of unemployment is dropping in Chatham-Kent—Leamington.

In a former life I had a business. I was a car dealer. I got to work for who I think is probably the smartest guy I have ever met in the car business. He is an actuary. He was a graduate of the University of Toronto. He used to tell me that it is all in the numbers and that I should check the numbers. Subsequently, I have kind of been a number miner.

When I looked at the Chatham-Kent workforce statistics, they showed first of all that we had the large employers and the small and medium-sized businesses. There were some really discouraging statistics. First, we have only two employers who employ over 500 people in the riding of Chatham-Kent—Leamington. The other group is shrinking too.

However, we all know who does the hiring. It is small business. There was a group of businesses with zero to 100 employees. Which group was the largest? Let me just clarify this so members can understand my question. Of that group of businesses that employ from zero to 100 people, which segment was the largest hiring group? I have asked this question of a number of people and we get some varying answers. Some went as low as three employees. Do members know what it is? It is the segment with zero employees.

I was shocked when I saw those numbers, but I am not that shocked when I see legislation like this, because an employer will hire someone when he does a good job. If an individual is a finishing carpenter and the demand is such that the business is getting more work and it makes sense to hire another employee, then they have a whole lot more managing to do, but they will pay that employee what he is worth.

Oftentimes, those people who are at the entry level do not have that value yet. Members can check the statistics for themselves. It is shocking to see that more and more people are doing it on their own. They are not going out and hiring. Who does that affect? It affects the poor, the disenfranchised, the ones we often call the generational poor. It is generational poverty.

My wife and I love parades. When we go down King Street and get into the east end in our home town of Chatham, we get the marginalized people. These people oftentimes do not have the privileges we have. Life is a bit tougher. A lot of them do not have jobs or have not had jobs for a long time. It is those people who will be affected. It is those people who will not be hired. The sad thing is that this continues on generationally.

If the cost of hiring an employee was such that it made sense for that carpenter, plumber, electrician, or whoever to hire, they would. The economy is growing, but the problem is that we put these restrictions on people and we do not realize who it is hurting.

We hear so much in the House about the middle class. I am part of the middle class too. However, we should be talking about the poor. The poor do not necessarily vote for me. However, we should be talking about those people. They are the people who have no voice. Those are the people who look for jobs and cannot find them, or just give up. If we talked about those people, if we have a heart for the people who do not necessarily have a chance, I think we would be talking about something else when it comes to CPP.

I have an idea. Let us have a universal pension plan. I have talked about this with a number of people. We have universal health care. Imagine talking to our neighbours or other people in our home towns who need knee replacements. However, because they do not have a universal pension plan, it will be two years until they can get their knee fixed. However, for us, it would be two weeks. We do the same thing in our pensions. If we really wanted to make change and affect the economy, we should talk about a universal pension plan.

Years ago I had the privilege of working on the finance committee and I got to know a man by the name of Bill Tufts. He is involved in an organization called Fair Pensions for All. Bill and I talked about what would happen if we took all the CPP, OAS, GIS contributions and all of the government's contributions to pension plans, threw it in a big pot, and divided it among all the people who were retired. Every woman and man in our country would get $24,000 when they retired. There is a real solution. If we really wanted to help the poor, if we really wanted to make some changes, there is a universal pension plan right there.

I know that might be a pipe dream, but I am concerned that this legislation would further exacerbate the hiring abilities of employers today. Although that is tough and although it is going to make it rough on employers, it is especially going to make it rough on the poor.

I fear that for the coming generation, more and more it will be impossible for us to hire those who need the jobs, those who will move from their poor status to a higher status, to the middle class, the one we all talk about so much in the House.

I hope members on the other side, because ultimately this will go vote, will consider the damage this will do to our economy, the damage it will do to that group, and ask their government to make the changes and not let the bill before us pass.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Mr. Speaker, I am glad to join this debate since this is actually the last time we will be able to have this debate on Bill C-26 in this House.

I want to start with something I used in the last session, a Yiddish proverb. “With money in your pocket, you are wise, and you are handsome, and you sing well too.” I am sure the Minister of Finance has a great singing voice. However, this proverb speaks to how money is best left in the pockets of Canadians, of the people who actually earned it through hard work, having a job, either working for themselves or fulfilling someone else's need.

What the government has done today by shutting down debate after a mere eight days does a great disservice both to the discussions so far on this bill and the interventions other members have made. This debate on the Canada pension plan is important. It is with respect to a proposed law that will amend that which will impact Canadians for many generations. Therefore, having 20 days, 25 days, or 30 more days of debate is absolutely worth having on something that will have an impact on future generations 40 years down the line.

I also think it is shameful that the Minister of Finance called this debate a stalemate so far. It is a commentary by a minister of the Crown on the work that we do on behalf of our constituents here to loyally oppose the government's agenda, to bring new ideas, and to raise points for future consideration and possibly for amendments that the government could bring to its own bill, either at committee or second reading, wherever it chooses to do that. Therefore, debate in this House is not a stalemate; it is an enriching process of what I will call crowdsourcing of new ideas. We are the crowd sent here by our constituents to speak to ideas and to offer them up to the government. Therefore, it is not a stalemate, and I very much think the government should realize we are not here as an audience, we are not here to spectate while it passes legislation. Her Majesty the Queen has given us the constitutional authority to loyally oppose, and that is what we will continue to do. Therefore, I very much look forward to the Minister of Finance not using such terminology.

I also want to point out that it was an internal finance document from his own department that said that this bill, the expansion of the CPP, will be a drag on the economy until 2030, and that it will suppress employment growth until 2035. I come from a province where we have a jobs crisis. The Speaker knows this. I had asked for an emergency debate last week on this because 122,000 energy workers are out of work. However, there are very many people who are under-employed, people who have been furloughed. Normally, they have a job, but they are just not being paid, and they are not being captured by the unemployment figures. When people are not working and not earning an income they are not paying into CPP, so it really does not matter. None of this will help any of the people if they do not have a job in Alberta right now because we have a jobs crisis.

There is also an open question that remains unanswered on the administration costs of layering on this new CPP program on top of the old CPP. It is not clear how much that will cost in the long term, over the next 40 years, and how much its management and administration will eat up the savings of Canadians.

Jack Mintz is a very well-respected tax specialist, a former professor, and a former head of the School of Public Policy at the University of Calgary. He wrote a piece entitled, “What the TFSA limit increase really means for future governments”. Although that was on TFSAs, he had a lot of great points on savings, and the behaviour and psychology behind saving as well. He brought up the fact that what many future governments will be looking at is a tax rate with a low-interest environment and 100% on inflation-adjusted returns. What we will find is that the tax rate will have a huge impact on the savings themselves, how we save, and what is deducted off our savings, so there is an open question there on people's incomes, how they save, and what they will see on their tax returns. They will get nothing from the CPP on it there.

He went on to say that a one-size-fits-all rule is of little help and that for a lot of Canadians, the need for a comfortable retirement depends entirely on individual circumstances and preferences. That is an important consideration too. Not everyone retires in the same way or with the same model. Not everyone chooses to simply stop working entirely. There are a great many people who choose at 65, 70, 75, or even earlier if they take early retirement, to work part time, and to maybe volunteer in their community or at their faith-based institution, at a church or at a temple. They may also choose to change career paths later and choose the concept of retirement around 65 years of age to choose a new career they would like to pursue. Therefore, not everyone chooses to simply stop working.

A point I have brought up in previous debate here, and a question I asked one of the members of the Liberal government caucus, is this concept of savings substitution. There is a study by the Fraser Institute that shows that forcing Canadians to save more, using the government's concept of “more”, would lead to a decrease in private voluntary savings with little or no increase in overall savings.

Savings substitution is a real danger to both the government's plan, but in general also to our economy and to people's independence from government.

People should be allowed to choose how they retire. They should also be allowed to choose how they save and what type of investment vehicle they want to use. A lot of people have chosen to save in real estate, and real estate has provided the best returns over the last two generations to those who have chosen to go down that path.

One of the very first things my wife and I did was to purchase a condo, because we knew that would get us onto the property ladder. It allows people to save. They put aside money because they are trying to pay off mortgage interest and trying to put money away toward the principal. It is a mechanism that allows them to choose saving, but to choose it in the way they want to do it.

When the previous Conservative government introduced TFSAs, then doubled the maximum amount people could put away, it was a way of showing Canadians they could choose another model to save on their own, one that is tax free. We should stop taxing the savings of Canadians and forcing them to put more toward this layered CPP on top of another CPP. The administration fees for this are another form of taxation. We send money to Ottawa, to the government departments for some work to be done. That is a form of taxation. That is what our taxes go toward.

Building equity in housing has consistently been the best thing for saving, for youth especially. By buying a property they are getting onto that saving ladder.

I would be remiss if I did not mention the rate of return. The annual rate of return, reported by the CPP Investment Board, is actually quite low, and the younger one is, the worse off one is. For those who nominally put money into the CPP because they were forced to do so back in the 1960s and 1970s, they will get the best rate of return. I look at the pages in this chamber. They will have the worst rate of return. My generation and their generation will be worse off because the rate of return is so low, sometimes falling below 2%. That is because of record low interest rates, which are really driving this low rate of return. Also, administration fees cannot help but be higher.

No one cries for a job that is never created. No one cries for an investment return that never happens. What we always talk about here is the give and take, this job here or that job there, the taxation of incomes on one side and how government chooses to spend it, versus the individual who chooses to spend it in a certain way.

What the government is doing with the CPP increase is substituting for the person's choice on how they will save. That substitution will have worse results at the end of the day, especially for the next generation, because the rate of return will be so low. If someone chooses to invest in a property or in investments where they could earn a higher rate of return than the government is able to achieve, why can a Canadian not make that choice? Sure, the government will say it is one size fits all, that we are guaranteed a return. The higher the risk the higher the return. Canadians can choose to take a higher risk. With risk, of course, can come disappointment. They could lose their investment. Their retirement may not be as certain as they thought it would be, and they may have to adjust their goals and plans. That is why everyone should be doing financial planning for themselves. We should be encouraging people to not be dependent on the government.

The Fraser Institute noted this as one of the five myths of the Canada pension plan. Myth number 4 was “The CPP produces excellent returns for individual contributors”. They are thin margins.

There are a great many seniors who are better off today than they were pre-2006. They are better off thanks to the previous Conservative government's work to try to ensure they had a solid retirement. Lots of reports have shown this. Statistics Canada has said that the share of Canadian seniors living on low income has dropped from 29% in the 1970s to 3.7% today, which is among the lowest in the world.

The Human Resources Institute of Alberta is responsible for HR professionals in the province. It has said that consistently, across the board, only about half of all organizations offer employment pension plans and group RSPs with employer-matching plans. That means half of all employees in the province of Alberta may lose the opportunity to continue investing in their employee pension plan or group RSP, because they do not have the money to invest in it and see that matching funding by their employer. They simply will not take advantage of it.

I oppose the bill, and I encourage all members to oppose it as well.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, today and over the past few days, we have heard the same as we have heard in previous debates on this legislation. The fundamental difference is that ideologies in the chamber become more and more evident every day.

Differences in opinion are good and, in fact, are foundational to our Westminster style of Parliament. However, what we are seeing from the Liberal Party and the New Democratic Party is a trend that is deeply troubling. Whether it is the Liberals in government or as individually elected members of Parliament, they still think that they know better than their constituents and all ordinary Canadians. Conservatives believe that Canadians know what is best for them. For the Liberals and NDP to imply that they know better than ordinary Canadians is an insult. Canadians are in the best position to make their financial decisions, and those include decisions related to their retirement.

We saw this difference in perspective most clearly recently when the Liberals clawed back the tax-free savings account contribution limit. The TFSA is a phenomenal vehicle for personal savings. For retirement, it could be used to make a lump-sum mortgage payment, maybe do an urgent home repair, or maybe even finally take that long-awaited vacation, but the important detail is that it is completely tax free.

We have all heard the saying that Liberals have never seen a tax they do not like and the NDP has never seen one it does not want to hike, but if the government thinks it can increase payroll taxes on Canadians because it has decided to blow through its election promise of a supposedly small deficit, which has now grown to over $30 billion, it can expect strong opposition from the Conservative Party and many other Canadians.

The Liberal government has spent much of its time patting itself on the back for its openness and transparency, but let me share what Canadians actually believe about the CPP and what this legislation would change. Liberals have been slow to correct these misconceptions. So much for transparency.

Forty per cent of Canadians actually think the government pays into their portion of CPP, and nearly three-quarters of Canadians do not realize that current retirees would not benefit from the proposed expansion. In fact, nearly one-quarter of current retirees wrongly believe that they will see larger CPP benefits as a result of the proposed expansion. Most Canadians are not aware that it would take up to 40 years of increased premiums in order for workers to see the full impact of these increases to their CPP benefits. I would like to know what efforts the government is making in addressing these misunderstandings. Will it be open and transparent and point out upfront that it will take 40 years for the additional CPP benefits to be realized?

As a former small business owner, I know the real effects that these CPP premium increases would have on small and medium-sized businesses in Canada. In committee two weeks ago, Ms. Monique Moreau, director of national affairs for the Canadian Federation of Independent Business, shared a compelling statement as it relates to the impact on small businesses.

Representing more than 109,000 small and medium-sized businesses, the CFIB is worried about the negative impacts on these businesses. She shared that its monthly poll on small business confidence dropped in September and October, now sitting at 57.7%, as opposed to the 70% where they would like to see it. She said:

Small business owners don't have money hiding under the mattress waiting for government tax hikes. If CPP/QPP is increased, even if it results in higher future benefits, two-thirds of business owners indicated they would feel pressure to freeze or cut salaries, while nearly half would be forced to reduce investments in their businesses. This impact comes at a time when the government is trying to encourage innovation, investment in business, and job creation in small firms.

The results of these changes in CPP premiums might not be as visible in business operations with just a few employees, but if we start to look at businesses with 15 or maybe 20 employees, the costs that these changes would impose could be crippling, causing layoffs, wage freezes, or even closure of businesses.

Ms. Moreau went on to say:

...if employed Canadians had extra money to save for retirement, they would first invest in RRSPs and TFSAs over other savings vehicles such as the CPP/QPP. Small business employers also favour such saving vehicles if they have the opportunity to contribute toward the retirement savings of their employees.

If the government is trying to help Canadians save more for retirement, only 18% of Canadians are choosing mandatory CPP increases. There is a variety of other options available, including reducing taxes, creating new incentives for savings, and allowing employees to voluntarily contribute to their own CPP/QPP. Putting pressure on financial institutions to lower their management fees for retirement savings vehicles is also an important consideration.

It is clear that not only are Canadians for the most part unaware of the changes the government would make to CPP, but those who are aware are misunderstanding the impact of these changes. For those who do understand, the large majority seem to drastically oppose these changes in favour of other measures.

Aaron Wudrick, federal director of the Canadian Taxpayers Federation, also shared his concerns at committee, noting, as I have, that it is a classic case of government believing that it, rather than Canadians, knows what is best for Canadians. Aaron touched on a very important point in his opening remarks. He said:

It is also important to stress here that, when we are discussing income security for seniors, income support is often conflated with income replacement. CPP, of course, is a program where the yield you receive depends on what you pay in. Enhancing it, therefore, does nothing for people who are not paying very much into it in the first place. It does not give people extra money. It simply shifts the money from the current day into the future.

This is very troubling. We know that household incomes are stagnant and that in many sectors wages are frozen or shrinking. What Canadians do not need is another tax that shrinks their take-home pay. This would have effects on spending and investing habits, and would ultimately hurt our already fragile economy.

Furthermore, it is true that since CPP is geared to income these changes would not help lower-income Canadians. A paper released by the C.D. Howe Institute shows that the Liberals' plan for CPP would not benefit low-income workers. They would see their premiums go up but their net increase in retirement benefits would remain low since higher CPP payments would be offset by clawbacks in GIS benefits. These changes would also not help Canadians who are facing rising unemployment. In fact, it seems like the changes being made today would make life harder for those who are trying to enter their field of work. The Department of Finance analysis shows that the Liberal government's plan to increase CPP would hurt job creation and the economy as a whole. Quoting directly from its information, these changes would reduce employment by 0.04% to 0.07%. That is 1,050 fewer jobs every year, which means, over a 10-year period, 10,000 Canadian jobs that would not be created, as a result of this CPP increase. This is from the Department of Finance.

Do the Liberals really believe that the changes they propose, which would have no benefits today or in the near future and would have minimal benefits for Canadians retiring 40 years from now, are really worth the job losses today and decreased investments for jobs for tomorrow?

In closing, it is worth noting once again that the Liberal Government of Canada does not know what is best for Canadians and that the Liberal government should provide Canadians with all of the choices they deserve in making their own retirement decisions. The government needs to immediately return the annual contribution limit to the tax-free savings account and promote its use through advertising and educational programs. This is a fantastic savings mechanism that does not lock in people's savings that might be needed in case of an emergency, unlike CPP contributions, which they cannot access as needed.

For the benefit of the survival and success of small and medium-sized businesses, I urge my colleagues to reject Bill C-26.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, I do agree with my friend the member for Sherwood Park—Fort Saskatchewan that there are other ways to more directly help low-income seniors, but that does not escape the fact that the CPP is long overdue for enhancement. We really do need to recognize that.

The parliamentary budget officer, a number of years ago, reviewed it—I think it was in 2011—and found that our CPP planning is one of the most sustainable and durable programs for retirement savings. Expanding it makes sense. At the same time, there could be much more done for low-income seniors. There is no question about it.

I commend one of the things the Harper Conservatives did, which was income splitting on pension benefits. That was a real benefit to many seniors. However, we really need to have more of that top-up for low-income seniors who are in poverty. That could be boosted right away. At the same time, I do support Bill C-26.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

I am sorry, Mr. Speaker, but I am having trouble speaking through the noise.

I wish that Bill C-26 dealt with another pension issue. There is an omission, and I hope that the Minister of Finance will get back to it in the spring budget. It is an egregious situation that affects a minority of pensioners for sure, but they are the very people we should do the most to honour. These are people receiving pensions who, through the Superannuation Act, are deprived of spousal benefits if they are veterans, retired service persons, retired RCMP members, and other retired categories of public servants and have remarried over the age of 60. They are deprived of spousal benefits on their death.

This is a terrible injustice to a lot of constituents in my community of Saanich—Gulf Islands. I know that a lot of other members of Parliament are aware of this. It is due to the most anachronistic of all pension rules. It goes back to the Boer War. It was called the “gold-digger” clause.

I do not mind saying that I am 62. I do not feel that I am so far along with one foot in the grave that the gold-digger clause makes sense. The gold-digger clause in the Boer War was that if a soldier came back from the Boer War and remarried over the age of 60, the only possible reason anyone would have married one of these soldiers would have been to get their hands on their benefits when they passed away.

Times have changed. Very healthy, vigorous adults who have a lot of life left get married over the age of 60. I have one such serviceman in my riding who received the highest medals of honour, including the Legion of Honour from the French government, for his service in the Second World War. He is now over 90, and every day I see him, he reminds me to please do something about this terrible injustice. He does not want to leave his wife destitute. Therefore, I flag that again for the Minister of Finance.

Overall, the Green Party supports the bill. We support the fact that it is expanding the most reliable and consistent way in which we can ensure that seniors in Canada have adequate savings for retirement. The Canada pension plan is the most reliable and the most sustainable of what is available.

RRSPs, for example, are a good program. I know many of us will pay into it, but the registered retirement savings plan appeals primarily to those Canadians who already have discretionary income to put into an RRSP. That taxable benefit to higher wage earners costs the tax system quite a lot of money. If we look at it as a public policy question, we see it is not clear that the RRSPs make sense.

The Canada pension plan makes abundant sense, and we know right now that two-thirds of Canadians no longer have any workplace pension. Workplace pensions are disappearing. More and more Canadians have inadequate savings for retirement, so the workplace pension plans are shrinking at the same time as we have what is sometimes called the grey tsunami. We know we have a demographic with many more people about to enter retirement.

By the way, I commend the government for returning the retirement age to 65; that is commendable. However, we do need to enhance CPP benefits. There is no question that overall the bill is going in the right direction. We know that right now the median value of retirement assets for Canadians between age 55 and 64, with no accrued employer pension benefit, is under $4,000. We know we need to augment the CPP. Only one in five Canadians have adequately saved for their retirement.

It is all well and good for some members of this place to say that Canadians should plan ahead and it is their responsibility to figure out how to save for their retirement. This is a very small cost of a public program, with the cost split between the employer and the employee, to make sure that people have adequate savings for retirement. The reason people do not put aside money for retirement is generally that they lack disposable income because the other costs of daily life eclipse their ability to set aside money for retirement.

I urge my friends on the other side of the House to embrace expansion of CPP. I agree with the analysis of the Canadian Association of Retired Persons. It does really good work on public policy and commends the bill as well.

That brings me to the point where I wish we had time in this place and I wish the Minister of Finance and the Minister of Families, Children and Social Development could have provided, at committee, by accepting amendments, a fix to what looked initially like an oversight, and that is the dropout provisions for disability and child rearing to ensure gender parity. Both ministers have said that they can fix this problem by renegotiating terms with the provinces. I wish they had fixed it while they had the chance at committee. They still have the opportunity to fix it, if they are willing to accept amendments when we get through this process. However, at this point there has been no sign of a willingness to accept amendments, and we are left hoping for public pressure to continue what both ministers say they are willing to do by changing the terminology in the negotiated agreements with the provinces.

It is very hard to understand how this oversight has not been fixed already. The conclusion that my friends in the NDP have reached appears an inescapable conclusion. On the evidence we have before us, it appears that the bill will disadvantage women for no apparent reason other than an oversight. I did have a brief moment to discuss this with the Minister of Finance earlier this morning, and his position is that to do what the NDP asks now would result in a transfer of wealth from poorer women to wealthier women because of the way the calculation works. Unfortunately, I do not have the full facts on this. I had a 30-second conversation with the Minister of Finance, which is what happens when there is time allocation and inadequate time for debate.

I am left with the dreadful conclusion that, with the chance to bring in a really strong bill that would have no negatives attached to it, which is what Bill C-26 was when I first read it, it needs to be fixed. The NDP spotted this problem. I commend the NDP for spotting it. With that, I will close.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, I know that many who are currently heckling me were not here in the 41st Parliament, but I can assure them that we had no time to turn around before there was yet another time allocation motion. The Conservatives broke through all historical records. However, this does not excuse the Liberals for doing the same thing.

I would urge members on both sides of the House to consider what we really want in terms of parliamentary decorum and in terms of being able to address bills and get them through the House in an expeditious way while also ensuring that we do not trample on the rights of each of us here as members of Parliament to do the work we were elected to do, which is to study the legislation, provide suggestions, work together, and produce what the people of Canada want. They want parliamentarians who see the big picture and are prepared to put their heads together to come up with better legislation by taking the time that is needed.

Tme allocation is in no one's interest here. I very much regret that the current government has brought it in now, for the ninth time. Again, for those who live in glass houses, I will remind them that it was 100 times that time allocation was brought in during the 41st Parliament.

I urge the Liberals in this place to consider what the threshold is against which they strive to achieve their goals. I would urge them not to think that their goal is to be better on any issue—the environment, climate, the treatment of veterans, criminal justice, Bill C-51, parliamentary decorum, the use of time allocation—than what Prime Minister Harper did. I want to set a really ambitious goal for them: Do better than what Prime Minister Mulroney did.

Obviously, I did not agree with everything done by the Progressive Conservative majority back in the 1980s, but I think if members go back and look at the use of time allocation, the number of whipped votes, and the treatment of issues and use that as a benchmark, they will find that they have to set their sights a good deal higher than trying to do better than the prime minister in the 41st Parliament.

Turning to the specifics of Bill C-26, I wish it did include—

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, it is an honour to rise today to speak to Bill C-26, a bill to enhance the Canada pension plan.

I want to start by lamenting, as I did this morning, time allocation, which is bringing this debate to a premature end. I think this is one of those times, particularly with the degree of controversy about the drop-out provisions in the bill and how they will unequally impact women in this country, when we really should have more time for debate and more time to ensure that we have all the facts.

I want to take a moment to say that if there is anything sadder than watching Liberals fall short of their promises, it is the Conservatives jumping on them for doing about one-tenth of what the Conservatives did when they had power. The use of time allocation was constant in the 41st Parliament.

[Chandra Arya, Liberal, Nepean, ON]

Mr. Speaker, it is a great honour and privilege to speak to Bill C-26, which I agree is one of the most important bills of this government, not just for the people of my generation but also for the next generation.

There are 11 million working Canadians without a workplace pension plan. As well, if we talk to people in the food banks today, they will report that a lot of working families are availing the help of the food banks.

When we combine the fact that 11 million working Canadians are without a workplace pension plan and a lot of working families are going to food banks for help, we know that when these families retire, they will retire in poverty.

We already have a lot of issues with the growing number of seniors. Just to give one example, in eastern Ontario, 2.5% of the patients account for close to 35% of the total hospital expenses. In this 2.5% of patients, close to 50% of them are seniors. The issues related to seniors are already costing us a lot. We have to take adequate steps so the seniors of the future years are well covered.

This bill, an act to amend Canada pension plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act, as I mentioned earlier, is the most important thing. Let us summarize what the bill would do.

The bill proposes to amend the Canada pension plan to increase the amount of the retirement pension as well as survivors and disability pensions and the post-retirement benefit, subject to the amount of additional contributions made and the number of years for which those contributions are made; increase the maximum level of pensionable earnings by 14% as of 2025; provide for the making of additional contributions beginning in 2019; provide for the creation of additional Canada pension plan accounts and the accounting of funds in relation to it; and, finally, 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.

I know this on its own cannot operate and deliver the results, so there are other related acts that need to be amended. Therefore, part 2 of the bill seeks amendments to the Income Tax Act to increase the working income tax benefit and to provide a deduction for additional employee contributions.

The first part of the act also proposes to amend addition 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 interpretation of financial statements in relation to amounts managed by the Investment Board in relation to the additional contributions and increased benefits.

As I mentioned earlier, middle-class Canadians are working harder than ever, but many are worried they will not have enough money for their retirement. A lot of working Canadians have no workplace pension plan. Each year, fewer and fewer Canadians have workplace pension plans on which to fall back. For this reason, we made a commitment to Canadians to strengthen the Canada pension plan to help them achieve their goal of a strong, secure and stable retirement.

Earlier this year, Canada's Minister of Finance released a historic agreement to make meaningful changes to the CPP, an example of federalism at its best.

The more than one quarter of Canadian families nearing retirement, about 1.1 million families, who are facing a drop in their standard of living will be able to retire in dignity as a result of this enhancement. This deal will boost how much Canadians will get from their pensions, from one quarter of their earnings now to nearly one third, which in my opinion is quite significant and is a necessary change we need to address.

To make sure these changes are affordable, we will phase them in slowly over seven years, from 2019 to 2025, so the impact is small and gradual. Every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Through this announcement, we have taken a powerful step to help make that happen.

There are certain facilities that are available to plan for retirement. One is the RRSP account, which is available to every Canadian. We note that there is a huge gap. A lot of Canadians are eligible to make contributions to those accounts but are unable to make contributions because of the cost of living.

One of the ideas a friend from the opposite side of the House pointed to is financial literacy. While I agree that financial literacy is an important component in achieving this result, we also need reasonable, tangible ways and means to make this possible.

To conclude, I repeat, there are 11 million working Canadians without a workplace pension plan. A lot of food banks are seeing working Canadians. Keeping that in mind, I think we should all support Bill C-26.

[Karine Trudel, NDP, Jonquière, QC]

Mr. Speaker, I thank my colleague for her question.

Her remarks are interesting. What I forgot to mention is that more and more young fathers are playing an active role. I want to emphasize this, because it is becoming increasingly common, which is great.

Bill C-26 does not encourage young parents, whether the father or mother, to stay home. The bill ignores fathers and mothers who choose to stay home to raise their children. In those cases, the enhanced benefits will not be calculated, which I think is appalling. This does nothing to help our young people create a better future for themselves and make good decisions regardless of their financial situation in order to give their children a good upbringing. How people help their children and the values they want to instill remain their choice.

[Karine Trudel, NDP, Jonquière, QC]

Mr. Speaker, I thank my colleague for his question.

That was 2015. This is 2016, and the government calls itself feminist. We have had to set the record straight on that a number of times in the House.

The new enhanced benefit in Bill C-26 will not help young women.

The same applies on the labour front. So much has been done in pursuit of pay equity, but the bill will not take effect for another 18 months. Pay equity is more than 40 years overdue.

How can the government call itself feminist? “Feminist” is a great little word, but the government has to walk the talk. I think that Bill C-26 makes it clear the government is not really feminist.

[Karine Trudel, NDP, Jonquière, QC]

Mr. Speaker, I am very pleased to speak to Bill C-26 today. However, I find it unfortunate that our speaking time has been cut short. I became involved in politics to represent the constituents of Jonquière. I took on this role to uphold everyone's democratic rights. Whether we agree with the government or not, we are here to ask questions on behalf of Canadians in order to determine where our society is going.

First of all, I would like to thank my colleague from Hamilton Mountain for his excellent work on Bill C-26. He worked very hard, especially in committee, to raise the issues that I will discuss in my speech.

This bill would amend the Canada Pension Plan Act to incorporate the recent agreement reached between the provinces to enhance CPP benefits. While a better outcome was possible, since the full effect of the changes will not be felt for another 49 years, our young Canadians will benefit. Unless something changes along the way, when my young boys reach retirement age they will benefit from the changes we are debating in the House. I have to say that, as a mother, I find it a bit funny to say that. My boys will get older and benefit from this measure.

We must now see immediate action to help those seniors and Canadians on the cusp of retirement who will not benefit from these changes. The government must build on the momentum of this agreement and take steps to improve long-term retirement security for today's workers. It is all well and good to have changes that will come into effect in 49 years, but there is no denying that many seniors who are about to retire or who are now retired are grappling with financial insecurity. Unfortunately, they do not have enough income to live on, in other words to pay rent or eat properly. Still today in my riding, some seniors cannot afford a decent retirement home when the time comes to move into one.

Retirement insecurity is reaching a crisis level in Canada, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. A large part of this problem is fuelled by the erosion of workplace pension plans. Six in ten working Canadians have no private pension plan.

The NDP supports the bill, even though we feel that it does not quite meet Canadians' expectations regarding CPP reform. New Democrats, along with many in the labour movement and groups working for the rights of seniors and retirees, have long advocated that benefits be increased from replacing 25% of a worker's pre-retirement income to 50% of pre-retirement income. However, this legislation has offered up a very modest increase, from 25% to 33% of pre-retirement income.

Although we do like to see an increase, we feel that the amount is wholly inadequate, especially in terms of ensuring that our seniors do not have to live in poverty and can retire with the dignity and quality of life they deserve.

While many would be happy to finally see some changes to the plan and some increases in benefits, there are many who will be very unhappy. Those are the people who will see very little or no benefit from the changes presented in this bill. 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 problem for today's seniors is that these pillars are falling behind in terms of enabling seniors to maintain an adequate standard of living. Dramatic increases in the costs of things like electricity and housing are causing great strain on seniors' fixed incomes.

Failing to take action now will have a great social cost, forcing many seniors into poverty. The number of seniors forced to use food banks will rise dramatically.

We talk about young moms a lot in the House. I want to talk about my best friend, Nathalie. Since I was elected, we have not spent as much time together as we used to because of my new responsibilities, but my friend Nathalie has been on my mind since Bill C-26 was introduced. She is a young mom who, together with her husband, decided to raise her children, to be there for them and to stay home with them, but also to work on her own personal growth by doing other things, such as volunteering with her local farm women's group.

I really admire this young woman because she is caring for her children and making a good life for them. She and her husband made some tough choices. She stays home, which means less income for the family, but the two of them feel it is very important to provide a good quality of life to their two young daughters.

However, I am disappointed by a major flaw in the bill. I fail to understand why the government simply will not help mothers like my friend Nathalie by immediately making the necessary changes. It would be so easy for us to do and it would help these mothers when they retire. Why do we penalize young mothers who decide, together with their spouse, to stay home to raise their children? We are talking about our future generation.

It is great that child care services are available to women like me who have a career. That is wonderful. However, it is not right to penalize women who stay at home to help their children become the adults of tomorrow because a bill fails to meet their needs. That is unacceptable. We must immediately rectify this as part of the new improvements.

It is easy to change a bill. We would just have to change a subclause, two or three lines maybe. Why is the government so bent on penalizing young women? I cannot stand by that.

The Canada pension plan is being improved and will benefit future generations, as I said, including my children, but not for another 49 years. I talked about our seniors earlier and I am quite concerned about what will happen to them now.

My parents are retired. They worked their entire lives to make a decent living in order to be able to pay for their house and groceries and to help me with my children. In fact, my parents look after my children when I am here in the House and am working on behalf of all Canadians. I am proud to be here for them and to do this work every day. However, when I meet with people from my riding of Jonquière and see the inequalities among them, I start asking myself serious questions. We have to find ways to take action now.

The NDP is recommending further increases to the GIS and the OAS, a national pharmacare program, and programs to enhance home care and palliative care.

We have much more work to do to ensure that workers can retire with adequate incomes and access to the services they need to have a good quality of life. The NDP will continue to work with our labour allies and others to improve the lives of Canadian seniors and retirees.

I will end my speech there. I hope that the government will listen, especially to women, like my friend Nathalie, and our seniors. I am thinking of Ms. Tremblay who devoted her entire life to looking after her granddaughter, a person with reduced mobility who needed very special care. We must consider these people because they, too, will need us in retirement. It is our responsibility and our duty as parliamentarians. It is also the government's duty.

[Randeep Sarai, Liberal, Surrey Centre, BC]

Madam Speaker, the goal of a stronger Canada pension plan is truly a high priority that is shared by Canadians from coast to coast to coast, with 75% in favour of a stronger public pension plan. By making this priority a reality, we have the opportunity to demonstrate what Canadian federalism can accomplish when governments work together openly and constructively.

Helping Canadians achieve their goal of a safe, secure, and dignified retirement is a key part of the Government of Canada's plan to help the middle class and those working hard to join it. As part of this plan, the Government of Canada is committed to working with all provinces and territories to enhance the CPP to ensure that future generations of Canadians can count on a strong public pension plan in their retirement years. This is precisely what we are doing by enhancing the plan.

We know that middle-class Canadians are working harder then ever before, and many are worried that they will not have set aside enough money for their retirement. The Department of Finance has examined whether families nearing retirement are adequately prepared. About one in four Canadian families approaching retirement, or 1.1 million families, are at risk of not saving enough to maintain their current standard of living, and the risk is highest for middle-class and middle-income families. Families without workplace pension plans are at an even greater risk of under-saving for retirement. In fact, one-third of these families are at risk.

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

There is a particular concern regarding younger Canadians who tend to have higher debt than in previous generations and who, in most cases, will live longer than in previous generations. They face the challenge of securing adequate retirement savings at a time when fewer expect to work in jobs that will include a workplace pension plan. Further, a prolonged period of low interest rates could mean that young workers will face lower returns on their retirement savings, which means that they may need to save even more than in the past.

I am proud to be able to say that we are delivering on our commitment to help Canadians save more for retirement. Working in close collaboration and towards a common purpose with governments across Canada, we reached a historic agreement that would give Canadians a more generous public pension to help them retire with dignity.

The challenge that governments faced in crafting an enhanced CPP was that the current plan was not accumulating benefits quickly enough to meet the future needs of Canadians in a world where workplace pension coverage continues to decline. The enhancement that the Canadian governments have agreed to does 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 roughly $12,000 a year today.

Second, the enhancements would increase by 14%, which is the maximum income range covered by the CPP. This means that, once fully in place, the enhanced CPP would increase the maximum CPP retirement benefit by about 50%. In other words, the current maximum of $13,110 would, in today's dollar terms, increase by nearly $7,000 under the enhanced CPP, bringing the maximum benefit up to almost $20,000. The legislation also includes enrichments to CPP disability and survivor benefits.

For most Canadians, these increased benefits would come from just a 1% increase in their contribution rates. We are also making sure to give individuals and their employers plenty of time to adjust to the modest increase, making sure that it is small and gradual, and it would start in 2019.

Our plan is also fiscally sound. The chief actuary released a report in late October that confirmed that the contribution and benefit levels proposed under the CPP enhancement, agreed by Canada's governments on June 20, would be sustainable for the long term, ensuring that Canadian workers could count on an even stronger, secure CPP for years to come.

What does Bill C-26 mean for Canadians? First and foremost, enhancing the CPP means there will be more money from the CPP waiting for Canadians when they retire. This means they will be able to focus on the things that matter, like spending time with their families, rather than worrying about how to make ends meet. It will mean a reduction in the share of families at risk of not saving enough for retirement, as well as a reduction in the degree to which Canadians are under-saving.

The Department of Finance has estimated that by supporting and ensuring royal assent of Bill C-26, parliamentarians would have the opportunity to reduce the share of families at risk of not having adequate retirement savings by one-quarter, from 24% to 18%, when taking into account income from the three pillars of the retirement income system and savings from other financial and non-financial assets. Therefore, the enhanced CPP builds on the core existing CPP benefits. It does so in a smart, carefully targeted, and effective way that reflects the extensive research that governments brought to the table in crafting this enhancement for the benefit of working Canadians. Taken together, it is a comprehensive package that will increase CPP benefits while striking an appropriate balance between short-term economic considerations and long-term gain.

I would encourage hon. members to support the timely passage of Bill C-26 through the House to help the government increase the confidence of Canadians in their future.

The House resumed from November 28 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--Time Allocation Motion

[Bill Morneau, Liberal, Toronto Centre, ON]

Madam Speaker, I appreciate the question. It is an important one.

We know that we have things we need to do on behalf of Canadians. We came into office with a promise to improve the lives of middle-class Canadians and to improve the lives of those people who want to get into the middle class.

We know that the legislation we are putting forward in Bill C-26 is very important for the long-term health of our country. We cannot move forward on the things we need to move forward on if we do not have a way to manage effectively what we can put forward to Canadians.

Time allocation is the only tool that exists for government to advance legislation when a stalemate exists. We have a duty to ensure that we move forward our legislation.

We have provided eight days of debate so far on this measure. It is completely disingenuous to claim that we have not provided sufficient time for debate on this measure. We believe that it is important for Canadians, and we are looking forward to having a better outcome for Canadians in the future as a result of this measure.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Madam Speaker, I am going to raise a larger concern. We went through ten years, and I know my friends on the Conservative benches may object to my reminding us, when we had a government that did many things the new government promised would not be repeated, including the use of time allocation repeatedly, but also in other areas of public policy.

The changes that were promised are not the changes we are seeing. It seems that 10 years of one style of policy gets us acclimatized to a certain amount of loss of democracy. I had hoped we were hitting the reset button and that we would not see the use of time allocation as frequently in this place.

Between 1914 and 1945, time allocation and shutting down debate was used seven times. While nine times in one year does not seem like a lot, when the previous government used it 100 times in one session of Parliament, the 41st Parliament, it is still against the essence of democracy in this place to shut down debate.

It is true, as the Minister of Finance says, that many parties have had a chance to weigh in on this debate. Members of Parliament in positions such as mine, in parties that are not recognized, those with fewer than 12 members, have not had the opportunity.

There are many questions to be asked about Bill C-26. The bigger question is whether the bar the new government set is to do better than the previous government or to do as well as it promised to do.

[Bill Morneau, Liberal, Toronto Centre, ON]

Madam Speaker, as I mentioned, including today we have had eight days of debate on Bill C-26 at second reading. Again, this has allowed nearly 70 members of Parliament to participate in debate. This represents very significant percentages of both the Conservative members opposite and the New Democratic Party members opposite.

We have been very clear. The government is committed to improving retirement outcomes for Canadians, all Canadians. We are looking to introduce this measure because we know that it will improve the lives of Canadians in the future. It will be an improvement for all Canadians who are able to save in the Canada pension plan. We know that it will bring forth a better outcome in the future.

[Murray Rankin, NDP, Victoria, BC]

Madam Speaker, it is the ninth time that the government brings in guillotine motions like time allocation. It is the third time in a week and a half that it has done this. So much for sunny ways.

The government is well aware of the problems with Bill C-26, a well-intentioned reform bill to fix the Canada pension plan. New Democrats have made many constructive comments, including the fact that this bill discriminates against women, primarily, who take time out to have children, and against people who have disabilities of various sorts.

How is this time allocation motion possibly consistent with the respectful procedures that the government promised in this place and that the Prime Minister was committed to addressing? How does this square with those promises?

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Madam Speaker, my question is this: What is the hurry? We know that Bill C-26 is not going to have any benefit for anybody for 40 years. We know that it certainly will have a bad effect in terms of reducing GDP, killing jobs, and potentially hurting small businesses for the next 30 years. Understanding that it would do nothing to help Canadians today who are struggling in retirement and nothing good would come from it for at least 40 years, why is the government in such a hurry to take money out of the pockets of hard-working Canadians and small businesses?

[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.

[Kamal Khera, Liberal, Parliamentary Secretary to the Minister of Health]

Mr. Speaker, thank you for allowing me to continue my speech on an extremely important piece of legislation.

As I was saying, last week, one of my constituents said to me, “If it is this difficult now, what will I do when I retire and need to live on a fixed income? What will our grandchildren do, and how will they support themselves in their retirement?”

This is a real and growing concern for middle-class Canadians. The cost of living in Canada is rising. The cost of food is increasing, particularly healthy foods. The cost of leasing an apartment is rising. Transportation costs are going up. These trends are expected to continue, and these trends will increasingly burden Canadian families in their retirement years.

As a result of technological advancements, Canadians are living longer and healthier lives. In 1971, a 65-year-old Canadian was expected to live to the age of 79. Today, the expectation has risen to the age 87. The numbers continue to improve, continue to rise. However, this also increases the risk that Canadians will outlive their savings.

Today, 1.1 million Canadian families with major income earners approaching retirement are at risk of not having enough saved for their retirement. This is about a quarter of families approaching retirement. We need to take action to help ensure that this trend does not continue.

Fewer Canadians have access to a workplace pension plan, and even fewer have access to a defined benefit workplace pension plan. In 1981, about 34% of private sector employees had workplace pension plans. Today, this figure is close to 24% and continues to drop.

After working hard for 40 or more years over their lifetimes, Canadians deserve better. A stronger Canada pension plan is a critical priority for middle-class Canadians and those working hard to join it. Our government has developed a responsible, long-term solution to address this issue. The enhancements to the Canada pension plan proposed in Bill C-26 will provide real and meaningful change for all Canadians.

Enhancing the Canada pension plan will give Canadians a larger public pension, helping them retire with dignity. I am proud of our government's hon. Minister of Finance, and all of the Canadian provincial finance ministers, for prioritizing an enhancement to the Canada pension plan, and for reaching a bold and historic agreement to deliver for the benefit of each and every Canadian.

Working Canadians currently receive a pension that is one-quarter of their eligible earnings. This figure could increase to one-third of eligible earnings under the proposed plan. This is a meaningful and significant change. To ensure that our most vulnerable Canadians are not held back by the changes, the working income tax benefit will be increased. The increase in the working income tax benefit will roughly offset the incremental Canada pension plan contribution for low-income workers. Only the contributors who make additional contributions will be able to receive the benefits of the enhancement.

This important feature of our nation's pension plan legislation would ensure that each generation pays for its own benefits and that our Canadian pension plan remains financially sustainable. If the enhanced Canadian pension plan had been implemented in the past, instead of the 24% of families who are approaching retirement being at risk of not having adequate retirement savings, that number would be closer to 18%. This represents a life-changing difference for many hard-working middle-class families who will likely struggle to maintain their standard of living through retirement under the current system.

The proposal would make a meaningful impact for all Canadians. This means more money to put toward living expenses for retirees, more money to put toward housing, more money to put toward food or health services such as prescription drugs, and the list goes on.

Ensuring that Canadians have more money in their pockets at retirement through the proposed Canada pension plan changes would stimulate our economy in perpetuity, creating long-term growth. Canadians have given our government a clear mandate to ensure that all workers have a minimum level of financial security as they retire.

All Canadians deserve to retire with dignity and to have the opportunity to maintain their standard of living in their retirement years. It is our responsibility to support legislation that would have such a meaningful impact on the day-to-day lives of Canadians in their retirement years.

On behalf of the residents of Brampton West, I proudly support the proposed enhancements to the Canada pension plan, and I encourage all parliamentarians to vote in favour of Bill C-26.

The House resumed 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

Motions in amendment

[Kamal Khera, Liberal, Parliamentary Secretary to the Minister of Health]

Madam Speaker, I am honoured to rise in the House today to talk in support of Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act. This is an extremely important piece of legislation that will help millions of hard-working Canadians from coast to coast to coast, including many in my riding of Brampton West.

Opponents who are critical of this legislation often cite the fact that we have hard-working Canadians struggling to make ends meet today. I have residents from my riding calling and meeting with me on a regular basis to express how difficult it has become to support their families. Let me start with a story.

I met a couple with three children from my riding a year ago last November at a coffee shop before my constituency office had even opened. Both parents worked and the father had a second part-time job, yet this family was struggling. They were barely able to feed their children. Unfortunately, their story has become too common in our country. Canadian families that work so hard should not be struggling.

This same family visited me again a couple of months ago in September. They asked me if I could thank our Prime Minister on their behalf. The Canada child benefit that our Prime Minister has championed has taken a huge burden off this family. The increase in the Canada student grants has given this family hope that their children will be able to attend university one day.

This is just one of the many examples of families that have been positively impacted by the reforms our government has introduced to address the urgent issues facing Canadian families.

Short-term stimulus is extremely important. However, to generally serve Canadians our government must deliver for Canadians in the long-term as well. We need to give Canadians hope for their future. We need to ensure that all Canadians are given the opportunity to have a strong, safe, and secure retirement. Ensuring that all Canadians have the support of a pension plan that helps them maintain their standard of living after they retire is essential to achieving this objective.

Canadians value the long-term pension security provided by the Canada pension plan since its inception over 50 years ago by Lester B. Pearson's government. One of the harsh realities of today's economic climate is that it is becoming increasingly difficult for Canadians to plan and save for their retirement years. The cost of living in Canada continues to spike sharply. Retirement savings and the pension plans of Canadians are not keeping pace. The life expectancy of Canadians is going up. As a result, an increasing number of Canadians will be forced to reduce their standard of living in their retirement years.

I have heard these issues loud and clear at the doorsteps, in our town halls, at community events, and in my constituency office. Last week, one of my constituents said that if it is this difficult now, what would he do when he retires and needs to live on a fixed income? What would his grandchildren do? How would they support themselves in their retirement? This is a real and growing concern for middle-class Canadians. As I said, the cost of living in Canada is rising. The cost of food is increasing, particularly healthy foods. The cost of leasing an apartment is increasing. Transportation costs continue to go up. These trends are expected to continue and will increasingly burden Canadian families in their retirement years.

I see that my time is up for now. I will continue my remarks after question period.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Madam Speaker, I was going to rise to ask a question, but it seems that I will be starting my speech now. I would like to say hello to all those Canadians who are watching us right now, especially my constituents in Beauport—Limoilou.

I am very pleased to speak in the House to Bill C-26, regarding the Canada pension plan.

My Conservative colleague from Moose Jaw—Lake Centre—Lanigan spoke just before me. I admire his exemplary oratory skills and aspire to achieve the same some day. He talked about how this bill is typical of this and every Liberal government since the dawn of Canada. In fact, this is about taxing Canadians even more in order to fill the government's coffers to help carry out the Liberal government's agenda.

My colleague also talked about the Liberals' paternalistic approach to everything. All the while, he was able to illustrate with clear and concise definitions that increasing CPP contributions was in fact a tax from an economic and social policy perspective. He described in detail the Liberals' typically paternalistic approach to raising taxes.

That was encouraging to me as I wanted to explain that this bill is typical of this government, one that, despite its claims, has been increasing Canadians' taxes every month since coming to power one year ago.

It cancelled various tax credits that we introduced, such as those for children's sports activities or books and educational items. It refused to move forward with its promise to lower the small business tax, which represents a tax hike. It cancelled the universal child care benefit and replaced it with a benefit that was poorly implemented and that, by 2020, will incur extraordinary costs that were not anticipated. The government did not think of indexation, for example. That is not revenue neutral.

The Liberals have also proposed the Liberal tax on carbon of 11.5¢ a litre, which will soon be implemented. They are also increasing the CPP contribution by $1,000 a year for every employee and every employer. Furthermore, they did not reduce the small business tax. They are also making it more difficult to obtain a mortgage in order to buy a home.

On this side of the House, we understand full well that the exponential growth in real estate prices in places like Vancouver and Toronto is a problem that needs to be addressed. However, the Liberals decided to draft a bill that makes no distinction with respect to the different regions of Canada in order to resolve a problem that is affecting only certain cities.

Bill C-26 is part of a general plan to raise taxes for Canadians. This bill is proof that the Liberals are saying one thing and doing another. For the past year, we have been hearing the Liberals talk about strengthening the middle class, but what we are seeing is that they are imposing more taxes on the middle class and introducing measures that will prevent the middle class from developing as it should.

We could even go so far as to say that the government is using the middle class to achieve its own ends and improve its electoral fortunes three years down the road. The government promised us a modest deficit of $10 billion a year. However, that deficit has now grown to $30 billion because of the government's poor decisions and bad management. To fill its coffers, the government has to raise taxes in all sorts of areas, and that includes the Canada pension plan.

In a nutshell, because of Bill C-26, workers will take home $1,000 less every year and employers and entrepreneurs, the people who lead the way in job creation in Canada, will have to give up another $1,000 per year.

I heard what my Liberal colleague said about seniors working hard all their lives and being entitled to a good Canada pension plan. He was talking about workers who are seniors right now. I stood up to ask him a question. Nowadays, more and more of our seniors keep working after retirement. My father-in-law retired from the Quebec public service a few years ago and is now working part-time. The higher Canada pension plan premium will be deducted from every one of his biweekly paycheques. Moreover, the changes to the Canada pension plan will not come into effect for another 40 years. Many seniors, including anyone who is currently a senior, will not benefit from the higher premiums, which are supposedly intended to reduce poverty among seniors.

I would also like to reiterate what my colleague from Louis-Saint-Laurent was saying a little earlier when he began the debate on Bill C-26. As he explained, what we are seeing right now are two different and opposing political and philosophical outlooks. My colleague from Moose Jaw—Lake Centre—Lanigan provided a good description of the Liberal Party's vision. The Liberals think they know better than Canadians what they should do with their money and how they should use it at the end of the day. That is so paternalistic. It is in this government's DNA. It always thinks it knows better than Canadians what do to about all kinds of things, including how to invest and prepare for a comfortable retirement, if that is possible.

Conversely, we the Conservatives believe that individuals, Canadians themselves, know best what suits them to meet their own needs. That is why, during the 10 years we were in power, we took action and introduced policies that would help return as much money as possible to taxpayers, to maximize the amount of money that would stay in their pockets at the end of the year, as well as maximize the tools available to enable them, in turn, to maximize everything themselves. For instance, I think that the tax-free savings account is an excellent tool. Many people in my immediate family use that measure, as do my neighbours and constituents.

I also want to say that we should look to our ancestors. For example, my great-grandfather built his own retirement nest egg. I am not saying that we should go back to a time when there was no government plan to support those among us who forget to do our due diligence and prepare for old age. However, we must not implement measures that encourage people to neglect their needs and their responsibility to take care of their own retirement. We must always keep in mind the sage advice that our ancestors lived by. In other words, we must create our own nest eggs and ensure that when we reach old age we are able to take care of ourselves as much as possible for as long as possible.

I also think that Bill C-26 reflects two rather different political approaches. I would go so far as to say that my NDP colleagues share this same vision. Currently, every policy from this government is about short-term political gains with a view to re-election in three years, or so they think and want. How many decisions did we make in the past 10 years that were not at all popular? We still went ahead and made them anyway. We were courageous and proud to make those decisions. I am talking about increasing the age of retirement from 65 to 67. That was an extremely courageous and necessary decision. I am sure that I will likely never retire. I will work until I die, as people did for thousands of years. It is too bad.

I wanted to close by saying that one of my hobbies is to watch political debates. I have watched the debates in France, England, and in Germany, and the majority of the western European countries are saying that the age of retirement needs to increase. We said that, but this government is going in the opposite direction. It is very unfortunate.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

Madam Speaker, I am proud to speak to Bill C-26 once again. I am confident in the beneficial impact it will have on the lives of hard-working Canadians.

I like to think of the bill as an investment in our future, an investment to ensure that Canadians who have worked hard all their lives will be able to lead the lives they always wanted when they retire. More importantly, the bill is an investment in young Canadians, an investment in our future generations.

With all nine Canada pension plan participating provinces supporting this investment, it is well known that this investment is indeed necessary. By enhancing the Canada pension plan, we are enabling young Canadians to enter the workforce with confidence, knowing that when it comes time for them to retire, they can do so with a stable pension.

Throughout my first year as a member of Parliament, I have spoken with many young Canadians regarding a wide range of issues. As mentioned in my first speech on the bill, the issue of saving for retirement was consistently brought to my attention throughout these conversations. Even though they may be decades away from retirement, with fewer and fewer employers offering a workplace pension plan, young Canadians are very concerned that they will not have enough when they retire.

A 2016 survey conducted by Franklin Templeton indicated that 70% of young Canadians say that retirement makes them anxious. In a 2016 poll conducted by The Globe and Mail, it was discovered that saving for retirement is the second most pressing concern for young Canadians. Why is this? It is because today's young Canadians have grown up in households where not saving enough for retirement has been a constant fear. These young Canadians see the approximately 1.1 million families currently facing the insurmountable fear of not having enough money saved to maintain their standard of living in retirement, and they take on this fear before entering the workforce.

It could be argued that due to the fact that Canadians are living longer, the fear of not saving enough for retirement is greater for young Canadians than it was for their parents, given that they know they have to save more for longer. It is hard for me to believe that in 2016, in our country, our young adults are facing such concerns. Young Canadians entering the workforce should feel like they have their whole lives in front of them, because in reality, they do. However, currently these young Canadians are faced with the intimidating fear of not having enough money saved for retirement, something they should not worry about until much later in their lives.

According to Statistics Canada, Canadians aged 34 and under currently account for 42.5% of Canada's population, and this is expected to increase over the next 15 to 25 years. This is a significant portion of our population that cannot be ignored. It is for this reason that an enhancement of the Canada pension plan is necessary. Bill C-26 is designed to address and ease their concerns.

When speaking with young Canadians in my riding regarding this issue, I have promised that I would be their advocate here in the House of Commons, and by standing here again in support of the bill, I know I am fulfilling that promise.

Now, switching gears a bit, the members opposite have raised concerns that the bill does not benefit low-income Canadians because of the incremental increases in contributions. I would like to remind the members opposite that the bill would also provide an enhancement to the working income tax benefit, which would provide additional benefits that would ultimately offset the incremental increases in contributions. I would also like to remind them that the contributions to the enhanced portion of the Canada pension plan would be deductible.

I am well aware that the members opposite have brought forward other concerns about the bill, but I want to remind these members that our government was able to work with all nine Canada pension plan participating provinces to come to an agreement on this enhancement. This demonstrates that our government is able to effectively work with the provinces. Therefore, I want to assure the members opposite that no matter what concerns they have, our government is able to work with the provinces to make adjustments and fix any problems that may arise in the future. This is something that will be discussed when the minister meets with the provinces next month.

Like many members in this House, I come from a family that immigrated to Canada. My family, like every other, worked hard and made sacrifices so that their families and future generations would not have to face the same struggles. Ultimately, they made these sacrifices in the hopes that future generations would live better lives than they did.

In keeping with this concept, today many Canadians who have worked hard all their lives are now in their later years and are struggling to make ends meet. Many of their employers did not provide a workplace pension plan, and the current Canada pension plan is not strong or stable enough for them to live comfortably. I can guarantee that the Canadians who are currently facing these struggles do not want future generations to face the same struggles they are currently facing.

This government is working hard to ensure that this does not happen. By working with the provinces to reach an agreement and by being strong advocates during the debates in this House, this government is demonstrating its commitment to providing a better life for our country's future generations. Enhancing the Canada pension plan is an investment in our future, and I hope all members of this House feel the same way.

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Madam Speaker, I thank my hon. colleague for his kind remarks at the outset of his question. From one Blue Jays fan to another, I suppose we will always have some areas of agreement as well as some of disagreement.

My answer to that would be to ask what life his children or my children or grandchildren will have if they do not have jobs. Many small business people have told me that the CPP expansion, even though the government suggests that it is a modest increase, would have an incredibly detrimental effect on their ability to hire more employees.

In fact, when we were on a tour across Canada just recently, we happened to be in Thunder Bay. I went to a restaurant for dinner with one of my colleagues. The restaurant owner, once finding out that I was a member of Parliament, started to engage me in conversation about what the expansion of the CPP premiums would mean to his business. He told my colleague and I, very clearly, that the profit margin was so skinny that with the CPP expansion, he would either have to close his doors or lay off employees. What kind of retirement would he have? What kind of retirement would his employees who might be laid off have?

There are other ways to help Canadians who need assistance plan for retirement. We expanded the GIS. The GIS is targeted to the lowest-income Canadians in this great nation of ours. We expanded it. I believe the Liberal government, to its credit, increased it by about 10%. Things can be done without increasing a job-killing tax, which Bill C-26 most surely is.

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Madam Speaker, my approach, quite frankly, is that I believe in individual freedom. I believe in an individual's right to make his or her own decisions rather than have the government step in and be Big Brother all the time. That is a fundamental distinction that I do not know my colleague opposite truly understands.

In other words, I believe the government is trying to find a solution for which there is no problem. Statistics bear that out. Fewer than 5% of Canadians right now, fewer than 5% of seniors, are living below the poverty line, when 30 years ago it was 30%. More Canadians are saving as they prepare for retirement. They are doing so of their own volition. They are doing so with plans they generate themselves. They are not being told, nor do they want to be told, how to invest and where to invest.

That is why I believe in individual freedom. That is why I believe that Bill C-26 is a flawed piece of legislation.

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Madam Speaker, before I begin my remarks on Bill C-26, let me first offer my personal congratulations to everyone in the Ottawa Redblacks organization for a great Grey Cup victory yesterday. It was one of the more exciting games I have seen. A special shout out to Henry Burris, formerly of the Saskatchewan Rough Riders, who played a fantastic game. If that is the last game he plays in this league, it is a fitting exist. It was a magnificent performance.

I have some comments to make about Bill C-26, and, quite frankly, they are extremely critical.

Let again remind members of the definition of a tax. In essence, that is what is contained in Bill C-26. A tax is defined as “A compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions”.

Let us take that definition and examine what is contained in Bill C-26.

Bill C-26 purports to have CPP premiums increased. Are they going to be increased voluntarily or is it compulsory? It is compulsory. Workers and employers alone have no say in the matter.

Is it levied upon workers' incomes and business profits? Most assuredly, it is. Both employers and employees are going to be forced into paying increased premiums.

Therefore, I would suggest, by anyone's definition, that Bill C-26 is a tax. It is a tax increase. It is a business and payroll tax. This is the worst time in Canadian history to be levying new taxes.

I am not a fan of taxes of any sort at any time. However, in the position we are now in Canada, with a sluggish economy, raising taxes is absolutely incoherent to me. It makes no sense. It takes money out of the pockets of people. It reduces the availability of Canadians to save more money. It reduces the ability of businesses to expand and create new jobs, in fact, just the opposite. I have talked to many small business owners who say that a CPP increase will, in eventuality, force them to either close up shop or lay off employees to try to survive. Neither one of those two options is a good one for small business owners.

The thing I cannot quite understand is why the government is trying to pass Bill C-26 now. Frankly, it is simply not necessary. Empirical evidence backs that up.

The government suggests that Bill C-26 is a way to increase retirement benefits for those Canadians who need it most.

When we take a look at the statistics, we find that less 5% of Canadian seniors are living below the poverty line. We have made great strides over the last decades. Only 30 or 40 years ago close to 30% of Canadians were living on low incomes. It is less than 5% now. Where is the need to increase retirement benefits if Canadians themselves are not living below the poverty line?

Additionally, I would point out that Canadians are saving more money now than they ever have in the past, approximately twice the amount they saved in 1990.

I would argue that all Canadians are aware of the responsibilities that come with planning for retirement. Their financial literacy quotient is increasing, and they are taking steps to prepare themselves for retirement.

Once again, if there is no need, why does the government feel it necessary to increase CPP premiums, to put additional taxes on Canadian businesses and Canadian workers? It does not seem to make much sense.

However, I think we can safely say that the reason the government is doing this is that it is part of its DNA. That is why its members are Liberals. They live to increase taxes. This is just one more example of it.

However, what is truly troubling to me is that this paternalistic approach to saying the government knows best, that it will take care of the retirement needs of people, is not only paternalistic, it is insulting to Canadians. In effect, the government is saying that Canadians do not have the capacity to plan for their own retirement, so the government will do it for them.

I have confidence in Canadians. I have confidence that they can plan for their own retirements and they do not need to be told by any government, let alone the current one, how to go about doing that.

I would point out for members of the chamber that there are more opportunities, more investment and retirement vehicles, in the marketplace now than there ever have been before to assist Canadians in planning for their retirements. I make specific reference to the TFSA, the most important advancement in tax avoidance that we have seen since the advent of RRSPs, a vehicle we introduced when our Conservative government was in power.

The TFSA, currently permeated in the Canadian tax base by about 10 million stakeholders who have TFSAs, allows after-tax dollars to be put into a tax-free savings account. The money generated in that account over years is tax free, and is not taxed when that money is taken out.

We introduced this new innovation several years ago when we were in government. We started with a contribution limit of $5,000 per year, the amount Canadians could put into their TFSAs. A few years later, we increased it to $5,500. Then just before the last election, we increased the contribution limit to $10,500 to allow Canadians to put up to $10,500 a year into tax-free savings accounts to help plan and prepare for their retirements.

What did the Liberal government do? It rolled back the TFSA contribution limit, down to $5,500. In other words, it took away the ability of Canadians to put an addition $5,000 into TFSAs. What was the rationale? The Liberals say that Canadians simply do not have $10,000 kicking around at the end of the year. Therefore, since they would not be able to max out their contributions, the government would reduce their ability to even try.

In other words, the government is saying that Canadians could not afford to contribute to TFSAs. What is its answer? Instead of allowing Canadians the opportunity to voluntarily put money into tax-free savings accounts, the government is forcing Canadians, who apparently cannot afford it, to pay money into a state-run pension plan that is taxable when people withdraw their benefits. Canadian investors have no ability to choose the investment vehicle of their choice.

Nothing makes sense about this whatsoever. If Canadians are going to be forced to save, why not allow them to at least put it in tax-free savings accounts? No, that is not the case. They are being forced to put it in the CPP.

Granted, I believe the pension fund managers of the CPP over the years have done a very good job. However, the point is that, as an individual, I would like to control the investment vehicles myself. I want to choose whether I want to put money into mutual funds, stocks, bonds, or other investments, rather than someone telling me what I have to invest in and what my rate of return will be.

Once again, this seems to be a pattern with the government. It has the attitude that government knows best. We have seen this before. The insult to Canadians is that Liberals do not believe Canadians are bright enough to choose wisely with their investment accounts. They believe the government is smarter than Canadian taxpayers.

We can all recall, just a few short years ago, during the federal election campaign, when the Conservative government introduced the universal child care benefit. The chief of staff of the prime minister of the day, Paul Martin, went on television and said that it was a bad idea because if the government gave money directly to parents and let them choose how to raise their children, they would blow it all on beer and popcorn. That is the attitude the current government has. It is paternalistic, it is condescending, and it is insulting. That is why, on this side of the House, we will oppose Bill C-26.

The basic difference between Conservatives and Liberals is this. As Conservatives, we believe in lower taxes, balanced budgets, and smaller governments. The Liberals believe in higher taxes, deficit spending, and much larger governments. Eventually, Canadians will see the light and that is why, on this side of the House, we will be opposing Bill C-26, and opposing it with vigour.

[Salma Zahid, Liberal, Scarborough Centre, ON]

Madam Speaker, we are proud of Bill C-26, the agreement reached with the provinces, to reform the Canada pension plan and improve retirement outcomes for all Canadians, including women and those with disabilities. I agree with the hon. member that more can, and should, be done with respect to dropout provisions for disability and child bearing. I would note though that such changes will require agreement with the provinces. I understand the finance minister will raise this issue with provincial and territorial colleagues in December. I look forward to the results of those discussions.

[Salma Zahid, Liberal, Scarborough Centre, ON]

Madam Speaker, it is a privilege to rise in the House today in support of Bill C-26. This is a piece of legislation that would bring peace of mind to millions of Canadians, many of them my constituents, who are worried about their retirement.

With Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, our government is fulfilling its campaign commitment to reform and enhance the Canada pension plan and help Canadians who are having trouble saving for their retirement.

The CPP is a Canadian success story and it is the right way to help Canadians save for retirement in a world that is very different from that of our parents and our grandparents.

There was a time when Canadians would work for one company all of their life and then retire comfortably with a gold watch and a defined benefit pension plan. Complemented by the Canada pension plan, they could be assured of a comfortable and dignified retirement but sadly, those days are no more. They are over.

It is very rare today to find a defined benefit pension plan outside of the public service. Today, due to costs and risks, most companies have moved to a defined contribution pension plan, which shifts the investment risk to the employee and that is if one is lucky enough to be working for a company that offers any kind of pension at all. According to Statistics Canada, in 2014 only 37.9% of employees had a pension plan and that number was trending down.

Then there is the changing nature of work today. A 2014 Workopolis study found that if current trends continue, average Canadians can expect to hold roughly 15 jobs in their careers. Indeed, 51% of people now stay in any one role for less than two years. Some of this is by choice, but some is also by necessity. Contract work is increasingly prevalent and employees are often seeking new challenges and new opportunities.

In short, Canadians can no longer rely on the traditional retirement savings methods. The onus has now shifted to employees, but the data makes it clear that Canadians are having difficulty with this new responsibility.

A report earlier this year from the Broadbent Institute found that only 47% of those aged 55 to 64 have no accrued employer pension benefits and the vast majority are retiring with inadequate retirement savings. Just half have savings that represent less than one year's worth of the resources they need to supplement old age security and the Canada pension plan, and fewer than 20% have the resources needed for five years of retirement.

According to the report, just 15% to 20% of middle-income Canadians retiring without an employer pension plan have saved anywhere near enough for their retirement. Without action, this means seniors are forced to continue working whether their health allows it or not, or are living their retirement in poverty. No Canadian seniors who have worked hard all their lives deserve to retire in poverty.

I understand why Canadians are having difficulty saving for retirement because I have been there myself. First, my husband and I saved to purchase a home in Scarborough, in the expensive greater Toronto housing market. At the same time, we set aside what money we could to put into a registered education savings plan for our two boys to save for their educations. Our first son started at Ryerson University this fall and our second son is not far behind. All along, my husband and I changed jobs and employers two times and have not had the benefit of an employer pension or savings plans.

I am privileged now as a member of Parliament to have access to an employer pension plan. While I can now worry less about my retirement, millions of Canadians are not as lucky as we are, and many of my constituents are not as lucky. I regularly knock on doors in my riding of Scarborough Centre to stay connected to the concerns of my constituents, and many of them tell me that they are worried about their retirement. For many Canadians, this is one of the most important things on their mind.

Canadians are justly proud of the Canada pension plan. Like our public health care and the Canada child benefit, it is one of those things that helps to define Canada.

It has been a long time, since 1965, when the Liberal government of Prime Minister Lester B. Pearson first established the Canada pension plan. As I have said, we live in a very different world than we did back in 1965, and Canadians face a very different retirement scenario today.

If we are to help Canadians save for their retirement and ensure that our retiring seniors do not slip into poverty, we need an enhanced Canada pension plan. With its efficient administration and strong performance, the Canada pension plan is the right vehicle to use as we seek to provide enhanced retirement savings for Canadians.

With Bill C-26, we would increase the maximum level of pensionable earnings by 14% by 2025. By increasing the amount of retirement pension, as well as the survivor and disability pensions, and the post-retirement fund, we are keeping our commitment of helping Canadians secure a strong, secure, and stable retirement.

We recognize that there will be an impact on both employees and employers, which is why the changes are being phased in gradually over the next seven years, from 2019 to 2025, for these needed investments. Canadians are investing in themselves and in their future. By investing in their employees, businesses will benefit as well. An employee who does not need to worry about their retirement is an employee who is happier and more productive for their employer.

Canadians deserve to retire with dignity. Today, 1.1 million families nearing retirement are facing a drop in their standard of living, but they will be able to retire with dignity when these reforms are fully in place.

Pension reform is an issue that needs national leadership. For years, as the provinces called out for federal leadership to address this growing problem, the previous government stayed silent, while everyday Canadians retired without enough savings to live comfortably.

I am proud to be part of a government that is prepared to lead and make some difficult choices. This is what leadership is about. The finance minister has worked closely with his provincial counterparts to reach an agreement that critics said was impossible.

We do not need to worry about our retirement in this place, but the millions of Canadians we represent do. This bill is for them, and I am proud to support it.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, my colleague is asking me if I think we should now just pass Bill C-26 the way it is and hope for something in the future. My question back is: Why was this omitted to begin with? That is the whole problem.

I do not understand what the Liberals are asking. They are doing such a great job for one group of Canadians and not including all Canadians. It is the same thing that happened with their tax deduction. They forgot the group. Why was this omitted? You should make sure it is fixed.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, I am really surprised at that question. Actually, I am shocked. The Liberals brought in a bill, Bill C-26, that was supposed to enhance the CPP benefits for other people. We know it had to be fixed. They brought in a certain portion of it for one group of Canadians only, and omitted another group of Canadians. It is insulting.

The Liberals knew about it. They had time to fix it. Now they want to blame it on the provinces for not being there and hoping they will be in the future. Fix the bill now.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, on October 6, the current government introduced a flawed bill in the House of Commons, Bill C-26. It did so while being fully aware of the bill's shortcomings. It did so with full knowledge that women and people living with disabilities would be negatively affected. That the bill would omit dropout provisions already in the Canada pension plan to protect women and people living with disabilities seemed to matter very little. Getting a deal done quickly, the PR, and the photo-op were more important. Looking good was more important. Sadly, looking good is more important to the government than sound public policy that protects the rights and needs of all Canadians.

Removing the dropout provision from the CPP was a surprise to many experts who have been working on a pension reform for many years. While testifying at committee, I asked Mark Janson, a pension expert from CUPE national, if he or his union had any indication that the child-rearing or disability dropouts were on the table for CPP expansion. In reply, Mr. Janson said:

...it was a surprise to us to see they were not included. The signed document the finance ministers put out in June and the backgrounder they produced at the time said nothing about this, so it was only when we saw the legislation. During the years of talks we had not heard that this was an item to be discussed and perhaps changed.

When I asked Mr. Hassan Yussuff, president of the Canadian Labour Congress, about the government's plan to omit the dropout provisions, he was very straightforward. He said:

[The] committee has a direct responsibility to amend the bill to fix that problem. This is an affront to women's equality in this country, and it is simply wrong. It was corrected in 1997, and we have no business going back and taking that away from women and people who get disability benefits. However, the department came up with a draft. They've made a fundamental mistake, in my view, and it needs to be fixed. This committee has the responsibility to fix that.

More than half the workforce today is represented by women. To tell them that they are not going to be treated equally as men in the workforce is wrong and this committee has a responsibility. Equally, the department should come back to say that it made a mistake. This will do very little, I think, in terms of the premium increase. It disadvantages two very important groups in this country, and in my view, it was never discussed during the enhancement.

It's fundamentally wrong and given what the government has said about women's equality, I don't think this was intended. It needs to be fixed.

It did not take the NDP long to discover the flaws. At first we wondered if the omission of these critical provisions was an oversight or done on purpose. How could the government leave out provisions designed to protect the well-being of such a large number of Canadians? How could the government leave out provisions originally put into the CPP by the Prime Minister's father after he discovered a major hole in the legislation? We thought that for sure the omission had to be a mistake. However, we have come to find out that it was no mistake at all. We have learned that in the haste to get a deal with the provinces in June, the current government was willing to throw the rights of women and those living with disabilities under the bus. It was a shameful move and, now that they have been exposed, the Liberals should feel ashamed and fix the bill.

I know that many members on the other side of this House realize the government made a mistake. I watch them look down and squirm uncomfortably any time that we raise the deceit in this House or at committee. However, even when they have been exposed and their mistakes are laid bare, the government and all its members still refuse to commit to fixing the bill. Many times, my colleagues and I have stood in this House and asked if the government would fix its flawed bill. For days on end, all we got back were disdain and non-answers. Not one member on the other side of this House would even admit that the bill would trample on the rights of vulnerable Canadians.

We were challenged to take our concerns to committee, so we did. The New Democrats studied the bill and we figured out how to fix it. We developed the language and the clauses needed in the bill to fix the government's mistake. In good faith, we went to committee. We listened to the witnesses, some of whom supported the bill, and some who did not. Many witnesses recognized the flaw in the legislation and urged the committee to put the dropout provisions into the bill.

During the clause-by-clause consideration of the bill, I presented amendments to fix the legislation. My two amendments were all that were needed to put the dropout positions back into the bill. There were two amendments that would restore the protection for women and those living with disability. However, my amendments were ruled out of order. The only way to fix the bill would be to come back to the House and have the minister make the appropriate amendments at that time.

I moved the motion to have the committee consider making these recommendations to the House of Commons. What happened next was shocking and disheartening. The Liberal members on the committee resorted to the lowest form of procedural manoeuvring, and moved and passed the motion to adjourn debate. That meant that a motion to consider fixing the bill could not even be debated or discussed, never mind actually voted on. I could not believe it. It was a clear that a heavy-handed whip had been used. So much for the government of sunny ways, free votes, and the best intentions. It is clear that Canadians who voted for change are receiving nothing but chump change.

A few days later, I was able to bring my motion back to the committee. Again, the Liberal members of the committee proved very clearly that they were not serious about fixing the bill. Instead of even debating my motion, they used another procedural manoeuvre, which guaranteed no immediate fix for the bill. It was shameful and disappointing.

I have mentioned what happened at committee because I want Canadians to know, and I want my constituents to know, that things do not always happen here in Ottawa the way that we think they should. The government had a very easy way of fixing a major flaw in a bill it introduced, a flaw that could affect 14 million Canadian workers. It chose not to. We in the NDP now find ourselves in an awkward position. We plan on supporting the bill, but we are very concerned about whether the CPP will ever be fixed and the necessary dropout provisions included in the legislation.

So far, we have heard from the President of the Treasury Board, who said:

We are aware that more could be done in respect of the dropout provisions for disability and child rearing and, in fact, the Minister of Finance will raise these provisions at the next meeting of provincial and territorial finance ministers in December in the context of a triennial review of the CPP.

The Parliamentary Secretary to the Minister of Finance said:

Our intent is to pass the bill, as is; however, the Minister of Finance will then raise the dropout provisions at the next provincial and territorial finance ministers' meeting in December, in the context of the triennial review of the Canada pension plan.

In my view, these are both weak and non-committal statements. We have heard nothing from the Minister of Finance himself. Is he committed to fixing the legislation? Is he committed to making sure that women and those living with disabilities are not victimized for the mistake in Bill C-26?

No one knows for sure. I am not optimistic. I will believe it when I see it.

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

Madam Speaker, the member is all wrong. First, we are attacking Bill C-26 because it is a tax increase, not the principle of the CPP. We do support the principle. The reality is that it will cost people billions of dollars more, as the Liberal government will pick 1,000 bucks from the pockets of people. This is totally unacceptable.

Second, when he talks about the fact we decided to raise the age of eligibility to 67, that was the real thing to do. We had the courage to do that and we are proud of it. Why? It is because it would otherwise cost the Canadian economy $11 billion by 2030. That is a shame.

He talked about the fact he was elected under the promise of an increased CPP. Let me remind him that he was also elected with the promise of a small deficit of $10 billion. It is three times that amount. Shame on him.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, the member across the way is quite wrong in his assessment.

First, the member needs to realize that the Liberal Party platform recognized that what Stephen Harper did when he was prime minister and decided, when overseas, to increase the age of retirement from 65 to 67 was just wrong. Canadians knew it was wrong. We could afford it. Parliamentary secretaries and others knew it was a bad policy decision. This government has reversed that Harper decision. We are saying that people should be able to collect OAS at 65. This is a positive.

With reference to the bill itself, there is a clear difference. This is a government that understands that we also have to think of future generations, for those who are in the workplace today, and who are retiring. We want to make sure that they have money in a retirement plan through the CPP.

From listening to the debate, one could conclude that the Conservatives, on the other hand, do not support the CPP. Would the member not recognize that the very same arguments the Conservatives are using today to say no to Bill C-26 could have been used to get rid of the CPP in the first place?

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

Madam Speaker, before I get into the substance of the debate, I would like to draw the members' attention to the fact that I am wearing the prostate cancer tie. As members are aware, November is also known as “Movember”, a month dedicated to raising awareness about prostate cancer.

Quebec has had a wonderful initiative in place since 2010 to support the Fondation du CHU de Québec, which works on prostate cancer research and prevention. Since 2010, a tie has been available for purchase for men to wear to show their support, which is what I am doing today.

This tie is a Surmesur boutique signature design, and this initiative is supported by Pierre Jobin, TVA's new anchor. I applaud him for his involvement, and I want to thank everyone in Quebec for wearing the tie for prostate cancer.

We are here today to talk about Bill C-26, and you tabled all the amendments that we Conservatives proposed, with the support of my colleague, the member for Central Okanagan—Similkameen—Nicola.

I want to pay my respects to you, Madam Speaker, because I have never heard my name so many times in such a short time. I am quite sure that my parents are very proud of that.

We are talking today about the Canada pension plan. It is crystal clear, because there is a huge difference between the vision of the government and our vision. The vision of the government is to pick up more money from the pockets of the people, to pick up more money from the pockets of business owners and essentially those who create wealth and create jobs, whereas our view is to give more tools to people to make their own choices on what they believe is important and to give them the tools to put money aside for retirement.

That is why we object so strongly to Bill C-26. Our parties have two opposing views. At least that much is clear. In politics, sometimes we find some good points in things that we must nevertheless oppose, and vice versa. Sometimes we find that kind of balance in politics.

In this instance, the matter is crystal clear. On the one hand, there is the Liberal vision, which involves taking more money out of Canadians' pockets. On the other hand, there is our vision, which, in contrast, involves giving people tools that enable them to make their own choices regarding saving for retirement based on their own priorities, their income, and their way of life.

Bill C-26 essentially seeks to increase the contributions that workers currently make to CPP. We are currently being taxed roughly 9.9% and the bill would increase that rate to 11.9%.

In other words, this means that the average worker will pay up to $1,000 more a year. For business owners, this means an extra $1,000 per employee. That is why we believe this is not the right thing to do. The government picking taxpayers' pockets and charging business owners more money is bad for the economy. We will have the opportunity to come back to this with some serious statistics to show the consequences.

For seniors, this bill does not change anything. They will not get a penny more and that is a fact. The other thing is that we will have to wait not two, five, 10, or 20 years, but 40 years before this measure takes effect. At the risk of being ageist, I have to say that many of my colleagues will no longer be here in 40 years. I am 52 now, which means I will be 92. I have good genes. My parents are 92 and 93 and in good health. I might be lucky, but one never knows.

People will have to wait 40 years, or two generations, before there is a direct, tangible, and real impact. That is a long time. While they wait, workers and business people will pay even more, which is not a good thing.

We recognize that there are still some seniors living on low incomes today; however, the situation has greatly improved. In 1970, about one in three retirees were living on a low income, compared to 3% today. That is quite the improvement and it is due to the personal savings measures that we established.

The amount saved by Canadians is an important factor. The best way to improve our situation is to save, and Canadians have saved more over the years. In 1990, people saved 7.7% of their income, whereas today they save about twice as much, or 14.1%.

There have been two improvements over the years: the improvement in the situation of seniors and the increase in Canadians' savings. That is why we, the Conservatives, want to move in that direction. We want to provide Canadians with stronger, more responsive, more pertinent, and more effective tools that enable individuals to make their own decisions, according to their conscience, and based on their priorities, income, and choices that suit them. The government must provide savings tools rather than taking more money out of people's pockets.

This bill will be detrimental to the economy. We, the Conservatives, are not the ones saying so. I am pointing this out today, but I am basing what I say on the conclusions of the Department of Finance, which found in a study that this would negatively impact all vectors of the economy. It forecasts reductions in employment, GDP, private investment, disposable income, and personal savings. Those would be the results of Bill C-26.

Baseball players get three strikes and then they are out. This bill has five strikes against Canadians and the country's economy. Not only does this bill take $1,000 out of people's pockets and charge business owners $1,000 more per employee, it also affects the five key drivers of job creation, savings, and wealth.

We find that unacceptable. That is why we strongly oppose Bill C-26 and why we introduced 69 amendments to eliminate 69 clauses. It makes sense. The amendments that were read earlier show our fierce opposition to every hyphen, semicolon, and letter that do not belong in this bill.

Now let us talk about some things that are quite interesting and important about the future, which is the retirement age.

As members know, people's health has improved. When Canada decided to implement the Canada pension plan a few decades ago in the 1960s, the reality was not the same as today. In the 1960s, the life expectancy of men was 68, but today it is 79. It is 11 years more than when the Canada pension plan was tabled. It is along the same track for women, whose life expectancy in the 1960s was 74 and today is 83. Therefore, the health of people is better and people live longer.

However, the government decided a month ago to cancel the previous government's decision to raise the retirement age from 65 to 67 and return it to 65. This was one of the worst economic decisions made by the current government. There are so many bad decisions, but one of the worst for its long-term effects is its change to the retirement age.

In 2012, when the previous Conservative government addressed this issue, for sure it was very courageous in addressing what was a very difficult issue, and for sure realistic and responsible, because it was the right thing to do and we did it with pride. Unfortunately, the current government has failed to recognize the reality of that. This is why today it will cost Canada billions of dollars more. The current government has failed to recognize the reality of the fact that people live longer, and with that, we can achieve so much more.

Given the current circumstances, lowering the age of retirement from 67 to 65 is one of the worst decisions this government has made.

In 2012, the Conservative government made a courageous decision that was not easy to explain to Canadians. However, we made it with honour and dignity because it was realistic and extremely important for Canada's economic future. Unfortunately, this government decided to reverse that decision and change the age of retirement from 67 back to 65.

That does not make any sense, particularly when we take into account the fact that there is a longer life expectancy. When the Canada pension plan was designed in the 1960s, life expectancy was 68 years for men and 74 years for women. Today, the life expectancy of men is 79, while women can expect to live to 83.

Since Canadians have a longer life expectancy and are in better health, they can continue to work longer. However, this government decided to bring the age of retirement back to 65.

The sad part is that this was not an easy thing for the Conservatives to do. We recognize that. It was a politically difficult decision to make. However, that was what had to be done, and the measure was implemented. It became a fait accompli, and the public accepted that decision.

However, now, the government is reversing that decision, which is sad because it will have a major impact on the rest of the economy.

The House proceeded to the 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.

Canada Business Corporations Act

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, a number of Conservatives have stood up and made reference to the legislative workload. We can talk about Bill C-2, the middle class tax cut; Bill C-26, a negotiated agreement where we have seen significant agreement across the country among different provinces and territories; and things like medical assistance in dying.

Right now we are debating Bill C-25, a bill for which the Conservative Party wants to assume the credit, saying that it is, in essence, a Conservative bill. If it is a Conservative bill and we are trying to move things along, why would the Conservatives not allow it to continue through the process?

Pensions

[Scott Duvall, NDP, Hamilton Mountain, ON]

Mr. Speaker, for two weeks now, the NDP has been asking the Liberals to fix their flawed CPP expansion bill, Bill C-26.

After refusing to address it last night, Liberal MPs once again prevented us from fixing it.

The Liberals also refused to answer why the dropout provisions were not included in the first place. Did the minister not realize the impact this would have on women and people living with disabilities?

If the Liberal government truly recognizes this problem, then why is it forcing through a flawed bill?

[Kelly McCauley, Conservative, Edmonton West, AB]

Thanks, Mr. Chair.

I appreciate the comments, and I appreciate your desire to push ahead with it. I do have to agree with my colleagues. I was very pleased to sit with Mr. Duvall and get to know him on the Canada Post tour, and I have a lot of respect for him. Although we don't necessarily share the same political views, I very much believe that he shares with all of us in this room a desire to help Canadians. I watched him stand again and again, and ask for hours on end in the House about this adjustment that they'd like to see made. I think we can say very clearly that we didn't get a clear answer back. We just heard, “You hate CPP, if you don't support us”.

I'm very disappointed that we can sit here, and every time we bring forth something you disagree with, we get lobbed at us, “Oh, you hate CPP”. I think when I spoke about this bill, one of the members stood up and said, “Why do you hate CPP? You'd like to destroy it altogether”. We're not going to get any further forward if every time we have a disagreement with something, one side, instead of agreeing to discuss it, immediately sets out to destroy it.

I also pointed out you used the words, “I think it's rich” that we want to discuss it. I will use these exact same words. Just last week, we had a private member's bill in the House supported by financial agencies, think tanks, and also the Canadian Association of Retired Persons, which would help every single senior today, not 40 years down the road when this bill suggests and not some fantasy that the OAS is going to change tomorrow, which this government seemed to be peddling. Without even getting a chance to discuss it, members of your government, one of them right here, stood up and said, “We will not support it”. The NDP would support it. CARP supports it. Without even, as the NDP was saying, pleading, letting it get to discussion, your government arbitrarily, for partisan reasons, said, “Hey, let's just throw it down.”

Again, it's very rich for your folks to say, “We're the only defenders of the handicapped. We're the only defenders of CPP.” It's very disingenuous and it does all of us a disservice, when we're elected to be here to support and represent all Canadians, to sit there and try to shout down opposition or gut someone's amendment on the suggestion that you're the only defenders of CPP. I think it's very wrong and against democracy.

I just do not understand the purpose of not allowing his motion to stand for a vote or your having to gut it. I think it's very incorrect.

Getting back to the CPP thing, we very much care for seniors. I was the head of a foundation for six hospitals for the elderly in a past life, which is why I put through the very important and very widely supported private member's bill to assist all seniors, which I hope the Liberals will have a change of heart with and support for all seniors.

The reason we did not support Bill C-26 fully—

[Scott Duvall, NDP, Hamilton Mountain, ON]

Thanks, Mr. Chair.

First, I don't know why this came in the way it did. It's not even in both official languages, and I don't even know why we're accepting it.

Second, I'm very happy to hear the Liberal statement that they applaud some of these recommendations coming forward, and now all we're doing is putting the pressure back on the provinces to make a decision that we, in Canada...and that's what we got voted to be here for. You made proposals in Bill C-26, and that was doing an enhancement. We appreciate that, but there is a clause that we omitted and it's very important and critical, and the government in 1977 knew of that problem and they corrected it. They didn't go back to the provinces. They made that change, so why are we doing this, or prolonging it, and saying, let's leave the pressure on the provinces?

All we're asking for is a recommendation from this committee to go back to the report stage. That's all we're asking, that we recommend that this be amended in Bill C-26. That will happen, but to put all this other fancy little language in there, and prolonging it, is kind of embarrassing.

I'm hoping that the Liberals over there, my good friends, will support the motion of doing the committee work that we're supposed to be here to do and not put it onto the provinces.

Thank you.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Thank you.

I strongly disagree with this. I think it's our job to be doing the work for Canadians that we're supposed to do.

On Bill C-26, the proposal, we've all heard...and even many Liberals have said that it was a mistake and they'd like to see it back in there. This is basically saying, “On the condition of whatever happens at the territorial and provincial meetings”. I believe the committee has heard the witnesses who came here very strongly.

All I'm asking for is that this committee recommend at the report stage to see if the minister would like to change it then, or add something else, but it's only at the report stage. That's all we're doing. It shows that we're working together and we're working for Canadians to make sure nobody is excluded.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Thank you.

I just want to read the motion out again to remind everybody. The motion read:

That the Finance Committee make a report to the House recommending that the government amend Bill C-26 at report stage in order to include child rearing and disability drop out provisions like those present in the existing CPP.

I'd like to talk to it, Mr. Chair.

This is a critical piece of legislation that we have found has been omitted in the enhancement part of the Canadian Pension Plan proposal on Bill C-26. We have heard from witnesses many times that this should not happen, that it's an inequity considering the existing CPP.

The Liberal government back in 1977 saw the inequity in that and changed the actual legislation to make sure that people raising their children and people with disabilities were not being penalized.

It's very important that this committee work together. I believe that everybody agrees that these people shouldn't be omitted and that we move forward with a recommendation from this committee at the report stage. That's all we're basically asking. I ask all my friends in here to support this because, as each day goes on, people are getting very concerned that it's not part of the legislation.

Thank you, Mr. Chair.

Business of the House

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, this afternoon we will continue second reading debate of Bill C-18, the Rouge National Urban Park legislation. The other bills on the agenda for today and tomorrow will be Bill C-25, the business framework legislation, and Bill C-30 regarding CETA. It is my hope that we can complete second reading debate on all these important bills by tomorrow afternoon if at all possible.

Next week, we will commence debate at report stage and third reading of Bill C-26 concerning the Canada pension plan. We will call this bill on Monday, Tuesday, and Wednesday.

Finally, next Thursday, December 1 shall be the last allotted day for this supply cycle.

Canada Pension Plan

[Cheryl Hardcastle, NDP, Windsor—Tecumseh, ON]

Mr. Speaker, I rise today to express my profound disappointment with the Liberal government's unwillingness to fix its CPP enhancement legislation, Bill C-26, so that Canadians are not punished for being on a CPP disability pension or for taking time off to raise a child.

For reasons that are not entirely clear, so-called dropout provisions have not been included in Bill C-26. NDP amendments to fix this oversight were rejected by the government yesterday. These dropout provisions have been part of CPP since 1976. Essentially, the government is stacking on a layer, or tranche, to expand benefits. Women and people living with disabilities are going to be penalized because this new tranche will not have the same dropout provisions as the existing one.

These provisions have been excluded from the legislation, but we must not give up on other measures in the very near future to fix this injustice.

The minister must commit today to undertake due diligence and consult with each province and territory—

Finance

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I have the honour to present, in both official languages, the seventh report of the Standing Committee on Finance 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.

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

[Scott Duvall, NDP, Hamilton Mountain, ON]

Yes: that the finance committee make a report to the House recommending that the government amend Bill C-26 at report stage in order to include child-rearing and disability drop-out provisions like those present in the existing CPP.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Yes. Given that my amendments were ruled out of order, I would like to move the following motion: that the finance committee make a report to the House recommending that the government amend Bill C-26 at report stage in order to include child-rearing and disability drop-out provisions like those present in the existing CPP.

[The Chair, Liberal, Wayne Easter]

That completes Bill C-26.

Mr. Duvall, you had a motion.

[The Chair, Liberal, Wayne Easter]

Okay. People do have copies of the amendment.

I have a ruling on this particular amendment, Mr. Duvall.

The amendment seeks to amend Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act. The amendment would result in an increase in the value of the benefit in question. Therefore, as House of Commons Procedure and Practice, Second Edition, states on pages 767 and 768:

Since an amendment may not infringe upon the financial initiative of the Crown, it is inadmissible if it imposes a charge on the public treasury, or if it extends the objects or purposes or relaxes the conditions and qualifications specified in the royal recommendation.

In the opinion of the chair, the amendment proposes to increase the value of the benefit, which could impose an additional charge on the public treasury, and therefore I must rule the amendment inadmissible.

That's the ruling.

[The Chair, Liberal, Wayne Easter]

Okay. In any event, it's a notice of motion, and it will be scheduled in and debated at the first opportunity after 48 hours.

Turning to Bill C-26, I think everybody has been through this procedure before. There are only two amendments for the bill, which have been proposed by the NDP. One is on clause 22 and the other is on clause 24.

The procedure we can follow is to go clause by clause or, where there are no amendments, we could go from clause 1 to 21. How do you want to proceed? Do you want to go clause by clause or have them in a block?

Mr. Albas.

[The Chair, Liberal, Wayne Easter]

We'll call the meeting to order.

Pursuant to the order of reference of Thursday, November 17, 2016, we're here to deal with Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, in clause-by-clause consideration.

I would just mention a couple of things before we get to that. Officials are in the room. If there are any questions on any clause, officials are willing to come to the table and answer them.

We also have a written response from the Department of Finance on Bill C-26, which we asked for at a previous hearing. That is on your iPads. It just came in.

Pensions

[Scott Duvall, NDP, Hamilton Mountain, ON]

Mr. Speaker, 10 times I stood in the House last week and asked if the government would fix its flawed CPP legislation, Bill C-26. Ten times I received non answers.

Today, I will be introducing my amendment at committee to fix this Liberal flaw that would have serious consequences on the well-being of Canadian women and people living with disabilities.

I have a very simple question for the minister. Will he fix the flaw in the bill by supporting my amendment, yes or no?

[The Chair, Liberal, Wayne Easter]

The problem is that we're under a very tight time frame. Anyway, we'll give that a little thought. I'd love to see what those independent numbers would be.

Committee members, tomorrow we meet in room 112-N for clause-by-clause examination of Bill C-26 and we go until we're done.

Witnesses, thank you very much for your presentations and your responses, and thanks to some of you for coming on short notice.

The meeting is adjourned.

Canada Pension Plan

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

Mr. Speaker, we have all heard the stories that middle-class Canadians are trying to work harder than ever, but they are worried that they will not have enough to put away for this month's bills much less their retirement. Our whole economy, in fact, over the last 15 to 20 years, has been based on consumer spending, and we have run up the credit cards. Therefore, putting that little bit away each month or even in the course of a year for retirement is becoming extremely difficult.

I have to admit that I am not one of the 20% of Canadian families who get 46% of the wealth. The rest of us are left to basically fight over the scraps, and that does not bode well for the future.

We have one in four families approaching retirement, and about 1.1 million families at risk of not having enough. We have heard this loud and clear in our meetings with the constituents, in town halls, and on the doorsteps right across the country. I certainly heard it, and mine is a relatively prosperous riding.

This is why the Government of Canada committed to helping Canadians achieve that goal of a safe, secure, and dignified retirement. It is why we made it a core component of our commitment to work with the provinces and territories to strengthen the CPP, and on June 20, in Vancouver, we delivered. It was a historic occasion. Canada's governments, plural, agreed to enhance the CPP to give Canadians a more generous public pension that would help them retire in dignity.

The definition of dignity came up. What does that mean? Well, it means not having to split one's medications in half or go without. It means not having to choose between keeping the house warm or keeping a good meal on the table.

On behalf of hard-working Canadians, I would like to once again thank our hon. colleague, the Minister of Finance, for his tremendous efforts in advancing this dialogue. The credit also goes to his counterparts in the provinces right across the country who also saw the need, had the vision, and agreed with us that it needed to be done.

Today, we as parliamentarians have a chance to support these quintessentially Canadian values and join their efforts to provide Canadians with a stronger CPP. Canadians have made it clear that they support an enhanced CPP. They did that by an overwhelming majority about a year and a couple of months ago.

The Minister of Finance did a tremendous job, when he introduced the legislation last week in the House, of articulating Canadians' concerns and spelling out precisely how this bill would give them a more generous public pension that would help them retire well. Today, I would like to build on this momentum for a stronger CPP by kind of taking a look under the hood at the enhancements that the CPP changes would bring. When we do this, we are going to see in even greater detail why this agreement is going to be so effective in meeting its objectives and why it merits support.

First, it is a balanced approach on a rock-solid foundation. One of the greatest strengths of this government and this agreement is that it is based on extensive, professional, and rock-solid economic analysis. Central among its assumptions is the premise that families need to have enough in savings set aside to replace about 60% of their pre-retirement income.

This 60% income replacement threshold is fully consistent with the considerable range of empirical literature suggesting an appropriate adequate income replacement rate should be between 50% and 70%, depending on family circumstances. At the top of the range, some suggest that 70% is sufficient to keep the consumption of an average Canadian family in line with that seen over their working years. However, the 70% target is a benchmark typically used in defined benefit pension plans, which are a pretty rare breed these days. It is also often used by retirement planners in providing advice to their clients.

However, we know that retirees typically spend less in their older ages, because they generally buy fewer durable goods like cars, or because of physical limitations. Many households also downsize their homes in retirement and use those proceeds to finance consumption. This implicitly means that a lower pension income replacement rate would be appropriate.

In view of these considerations, the Department of Finance, as well as many academics engaged in studying these issues, believe that using the 60% replacement rate is more appropriate, as it is generally regarded as sufficient to avoid a material drop in the standard of living. Therefore, this carefully targeted, balanced approach is reflected in the legislation we have before us today.

Now, had finance ministers tried to make the enhancements more dramatic, they would have, as the fears expressed by the other side, placed too much of a burden on workers and their employers as a result of the correspondingly higher increases in contributions that a dramatic enhancement would have entailed.

Had the finance ministers not been ambitious enough in targeting the enhancement, the resulting increase in benefits would have been too marginal to effectively support Canadians in reaching their retirement income goals.

As it stands, today's legislation would have a comprehensive package of enhancements that would increase CPP benefits while striking an appropriate balance between short-term economic considerations, long-term gains, and the provision of flexibility in retirement income decision-making.

Let us talk about the balanced approach and the benefits it would bring.

The balanced CPP enhancement contained in Bill C-26 would increase the maximum CPP retirement benefit by almost 50%. To put this in dollar terms, the current maximum benefit is, give or take, $13,000 in today's dollar terms, but the enhanced CPP benefit would represent an increase of nearly $7,000, to a maximum of around $20,000 a year. With this increase, it would meaningfully reduce the share of families at risk of not saving enough for retirement, as well as the degree of under-saving.

The Department of Finance has estimated that the enhancements would reduce the share of families at risk of not having adequate retirement savings by about a quarter. It would take it from 24% to about 18%, when considering income from the three pillars of the retirement income system and savings from other financial and non-financial assets.

For most Canadians, all these increased CPP benefits would come from only a 1% increase in contribution rates.

Moreover, as the finance minister explained last week, it would also include provisions that would help ensure that low-income Canadians are not financially burdened as the result of the extra contributions and, because of its balanced and targeted approach, it would achieve this while also supporting a stronger economy over the long term.

However, above all else, it would mean there would be more money from the CPP waiting for Canadians when they retire, so they would be able to focus on the things that matter, like spending time with their families, rather than worrying about making ends meet.

This outcome is precisely what we had in mind when we began engaging with the provinces to enhance the CPP. With Bill C-26, we are delivering on this promise.

However, how we have achieved this is just as important as what we have achieved.

We have done it by basing our decisions on rock-solid economic analyses and research that draws on the best elements of independent academic literature on retirement savings.

Equipped with this knowledge, we have taken a carefully targeted and balanced approach that would give Canadians more money in retirement without burdening them or the economy. We have given Canadians the flexibility to invest in other discretionary retirement savings as they see fit and, as important, as they are able. We have accomplished all this by working in common purpose with our provincial and territorial governments.

By doing all this, we have shown the power of the fundamental principles of commonwealth and co-operation upon which this country was built.

Today, we have the historic opportunity to act on these principles to build an even stronger country for future generations. With Bill C-26, we have the chance to support the implementation of the agreement that Canada's governments came to on June 20 of this year to enhance the CPP, to give Canadians a more generous public pension that would help them retire in dignity.

I invite members to become part of this history by giving this bill their full support.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Mr. Speaker, this is my first opportunity to speak to Bill C-26. If I am one of the 36 on this side, I am privileged to extend the debate here today in the House.

The Liberal government continues its assault on hard-working Canadian families. If it is not the carbon tax, it is the CPP tax hike from 9.9% to 11.9%.

What does this mean for hard-working Canadian families? It means they will have less money in their pockets today. They will have less money in their pockets to maybe purchase their first home. They will have less money in their pockets to maybe go on a trip this winter. The economy will suffer because of this. This increase, as we all know, could put thousands of jobs at risk.

I will go further on that. It is another tax on small businesses. The Liberals have broken their clear promise to small businesses to proceed with their reduction in the small business tax rate to 9% in 2019. This decision will cost small firms over $900 million per year as of 2019, according to the CFIB. Now businesses will have to pick up the increase in these CPP premiums. Premiums will rise up to $2,200 per worker, split between the employer and the employee. Seventy per cent of small business owners totally disagree that the proposed CPP increase is “modest”, as the government calls it. Ninety per cent of small businesses think it is important to have public consultations before any deal at all is finalized.

The Liberal government talks about being engaged with Canadians. Then why does it not sit down with the business community of this country first before going ahead with this? Yes, it has said before that it has consulted with the territories and the provinces, but perhaps it should first talk to the businesses that will be most affected by this CPP increase.

Even with the low Canadian dollar, the Liberals have generated 20,000 fewer manufacturing jobs in the country. In my province of Saskatchewan alone, we lost 4,000 jobs this August from the same period last year. The trend continued. Six thousand fewer people are working in my province this year than they did the year before. The October numbers are out, and they do not paint a pretty picture. Ten thousand fewer people are working in my province today than they did in 2015.

Our previous government led the way for Canadians to save for their future. Canada's savings rate has climbed, as we all know, from 7.7% of pay back in 1990 to almost double that today, at 14.1%. According to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in 1970 to 3.7% today. That is still too high. We would all love to see it at zero. However, that is still among the lowest rates in the world today. Eighty-three per cent of Canadian households are on track to maintain their current living standards for retirement.

Let us be honest that each and every family has different views on retirement and that this, too, is up to the family.

The TFSA, put in by our previous government, was simply a fantastic tool for investing for retirement, or even for someone today who is one of the 10,000 in my province who were laid off . Many Canadians are enjoying these benefits. We wanted to increase the contribution limit to $10,000, knowing that it would give Canadians an incentive to save for the future, but the Liberal government, as we all know, rejected that idea.

I believe that the CPP tax hike is really an insult to hard-working Canadian families. Our previous Conservative government believed that Canadian families were able to manage their own money. We had confidence. Obviously, the Liberal government does not trust the Canadian family.

What is concerning to me is that in my province of Saskatchewan, since we have had downturn, more than half of the people are on the verge of not paying their bills. A report by Meyers Norris Penny shows that 64% of people in my province are now living within $200 a month of not being able to pay their bills or their debts. The Liberals can talk about the CPP increase starting at $6 a month and increasing to $33 or $43 a month, but think about these families who today are within $200 a month of not meeting their bills. Thirty-four per cent of people in my province say they already do not make enough money to cover their bills and 57% of people are concerned about their current level of debt—again a jump of 14%.

May I remind the Liberals of laid-off workers. Their families are not the only ones hurting. The slowdown has trickled down to everyone in my province, including the retailers, the restaurants, and virtually every business and every sector. This is why the CPP tax would have a major effect on everyone in my province, the 1.2 million who live there.

We all know that the small- and medium-sized businesses drive the healthy economy, but the additional CPP tax on them could have major impacts on their hiring decisions. We have already seen that. In the past year, the Liberals have not created one full-time job in this country. We wonder about this. The millennials in this country are now upset, as they should be, about the sunny ways of the finance minister, who was recently talking about the job turn and saying not to expect any long-term employment at all. We have witnessed massive increases in part-time jobs at the expense of full-time employment. This will further erode the middle class in our country.

Employees have four avenues of retirement. We have pensions, the current CPP, the improved GIS, and the OAS. Plus, let us not forget that we have other assets like inheritance, life insurance, and other financial assets along with the TFSAs. The value of housing has certainly gone up over the last 10 years, more so in Vancouver and Toronto markets, so that when the baby boomers die, their bequests will give many millennials a healthy financial backing.

We have talked about the CPP tax increase. I am going to discuss the carbon tax now because it is another tax on employees and employers.

In my province of Saskatchewan, we have been very vocal about this carbon tax. I am going to invite the politicians in this House to fly over my province, and especially over Buleya, Saskatchewan. On the field, farmers have created circles with the letters c-a-r-b-o-n t-a-x. These farmers have gotten together in their fields and have drawn a circle around those letters and a line through them, saying no to a carbon tax.

I hope all of the farmers in our province do the same for the CPP tax increase. We do not need it in our country at this time. We all want to have money for retirement, and increasing the CPP premium rate from 9.9% to 11.9% starting in 2019 would have a big effect, not only in my city and in my province but also in the entire country.

[Randy Boissonnault, Liberal, Parliamentary Secretary to the Minister of Canadian Heritage]

Mr. Speaker, I rise today to address what has transpired in this House over today and yesterday.

Today would have been the sixth day of debate on Bill C-26, a bill that would help Canadians achieve a secure, safe, and dignified retirement.

The Conservatives have requested more time for debate on the bill. They could have debated the bill today, as scheduled, but instead, they resorted to procedural tactics to obstruct debate and attempt to shut down the House of Commons and go home.

I had hoped for a negotiated consensus, but now we will respond to political manoeuvring from the other side in the Conservative Party, so that such important financial measures that affect all Canadians are brought to a vote.

Disappointingly, it has become clear that the Conservatives would rather focus on these type of tactics than debate substantive issues. As a result of Conservative tactics, six committees were disrupted or cancelled, including the appearance of five ministers and important witnesses scheduled to testify on issues of relevance to Canadians.

This kind of behaviour is exactly what Canadians rejected when they voted for real change a year ago.

Consequently, the Conservatives have left us with very few options in terms of how—

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

Mr. Speaker, I am especially pleased to speak again to an issue that is so important to the future of our seniors, our country, and retirees.

I am referring 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.

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.

Do we need to enhance the CPP? Absolutely. It is essential and I will explain why. Middle-class Canadians work hard, but they still do not feel as though they are getting ahead. One in four families who are approaching the age of retirement, or about 1.1 million families, may not be able to save enough money to maintain their current lifestyle when they retire. We have to take action.

We also have to accept the fact that 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, there is a limit on pensionable earnings. The maximum level of pensionable earnings will go up 14% by 2025. That means that 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 a year. 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 the 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.

Proportionally, my riding, Laurentides—Labelle, has more seniors than almost every other riding in this country. In 2011, the average age was 49.5 years. Seniors' issues are therefore extremely important in my riding. I am acutely aware of retirees' needs. People think my riding is rich because of Mont-Tremblant, but it is not. Workers in my region do not have much money. We need every tool in the toolbox so we can help seniors and future generations and plan for the long term, not just up to the next election.

Personally, I am sick of the government doing all the planning for future generations in just four years. Life does not end in four years. Life goes on. The country and society continue to advance. We will never fix our problems by always thinking only about the next four years. As the indigenous peoples say, we must think of the next seven generations. If we do not, then society will never improve.

I strongly support Bill C-26, because it is an important step in the right direction. It is not a solution to all the problems. A lot of work remains to be done. However, this is one aspect of a plan for the future, for our seniors, and for society in general.

[Eva Nassif, Liberal, Vimy, QC]

Mr. Speaker, I am pleased to speak today to Bill C-26, which seeks to improve the Canada pension plan. This plan is a recognized and effective part of Canada's public retirement income system. Since its inception and implementation in 1965, under the Liberal government of Lester B. Pearson, it has provided contributors who reach the age of eligibility regular retirement income payments in order to help them cover living expenses during retirement, and to guarantee the financial security of hard-working Canadians.

Together with old age security, the CPP provides the foundation for our publicly funded system for retired Canadians that allows people and their families to hold on to their savings while living comfortably, without the insecurity that comes with financial instability.

As all hon. members may know, the Government of Quebec manages its own retirement plan, the Régime de rentes du Québec, which is akin to the Canada pension plan. The improvements that Bill C-26 makes to the Canada pension plan are an investment in the future.

The bill presents a comprehensive plan that will provide an appropriate and realistic increase in benefits for contributors when they become eligible. This will have a positive and lasting impact on the financial security of Canadian retirees in the coming decades.

The proposed enhancement, which will be implemented gradually and through the creation of a new separate account to manage additional funds for retirees, will guarantee a stable and smooth transition, without imposing a financial burden arising from unmanageable financial expectations.

As indicated in the bill, the changes will be administered by the Canada Pension Plan Investment Board, which will have the authority to prepare financial statements concerning the amounts managed, which consist of the additional contributions and increased benefits.

Last year, Statistics Canada announced that the number of seniors in Canada, people aged 65 years and older, had exceeded the number of children aged 0 to 14 years. In fact, on July 1, 2015, seniors represented 16.1% of Canada's population, compared to 16% for young children. There are now about six million seniors in Canada and this number is expected to grow by 50% in the next 21 years.

In my riding of Vimy, which is located in the heart of Laval, Quebec, there is already a large population of seniors. Since the population is aging, it is vital that we improve the existing mechanisms that, to our knowledge, effectively provide the necessary financial assistance in retirement.

We have the data in front of us, and we know which way the wind is blowing. Bill C-26 will gradually improve the existing system to help meet the needs of our aging population.

Some opposition members believe that this is just another tax hike and that there are better retirement savings options available to individuals. To say that this is a tax hike is completely absurd, and while it may not be completely false to say that there are better retirement savings options, that is true only within reasonable limits and under very specific circumstances.

Members of the official opposition talk up the tax-free savings account, saying that it could and should be the main means by which low-income and middle-class Canadian workers save for retirement. According to the Conservatives, the higher the annual TFSA contribution limit, the more low-income and middle-class Canadians will benefit.

Let us be realistic. The previous government increased the TFSA limit to $10,000. Does anyone really believe that low-income or even many middle-class Canadians can afford to contribute that much to their TFSA?

The TFSA is a mechanism that can be used effectively to invest and save depending on a person's income threshold, but make no mistake, the $10,000 limit benefited only Canadians with very high incomes who were able to use their TFSAs to get a tax exemption. The public purse paid the price of that measure.

The people that TFSAs were supposed to help are the very same ones who were forgotten when that ill-considered increase was introduced. It would have been better to properly address income inequality by optimizing and using other mechanisms enabling low- and middle-income Canadians to keep more money in their pockets and enjoy a comfortable retirement.

We have heard people say that low-income taxpayers are able to contribute the maximum to their TFSAs. Does anyone really believe that low-income workers and certain middle-class workers who support themselves can pay all of their bills, eat reasonably well, pay off their debts, and splurge on something every now and then and still deposit $10,000 per year into a savings account? That would be really disingenuous, and it would be a pretty mean thing to do to the people we are trying to help.

There is also the criticism that this would do nothing to help seniors now. This argument is not only missing the point of the legislation entirely, but fails to recognize what the government has already done for seniors, both through enhancements to existing programs and fixing the mistakes from the previous government. The first budget made provisions to restore the age of eligibility to the OAS and enhance the GIS for low-income seniors, again, putting money directly in the pockets of those who need it most.

This legislation does not do anything immediately, because that is not its purpose. We have already made changes for the interim to help offset the rising cost of living for our most vulnerable seniors. Therefore, to say that Bill C-26 would do nothing for seniors now, has very little to do with the nature of this debate to begin with. This is a long-term project that would ensure financial security of our seniors for decades and has nothing to do with other adjustments to social security we have already made. The reality is a significant decline for a large percentage of employees in Canada who had access to a registered pension plan through their jobs. It is the shortfall in middle-income retirement planning that is opening up as a result of disappearing corporate pensions.

CPP reform is designed to address these shortcomings. The current maximum amount of income covered by the CPP is $54,900. An enhanced CPP would see that maximum raised to $82,700 by 2025. It would also raise the annual payout target from 25% of pre-retirement earnings to 33%. For retired Canadians, this could represent thousands of dollars in take home pension income.

With Bill C-26, we are planning for the future. We are ensuring the well-being of retirees whose other savings options were curtailed by the elimination of private employer-sponsored pension plans. We are offsetting the rising cost of living by increasing the pension benefits that Canadians receive from a quarter of their income to a third.

We are preserving a certain standard of living for all families so that everyone can live with dignity in retirement. Most importantly, our affordable and sustainable approach will ensure that today's prosperity lasts.

[Mel Arnold, Conservative, North Okanagan—Shuswap, BC]

Mr. Speaker, I rise 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,

I must say that the bill proposes drastic intervention in the form of increased payroll taxes on every working Canadian in our nation. It is not just Canadian workers who would pay for the bill, but Canadian employers would likewise be required to increase their CPP contributions for each and every employee.

At a time when there are already clouds of uncertainty over our economy and employment insecurity for too many Canadian workers, the Liberal government proposes to take more cash from the pockets and books of Canadian workers and employers.

Why?

Canadian economists, Canadian business owners, and even the Department of Finance have told the Liberal government that this proposed tax hike would hurt Canadians. Analyses from Finance Canada show that this proposed tax hike would reduce employment, which is a nice way of saying it would kill jobs; reduce our national GDP; reduce business investment; reduce Canadians' disposable income; and reduce Canadians' private savings.

The Liberal government's own Department of Finance has warned the government of the harms this bill would inflict upon Canadian workers, Canadian employers, and Canada's economy. Yet, the Liberals want to steamroll this bill through Parliament.

Again, I would ask, why? What is the impetus driving this tax hike? Where is the crisis?

Finance Canada has reported that the median Canadian senior earns 91% as much as the median Canadian, which is well above the OECD average of 84%. A study by McKinsey & Company found that 83% of Canadians are on track to maintain their living standards into retirement. It seems that Canadians are saving for their retirement already. The Liberal government could take a lesson from Canadians who are saving at a rate of 14.1% of their pay, which is a marked increase from the 1990 rate of 7.7%.

Canadians understand the importance of personal responsibility, of living within one's means, and of fiscal prudence. It is too bad the Liberal government cannot achieve these same understandings.

It is my belief that the people are best served by government policy when such policy supports and provides incentives for Canadians to make sound decisions, such as saving for their future.

This is why Conservatives introduced tax-free savings accounts, TFSAs, to support and provide incentives for Canadians to save for their future. Unfortunately, the Liberal government has chosen to reduce the amount that Canadians can save in TFSAs.

This is also why our Conservatives expanded the guaranteed income supplement, or GIS, as a means of reducing the poverty rate among seniors, those who need it the most. It was a logical policy that actually worked.

I do congratulate the Liberal government for following our lead by increasing the GIS rate by a further 10% in budget 2016. I hope I can stand in this House one day and congratulate them for also restoring the contribution limits to TFSAs.

Today, the poverty rate among seniors is reported to be 3.7%, which is a significant decrease from the rate of 29%, in 1970.

As Charles Lammam and Hugh MacIntyre of the Fraser Institute wrote in the Financial Post on June 22:

Instead of expending political energy on debating CPP expansion in the misguided belief that many middle- and upper-income Canadians are not saving enough for retirement, the focus of public debate should be on how best to help financially vulnerable seniors.

I say, do it today. While savings are up and the poverty rate among seniors is down, I believe that governments ought to concern themselves with the responsibility of supporting our seniors who need support today, especially the 3.7% who remain in poverty. Unfortunately, this bill would do little to support these seniors this year, next year, or the year after that.

This bill proposes an increase in CPP benefits and that Canadians wait and wait a little longer, and wait a little longer yet, for the next 40 years. If the prevailing trend is that Canadians are saving more and investing and doing their own planning and strategizing for their futures, why is the government not supporting those responsible decisions? Canadians are speaking with their actions when it comes to planning for their retirement, and this bill before us today would undermine Canadians' ability to plan for their future by saving. The finance department's own analysis projects a 7% reduction in private savings over the long run if higher CPP contributions are imposed upon Canadians.

In 1964, the Liberal minister who was tasked with establishing the CPP, the Hon. Judy LaMarsh, stated that the CPP “is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans.” Who in this House can disagree with that logic?

Allowing Canadians their individual choices seems a natural conclusion, but not for the current Liberal government. The Liberal government remains bent on steamrolling this bill through Parliament and right across every paycheque, every Canadian worker, and the bottom line of every Canadian employer. Canadians are not comfortable with the proposals in this bill. Seventy per cent of employed Canadians oppose a CPP expansion if it means a wage freeze. This begs the question of whether wage freezes could result from this tax hike. According to the Canadian Federation of Independent Business, “Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike”. Also, according to the CFIB, a full 70% of small-business owners disagree with the notion that the proposed CPP increase is modest and would have a limited impact on their businesses. The CFIB also found that 90% of small business owners think it is important to have public consultations before any deal is finalized.

The C.D. Howe Institute has also issued a report showing that the Liberals' CPP proposal would not benefit low-income workers. Low-income workers would see their premiums go up, but the net increase in their retirement benefits would remain low. This is because higher CPP payments would be offset by clawbacks in GIS benefits.

Surveys have shown that over one-third of employed Canadians say that the proposed tax increases are unaffordable. Canadians know that the proposed Liberal hike would hurt them. Moreover, over 80% of Canadians want the government to further consult before making its decision, according to another public survey.

Canadians deserve to be trusted. They deserve the freedom to make their own choices on where and how they will save their hard-earned money for their retirement. Canadians also deserve to be heard on this matter. The current Liberal government seems motivated to launch consultations on everything under their paper sun. Why not consult Canadians on this tax hike?

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

Mr. Speaker, it is a pleasure to rise today to share my enthusiasm for Bill C-26 and the updates being proposed for the Canada pension plan. The ability to have a safe and secure retirement is something that is incredibly important not just to Canadians broadly but to the folks in my riding of Pitt Meadows—Maple Ridge and to me. They are rightly concerned about what retirement will look like for the young people in our communities. This is an issue I hear about from constituents, and there is a wide Canadian consensus that this is a very real issue for millions of Canadians. By taking action now, we are securing a future Canadians can count on.

When the CPP was introduced in 1965 by then Prime Minister Pearson, it took both courage and fortitude to introduce a program that had a long-term, not just a short-term, vision for this nation and its workers. Millions of Canadians today benefit from the Liberal government's bold action at that time. Today we are witnessing the same courage and commitment to the long-term economic prosperity of Canadians by the Minister of Finance, the Prime Minister, and all those in this House who are thinking about Canadians not three or four years from now but in 50 years. I know that the generations to come will look upon this Parliament for its strength and willingness to do the right thing.

Families and workers across this nation have had an overwhelming desire to look to the federal government for national leadership on this issue. For far too long, this leadership has been lacking, and I am proud to stand in this chamber and be part of a government that is listening and responding, not just to the short-term needs of Canadians but for the long-term success of our nation.

Canadians today are working harder than ever to keep up with the financial demands of today's economy and to save for the future. The enhancements to the CPP are part of a comprehensive and multi-dimensional approach our government is taking to invest in Canadians today and for the future. The improvements to the CPP in Bill C-26 will be an investment economically. Perhaps more importantly, when it comes time for Canadians to retire, they can do so with dignity.

I have heard a lot over the last few days about how 85% of Canadians are supposedly ready for retirement. I do not see that in my community. When I talk to seniors in my community, they are struggling. Even with the CPP, the GIS, and the OAS, they are struggling. It is not enough for them today.

Today we are looking to the future. We are looking to make sure that our youth are in a good position. When I knock on doors and meet people in my riding, it is no secret that hard-working families are worried that they and their children will not have enough money set aside for retirement. I have had countless conversations with a wide variety of constituents, and it is clear that this concern is present across all demographics.

Youth in my community are facing many challenges in ensuring that they are saving enough for retirement. Young people understand the reality they face today and in the future. They know that fewer of them will work in jobs that will guarantee a workplace pension, like perhaps most of their parents had. There are a lot of factors, including a shifting economy, a change in culture, and a boost in entrepreneurial spirit.

The reality is that fewer young Canadians in this era can expect to have a single employer throughout their careers, as many once did decades ago. In addition, fewer employers are providing opportunities to save. Studies have found that in 2011, only 11.1% of the workforce was covered by private workplace pension plans, which is down from 28.6% in 1982. At that time, only a quarter of Canadians who earned between $40,000 and $60,000 contributed to RRSPs.

The CPP was established in 1965. I know that members opposite like to joke about what year it is, but it is 2016, and the labour market simply is not what it once was.

The CPP needs to be enhanced to reflect the realities of today and the anticipated changes of tomorrow. It is the responsible thing to do in response to a big challenge facing Canadians today. The enhancements to the CPP are well thought out and responsible. CPP contributions will increase modestly over seven years, starting in 2019, and when fully implemented will significantly reduce the number of families at risk of not saving enough money for retirement.

In my riding, when I talk to my constituents, I ask if they are saving money. From age 20 to age 50-plus , everyone is struggling to save money. Without the CPP we have today, where would our seniors be? It is a struggle already. The enhancements will boost how much Canadians will get from their CPP by increasing the earning range covered by the plan, resulting in an increase of up to 50% in benefits. As a result, these enhancements will increase the maximum CPP benefit by about 50%. The current maximum benefit is $13,110. In 2016 terms, the enhanced CPP represents an increase of nearly $7,000, to a maximum benefit of nearly $20,000. If we look at the children this is going to affect, are they really going to be able to survive on $13,000? Is that where we want to put our children, struggling at that point? We need to do this today for the future.

Numbers aside, there is a reason there is support on both sides of the House and across the nation for enhancement. All the provinces have agreed to do this. It is because it is what Canadians have been calling for. Canadians know that a secure retirement means secure access to healthy food, an ability to afford adequate housing, and the capacity to travel to see their children and grandchildren if need be.

I would also like to emphasize that as a small-business owner myself, all politics aside, I support the enhancements to the CPP outlined in Bill C-26 because it is the right thing to do. Bill C-26 will ensure the financial security of many employees down the line. It will help those who each and every day put their hard work into the success of my business and all businesses. The enhancements to the CPP are being slowly introduced over seven years to reduce the impact on small business.

This is smart policy-making that has rightfully gained the support of many small-business owners like me. When seniors and middle-class families have money, they can spend that money in the local economy. As a small-business owner, and as a member of Parliament and a member of my community, I do not wish to see any seniors living in poverty and without the dignity they deserve. The much-needed enhancements to the CPP proposed in Bill C-26 are something I can be proud of having voted in favour of and something I know will ensure that millions of Canadians have a retirement they deserve down the line.

I want to conclude by acknowledging the leadership our government has shown in making the tough decisions that will benefit Canadians not only today but for generations to come. I think this demonstrates a sincere willingness to think beyond the next election cycle, something the previous Conservative government put before the best interests of Canadians. The enhancements to the CPP are something Canadians have been demanding for years, something the provinces and territories, organizations, think tanks, and workers' representatives have been advocating for.

The time is upon us. I welcome all members to reflect on what it would be like to work an entire lifetime, a lifetime in which every extra dollar has gone to putting healthy food on our family's table, and to wake up in retirement and have to go back to work to put food into our own mouths.

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

Mr. Speaker, I am pleased to rise today to talk to Bill C-26. However, I want to take a few moments to talk procedurally about what is going on today.

My friend opposite had some concerns, but let us ensure we look at the facts. Today would have been the sixth day of debate on Bill C-26, a bill that would help Canadians achieve a secure, safe and dignified retirement.

The Conservative Party had requested more time for debate on the bill. Its members could have debated the bill today as scheduled, but instead resorted to procedural tactics to obstruct debate and attempt to shut down the House of Commons and go home.

Disappointingly, it has become abundantly clear that the Conservatives would rather focus on these types of tactics than substantive debate on this important issue. This kind of behaviour is exactly what Canadians rejected when they voted for real change a year ago. As a result, the Conservatives have left us with few options on how to proceed with this bill. We have an obligation to ensure the legislation is sent to committee for further study, and we will do what it takes to ensure that occurs.

Therefore, it is a pleasure to speak to the enhancements to the CPP found in Bill C-26. Today, middle-class Canadians are working harder than ever, but many are worried they will not have enough money for their retirement.

Each year fewer and fewer Canadians have private pension plans to fall back on.

To address this, we made a commitment to Canadians to strengthen the Canada pension plan in order to help them achieve their goal of a strong, secure, and stable retirement. Earlier this year, Canada's finance ministers reached a historic agreement to make meaningful changes to the CPP, an example of federalism at its best. The more than one-quarter of Canadian families nearing retirement, 1.1 million families, who are facing a drop in their standard of living would be able to retire in dignity as a result of this enhancement. The deal would boost how much Canadians would get from their pension, from one-quarter of their earnings now, to fully one-third. To make sure these changes are affordable, we would phase them in slowly over seven years, from 2019 to 2025, so the impact would be small and gradual.

Every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Through these enhancements, we have taken a powerful step to help make that happen.

It is worthwhile to look back at the CPP and its history. The CPP was first established by the Liberal government of Lester B. Pearson in 1965. It was a minority government. At its creation, there were six and a half workers for every retiree. By the 1990s, projections indicated that there would only be two workers per retiree very soon. By 1996, for these demographic reasons, the CPP payouts were higher than the contributions coming in. Obviously, this was not a sustainable model, and change was required. In 1997, the Canadian government acted to address these demographic changes and created the CPP investment board, the CPPIB.

Responsible governments react to the realities and challenges of the day. Earlier this year, agreement was reached between eight provincial governments and the federal government to enhance the Canada pension plan. The result of that agreement is what is before us in Bill C-26.

Changing demographics is not the only factor that necessitated these enhancements, however. The greatest factor is the effective disappearance of company pension plans. There was a time when nearly half of Canadians could look forward to a regular monthly pension for a defined amount fully supported by their employer.

Unfortunately, these defined benefit pension plans are rapidly becoming a thing of the past. According to Statistics Canada, back in 1971 around 48% of people were covered by a defined benefits plan. By 2011, that number had fallen to nearly half that rate.

These enhancements are designed to address the disappearance of corporate pensions. An aging population, coupled with the evaporation of company pensions, makes enhancements vitally important at this time. Quite frankly, Canada and Canada's economy cannot afford to not make these changes. Importantly, these changes would proceed at a gradual, reasonable pace beginning in 2019 and taking seven years to complete. Additionally, tax breaks would help employees absorb these adjusted pension contribution rates.

All Canadians deserve a strong, secure, and stable retirement. I think all members can agree on this. The new measures, importantly, would help young Canadians. Young Canadians today, like all Canadians, hope to retire with dignity, hope to retire with money to live on, and hope to retire in a stable economic environment. It is these young Canadians whom we must not lose sight of when we consider and debate this bill.

This bill would have long-reaching effects into the mid term and long term. It is important, not just from a social perspective—which it certainly is—to make sure Canadians have a dignified, secure, and stable retirement, but it is equally important from an economic standpoint. Canadians are living longer. There is no doubt about this. Canadians are going to live longer in their retirement years. This trend will continue.

To keep Canada's economy sound, viable, and strong, we need people who have money to afford retirement. People with money, of course, buy things. This consumption is what drives economic growth. As our population ages, if there were a corresponding decrease in the amount of income that they had, thereby resulting in a corresponding decrease in the amount of disposable income, our economy would screech to a halt.

We cannot let this happen. Responsible governments ought not to let this happen. We need to ensure that our economy remains viable well into the future. Of course the CPP has a well-managed, professionally run investment board. Any payouts have to be met with contributions. This is a reasonable amount of contribution that will result in payouts to Canadians.

The CPP will be around for generations to come. If we do not act now, that reality will deteriorate. People will be living on less and less money as they retire. We need to increase the retirement income of Canadians to make sure they have a secure retirement, to make sure they can pay their bills, but also to make sure they can enjoy the retirement they have earned after a lifetime of hard work, after a lifetime of contributing to the great Canadian economy, after a lifetime of raising children, working hard, perhaps putting their kids through school or paying for trade skills training, and after a lifetime of growing our great country.

We look at the CPP and we think of retired people, of course, but I want us to take a step back and also think of the young people this would definitely help well into their future, maybe some of us in this very chamber, maybe our children. We need to make sure Canada and Canadians will be able to retire in dignity, not only today, not only tomorrow, but well into the future.

I can think of no better way to make sure that happens than through these enhancements found in Bill C-26. I urge all my colleagues, for those social reasons and for the economic reasons, to support these changes to the CPP.

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

Mr. Speaker, I can tell my colleague from Mégantic—L'Érable that for 10 years, the middle class felt forgotten by the Government of Canada, and that this change will ensure that people will no longer be forgotten, that the government will help them and it will plan for the future.

I have a question specifically for the hon. member for Mégantic—L'Érable. If he is so concerned that his colleagues will not have the chance to speak to Bill C-26, then why is he speaking to it for the second time? He already spoke to it on October 21. Why is he speaking for the second time if he is concerned that the others will not have the opportunity to speak?

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Eight motions, Mr. Speaker.

I have begun to speak in English. Soon everyone will hear me more and more in English, but not now. I will continue in French, because my speech is in French.

On October 27, 2011, the member for Winnipeg North said:

In recognition of the importance and respect of the chamber, in which we all want to represent our constituents, by not allowing ample opportunity for members of the opposition, even government backbenchers, to provide comment on bills is not a healthy environment. The government House leader has the responsibility to work with and negotiate with House leaders. Time allocation should only be brought in when the government has failed to negotiate with opposition House leaders.

Has the government House leader given up negotiating in good faith with House leaders to the degree to which the government now feels obligated to bring in time allocation as a standard procedure nowadays in the House?

Is this what it means to do things differently? The members opposite were the ones tearing their hair out to oppose time allocation motions. They kept telling Canadians that they were going to do things differently.

By moving yet another time allocation motion to pass its legislative agenda, this government is showing its incompetence. It is also showing a genuine lack of respect for parliamentary procedure and, ultimately, a lack of respect for Canadians.

The government is still trying to prevent members from participating in the proceedings of the House of Commons and representing their constituents. Once again, I refer to the comments made by the member for Winnipeg North on June 3, 2015. I have the right to do so because the government was elected under false pretenses. It claimed to want to do things differently.

However, at the rate the government is going, Canadians will soon realize that it will have moved more time allocation motions than the previous government. The Liberal Party has been in power for less than a year, the session is not yet over, and it has already used time allocation eight times, even though only about fifteen bills have been passed. About half the bills introduced have been subject to time allocation. That is unbelievable.

Let us return to the Canada pension plan. The first time I spoke about it, I said that the government had misled Canadians during the last election campaign. After Bill C-26 was introduced, I had the chance to speak to people in my riding. I asked them what they thought it meant when a campaign platform stated that the Canada pension plan would be enhanced and they would have more money in their pockets. They told me that they expected to have more money soon, in six months, a year or two years. They understand that things do not happen as quickly as we would like in Parliament. However, it is going to take 40 years.

People over 75 will reap the benefit of these measures in 40 years. Let us do some simple math: 75 + 40. Forty equals 4 x 10. Thus, 75 + 10 = 85; 85 + 10 = 95; 95 + 10 = 105; 105 + 10 = 115. People in my riding who are 75 years old today will be 115 years old when the plan enhancements take effect. However, SMEs will have to start paying higher contributions soon as a result of the Canada pension plan enhancement. That will hurt businesses.

Last week, something happened in North America, with our American neighbours, that many of us were not expecting. Something happened—

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Mr. Speaker, when I was the mayor of Thetford Mines, there was a tactic I often used at board meetings. A little “shh” is very effective, particularly when it comes from a member and not the Speaker. People seem to pay more attention.

I am pleased to have my colleague's attention as I speak to Bill C-26. I planned to speak about it, but this morning the government moved a time allocation motion regarding this bill. This means that many of my colleagues will not have the opportunity to speak to this bill, which, as the Minister of Finance said himself, is very important for Canadians.

At the beginning of question period, I was surprised to hear the Minister of Finance answer a question from my colleague from Louis-Saint-Laurent and say the following about the official opposition:

We were “the party that is playing games with the Canada pension plan”.

I think the government is the one playing games with Bill C-26 right now. The government is the one playing games with Canadians with Bill C-26.

During the election campaign, I remember a number of Liberal candidates who were running and knocking on doors, telling people in their riding that they wanted constituents to know that their party was going to improve the Canada pension plan. When seniors are told that the Canada pension plan is going to be improved, they do not expect that it will take 40 years for that to happen. However, that is precisely what is going to happen with Bill C-26.

I think Bill C-26 misleads Canadians. Again, this government's strategy is to keep making commitments and then expecting others to be forced to follow through on them later. The CPP commitments will not be met for 40 years, and investments in infrastructure will be made in 10 years. There is nothing on the books for the next three years.

Passing a bill that will not kick in for another 40 years is so pressing that a time allocation motion was moved today. My question is about an issue that I have raised over and over again: time allocation. This practice illustrates the government's contempt for the democratic process.

The words I am about to say are not my own. They were spoken by the member for Winnipeg North on April 30, 2015, when he was talking about time allocation motions:

Why does the government House leader feel that the only way [to] get legislation through the House of Commons is through time allocation? By doing that, they are really saying that they do not have the ability to negotiate in good faith with opposition parties, which is not healthy for democracy inside the House.

The government claims to be open and transparent and got itself elected on a promise to do things differently. However, with bills like Bill C-26 for seniors, we find ourselves in the eighth time allocation scenario in less than a year. We have been here for less than a year, and there have already been eight time allocation motions.

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, and of the amendment.

Business of the House

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

Mr. Speaker, this afternoon, we will continue our debate at second reading of Bill C-26 on the Canada pension plan.

Tomorrow, we will resume debate on Bill C-16 on gender identity. If time permits, we will also examine Bill C-25, the business framework bill.

On Monday, I will call Bill C-30, the CETA implementation legislation, for consideration at second reading. The bill will be on the agenda for Monday, Tuesday, and Wednesday. It is my hope that this bill will be referred to committee on Wednesday evening.

On Thursday, we will consider second reading of Bill C-23 respecting pre-clearance.

Next Friday, I will call Bill C-18, the Rouge national park legislation, for second reading debate.

Second Reading

[Sheri Benson, NDP, Saskatoon West, SK]

Mr. Speaker, it is a privilege to rise today to talk about a very important bill, Bill C-26, and the security of people in Canada when they retire.

I have a few introductory comments. I echo the comments of my colleague from Vancouver East who arrived in the House as a brand new member of Parliament, looking forward to a new spirit of collaboration and co-operation. Our hopes were very high that things would be different. I therefore want to register my disappointment around the government's choice to move forward with time allocation. I share that disappointment with the colleagues on my side who, unlike me, will be unable to share their points of view and comments with our colleagues today.

As I said, I am honoured to be speaking to Bill C-26, which will amend the Canada Pension Plan Act and incorporate recent agreements the government has been able to reach with the provinces to enhance the Canada pension plan.

Although the effect of the changes will not be felt for many years, 49 years, this enhancement is a very important first step in improving retirement for young Canadians. I want to acknowledge and offer my congratulations to the many citizen groups, in particular, unions that have really been fighting long and hard and laid the important groundwork so we were able to get to an agreement on these enhancements.

When this is fully implemented many years from now, but still important, the CPP will replace 33% of pre-retirement income, which is up from its current 25%. The New Democrats have long worked hard for improvements to many aspects of our social safety net, including the Canada pension plan, fighting for better old age security, and increasing guaranteed income supplement benefits.

As I mentioned in some of my questions, retirement security for many Canadians has reached a new crisis level. It really has been increasing and made worse under some of the policies of the previous government, which really saw the crisis come to a head with many people being unable to look toward a retirement. A golden retirement, as people used to say, will not be there.

A large part of that problem is that six in 10 working Canadians no longer have a workplace pension. I will do what a lot of people do not do usually and reveal my age. I am 53 years old. My dad would have been one of the first groups of workers who worked for a very large multinational corporation and had a workplace pension. Closer to the end of his tenure in the corporation, during a large corporate takeover, he lost that defined benefit pension plan. My parents, along with many others, have had to look forward to retirement, but, as my colleague on the opposite side said in his previous comments, have had to take on a lot more risk when it comes to pensions, more risks than his parents had and many before him. Younger generations are looking forward to an even more precarious work environment and retirement, one that may not provide them with the things they need to have a safe and healthy retirement.

During the election, the Liberals promised to enhance CPP, and we are glad to see that has come forward. I have a couple of comments on this.

I want to acknowledge my colleague from Hamilton Mountain. As any good MP would, he did some digging and studying up on the bill so we could speak about it as it was coming forward. He found some flaws with it. I thought the government would be very eager to hear about this and do a quick fix. It is one of the reasons we want to continue to debate this, because we would like to hear a response from the government that it does plan to fix this. Just saying that going to committee somehow that will make everything better does not reassure me or people in my constituency, in particular, women and those living with disabilities, that their retirement is going to be as secure as they thought it was.

Of course, what I am talking about is that the proposed changes to enhance the Canada pension plan would actually not afford women and those with a disability the same increases. Although we know this was brought in under a previous prime minister, Pierre Elliot Trudeau, it was not included in this particular enhancement to the Canada pension plan. I know members on this side and my colleagues have been asking the government over and over, both in question period and in debate, to tell us if this was a mistake. We have asked if it is going to fix it, or if it was not a mistake, why it was not included.

Of course, if it was not a mistake then I question its claims about being sincere in addressing some of the inequities and issues, particularly when it comes to retirement for those two groups of people who would be most vulnerable. They are those living on some type of CPP disability and women who had to leave the workforce who were the primary caregivers of children and were therefore not contributing to the Canada pension plan. From what we can see, from what we know, and from the research from my colleague, these folks are not going to see the increase, as others would. It is one reason to continue debate.

I understand the government has just recently, within a month, done some great work and brought our provinces together and got agreement. However, sometimes in haste, things get overlooked. This is one aspect I hope the Liberals just overlooked, and I hope they are going to try to fix it, because it is extremely important to me.

When I was campaigning to be the member of Parliament for my riding of Saskatoon West, one of the key issues in my riding was income and affordability. For seniors, it was being able to afford housing, and if they were lucky enough to scrape together enough to afford housing, they were not able to afford medication.

Retirement income, particularly for women and those who have lived on a more limited income because of a disability, is extremely important to me. Therefore, I rise today to speak about this and to draw it to the government's attention again. It would be nice to hear, definitively, from the government that it does plan to not allow this inequity to move forward, that it does plan to fix it, and not just say that everything will be all right, that we will talk about it in committee, to just get going with this, and keep talking—or not keep talking, I guess—so that we can address this.

I feel honoured to stand up and speak about this issue. I want to congratulate my colleague for bringing forward these two key pieces of inequity in the legislation.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is something that is really important for us to recognize. When we think in terms of the whole pension issue and Canadians heading toward retirement, whether they are retired today, retiring tomorrow, or in 10 or 15 years from now, there is a genuine concern that we have these social pension programs. For me, it is the big three: the CPP, OAS, and GIS. On all three of these fronts, we have seen the Prime Minister and our government take substantial action. On the OAS, we have now reduced the age back to 65. Canada can afford that. There are people who are looking forward to retirement at age 65, so we reduced it from age 67 to 65. That is a big plus.

Here is another one. Think of Canada's poorest, most vulnerable seniors. We would see, through the budget, a substantial increase of over $900 a year for some of the poorest. That would literally lift tens of thousands of seniors out of poverty. We are thinking not only about the seniors of today but the seniors of tomorrow. That is really what Bill C-26 is all about.

Ours is a government that is not only thinking about today, but also about tomorrow. Contrast that with the former Harper government: It is night and day. Hopefully, we will see sunny ways soon approaching as the vote on the bill will come today.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the member makes reference to sunny ways. I am an optimist. Perhaps the Conservatives will change their position on this and vote in favour of it. That would be a wonderful thing to see.

I did not say every Canadian supports it. I said a vast majority of Canadians support it. If the member is doubting what I am saying, I would invite him to come to Winnipeg North, and if the opportunity were there for me to go to his riding, I could attempt to do that. However, I invite him to come to Winnipeg North and sit down with a group of seniors. He can pick the venue. We will put out an open invitation. I will put on the agenda what we have done for the seniors of today and tomorrow. I can talk about the reduction of the retirement age from 67 to 65 for the OAS. I can talk about the increase in the GIS. I can talk about how Bill C-26 would enrich future retirees.

I believe a vast, solid majority of people would be very happy with what our government is doing. It seems to be only the Conservative Party that is not. Other parties and jurisdictions have recognized that this is the right thing. We are all collectively behind what a vast majority of Canadians want. Only the Conservatives seem to be out of touch.

However, I am an optimist. I believe in sunny ways. Maybe they will change their vote to yes and support the bill going to committee.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, just to respond very quickly to my colleague and friend across the way when he posed the question of whether the previous Conservative government could have done more, I would argue that the Conservative Party did virtually nothing in regard to assisting Canadian seniors. Indeed, the Conservatives could have done a whole lot more. In fact, for many years I sat in the opposition benches and listened to provinces calling for strong national leadership on the CPP. The Stephen Harper Conservative government continued to turn a deaf ear to what many provinces wanted and pushed the federal government to act upon. There is no doubt in my mind that it was a very low priority of the Stephen Harper government, that the Conservatives did not see the pensionable incomes.

To give any grace, I would suggest that at the very least the Conservatives did not understand and appreciate the importance of the CPP to the Canadian population and to many of the jurisdictions that wanted to see the national government demonstrate leadership on the file. That was not seen until we had our current Prime Minister in this current government who has taken decisive action and has demonstrated strong leadership in terms of recognizing what Canadians indeed wanted to see happen.

Before I get into that aspect, I want to make this very clear. I am a sensitive guy at times and I hear members provide questions or quotes, and maybe a little earlier quotes even about me in regard to the issue of time allocation. Let me address this issue because it is important for us to recognize. The Conservatives might have hoodwinked or fooled the New Democrats across the way, but they have not fooled the government members. I do not think it is going to be any surprise that what the Conservatives really want to do is kill Bill C-26. They might be the only entity in our country that opposes Bill C-26, but let there be no doubt that they want to kill this bill. They would be very happy if this bill never saw the light of day. That is why I was not surprised to see the Conservative Party play its games yesterday to try to prevent an ultimate vote occurring on Bill C-26. If it were up to the Conservative Party, we would never be voting on Bill C-26. That is why the Conservatives brought forward amendments.

They fooled the NDP, the third party. I give them credit for that, but sometimes it is not the easiest party to fool in this chamber. At the end of the day, time allocation is in fact a tool that is used to try to get the government business dealt with. This is something that Canadians want. A vast majority of Canadians support Bill C-26. I know that. If we are not prepared to use the tools, at times, that government has provided, then we will not be able to pass the important types of legislation that Canadians expect governments to pass.

I will give the Conservatives some credit. They have focused on what I would suggest is a bad bill, to line up and say that they do not want the bill to ever see the light of day. The Conservatives have had 30 speaking spots, but that does not mention the good number of other spots that they had in questions and answers. I would suggest that very easily more than half of the Conservatives, if they wanted to, could have actually spoken to the bill.

I will go further by saying that it does not take much. It takes 10 or 12 MPs to have party status. Any party can be fairly destructive in terms of the proceedings of the House because we have a finite amount of time in order to pass legislation through this chamber. If an opposition party chooses to be mischievous and not recognize what the government is trying to accomplish, it does not take very much to invoke time allocation. I saw that when I was in the opposition benches, where we had time allocation over 100 times. It does not take a genius from within an opposition party to create a bit of frustration on the government benches where it has to look at using that tool. Look at how much time has been allocated to Bill C-26.

If the government and opposition were to come to a consensus, that is always the ideal. We have a government House leader who has reached out to the opposition party in a very real and tangible way. If the opposition wants to be accommodative, and we are accommodating, that is great, but let us not kid around. We know that at times, the official opposition members will not want to co-operate, because they will want to kill a bill. However, just because the official opposition wants to kill a bill, it does not mean the government would not pass the bill, as we will continue to do what we believe is in Canadians' best interests first and foremost.

If we look at the substance of Bill C-26 and what it would do, it is pretty straightforward. It is a historical agreement achieved by our national government demonstrating leadership, right from the Prime Minister's Office to different ministries and, indeed, to our caucus. Every member of the Liberal caucus has been able to participate in this great debate regarding pensions for our seniors, and the CPP is one of those fundamental pensions that Canadians truly believe in and want to see action on by our government.

We took it a step further by saying that we were going to demonstrate that leadership, and within the first year of being elected, we have an agreement with provinces in every region of our country and their different political parties. Even Progressive Conservative parties have agreed to what we have before us today. We have many different advocacy groups that recognize that, yes, this is the type of legislation they want to see.

This is not just about today's seniors, but the government has not ignored them. The best example is the guaranteed income supplement, which was substantially increased in this budget. That initiative is going to lift tens of thousands of Canada's most vulnerable and poorest seniors out of poverty. That is helping today's seniors.

However, let us not focus on and think that because this would not help today's seniors in a very real and tangible way, we do not need to have this bill before us today. If we talk to seniors, they care about their children and grandchildren. They want their children and grandchildren to retire in dignity. This bill is all about the future, and this means having vision. This is a government that has leadership and understands that.

If I were to take any bill presented so far, this would be the bill I would focus my attention in showing why the Conservatives are no longer in power. It is because they lost touch with Canadians. That is the simple truth of it. They did not understand what Canadians really and truly wanted. They lost touch with them.

Contrast that with the attitude of the Prime Minister and this government. We have a Prime Minister who has consistently mandated his ministers, in fact, all of our caucus, to reach out to and better understand what Canadians want, and to bring that back to Ottawa so that the types of initiatives we take reflect what Canadians really want. This is really what Bill C-26 is all about.

I do not understand why the Conservative Party continues to oppose this legislation. This demonstrates that they still have not learned their lesson from the last election. They are ignoring what a vast majority of Canadians really want, and this is just one example of that.

I do not mind if the Conservatives want to stay out of touch with Canadians, but we will continue to move forward and will have to see what happens. However, we recognize what Bill C-26 is all about. Imagine a group of premiers, reflective of different political parties, meeting with the federal government, which is able to come to the table in such a way that we achieve an agreement.

It is an agreement that we believe is in the best interests of working people, not only in the short term, but also in the long term. The stakeholders, even businesses, in good part agree that this is legislation that all members of the House should be supporting.

[Murray Rankin, NDP, Victoria, BC]

Mr. Speaker, the last Liberal government of Pierre Elliott Trudeau introduced important measures to protect pension benefits of parents who stayed home to raise children. The current government appears to have forgotten them in Bill C-26.

Women already receive lower average CPP benefits than men. If this problem is not fixed, the gender inequality will only get worse. Bill C-26 contains a significant flaw that hurts women and people with disabilities. The proposed legislation fails to copy the child rearing dropout provision that were included in the existing CPP, so parents are not penalized for taking time out of the workplace to raise their children. Similarly there is a problem vis-à-vis the people with disabilities.

Is the government open to amendments to address this significant flaw?

The House resumed from November 15 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, and of the amendment.

Bill C-26—Time Allocation Motion

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, my colleagues have ably discussed many of the issues around time allocation. I want to ask a question specifically on Bill C-26.

Many people, when they put money aside privately, are not just saving for their retirement, but for interim priorities. They are maybe saving for an education, and then after realizing the value of that education, start to save for a new home, and then realize the value of that home to help them save for retirement. But the government, by restricting the eligible investments people can make in tax-free savings accounts, and by taking more money away from them and saving for them on their behalf, robs people of the ability to use their savings for interim projects, things like education, buying a home, and investing in a business.

Is this not another reason why we are much better off empowering people to save for their own futures, as well as long-term projects? Are we not better off doing it that way than by having a government-knows-best approach?

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

Mr. Speaker, I think we can all agree that Bill C-26 is important legislation. I think we can also all agree on the facts that nine out of 10 provincial governments are supporting this legislation. I wish the hon. opposition House leader was in the House to hear this—

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, I rise to pick up on the point of the hon. opposition House leader. When these debates about time allocation take place, the questions and responses are directed to the substance of the bill, in this case Bill C-26. However, the real issue lies beneath the surface, and it is the deteriorating relationship between the larger parties in this place, which unfortunately bleeds into and contaminates other important work in committees and so on.

The tone and the unwillingness to collaborate I have rarely found to be the fault of only one party. Rather, it generally reflects a lack of co-operation on the part of all parties. Therefore, my question is not really a question to the government. It is a plea to all the House leaders in this place, whether that be the member for Victoria or the opposition party and government House leaders. With all due respect, please do a reset.

Whatever has gone wrong in their relationship, they should go out, find a bar somewhere, have a scotch, and figure it out.

[Murray Rankin, NDP, Victoria, BC]

Mr. Speaker, here we go again. For the second time this week, the Liberal government has invoked time allocation. It is not as bad, I concede, as it was under the Harper government, where over 100 times it resorted to it. However, the sledgehammer of time allocation is simply not the only tool available. There are other tools. Whatever happened to the co-operative, collaborative approach promised by the Prime Minister?

Here is what the Parliamentary Secretary to the Leader of the Government in the House of Commons said not that long ago:

The government, by once again relying on a time allocation motion to get its agenda passed, speaks of incompetence. It speaks of a genuine lack of respect for parliamentary procedure and ultimately for Canadians.

This bill with which we are seized, Bill C-26, despite the excellent work of my colleague, the member for Hamilton Mountain, is deeply flawed in discriminating against women and disabled people.

Why are we rushing a flawed bill through by imposing time allocation?

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

moved:

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 at second reading stage of the bill;

and

That, 15 minutes before the expiry of the time provided for government orders on the day allotted to the consideration at second 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 said stage of the bill shall be put forthwith and successively, without further debate or amendment.

Income Tax Act

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, I want to congratulate the member for Edmonton West for bringing the bill forward. I am sad to hear from the parliamentary secretary that the government will be opposing the bill. When we look at the three pillars that Canada's retirement system is based on, we know that workplace pensions are really the pillar that is suffering. Therefore, the government has to look at the other two. They are the ones where the government can have a real influence.

To the government's credit, it is bringing in Bill C-26, and it has made some amendments to the guaranteed income supplement, which deals with that third pillar of personal savings. If we allow seniors, especially in this unstable retirement environment, more freedom to choose how and when they withdraw their retirement savings, that is all the better for them.

The bill is obviously not a panacea for the difficult issues facing our seniors today, but private members' bills have to be very careful. To succeed, they have to focus on one little item where they can make a real difference. It is really up to the government to do the rest. We will certainly be keeping our eye on the Liberal government to ensure it does that.

There may be some watching this debate who are unclear on the difference between RRSPs and RRIFs. We know that RRSPs give everyone the ability to save for their retirement, as long as they have contribution room available and based on their earnings. A RIFF is used as the fund people can withdraw from during their retirement. However, there are mandatory minimum withdrawals that a person must make every year.

The rules for these mandatory minimums were created back in 1978. While I acknowledge there certainly have been some modifications over the years, basically we have old rules that are not very well adapted to today's society and today's reality in which many retirees are living. Seniors are now living much longer than they were in the 1970s. Now RRIF holders face the very real likelihood that they will run out of money in the later stages of their retirement. When that pillar of personal savings is taken out, a person's quality of life can take a significant downhill turn. We certainly want to ensure, through this bill, that we address that very issue.

I venture to say that all members of Parliament in the chamber believe Canada's seniors deserve to retire in dignity and that the government should be doing everything it can within its power to make that a possibility. I strongly encourage support of the bill at second reading so we can at least bring it to committee for further study and hear from expert witnesses. We should at least do the bill that justice.

This has been a battle the New Democrats have been waging for some time now. I would like to point out for hon. members that it was in the previous Parliament that our pensions critic brought a motion before the House to review the retirement income fund mandatory minimum withdrawal threshold. That was John Rafferty, the former member of Parliament for Thunder Bay—Rainy River. His Motion No. 595 stated:

That, in the opinion of the House, the government should review the Registered Retirement Income Fund mandatory minimum withdrawal thresholds and amend them to ensure that they do not unduly force seniors to exhaust their savings too quickly.

The NDP has a history of supporting the intent of the bill. I am very happy to be offering my support of this bill at second reading. I believe this issue deserves further study.

Our party ran on support for any action that would address mandatory minimum withdrawals from RRIFs, so the ultimate aim is to ensure that seniors are not outliving their savings. We have supported this because of the very fact that if we follow the current withdrawal schedule, we will have many retirees with average savings, which are not very high, running out of money when they are in their 90s. No one in the House should support that.

If we look at the future, it basically means people who have saved diligently all their lives could have their quality of life significantly reduced later in retirement. When the income they were relying on from their personal savings suddenly dries up, because they had to follow that mandatory withdrawal schedule, suddenly they become reliant on just the government pension system. Of course, the guaranteed income supplement will respond accordingly in some way.

However, removing one of those pillars, such as personal savings, could have a very drastic influence on someone. I would argue that for a senior who has made it to the age of 90 and beyond, this is the last thing we need to do to them at that particular age. They have enough concerns when they are in their 90s, they do not have to suddenly worry about their income.

When we look at Canada's demographics, we have a real tsunami heading our way. In the next 20 years, the population of Canada's seniors is set to double. Time is of the essence. This is the time when we seriously need to be bringing forward proposals. To the government's credit, they have done some but I would argue this particular measure by the member for Edmonton West is something we could also be doing for that critical third pillar of personal savings.

We know that the probability of a woman who is now 71 living into her mid-90s has basically doubled. The same rate for men has actually tripled. We basically have 265,000 Canadians right now who are in their 90s. By 2021, just a few short years away, we are going to add another 100,000 Canadians to that number. I think that mandatory minimum RRIF withdrawals are becoming increasingly irrelevant as women and men are living much longer and working more years.

This bill does not address everything. On this side, the NDP will be working hard. We will continue to work hard to improve the lives of our seniors. We will support this bill, but we think that much more needs to be done so that workers can retire with adequate incomes. More importantly, we need to make sure that seniors have access to the services they need to maintain their quality of life.

As I go on, I want to talk a little about some of the other areas where I think seniors need considerable help. I want to give a nod to my colleague, the member for London—Fanshawe for the incredible work that she has done on behalf of seniors, on the national seniors' strategy. It is a real honour to sort of inherit the mantle of the NDP seniors' critic. It is like Isaac Newton once famously said:

If I have seen further than others, it is by standing upon the shoulders of giants.

Certainly, the member has done such incredible work, it has allowed me to build on that base.

We know that more than a quarter of a million seniors are living below the poverty line, and that without concrete action, many more are going to fall into poverty in the future. We need that national seniors' strategy that my colleague from London—Fanshawe has brought in. It will ensure that seniors have access to high-quality and affordable health care and housing, and additionally improve the financial security, quality of life, and the integration of seniors within our society. This is really such a multi-faceted issue, looking at the issues that seniors face.

We certainly want to see some measure on home care. We do not want to see the same funding proposal kept that the previous Conservative government brought in. We would urge the government to look at that escalator to make sure it does not drop down to 3%, but to keep it at the current 6%. Health care budgets are drastically affecting our provinces' ability to deliver services. Now is the time for the federal government to take real leadership on this issue, to reinstate that funding that was cut under the previous government.

We need a system of a national pharmacare plan. That is one of the greatest costs that our seniors face. We do not want our seniors to have to choose between food and proper prescription medication. We also need to have real food security. One of the fundamentals of healthy living is making sure that proper, nutritious meals are available for our seniors, as well as affordable housing.

On the pension system as a whole, while I appreciate the 10% increase to the guaranteed income supplement, it really took a fairly small number of seniors off the poverty rolls. Much more needs to be done.

In conclusion, this is also a good time to remind the government that their members need to keep the promise that was made in the March 2016 budget and introduce that seniors price index. That seniors price index needs to be introduced so that we make sure our old age security and guaranteed income supplement are keeping up with the rising costs. I certainly hope to see some news from them soon.

In conclusion, I will be voting for this bill to go to committee for further study, but we must never rest until every senior is out of poverty and can retire with dignity.

[The Chair, Liberal, Wayne Easter]

Yes. Bill C-26 is Monday, and Bill C-29 is next Thursday, for amendments.

[The Chair, Liberal, Wayne Easter]

For Bill C-29 it is next Thursday. Bill C-26 is Monday.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, as the member well knows, Canada's retirement system was founded on three pillars, and this bill will be of great assistance with respect to the pillar of personal savings.

I want to look at the situation of women. We know today that the probability of a 71-year-old woman reaching her nineties is much higher than it was even 20 years ago.

Shifting the conversation to Bill C-26, I realize that the Conservatives stand against this bill, but it more than likely has the votes to pass in this House. Would the member not agree that since the bill is going to pass, the government should at least amend its own bill to fix the provisions that unfairly penalize women with respect to that all-important pillar of government pensions for retirement security?

[Aaron Wudrick, Federal Director, Canadian Taxpayers Federation]

Thank you, Mr. Chair.

Good evening. My name is Aaron Wudrick. I am the federal director of the Canadian Taxpayers Federation. I am very pleased to appear this evening on behalf of the CTF to comment on Bill C-26, which, as we know, deals primarily with the expansion of the Canada Pension Plan.

In CTF's view, Bill C-26 is essentially a classic case of good intentions leading to some very unintended consequences, and of an attempt to solve a very specific concern by using a very blunt instrument.

Income security for seniors is, I don't think anyone will deny, a very valid and pressing public concern, but it is also important here to acknowledge that the facts do not show that there is a broad, generalized crisis when it comes to Canadian seniors' pensions. For poor seniors in particular, income supplements such as old age security and guaranteed income supplement, which have already been mentioned, largely address the issue. If concerns remain for this group as a whole that these programs are not sufficient, those are nonetheless the programs we should look to, and not CPP, to address any lingering problems. Rather, the changes in Bill C-26 are instead designed to target a relatively small group of middle-class to upper-middle-class Canadians who are not meeting an arbitrary threshold set by the government as to what an adequate amount of retirement savings should be. Most importantly, in calculating this, the threshold does not consider, for example, non-RRSP investments, nor things such as equity in people's homes. Rather, the government has declared that this threshold isn't met. As a result, they have chosen a sweeping, one-size-fits-all solution to effectively force—not help, but force—all Canadians to save more money.

Now, some people will probably react by saying, “What is so bad about governments forcing Canadians to save more money?” It does raise a number of important questions, such as why exactly the government feels that it is better placed than individual Canadians and their families—who I think we can all agree have a vast range of lifestyle preferences—to know what the right amount of savings is. It is entirely possible that there are some people who would prefer to spend more money today. I think an obvious example is people with young children or large families who require money today and want to spend that money today in anticipation of, perhaps, a more frugal lifestyle once the kids have grown up and moved out.

Then there is, of course, the question where, if some people are not saving because they simply cannot afford to save, how is depriving them of that money today—even if they are potentially going to get it down the road—going to make them better off overall?

It is also important to stress here that, when we are discussing income security for seniors, income support is often conflated with income replacement. CPP, of course, is a program where the yield you receive depends on what you pay in. Enhancing it, therefore, does nothing for people who are not paying very much into it in the first place. It does not give people extra money. It simply shifts the money from the current day into the future.

Finally, and very briefly, I think it is still worth noting that its expansion could be very damaging to businesses insofar as it effectively functions as a payroll tax. It is possible—I believe news came out today of a government memo that stresses exactly this point—that the CPP expansion could lead, certainly in the short and medium term, to lower wages and fewer hours for workers, as businesses attempt to compensate for the new costs.

I think I will leave it at that. Thank you.

Finance

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, again, infrastructure is of such critical importance for all Canadians in every region, from coast to coast to coast. We need to invest in infrastructure. This Prime Minister and this government have recognized the need for infrastructure expenditures and we have put more money into infrastructure in the history of this country. In fact, for many years I sat in opposition and saw Stephen Harper and the Conservative government do nothing in recognition of the importance of infrastructure. That is why I feel that the Conservatives, once again, made a mistake by voting against this budget.

If we want to talk about helping Canadians, let us think back to what I made reference to in my questions. This budget would make substantial increases to Canada's child benefit program. That would assist tens of thousands of children in every region of our great nation. They would be lifted out of poverty as a direct result of this budget. What happened? The official opposition voted against the budget, denying that benefit.

However, it does not end there. What about seniors, some of the most vulnerable in our society? Let us talk about single seniors who are finding it difficult and have to decide whether they buy the medications they need or food. Quite often, seniors make the decision to buy medications and go to a food bank. This Prime Minister and this government have recognized the importance of increasing the GIS for the most vulnerable seniors in our society. Once again, the Conservative Party voted against that.

I can go on. If we want to talk about vision, this is a government that demonstrates leadership with a vision and takes actions, something we did not see with the Conservative Party. Let me provide two examples, one of which we were supposed to talk about this afternoon, the Canada pension plan in this budget. If members had listened when Liberals talked about canvassing Canadians from coast to coast to coast, they would have heard that pensions were very important to them.

A historical agreement by this government demonstrates leadership. Provinces of all political stripes came on board. They recognized what Canadians see as very important, which was to increase CPP, because it is not just about today. We should be thinking about future generations also, and that is what having a vision and a plan is all about. That is something that this government and this Prime Minister brought to the table and were able to deliver in a substantial way.

In this entire country, as best I can tell, the Conservative Party is the only political entity that actually opposes investing in pension programs. In fact, if we listened to the speeches that the Conservatives made on Bill C-26, one would question whether they even believe in the CPP.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, it is a pleasure to rise and to put forward, in a very clear way, what I believe is somewhat of a tragic story by the Conservative opposition. I believe we are seeing a Conservative Party that has really lost touch with what Canadians want to see and what their expectations are of government.

Let me go further and say that it is more than just an expectation of government, but that Canadians as a whole have an expectation of the official opposition, too. What we are seeing today is disappointment in the official opposition.

One of the things that Canadians truly believe in is the Canada pension plan. They believe in its importance. We have witnessed the provinces, territories, and every region of our country recognize the importance of the CPP. Only the Conservative Party, the party that has lost touch with Canadians, does not recognize what Canadians want. That is really what Bill C-26 is all about.

It is about delivering to Canadians what Canadians have been asking for, and not just for one year but for many years. It is the type of thing that Stephen Harper—

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, we have an aggressive agenda as government. There is the cut to the middle-class tax bracket, the Canada child benefit program, and the substantial increase in the GIS for our seniors. We are lifting seniors out of poverty. We are lifting children out of poverty. We can talk about the investment in Canada's infrastructure. There are so many things in the budget and the government's mandate. We are disappointed that the member saw fit to attempt to adjourn the House.

The very bill that we hoped to debate today, Bill C-26, is a historic agreement that would see millions of Canadians benefit. My question for the member is very specific. Why does the Conservative Party attempt to adjourn debate when there is so much that Canadians want us to do?

[Herb John, President, National Pensioners Federation]

Thank you.

My name is Herb John, and I am the president of the National Pensioners Federation. With me as our counsel is Susan Eng.

The National Pensioners Federation is a national, non-partisan, non-sectarian organization of 350 seniors chapters, clubs, groups, organizations, and individual supporters across Canada, with a collective membership of one million seniors.

While seniors need help with their health and financial concerns today, they are also concerned about the financial security of tomorrow's seniors. Without reservation, National Pensioners commends the federal and provincial governments on reaching a historic agreement to increase the Canada Pension Plan. We welcome the proposal in Bill C-26 to implement the increase and to amend the Income Tax Act to facilitate deductions for the increased CPP and QPP contributions, but especially for the increase to the working income tax benefit to allow low-income Canadians to participate.

National Pensioners held our annual convention this year in Vancouver, where the delegates applauded this rare example of federal and provincial co-operation. It is important to note that none of the people in that room will benefit from the increase to the CPP. Rather, they are concerned that their children and grandchildren do not have workplace pensions—two-thirds of working Canadians do not—and see the increased CPP as vital to helping them save for retirement. They know how hard it is to make ends meet in retirement, even though some of them have workplace pensions.

The CPP increase is coming just in time. No new defined benefit pension plans have been established in years. Many workplaces that have defined benefit plans are switching to defined contribution plans in which the investment risk is entirely borne by the employees. This is happening even in the unionized environment. GM, Ford, and FCA auto workers made an unprecedented concession to allow companies to close the doors on their defined benefit plans and to require new employees to participate in a defined contribution plan.

Many of our members have also been affected by business bankruptcies like Nortel's, which left the pensioners with heavily reduced pensions, if they had anything left at all after the dust settled. This is an ongoing result of not having legislated protection of pension plan assets during bankruptcy. The sustainability of the CPP, clarified by the fact that the chief actuary has declared that the CPP will be able to pay CPP benefits for at least the next 75 years, is very important to seniors, again, for their children and grandchildren.

The changes announced, which are the first increase in half a century, will take years to phase in. Even so, the increase is modest and, while very welcome, does not ensure Canadians an adequate retirement. What it does do is bring the maximum CPP benefit to $20,000 in 2016 dollars, which is approximately equivalent to the poverty line. National Pensioners would recommend that a review of future increases, including a voluntary layer to the CPP, be initiated as soon as possible, especially given the length of time it took to get this increase.

I will now turn it over to Susan Eng, who has further recommendations for the committee.

[Dr. Tammy Schirle, Associate Professor, Department of Economics, Wilfrid Laurier University, As an Individual]

I'm glad you could come back to give me an opportunity to speak with you today. Thank you.

I will take this opportunity to flag some general concerns I have with Bill C-26, with a focus on individuals with low earnings. Over the past few years, several researchers have expressed concerns that an expansion of the CPP's existing structure, alongside the provisions for the guaranteed income supplement, would imply a very low rate of return on contributions for individuals who enter retirement with low average earnings.

The planned changes to CPP and the Income Tax Act, as set out in Bill C-26, take some steps to mitigate those concerns. First, an expansion of the working income tax benefit is included in this bill. Most importantly, this will help some individuals with low earnings cover their additional CPP contributions. This has several other benefits.

As a method of prefunding retirement income through the current generation's tax revenues, rather than relying on programs funded by future—

[James Hicks, National Coordinator, Council of Canadians with Disabilities]

Hello, everyone. Thank you for inviting me to talk. I'll make it quick so that you can move on.

Who are Canadians with disabilities? When we speak of people with disabilities, we are actually talking about people with impairments who are disabled by the environment and type of society in which they live. People may have impairments with hearing, seeing, communicating, walking, thinking, learning, or doing any similar activities, but they are disabled often because of inaccessible information; inaccessible buildings, homes, and apartments that are not designed for people with impairments; inaccessible public and private spaces; lack of supports and services for employment, education, and training; lack of services to remain in one's home; and stigmatizing attitudes.

People with impairments are disabled often because of societal barriers, both structural and attitudinal, which limit the types of activities they can do in their homes, at school, at workplaces, as well as other activities. The United Nations Convention on the Rights of Persons with Disabilities defines disability in terms of social factors, not so much in terms of biological factors.

People with disabilities want to be part of their broader communities, be educated, be trained, and have good-paying jobs. This requires leadership and commitment from governments, the private sector, and disability organizations to work together to bring about this change.

What are the employment realities for Canadians with disabilities? We know that people with disabilities are less likely to be employed than are people without disabilities. The participation rate for people without disabilities aged 15 to 64 years was 79.3%. For people with disabilities, this dropped to 53.6% of the population.

We know that people with disabilities have lower incomes than people without disabilities. The self-reported median income in 2010 for people with disabilities aged 15 to 64 was just over $20,000, while for people without disabilities it was just over $30,000.

We know that many people with disabilities rely on government programs for income and social supports. Among the 204,700 people with disabilities who are completely prevented from working, 43.4% reported that they received CPPD or QPPD in 2010. Among the 632,600 people with disabilities aged 15 to 64 who are permanently retired, 39.9% reported they received CPP or QPP in 2010. This program is extremely important to the welfare of people with disabilities in Canada.

With regard to the impact of Bill C-26, due to unknown sporadic employment periods, a person with a disability who was unable to maintain workforce attachment throughout their adult working life potentially will see a greater impact in terms of the benefit of the enhancement as other Canadian citizens. The impact for people with disabilities will likely be greater levels of disparity between disabled and non-disabled people in the amount received in CPP benefits Additionally, it has the potential to further impact women and girls who are typically the caregivers for both children and family members with disabilities. Women with disabilities who are also caregivers will be hit with a potential double reduction in revenues through these proposed measures if their disability and caregiving drop-out periods are in different years.

In terms of analysis, it is the view of CCD that the implementation of the measures in Bill C-26 has the potential to negatively impact Canadians with disabilities in a manner that could increase the disparity in income levels between Canadians with disabilities and other Canadians. The removal of the drop-out options in the enhanced portion has the potential to further increase the disparity between disabled and non-disabled Canadians through a publicly designed pension scheme. This would be in contradiction to the intent of the UN Convention on the Rights of Persons with Disabilities, which Canada has signed and promised to uphold. Some of these protections are important to highlight here.

Part of the CRPD preamble reads as follows: “Highlighting the fact that the majority of persons with disabilities live in conditions of poverty, and in this regard recognizing the critical need to address the negative impact of poverty on persons with disabilities”.

Article 3 talks about equality of opportunity, not about being treated the same.

Article 5, paragraph 3, says, “In order to promote equality and eliminate discrimination, States Parties shall take all appropriate steps to ensure that reasonable accommodation is provided.”

Article 5, paragraph 4, says, “Specific measures which are necessary to accelerate or achieve de facto equality of persons with disabilities shall not be considered discrimination under the terms of the present Convention.”

Article 28, paragraph 2b, says, “To ensure access by persons with disabilities, in particular women and girls with disabilities and older persons with disabilities, to social protection programmes and poverty reduction programmes”.

In conclusion, the proposed changes to the drop-out provisions in the enhanced portion of CPP and CPPD have the potential to further marginalize Canadians with disabilities. This includes those who have had to leave the workforce due to disability, those who experience potential discrimination in obtaining and maintaining employment, and those who because of disability have had to work sporadically throughout their working years.

CCD urges the finance committee to reconsider its acceptance of the current proposed changes to the CPP and CPPD programs. No revisions to the CPP program, including the retirement and disability portions, should create further barriers and inequality to Canadians with disabilities. The Government of Canada, through its commitment to the Convention on the Rights of Persons with Disabilities, has a responsibility to ensure that Canadians with disabilities are not further impacted negatively due to life circumstances beyond their control.

All federal programs should ensure provisions for those Canadians known to be living with adverse poverty, particularly those eligible for CPP and CPPD who would benefit from the inclusion of the drop-out provisions to all portions of CPP disability or retirement pensions.

Thank you to the committee for allowing us to bring this to light.

[The Chair, Liberal, Wayne Easter]

I call the meeting to order.

As our witnesses know, we're dealing with the subject matter of Bill C-26.

Thank you for coming. We will at least start with the presentations so that we have that on the record. We have to leave when the clock hits 15 minutes down.

I'll start then with the Council of Canadians with Disabilities and Mr. Hicks.

Pensions

[Scott Duvall, NDP, Hamilton Mountain, ON]

Mr. Speaker, after two days of our raising the issue in the House, it is obvious that the Liberals forgot to consider the needs of women and people living with disabilities in their legislation to expand the Canada pension plan. Stakeholders and union leaders agree that Bill C-26 is flawed because of the omission of the drop-out provision for these groups. It is a simple fix. We are proposing changes and asking for the current government's support.

Instead of rushing this expansion into law, will the government take the time to fix it by accepting our proposed amendments and make this right for all Canadians?

The House resumed from November 14 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, of the amendment and of the amendment to the amendment.

[Chris Roberts, National Director, Social and Economic Policy, Canadian Labour Congress]

Thanks for the question.

Yes, indeed, most defined benefit plans are integrated with the CPP. That means the benefit, the workplace pension benefit, is adjusted to take into account the CPP. It's the same with the contribution rate.

There's nothing in Bill C-26 that tells workplace plans how they're going to accommodate the gradual phased-in increase in contributions and the higher CPP benefit. That's up to the bargaining agents and the employers in a unionized situation, or the trustees where there's joint-only trustee plans. It's really up to the plans and the stakeholders involved to decide how they want to adjust to that higher benefit and the higher contribution rate.

There's a gradual phase in, so there's lots of time for plans to adjust. It's true, we do have to do a lot of education with members about it.

[Francine Lévesque]

Thank you for the question.

In Quebec, we have to make specific representations to our government, given that we have a special plan, but the content of what we are saying is along the same lines as what we have said before you today on the Canada Pension Plan. We believe it is important to take measures to increase the percentage of contributions to the Quebec pension plan. We also believe it is important to ensure better plan coverage.

On those issues, we are saying exactly the same things. We believe that measures must be taken factoring in all the generations. We must avoid costs for future generations. We express this view in the debate on Bill C-26, as well as to our government. Its work is still ongoing and we are waiting to see how it plans to change its pension plan.

[Mark Janson, Senior Pensions Officer, National Office, Canadian Union of Public Employees]

Thank you, Mr. Chair, and thank you to the committee members for having CUPE here today.

CUPE is Canada's largest trade union. We have 639,000 members across the country. Pensions are a very big deal for our members. Half of our members don't have good defined-benefit plans in their workplace, so this is an important issue for our members, their families, and their communities.

The labour movement, as the CLC representative said, has long been a champion of Canada's public pension system, and of seeing it grow. At a similar committee hearing to this in 1965, labour representatives appeared and said that they endorsed the creation of the Canada pension plan that year, but were sharply critical of the too-limited level of the benefits that were provided. The 25% replacement rate that was set out that day remains today.

At the time, labour representatives called for CPP benefits to be doubled. The government did not listen and implemented what we saw as a very modest pension system. In choosing a very modest public pension plan, Canada really put all their eggs in the basket of a private pension system that needed to work very well.

The CPP just turned 50. This is a good time to look back. We now have 50 years of evidence showing us quite clearly that this private pension system wasn't working very well for most Canadians. We've never had a situation where most Canadians had a pension at work. Today, six in 10 Canadians don't have a pension at work. Those who do have pensions are seeing their plans become less generous and less secure over recent decades. The individual systems of the RRSP and the tax-free savings account simply aren't working for most Canadian workers. You add all this up and it's no surprise that study after study showed we were facing a big problem, that Canadians simply weren't saving enough and that future generations of retirees were looking at very steep drops in living standards unless something was done. That problem was projected to get worse with each subsequent generation.

Clearly, something had to be done, so in 2009, as the CLC said, the labour movement revived our 50-year campaign to see CPP benefits increased. The labour movement and CUPE were very strongly supportive of the deal that was struck in June. We recognize changing the CPP is not an easy thing to do. The two-thirds/two-thirds rule makes this harder to do than changing the Canadian Constitution, so we applaud the federal government and the provincial governments for sitting down and getting that job done.

Like others here, while we recognize this as an important step forward, we also can't escape the fact that we were calling for a doubling of CPP benefits. The increase provided in Bill C-26 goes only about a third of the way to getting there. CUPE is still going to continue to fight for better public pensions for all Canadians.

Like the CLC, we are extremely concerned about the dropout provisions in Bill C-26. The child-rearing dropout and the disability dropout provisions, which I know you discussed at committee yesterday, have been long-standing provisions of the existing CPP. In Bill C-26 we were surprised to see that these provisions would not apply to the expanded portion of CPP. At first, we thought this must have been oversight and should be an easy fix, but yesterday departmental officials confirmed that this was actually intentional.

These two provisions have been long-standing aspects of the CPP. The child-rearing provision was introduced under the Liberal government of Pierre Trudeau in 1977 with much fanfare. Ministers of the day said the provision “would ensure that a contributor who remains at home to care for young children will not be penalized for that period during which he or she has low or zero earnings” and that “parents should not be penalized under the CPP for undertaking a socially desirable and necessary task”.

This child-rearing provision has mostly been used by women. It has helped women narrow, but not close, the gap between what they earn under the CPP and what Canadian men earn under the CPP. On average, for every dollar a Canadian man earns, a Canadian woman earns about 70¢ in the CPP. That's with the child-rearing provision intact. If the child-rearing provision were not there, that 70¢ would certainly be lower.

It's the same point on the disability dropout. This has been a long-standing provision of CPP. Since day one, this has been part of the Canadian pension plan. It ensures that workers who are forced to collect CPP disability payments do not see their CPP retirement payments suffer as a result. They're simply allowed to drop those years of zero or low earnings from their CPP calculation.

In our view, these are very important principles within the CPP. They're equity provisions within the plan. They've worked well for decades, and we don't see why they should not continue to work well into the future under the expanded CPP. They're still going to apply to the base CPP going forward; they should apply on the same basis to the expanded CPP.

We wonder whether the provinces were aware that these provisions would not apply when the deal was signed in June, and whether they know now. The discussion yesterday at committee clearly showed this has not been costed by the chief actuary's office or Department of Finance officials. We would suggest it's a pretty simple first step, which could be taken at the committee, to find out what this is going to cost on that side of the ledger, but then on the benefit side of the pension ledger to run some numbers to find out what this is going to mean for women going forward, or for Canadians with disabilities, in terms of the CPP cheques we expect they're going to receive under the expanded portion of CPP. These are important principles. They've applied for decades and they should absolutely continue to apply.

Thank you for your time.

[Hassan Yussuff, President, Canadian Labour Congress]

First of all, Chair, members, good afternoon.

Thank you for the opportunity to appear before you today. It's a pleasure for me to speak to the bill. I'm very proud to be here today in regard to this discussion.

The Canadian Labour Congress speaks on behalf of 3.3 million workers across this country. Every day in this country, unions bargain pensions on behalf of our members. The labour movement believes that all workers should be able to retire in dignity after a lifetime of work, regardless of whether or not they have a union. The Canada pension plan is a critical part of retirement security for Canadians. The universal CPP delivers a secure and predictable benefit in retirement and is protected against inflation. The problem is that the CPP benefit was set too low when it was created in 1965. It pays a benefit of just 25% of pensionable earnings below the average wage. We have been fighting to improve the CPP from the very beginning. Seven years ago, the Canadian Labour Congress, in 2009, and its member unions decided to once again redouble our fight to expand the Canada pension plan.

If we had not campaigned tirelessly for the last seven years to expand the Canada pension plan, we would not be here today having this discussion. There is no exaggeration in regard to this point. Both our allies and opponents acknowledge that the labour movement was pivotal in getting this agreement. In the beginning, we had little support. Not a single province supported the expanding of the CPP. The federal government was opposed, and as always, the banks and the insurance companies opposed any expanded CPP.

We were not deterred. We mobilized our activists across this country. We educated our members and the public about an expanded CPP. We patiently explained to anyone who would listen why it makes sense to expand the Canada pension plan. Gradually, we began to win over seniors, students, anti-poverty organizations, provinces, and politicians. The Federation of Canadian Municipalities unanimously endorsed our call to double the Canada pension plan. The Canadian Federation of Students backed our proposal. Pension experts and economists were on our side. Newspaper editorial boards endorsed the expanded CPP. Polls showed that Canadians supported an improved CPP in every region, in every age group, and in every income bracket, regardless of party affiliation.

Gradually, the provinces came to understand why Canadians need a better CPP. Only the federal government stood in its way. At one time, even then, the late finance minister Jim Flaherty supported an expanded CPP. The labour movement made CPP expansion an election issue in the last election in 2015. We helped change the federal government. I am happy and proud to say that the labour movement's consistent efforts are what got us here today.

Critics tirelessly continue to make the same arguments against expanding the CPP. They say that most Canadians don't need a better pension. They say that rising house prices and RRSPs will provide Canadians with dignity in retirement. They say the sky would fall if contributions were to rise modestly over a gradual phase-in period. These arguments have been discredited in the past. They have been rejected by Canadians.

Bill C-26 is the result of a long struggle, and we are proud to see it proceed. This is a historic achievement on behalf of Canadians and our country. For the first time in 50 years, the Canada pension plan benefits will improve.

I want to thank personally Minister Morneau and the provincial governments for their hard work and leadership in getting us this deal.

The bill before you today, Bill C-26, isn't perfect by any stretch of the imagination. For instance, we fail to see why the child-rearing dropout provision isn't extended to the enhanced benefit. This may have been an oversight and it needs to be fixed before the legislation is adopted by the House.

We urge the committee to include a child-rearing provision in the new benefit, but make no mistake; Bill C-26 is a historic and significant improvement in the CPP benefits for working Canadians. At a time when public pensions are in retreat around the world, Canada's leadership sends a beacon to working people everywhere. This is a proud moment that we Canadians can celebrate.

On behalf of the congress, thank you very much for inviting us to present before the committee today.

[The Chair, Liberal, Wayne Easter]

The meeting is called to order. Thank you.

Pursuant to Standing Order 108(2), subject matter of Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, we have witnesses here today to speak on Bill C-26.

First of all, welcome everyone. We would like to hold witnesses to about five minutes, if we could, so that we have plenty of time for questions.

Pat Trask, I believe you're going to be first, with the Saskatchewan Seniors Association Incorporated. Good to see you. You and I used to be colleagues 25 years ago.

Second Reading

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, it is a pleasure for me to join this important debate on the government's fiscal update and the fiscal policy of the government in general.

To be frank, there is a lot to sink one's teeth into in terms of objections to the government's direction. I can say, having just come back from constituency week and having spoken with constituents in my riding, that people in Alberta, but I think across the country, are being hit very hard by the policies of the government.

As I think through it and talk to business leaders, I am reminded of the fact that every single tax they pay is going up. Small businesses in my riding face a higher small business tax rate as a result of the fiscal policy of the government. They face a carbon tax, a carbon tax brought in by the provincial government but which the federal government will do everything it can to prevent any subsequent provincial government from repealing.

We have the elimination of the hiring credit for small business. Bill C-26 would raise payroll taxes that individual employees as well as small businesses would pay. There is the undoing of employment insurance reforms, which would, in the long run, force up employment insurance premiums. Of course, small businesses are facing higher business tax rates in general from the provincial government and are grappling with the minimum wage hike and other changes that are happening, and there still has been no serious effort when it comes to market access for our resources.

We have a government that is hitting businesses again and again and again. The reality is that these are the job creators in our economy. These are the people whose investments and ingenuity create jobs and opportunities for our country. I just went through the list, objectively, of things that are happening to businesses in my riding, and I have to say that I find the continuing optimism and the continuing desire of business leaders in my constituency to move forward and build truly inspiring. The government should be there to try to help them succeed, not make their job more difficult when it comes to creating jobs and opportunities.

I will mention one specific thing in this fiscal update, and that is the implementation of certain regulations with respect to credit unions. There are credit unions in my constituency. The application of one-size-fits-all regulations, perhaps designed for the big banks, to every small credit union is a huge red-tape burden. Again, we have a government that is not listening, that is not paying attention to small businesses. This deals with one specific sector of the economy, credit unions, but it is another example of how the government is simply out of touch with the needs of the job creators in our economy.

Moving beyond that, I was to talk about two general points: deficit spending by the government in general and the issue of the employment insurance changes contained in this fiscal update.

The government's approach to deficit spending is, yes, to run deficits, but it is more than that. It is to undertake a policy of constant structural deficits. This is very different from the traditional arguments made for deficits. There are, I think, good arguments for running deficits in certain situations. The basis of that would be the Keynesian economic principle of counter-cyclical government spending, a government doing more spending during times of economic challenge to offset the pullback happening in the economy as a whole and then the government pulling back and running surpluses during times of economic prosperity.

The importance of this is that the government is providing that stimulus for economic activity during relatively difficult times but is still balancing its budget over the long term. It is still in a position, in the long run, to balance its budget. I think we should all accept that we have to balance the budget in the long term. We cannot constantly, over a sort of forever time horizon, spend more than we have. Eventually, the capacity to borrow will run out. There is nothing wrong with running deficits in certain situations, provided that we intend to balance the budget over the long term.

When we talk about stimulating the economy, the important thing is that it needs to be in times that are relatively less good. Of course, even during good times, there will be people who are struggling. There will be people without jobs. There will perhaps be a desire to increase growth. However, if the government always spends more than it has in good times as well as bad times, then eventually, it is going to run out.

The government talks about stimulus, but it is really abusing these arguments, because its position is not that the government can do counter-cyclical spending at certain times to stimulate the economy. Rather, its position, stated by the finance minister, is that we can just run deficits all the time. The finance minister responded to a question I asked earlier during committee of the whole about whether the government would ever balance the budget. He would not say yes to that very simple question.

If we look at what is happening in the economy, the government is constructing arguments that are entirely resistant to the evidence. If things are going well, Liberals will say it is an indication of the fact that they can spend more. When things are going poorly, they say that they need to spend more. Every situation, good or bad, every data point, in their minds, is proof that they need to constantly be spending more money. Of course, there are limits.

Although Canada has a relatively low federal debt-to-GDP ratio, our total government debt-to-GDP ratio, which includes what the Kathleen Wynne Liberals in Ontario are doing and other spending programs of provincial governments, is comparable to countries like the United States and the U.K. It is important that we look at the total debt-to-GDP ratio, because in Canada we have relatively more public services provided at the provincial level than we do federally. For the federal government to say that it has lots of room to run deficits just is not true, because it needs to look at the overall debt-to-GDP ratio.

We see in this fiscal update the government making promises to people, increasing spending, and announcing the indexing of the new child benefit program. The Liberals are just not dealing with real money, because they are making promises into the future that are not costed, and that, in the long run, they should know they will not have the capacity to do. I think it is wrong to promise people that the government is going to spend money on things it knows it does not have the capacity to. When it has this kind of policy, when it undertakes government spending and assumes that it can run deficits forever, what it leads to eventually are significant cuts. The benefit of running surpluses during relatively good times and stimulating deficits during relatively less good times is that the government is able to spend more during challenging times, whereas countries that have consistently spent more than they have find themselves during bad times also in a position where they are forced to cut spending before they go off the fiscal cliff. That is the situation of some countries in Europe. We know that this has happened. We do not want to see Canada go down this road.

Just to complete blowing a hole in this stimulus argument, if we look at government spending, it is not targeted or temporary stimulus spending. Liberals are instituting what they would like to propose as permanent new social spending. They are proposing spending that is not targeted to economic stimulus. It is permanent new promised spending, a promise they know, or should know, simply cannot be kept.

I will conclude with a few comments about employment insurance reforms. In the last government, we brought in some very sensible reforms for employment insurance. Under new rules we brought in, it was expected that individuals would be actively involved in a job search to receive benefits. That is a reasonable requirement. We worked to define suitable employment in a way that said that even if individuals could not find exactly the same job they had before, there should be a broader definition of suitable employment but also that the government should provide more help to people in terms of finding jobs. We instituted a stronger system of providing job information to people who were seeking jobs.

It is important that individuals be actively involved in a job search when they are on employment insurance, that employment insurance be a meaningful insurance system, and that it be designed to help people get back to work, not something that can be constantly relied on year after year. I think that is a sensible way of structuring the program. The government, in undoing those employment insurance reforms, is creating additional costs for small businesses as well as for individuals, because everyone has to pay into that EI fund.

Therefore, if we take away those reforms to encourage job search on the payout side of it, then we have to increase the burden on those paying into it. This has a real cost for the creation of jobs and for people who work in our country. I prefer a policy that makes it easier for people to get jobs, not one that cuts back on jobs.

This is the wrong direction for our country, and I will be voting against this.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Okay. That's a different answer. I'm glad you clarified that.

Bill C-26 has provisions pertaining to the insufficient rates section of the current CPP act. This section deals with what happens if the actuaries show that the contributions flowing to the CPP are insufficient to fund the benefit. Can you describe what happens if the same pressure came on to the expanded portion of the CPP?

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]

Mr. Speaker, I regret to inform the House that an agreement could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the second 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 the said stage.

[Michel Montambeault, Director, Canadian Pension Plan, Old Age Security, Office of the Chief Actuary, Office of the Superintendent of Financial Institutions]

Thank you, Mr. Chair.

I will start my remarks in French and move on to English.

Mr. Chair and honourable members of the committee, thank you for the opportunity to appear before you today. I am Michel Montambeault, Director of the Canada Pension Plan, known as CPP, and Old Age Security, or OAS, Actuarial Valuations at the Office of the Chief Actuary.

I have here with me my colleague Michel Millette, Managing Director. Michel is involved in the CPP Actuarial Valuations and liaises with the Canada Pension Plan Investment Board, or CPPIB. Michel is also responsible for the actuarial evaluations of the employment insurance, or EI, premium rate-setting and the Canada student loans, CSL, program.

The Office of the Chief Actuary, or OCA, is an independent unit within the Office of the Superintendent of Financial Institutions, or OSFI, that provides a range of actuarial valuation and advisory services to the Government of Canada. While the chief actuary reports to the superintendent of financial institutions, he is solely responsible for the content and actuarial opinions reflected in the reports prepared by the office.

The OCA plays an important role in helping decision-makers’, parliamentarians’, and the public’s understanding of some of the risks associated with the public pension arrangements by providing checks and balances on the future costs of the different pension plans under its responsibility. As part of its mandate, the OCA conducts statutory periodic actuarial valuations of the Canada pension plan, old age security program, federal public sector employee pension and insurance plans, and the Canada student loans program.

Since 2012, the OCA has also been responsible for preparing the statutory actuarial report on the employment insurance premium rate. In addition, for the CPP, whenever any bill is introduced in the House of Commons to amend the plan in a manner that would materially affect the estimates contained in the most recent actuarial report, a supplementary actuarial report must be prepared reflecting the change in those estimates. A similar requirement also applies for other plans and programs. The purpose of all the actuarial valuations is to determine the financial status of the plans and to assist the stakeholders in making informed decisions regarding the financing of the plans.

Bill C-26 provides for the enhancement of the CPP as agreed to in principle by the provincial and federal finance ministers on June 20th. The enhancement increases the replacement level from one quarter to one third of pensionable earnings and increases the upper eligible earnings limit, the year's maximum pensionable earnings, by 14% by 2025. The additional contribution rates required are set at 2% below the year's maximum pensionable earnings and 8% above it, with the rates split evenly between employers and employees. There is a scheduled seven-year phase-in of the enhancement between 2019 and 2025. Under the enhancement, the new benefits will accrue gradually over time, with full accrual occurring by about 2065. Individuals with less than 40 years of contributions will receive partial benefits.

As required by the CPP statute, a supplemental actuarial report, the 28th, on the CPP was prepared to show the effect of Bill C-26 on the long-term financial state of the plan. The 28th CPP report was prepared on the basis of the last regular triennial report, the 27th CPP actuarial report as at December 31, 2015. This report pertains to the current or base plan. The 27th and 28th CPP reports were tabled on September 27 and October 28 respectively.

The findings of the 27th report confirm that the legislated combined employer-employee contribution rate of 9.9% is sufficient to financially sustain the base plan over the long term. The legislated rate of 9.9% is higher than the minimum rate to sustain the base plan of 9.79%, as stated in the 27th report. For the enhanced or additional CPP, the 28th report confirms that projected contributions under the proposed legislated first and second additional contribution rate of 2% and 8%, together with projected investment income, are sufficient to fully pay projected expenditures over the long term. The legislated rates are higher than the minimum required first and second additional rates of 1.93% and 7.72% respectively, as stated in the 28th report.

It is important to note that the financing approaches of the base and additional CPP differ. The base plan is partially funded such that contributions are and will continue to be the main source of revenue. In contrast, for the additional plan it is required that projected contributions and investment income be sufficient to fully pay projected expenditures over the long term in order to minimize intergenerational transfers. As such, investment income is the main source of revenue for the additional plan. This means that the minimum required contribution rates for the additional plan are far more sensitive to the rates of return earned on its assets compared to the base CPP.

As shown in the 28th report, for the additional CPP, if the projected real rate of return is reduced by 100 basis points, so that the average real return falls from 3.55% to 2.55%, the minimum additional rates would increase by 32%, exceeding the legislated rates of 2% and 8%—from 1.93% to 2.55% and from 7.72% to 10.2%. In comparison, for the base CPP the same 100 basis-point drop in the projected return for the base CPP, from 3.98% to 2.98%, would result in a projected increase of 8% in the minimum rate, from 9.79% to 10.53%. Although the base minimum rate would also exceed the legislated rate of 9.9%, the relative impact of lower investment returns is much higher for the additional plan, about four times higher than the impact for the base plan.

Thank you for the opportunity to appear before this committee. We would be pleased to answer any questions you might have.

[The Chair, Liberal, Wayne Easter]

Could we come to order, please?

Pursuant to Standing Order 108(2), our subject matter today is Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act. We have with us witnesses from the Department of Finance, the Canada Revenue Agency, the Department of Employment and Social Development, and the Office of the Superintendent of Financial Institutions.

I think at the steering committee we had asked that there be separate hearings, but we agreed to just put everybody in the mix. If we can get done a little earlier, we will.

The floor is yours, Mr. Purves.

[The Chair, Liberal, Wayne Easter]

Is there anything else?

We will then suspend for a few minutes and start early with the witnesses on Bill C-26.

Budget Implementation Act, 2016, No. 2

[Sonia Sidhu, Liberal, Brampton South, ON]

Mr. Speaker, even though it is Bill C-26, it is related to the budget, so I will answer according to that.

[Sonia Sidhu, Liberal, Brampton South, ON]

Mr. Speaker, there are a lot of big expenses looming in the face of young people these days.

I am proud of the work our government has done to help kids with the repayment of student loans. That makes a real difference for students once they graduate. However, there is still significant work to be done to get young people saving for the future. It needs to be part of the system. They need to have that money going into a reliable, secure place, where it will be there for them once they need it.

Financial experts have been saying for years that financial literacy is important for young people. I would like to commend the Ontario government for making financial literacy part of the high school curriculum and congratulate the Ontario Young Liberals on their work in putting that forward.

Each year, fewer and fewer Canadians have workplace pensions to fall back on. The private sector needs to do its part to support a strong pension system as well.

Seniors receiving CPP put that money back into the economy and into the brands and businesses in their communities.

We all must do our part, public and private, to make Canada a prosperous place for everyone and make meaningful changes to the CPP that will allow Canadians to retire with more money in their pockets.

We have been talking about the baby boomers and the generational shift under way for decades. We always knew that this massive portion of the population would retire, and we knew that we would have to take action to make the system sustainable for them and their children too.

The bill addresses those on their way to retirement by doing more to ensure that they have dignity, security, and stability.

The more than one-quarter of Canadian families nearing retirement, or 1.1 million families, who are facing a drop in their standard of living will be able to retire in dignity as a result of this enhancement.

The revisions in Bill C-26 are designed to help Canadians in every step of their lives: grandparents, parents, and children.

The deal will boost how much Canadians get in their pension from one-quarter of their earnings now to fully one-third. 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.

When l was going door to door in Brampton South in the last election, I met many seniors. I met seniors who were concerned about themselves but more concerned about their families' futures. They wanted to know if their grandchildren would have the chance to go through life with the same security that was there for them.

That is why the bill is important to me. When we talk about evidence-based and long-term growth, I think of the effects for Canadians tomorrow and five years from now. In both these scenarios, Canadians will be better off.

At the core of our plan is investment. Investment in the future is what past generations did when they built transport corridors that moved countless goods and people every day. Investment in the future is what donors to universities and colleges have done for decades. It is about giving back so others can follow.

Investment in the future is what the government did in the post-war years after World War II in building a system that is envied around the world.

In Brampton, while most of my constituents were born in Canada, there are those of us who were not. We came to Canada with our eyes on the system of compassion and mutual support.

That is why investing in the Canada pension plan matters today more than ever. We cannot wait, as some of my colleagues across the aisle might suggest. If past generations had thought to wait and save their pennies instead of investing them in the Canada around us today, we would be less well off.

Every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Through this enhancement, we have taken a powerful step to help make that happen.

This investment is in the people of Canada and the public system that makes us more equal and more united. That is why I will be voting for Bill C-26, and I encourage all my colleagues from all parties to do so as well.

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

Mr. Speaker, on a point of order, I believe that we are on Bill C-29, not Bill C-26. The member is speaking on a bill that was before the House previously.

[Sonia Sidhu, Liberal, Brampton South, ON]

Mr. Speaker, I am pleased to rise today to speak about Bill C-26. In my speech, I intend to discuss how this bill is focused on the long term.

I would like to start by simply reminding the House of the stark difference in our approach. The previous government spent a decade seeing the provinces as hurdles or opponents. Negotiation was done one by one. It was negotiation through division. Our approach is different. It is collaborative.

Our Prime Minister and the cabinet of our government have been working with the provinces as partners. Earlier this year, Canada's finance ministers reached an historic agreement to make meaningful changes to the CPP. This is what a collaborative approach looks like.

First and foremost, we believe that every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Today middle-class Canadians are working harder than ever, but many are worried that they will not put away enough money for retirement.

I think about my three kids, who are in their early twenties. They are all in school. They are hard-working and brilliant people. They did their homework, got good grades, and got into post-secondary education with few challenges because of their work ethic and thirst for knowledge. Even so, many of their generation and friends are in a tough place. They are not saving now, because they have to think about paying down their student debt, paying for car repairs, or saving for their first home, let alone the cost of weddings these days. There are a lot of big expenses—

[The Chair, Liberal, Wayne Easter]

That is the request for a project budget for Bill C-26. The paper is going around. The clerk did calculations of how much it will cost to do the subject matter of Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act. It is estimated to cost $9,500, given the witnesses' expenses that are outlined in the report before you.

[The Chair, Liberal, Wayne Easter]

I think probably procedurally the best way to proceed is we need basically an agreement to adopt the subcommittee report, and if there's anything we want to pull out of it and deal with differently we can do that. Perhaps I could finish quickly going through the report and then come back to those sections that people want to deal with separately.

The second section really deals with the procedure and how we would deal with Bill C-26, which is the amendments to the Canada Pension Plan, the schedule that we would set up. It's listed on the paper.

The third section lays out, on a motion from Steven MacKinnon, the procedure that would be followed relative to votes on Bill C-26.

The fourth section lays out the plan of the committee to deal with Bill C-29, a second act to implement certain provisions of the budget tabled in Parliament on March 22, 2016, and other measures. That procedure on timing is laid out there.

The fifth section in the subcommittee report points out that we agreed to a motion by Steven MacKinnon that lays out how we would consider Bill C-29 and when the votes would have to take place.

The sixth section is laying out that in relation to the pre-budget consultations on the 2017 budget, if we can find the time, the committee would convene an in camera post-mortem meeting before the holiday break to discuss this year's progress and how we could do it differently.

The seventh section of the subcommittee report talks about how we would deal with Bill C-240, an act to amend the Income Tax Act (tax credit—first aid), which was referred to the committee on October 26, 2016, and that the committee consider this bill at the end of January or in February 2017, as the bill must be reported back to the House for March 23, 2017.

That's the subcommittee report. Have we got agreement on that?

You want to come back and deal with the first section, I gather? Okay.

Dan.

Canada Pension Plan

[Andrew Leslie, Liberal, Orléans, ON]

Mr. Speaker, I request that the recorded division on the amendment to the amendment at second reading of Bill C-26 be deferred until the expiry of the time provided for oral questions tomorrow, November 15.

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

Madam Speaker, I will make my answer very short. The member asked this question earlier in terms of the seniors he spoke to when he went door to door. The long phase-in period of Bill C-26 will do nothing to support those very people he was talking to today. Nobody will benefit from this for 40 years.

I am not sure why he is making the connection between Bill C-26 and the things he was hearing from seniors on the doorsteps today.

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

Madam Speaker, I am pleased to participate in this debate on the amendment to Bill C-26.

I had the opportunity to speak on Bill C-26 at second reading and will readily admit that my position on this ill-conceived bill has not changed. In fact, after spending a week in my riding, I am more convinced than ever that the bill needs to be scrapped.

I had the privilege of meeting with many constituents and holding a series of round tables with members from the chambers of commerce from the communities of Rosetown, Martensville, Warman, and Humboldt, just to name a few. Without fail, everyone spoke to what the impact of the CPP premiums increase would be on their businesses. Their responses were unanimous: this tax hike would hurt their businesses both indirectly and directly. Every single attendee said that they will have to consider this payroll increase when they budget for staffing next year, and that overall employee compensation will be affected.

Since the bill was introduced, I have been hearing a lot of conceptually wrong statements and value judgements from the members on the other side.

For starters, Bill C-26 would not create new money for today's retirees or for low-income Canadians nearing retirement. The bill would increase CPP premiums from 9.9% to 12% and would increase the benefits that people receive once they retire by the amount of the increase.

The increases in benefits are only made possible due to the increased contributions that workers and their employers are being forced to make today. The CPP is a contribution program. The benefits received once a contributor retires are equal to what they contributed to the program plus whatever investment returns the CPP investment fund realized.

The CPP is not an income redistribution program. It was never designed to be. It does not support low-income seniors. Quite simply, what one puts in is what one hopefully will get out plus interest. This is why retired Canadians or folks who are nearing retirement will see no change to the benefits they can expect to receive.

The Liberals claim they are raising the CPP premium because my children's generation is not saving enough for their retirement. Undoubtedly, there are some Canadians who are not saving enough, but this is not a universal problem. This CPP increase would end up costing an individual more than if the Liberals increased the sales tax from 5% to 7%, which, given the fact that Canada is in the midst of the largest year-over-year peacetime increase in federal government spending, is becoming more and more likely.

When the CPP was first created in 1965, the contribution rate was set at 3.6%. Over time, governments have increased this rate by three and a half times to the 12% being proposed by the current government.

Because CPP contributions are made as a percentage of income up to a maximum each year, there is no need to increase contribution levels to account for inflation. The CPP Investment Board returns are sufficient to ensure that the fund grows at a faster rate than inflation. The chief actuary reviews the solvency of the CPP fund every three years, and the last report indicated that the program was fully funded for the next 75 years. Therefore, this increase in the contribution rate is not being done to ensure the fiscal health of the plan.

Of course, Canadians deserve to retire with the peace of mind that their retirement is fully funded, but that does not give the government free rein to collect a growing part of every Canadian's income. The CPP was never designed to be the only pillar of retirement. It was designed to be one of many.

Also, young Canadians are faced with many expenses, like their first home, first car, and starting a family. Should retirement income be considered more important than having 2% more of one's after-tax income to pay for today's necessities? It is absolutely reasonable for many young families to want to keep more of their income at a time when their living expenses are at their highest.

With this proposed CPP tax hike, the current Liberal government actually would be 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. We have heard the Liberals say that because of the child care benefit, they now have carte blanche to increase the taxes of families. However, it makes no sense to give some money back to families and then tax it again. All that ends up happening is the government forcefully becoming more involved in the day-to-day lives of Canadians.

I believe the CPP is important, but how much further can the contribution rate really be increased? What if, according to the government, in the future Canadians are still not putting enough aside to maintain their standard of living? How much more should contribution rates be increased? Will we see an increase to 14%, to 16%, or maybe even to 18%? What is the limit? I am confident that Lester B. Pearson never envisioned that the combined contribution rates for the CPP would grow to 12% and that government would seek to take over retirement planning for Canadians, but that is the road the Prime Minister and his finance minister are taking Canadians down.

Beyond the basic problem that this would be a tax hike when businesses and employees can least afford it, it would also contribute to an endless feedback loop. The more that government gets involved in managing retirements, the less people will feel the need to save for their own retirement; and then government will once again feel the need to get involved in forcing Canadians to save more, and on it goes.

For my colleagues on the other side, here is another reason to consider this as a tax hike. If contributors die before they are eligible to claim CPP benefits, the benefits that were accrued would not flow to their partner or their dependants. Unlike other retirement-saving options, CPP contributions are not money that contributors or their beneficiaries will necessarily get back.

In conclusion, on this side of the House we trust Canadians with the money they have earned. We believe they should keep their hard-earned money and make the decisions on how to save and invest for their future, not the government. That is why I will be voting in support of this amendment.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, the bill deals with an expansion of the CPP for Canadians. This has been a long discussion. It was discussed at the provincial level. Our previous government suggested other alternatives. Then, when this government came in, it has been treating it as a primary piece of legislation.

It really comes down to a debate between ideologies. It is between those who think the government should be managing Canadians and taxpayers' money and should have the capacity to force Canadians into limited options when it comes to their retirement, or those who believe people should have the choice as to how they wish to invest their retirement income and should be able to manage their own money. Of course, on this side of the House, we believe that Canadians have enough of a sense of responsibility to manage their money. The Conservatives have taken the position over the years that we believe people have the ability to do that, and we have walked the walk. We walked the walk in both our tax policies and our positions on pension reform as well.

I am going to go through a few of the things we did when we were in government in terms of tax benefits, just to point out that we have been consistent. We increased the amount that Canadians can earn tax free. We believe that Canadians should be able to keep their money. They should be able to make choices about how they want to spend it. Consistent with that, we cut the lowest personal income tax rate to 15%, giving low-income Canadians in particular an opportunity to be tax free. We cut the GST from 7% to 5%. That tax cut had an impact on everyone across the country.

My colleague from Saanich—Gulf Islands was just asking about seniors and whether they spend their money locally. We believe they do spend their money locally, but certainly the tax cuts that our government provided Canadians across the board made it more possible for seniors to live out their lives keeping more of their own money. We did things for families, including creating and enhancing the monthly universal child care benefit.

There is a whole other area of improvements we made for pensioners and seniors as well. We did things like improve the rules for the registered retirement income funds to allow seniors to change the way they were moving their money from those investment funds. We increased the age credit amount by $2,000, and doubled the $2,000 maximum amount of income eligible for the pension income credit. We introduced pension income splitting, which was a big deal for pensioners across the country. When we talked to Canadians about this, they were very thankful for it and wanted us to extend it to others as well, which we were doing. This government has decided that is not important.

Probably the single most important thing we introduced was the tax-free savings account. It was interesting how quickly Canadians took to them. In fact, these were introduced in 2009-10, and by 2013, nearly 11 million individuals in Canada had a TFSA, and the total value of the assets held in them at that time was nearly $20 billion. That is a pretty significant initiative. It is one Canadians obviously welcomed. They were willing to put their money into it. Everywhere I went, people were very happy with that. It was individuals with annual incomes of less than $80,000 who accounted for more that 80% of those accounts, and three-quarters of those assets, by 2013. In spite of what the other parties have said about the TFSAs, these are is not just for wealthy people. There were a lot of lower-income people with them too. A lot of seniors, actually, were maxing out their TFSAs because they believed it was a very good retirement vehicle for them. By the end of 2013, about two million people had contributed the maximum amount to their TFSAs and 46% of those individuals were seniors. It is really interesting to look at the reality of TFSAs compared to the illusion the other parties were trying to create about them. Over 70% of those folks who had maxed out their TFSAs were over 55.

Therefore, if we are here to talk about seniors and protecting seniors, that was a real way of doing it, and it was something that was going to be done in real time. The changes we are talking about today with what the Liberals are proposing are not going to impact folks who are middle-aged or seniors now. It is going to take decades for this supposed benefit the Liberals are bringing in to really impact the people who would take advantage of these extra CPP benefits.

There are a number of other things I mentioned. We did pension income splitting. We raised the pension income credit for older people as well. We raised the guaranteed income supplement so that pensioners could make up to $3,500 from that, and the change to the age limit on RRSP to RRIF conversions was an important thing.

That brings us today to Bill C-26, an omnibus piece of legislation that is going to implement an agreement reached on June 20, 2016, between the provinces and the federal government. As noted before, Quebec does not participate directly in this, but it has its own plan. As a result of this legislation, CPP premiums are going to rise for workers and employers, by up to $2,200 per worker, which would be split between workers and employers. Obviously, that will have an impact on employers' capacity to hire workers.

The tax hike would take at least $100 a month directly from the paycheques of hard-working Canadians, an amount that will probably increase as time goes on. It puts thousands of jobs at risk. We have also had discussions on the planned increases in minimum wages in the provinces, which threaten low-income jobs, and this is one more threat that employers will have to deal with in trying to hire and keep people at work. Certainly this is not the time in Canada when we should deliberately be putting jobs at risk. It is not a strong, stable economy that we are dealing with right now. It certainly is not the economy we had two years ago. It is unfortunate, because it seems that every choice the government is making puts Canadians and their jobs more and more at risk.

If households are going to have to pay up to $2,200 per year out of their salaries, it means that students in post-secondary education are going to have a much more difficult time to pay off their student loans. Families will face a challenge even on things like vacations. They will have a harder time funding post-secondary education as well. Certainly it will be harder for companies to create jobs and give workers raises. It is interesting that 70% of small and medium-sized enterprises see this as having a significant impact on their business. People are paying attention to it and understand that it will have an impact on them.

Furthermore, 90% of small business owners say they would certainly like to be consulted more by the government. They do not feel like they have had a chance to have their say. They do not feel like they have been listened to. It seems to be a topic I am hearing across the country, that the government is not capable of listening to people in spite of the multi-million consultations it seems to be having. It does not seem like it is talking to the average Canadian, because they do not feel like they are being heard. This is one more issue in which this shows its face.

As I mentioned earlier, this is going to take 40 years to be fully implemented, so none of the new benefits will go to people who are presently seniors. In our questions and answers, we have heard questions focused on present day seniors, whether they have low or medium incomes, but the reality is that these changes in Bill C-26 have nothing to do with people who are seniors right now because they will not experience any of these benefits. As I pointed out, that is quite in contrast to the tax-free savings accounts and the fact that people were able to manage their own money. They could put it into those vehicles and invest as they choose, and then benefit from that.

We believe that our system has been the envy of people around the world. One of the reasons people have been envious of it is that there has been some choice within the system. We believe on this side of the House that it does not hurt Canadians to have more choice, and that because they are saving more for retirement than they have ever done before, it is necessary for them to have those choices.

I am sorry to see that my time is winding up, but we are concerned that the bill the Liberals have introduced and are pushing through will reduce employment, impact GDP, and reduce business investment, and reduce the disposable income of Canadians. Over the long run, it is predicted that the bill would reduce private savings by up to 7%. It is unfortunate that more money is going to be taken from the pockets of Canadian workers. That affects them directly. It will put jobs in jeopardy and it will do nothing to impact today's seniors because it will take 40 years for it to be fully implemented.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Madam Speaker, I would like to tell a story today, a tale from history, which may be somewhat unfamiliar to those on the other side of the aisle, but I assure them that it is true.

Once upon a time, there was a country with a pioneer spirit. It grew from a small settlement in the maritimes and the banks of the St. Lawrence and expanded until it stretched from sea to sea to sea. It was filled with proud people, immigrants and first nations, who believed that there was no limit to what they could accomplish. They valued hard work and what they could achieve when they set their minds to it and worked together. They built a great nation, one that was to become the envy of the world.

This nation was built not only on hard work but on a common set of values. The people knew that one of the keys to success was planning for the future. They were careful with their money, saving a portion of their income for a rainy day and their retirement. They knew that they might at some point face adversity and need to use that rainy-day fund. They wanted at some point to be able to retire and enjoy well-earned retirement. Therefore, they put aside what they would need to deal with emergencies and a stable future.

When they did this, they were showing personal responsibility, knowing that they could not and should not depend on someone else to make such financial decisions for them. The people who made Canada great understood that they controlled their own destinies. They passed these values of common sense and thrift on from one generation to the next. They did not look to government to do what they should do for themselves. They knew that the individual is the person best suited to decide how to prepare for his or her own retirement, which is part of personal responsibility.

It seems that, somewhere along the way, the idea of personal responsibility, that core Canadian value, has been lost by some in this country. There is a group of Canadians—let us call them Liberals—who feel that individuals cannot be trusted to do what is in their own best interests. These so-called Liberals feel that it is their responsibility—indeed, their right—to dictate to others when and how they save for their future.

That is a true story we face with the bill before us. With this ill-considered attempt to raise premiums for the Canada pension plan, the current Liberal government distrusts the ability of the Canadian people to plan for their own retirement. There is no other reason for this ill-conceived tax hike, which members opposite like to pretend is not a tax on Canadians.

They tell us that, over the next 40 years, CPP retirement benefits would rise from an income-replacement rate of 25% to 33% of employment earnings. To finance these benefits, the government would hike the CPP premium from 9.9% to 11.9%, which is about a 20% increase, starting in 2019. In addition, the yearly maximum pensionable earnings would rise to $82,700 in 2025. Earnings between the current and future yearly maximum would be subject to an 8% premium. As a result, CPP premiums would rise by up to $2,200 per year per worker split between the employer and the employee.

I have met with business owners in my riding on many occasions since this plan was first introduced. Just last week, I was told that they were unanimous in their opposition to this plan. They feel that it is like the Liberal carbon tax; it would limit their ability to make a living as the government piles tax upon tax.

This CPP tax hike would take money from the paycheques of hard-working Canadians, putting thousands of jobs at risk, and yet it would do nothing to help the seniors who need it. If the government feels that there is a problem for seniors today not having sufficient retirement funds, why is it bringing in legislation supposedly helping the future generation 40 years from now? Where is the help for Canadian seniors today?

Figures show that some households would be paying up to $2,200 more per year if this ill-planned scheme is implemented. This means that it would be harder for new graduates to pay off their student loans or buy their first home.

It would be harder for families to save for vacations or their children's post-secondary education and harder for companies to create jobs and give workers raises. Make no mistake about it; not only would Canadian workers take home less in their paycheques, but Canadian businesses would also be taxed under this plan. If they have to give more money to the government, that means less that can be passed along to their employees.

Canada's retirement system is already the envy of the world. Poverty among seniors has dropped significantly in recent years, and Canadians are saving more for retirement today than ever before. Conservatives believe in reasonable, evidence-based policies to help Canadians retire with dignity, which is why the previous government expanded the guaranteed income supplement.

The Liberals clearly agree with this approach, since they increased the GIS by 10% in their first budget, but that is different from this plan to force people to save by having the government take more money from their paycheques. It shows a Liberal lack of trust in the ability of Canadians to manage their own money responsibly. Liberals always believe that they can do it better, that Canadian citizens cannot be trusted to handle their own finances. By contrast, the previous government helped Canadians save through the tax-free savings accounts and opportunities to make voluntary contributions to the CPP.

Conservatives believe Canadians should be able to manage their own money, and given the track record of the Liberal government, we believe Canadians cannot trust the Liberal government with their pensions. After all, they have not been able to keep the promises they made less than a year ago, let alone a decade from now, and who knows what their excuses will be in 40 years?

Finance Canada's analysis shows that higher CPP premiums would hurt the economy. They would reduce employment, the GDP, business investment, disposable income, and private savings. The Liberal government, when faced with that information, wants us to trust it and believe that what it is doing is for our own good. Liberal members do not seem to understand why we do not believe them.

According to the Canadian Federation of Independent Business, 70% of small business owners disagree with the Liberal notion that the proposed CPP increase is modest and would have a limited impact on their businesses. They know it is going to hurt. A paper released by the C.D. Howe Institute shows that the Liberals' CPP plan would not benefit low-income workers. They would see their premiums go up, but their net increase in retirement benefits would remain low since higher CPP payments would be offset by clawbacks in GIS benefits.

Bill C-26 would take money from the pockets of hard-working Canadians, who are being given no choice in the matter. The benefits of this tax hike, Liberals tell us, would happen at some point in the far future. If that means less money in Canadians' pockets and fewer jobs because business taxes are too high, I guess they expect us to thank them for that, too.

I have said it before, but it bears repeating. If the government were truly serious about helping Canadians save for retirement, it would reinstate the TFSA contribution levels set by the Conservative government, treat Canadians like adults, and let them choose how to save their money. Instead, we are told that Liberals know best. History has already shown us that is not true.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

Madam Speaker, I am pleased to speak to Bill C-26 this afternoon, as there is no question that the suggested changes to the CPP will have a significant impact on Canadians and our economy.

I have heard a repeating mantra from the government that people are struggling to save, yet Canadians' retirement system is one of the most envied in the world. Poverty among seniors has dropped significantly in recent years, and Canadians are saving more for retirement today than ever before. I agree that all Canadians should be able to retire with dignity: those now retired, those soon to retire, and young Canadians who are just beginning their journey in the workforce who will, before they know it, be where our seniors are today.

Despite these facts, there are definitely many seniors currently living in poverty and many working poor Canadians who are struggling to make ends meet. These are the individuals government should be focusing on. Our government should be implementing ways to help these individuals help themselves and should provide assistance when circumstances are such that retirement is difficult and the basic needs of life are out of reach.

The previous government expanded the guaranteed income supplement, and the current government did the same, increasing it by 10% in its first budget, which was a very good decision that I applaud.

When it comes to CPP contributions, I believe that the approach in Bill C-26 would cause more harm than good. Why? It is because it is not specific, when is could be, and so it would impact Canadians who have their savings plans already established and growing and would negatively impact Canadian businesses that actually fuel the economic growth our entrepreneurs, tradespeople, professionals, and labourers need to be successful.

We should be targeting voluntary additional individual contributions to CPP and not mandating that all Canadians participate further in a program that is complementary to the savings they choose to make as individuals. Canadians should be able to manage their own money. If they want to make additional individual contributions to the CPP, that could be done. As a small business owner, I know that it would be an easy move to add a request on a TD1 indicating how much more an employee would like attributed to his or her CPP contributions above and beyond the minimum. They could also use TFSAs, RRSPs, employer pensions, and other means of providing for their own retirement.

Small business owners are being penalized when they are forced to contribute more to CPP rather than being able to invest those funds in their businesses or other means of fund growth. Instead of stimulating the economy, they are being forced to contribute to a government program that takes away their right to manage their own investment of that income.

As well, we know that the CPP is unfair to single and divorced individuals. A constituent in my riding, who has been a certified financial planner for 20 years, indicated to me that 15% to 20% of his clients fit this category. When they pass away, their estate receives a CPP death benefit of only $2,500, because they have no spouse to receive the survivor benefit, yet they have faithfully made their CPP contributions over the years, and in the case of the self-employed, have made double contributions, which could have amounted to over $100,000 in the past, and in the future to perhaps well over $200,000.

Why would anyone wish to pay into a program that may never benefit them or their estate? This is unfair and is a form of discrimination. If I personally came up with a new pension plan today that asked clients to contribute $2,500 to $5,000 per year over their lifetimes, with the only guarantee on death, before drawing CPP, being $2,500, I am quite certain that the authorities would call such a plan criminal in nature.

Another concern is that the offsetting tax credit the Liberals are suggesting to balance the additional monthly contributions for the working poor would only apply to a maximum annual income of approximately $28,000 a year. For an individual, let alone a family living on a monthly income of $2,400 a month before deductions, an increased CPP contribution will be a hardship they cannot afford.

In 2013, the total household net worth of Canadians was $7.7 trillion, split almost equally between pension assets, real estate equity, and other assets. According to a study by McKinsey & Company, 83% of Canadian households are on track to maintain their current living standards in retirement. According to Statistics Canada, the share of Canadian seniors living on low incomes has dropped from 29% in 1970 to 3.7% today, which is among the lowest in the world.

According to Finance Canada's analysis, higher CPP premiums will reduce employment, reduce GDP, reduce business investment, reduce disposable income, and reduce private savings by 7%.

A paper released by the C.D. Howe Institute shows that the Liberals' CPP plan would not benefit low-income workers. Their premiums would go up, but their net increase in retirement benefits would remain low, since higher CPP payments would be offset by the clawback of GIS benefits.

Seventy per cent of employed Canadians oppose a CPP expansion if it means a wage freeze. Fewer than 20% of Canadians say they would opt to put more of their savings into the CPP, according to a survey by the CFIB.

Clearly, low-income workers and the working poor should be the focus of this government's argument that people are struggling to save. It should help those working hard to join the middle class through a voluntary CPP program instead of having an all-encompassing program that benefits the well employed, who already have strong retirement pensions and plans in which CPP payments are an added bonus.

I now quote Fred Vettese, chief actuary at Morneau Sheppell and co-author with the Minister of Finance of The Real Retirement. This appeared in the Financial Post on June 5, 2016. He said:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get. Yes, a little over five per cent of seniors today still have income below the poverty line

Charles Lammam and Hugh Macintyre, of the Fraser Institute, stated, in the Financial Post, on June 2, 2016:

Instead of expending political energy on debating CPP expansion in the misguided belief that many middle- and upper-income Canadians are not saving enough for retirement, the focus of public debate should be on how best to help financially vulnerable seniors.

Yves-Thomas Dorval, CEO of CPQ, said that he was worried about the new direction of the Canada Pension Plan and the impact on the Canadian economy. He said that if we want to encourage saving for retirement, a universal solution doesn't work. On the contrary, it is likely to have a negative impact on economic activity, jobs, and wages.

What impacts Canadians' ability to save is a slow economy, a loss of confidence in our economy, a loss of jobs, a loss of incentives, and increased taxes, all of which have a huge impact on the ability of young families to save.

I received a call from Brian, a constituent in my riding, who was emotional and distraught as he told me that the impact of an increase in CPP premiums, coupled with a carbon tax on everything, means that his wife will no longer be able to remain a stay-at-home mom, the way she wants to be, with their two small children. He was overwhelmed by the thought of his wife having no choice but to go to work, which will also increase their monthly costs, with child care, another vehicle, and all the additional expenses of a secondary income for their family.

The government is calling on Canadians to contribute more to the CPP, saying that Canadians do not know how to save enough, yet the Prime Minister has blown his modest deficit promise, borrowing three times more than he ever said he would. The Prime Minister has broken his promise to cut taxes for small businesses. The Prime Minister has broken his promise to make his tax plan revenue neutral. The Prime Minister has made children's sports, arts classes, students' textbooks, and tools for tradespeople more expensive. The Prime Minister has taken away the universal child care benefit, a plan that was easily implemented without a lot of red tape, that helped families and lifted hundreds of thousands of children out of poverty.

Those with higher incomes paid the benefit back in taxes too. However, if that well-off family faced a downturn in the economy that ended its employment, like what we are seeing in our resource sector right now, for example, they could keep that benefit. Under the Liberal child benefit, those families will have to wait until next year to show their income loss before benefits are adjusted.

Some people truly are struggling to save, absolutely. That is why the government should be targeting voluntary additional income contributions to the CPP and should be focusing on helping those who are working hard to join the middle class and on seniors living in poverty right now, rather than blanketing all Canadians and all businesses, which are growing the economy, with a punitive program that limits their ability to save and invest.

[Tracey Ramsey, NDP, Essex, ON]

Madam Speaker, let us take a moment and talk about what pensions really look like. In Canada, there is the concept that if we go to work every day and work hard, one day we will be able to retire with dignity. Canadians planning for retirement dream about what it will be like to finally not have to go to work every day and instead do things they enjoy, such as spending more time with their family, travelling, and volunteering. This is the dream of many Canadians.

Bill C-26 would be a positive step forward in enhancing CPP benefits. This bill, when fully implemented, would increase the current level of CPP benefits from 25% to 33%. Although this falls short of the NDP's long-standing proposal to double CPP benefits, Bill C-26 is a step in the right direction. It would improve retirement security for young Canadians today.

I want to give a huge thanks to the many organizations that have been working hard for this improvement over many years. Labour and retired-persons organizations have long called for an expansion, and we congratulate them for their hard-fought win.

New Democrats have also been long calling for dignity for our seniors, the very Canadians who have built our beautiful country, many of whom are struggling in their later years with very limited incomes. We have consistently fought for increases in CPP, OAS, and GIS and will continue to do so.

The CPP is the best retirement pension deal available to Canadians. The fund is widely considered to be well managed. As of June 2016, the CPP Investment Board manages over $287.3 billion in investment assets for the Canada pension plan on behalf of 19 million Canadians, making it among the 10 largest sovereign wealth funds in the world. The CPP currently covers earnings up to a cap of $54,900; and for earnings up to this cap it aims to replace 25% of income. Maximum pensions are at $1,092 per month or $13,100 per year. For many Canadians, this only covers their basic needs.

The extended CPP would be a separate new tier. This would be added on top of the existing CPP and do two things: taking the replacement rate up to 33%, and expanding the earnings cap to $82,700. While the increase in Bill C-26 is welcome, New Democrats know that better is always possible and the government could have gone further with the percentage changes and still maintained a healthy CPP. The government could also have implemented the changes more quickly to help seniors right now. This bill could have done so much more for those who are struggling today. We need to see immediate action to help seniors and Canadians who would not see the benefits of these changes.

Retirement security is in crisis in Canada. We have fewer workplace pensions than ever, with six in 10 Canadians having no workplace pension. This means that 60% of Canadians rely on CPP, OAS, GIS, and personal savings. Most people know that seniors do not have a lot of disposable income and very few have significant savings to help. Many rely on their family to help supplement their needs and to provide them with security. Many are women who are widowed or do not have their own private pension to supplement them.

I remember a conversation I had with a widow in Amherstburg whose husband's workplace pension had been drastically slashed because the company, General Chemical, had left Canada and was now only paying a small portion of its promised pensions to retirees. She was now talking about selling her house that she had lived in her whole life because she could not live on CPP, OAS, and GIS alone.

There are many seniors in my riding who are struggling. We have a lack of affordable housing; rising costs of drugs; and increased costs of food, gas, and hydro. The list goes on and on. Seniors today are struggling, and there is so much that could be done today. The changes that are being proposed us would not take place for 40 years. Those who would see the biggest benefit from the proposed changes are millennials.

If we talk to millennials, we hear they are often not even able to imagine a future that includes a workplace pension. They are struggling to find secure employment and are often working multiple jobs to patch together a living. They do not even think about retirement because they are so focused on working to find a job.

My colleague from Churchill—Keewatinook Aski recently brought her precarious work tour to Windsor, where we met with millennials to talk about their issues. I was crushed to hear a young woman talk about the fact she never envisions having a family or owning a home because she cannot find work. She is certainly not saving for retirement, which shows the clear need for CPP changes for future generations.

What an incredible difference we have had in a generation. It is a sad reflection on our society that 20 years ago when I began working, I was able to find work easily in a unionized workplace that had a decent wage and a workplace pension, which meant that I could retire with security and dignity. Today these opportunities are few and far between. With the decline of workplace pensions we are heading into a future in which there will be no security in later life for Canadians.

We often hear of people talking about the concept of the Canadian dream, that if people work hard for 30 years they can retire with dignity. I continually hear from the other side of the House that if Canadians just work hard enough, they too can join the middle class. This narrative is not only misleading but also insulting. Many Canadians work extremely hard every single day, but for so many reasons they are not able to save enough for a decent standard of living, let alone for retirement. They do not even think about trying to join the middle class, because they are struggling to survive today.

We can go back a generation before that. My grandfather was on the bargaining team in his workplace after he came back from serving in the war. He worked at a place called Dominion Forge. When they negotiated a retirement benefit for a 30-year-and-out contract, he became the first person to retire under that contract once it was signed. Today, we are losing these pensions at an alarming rate in Canada.

Today, our workplaces are creating divisions between new hires and long-term employees. They are pitting working people against each other. This new tier of workers is asked to accept lower wages and smaller pensions, if any pension at all. We see this in workplaces right across Canada. It is a trend that reinforces the growing problem of retirement insecurity.

When I started working 20 years ago, things were relatively good. People with a high school diploma could find a job, and many jobs paid well. People could get jobs with a pension and benefits. They knew they could start a family. Today, this is just a dream for so many Canadians. Young people are struggling to find these good jobs and do not imagine planning for retirement because they cannot even find a job today.

We have a serious problem in our country today with many seniors living in poverty. I am pleased to see that Bill C-26 would address future generations, which will certainly be necessary, because there are fewer young people today who have a job in the first place so they can put some type of personal savings away and, second, have some form of workplace pension .

What are we doing today for seniors in this country? We hear the government talk about the changes it has made to the GIS, which amount to under $1,000 per year at the maximum amount people are receiving. Seniors in my riding who get that extra amount of money have not been elevated out of poverty. They are still suffering from the high costs of medication and still cannot find affordable rent. When some people in my riding found out that seniors were going to receive that money, they turned around and raised their rent. Seniors are not seeing any benefit of that bonus.

So much more could be done today. I look forward to seeing what future initiatives will come forward in the House that would help the retired person and seniors of today.

[Bradley Trost, Conservative, Saskatoon—University, SK]

Madam Speaker, one of the things I like to do when I address an issue is always lay out the philosophical principle grounds as to why I am addressing it and where my conclusions come from. One thing I have noted in this House, over the years, is members do a fairly excellent job of going through the details. However, when we are in this House, we are not just speaking to other members, explaining details, we are laying out our basic understanding to our constituents and to the broader Canadian public as to why we are voting for or against something. I always consider it very wise to lay out the basic principle as to why I will be voting on a piece of legislation in one particular way or another.

However, with respect to this particular legislation, the CPP tax hike, as we the Conservatives are noting Bill C-26, the reason I am particularly voting against it is that the government is taking away freedom and choice from Canadians. Let us be fairly clear with what the government is doing by raising the CPP premiums: it is taking away people's choice. This is not some money that is coming from somewhere else into people's accounts. It is not money falling from heaven like manna. It is people being forced to take the money, which they may very well need now, and to delay it for some future benefit some day, as the data and research shows for Canadians of my age and younger, at a very poor rate of return.

Let us go through the basic objections as to why the Liberal government's CPP hike would be bad for Canadians, would give them less freedom, and, in the final analysis, would not be good for our economy or people's individual lives.

The first point is that increases to the Canadian pension plan, hikes to the premiums, have not over the long term increased savings. The government is naturally going to argue, “Of course, this is forcing people to put money into the future that they will get back from the CPP when they retire”, but the empirical data and research that has been done, in the past, shows that whenever we have hiked the rates on premiums the number one place where Canadians tend to take the money from, when the government takes it from them forcefully, is their savings. It is almost a 1:1 ratio.

That means every time there is a hike, the government requires more in contributions, be it directly from people's paycheques or indirectly, although it still comes from people, ultimately, under the guise of taking it from their employers' contribution share. What do Canadians do? They put less money into mutual funds; they put less money into RRSPs; and now, with the introduction of the tax-free savings account, we will see less investment and less savings there.

What is happening is not that Canadians are getting a larger sum of money for their retirement, but that the government is taking away options from Canadians, taking away flexibility, and putting money into a pension plan for them, which may or may not be in their best interest.

Canadians are at different points in their lives, with different interests.

I am married. I have a 20-month-old daughter. All members of the caucus who know me know I am very proud of her. My wife and I, rather than wanting to put more money toward our pension plans, are looking to start a registered educational savings plan for our daughter. We hope some day she will grow up, graduate from high school, and go forward for further education. That is the priority for us. However, when the government begins to engage in things like the CPP hike, it takes away people's freedom to make those choices and, instead, decides for them, “This is where your savings need to go”.

There is an issue right now with affordable housing across the country, and in Vancouver and Toronto in particular. One of the greatest places where people save money is in their real estate. It is very difficult for young people now to get a foot on the ladder. The argument is, “Well, these aren't great sums of money, but a dollar is a dollar, and every little bit makes it more difficult”. To top it off, with the government's changes to mortgages, it continues to make it more difficult for young people who want to get on the housing ladder. The point is that by taking away people's freedoms, the government does not increase and encourage more savings for retirement, it just changes the vehicle for how it is done.

The second point is this. There might actually be some benefit to Canadians if the rate of return was that much greater. There was an interesting paper done by the Fraser Institute that analyzed, depending upon what year people were born, the actual rate of return, in real value, for the average Canadian. For people born after 1972, it is barely over 2%.

I am 42 years old and was born in 1974. For me, the rate of return on my retirement plan is absolutely lousy. For people from my grandpa's generation born before 1920, it was an absolutely fabulous rate of return. It was incredible. He lived to be 92 years old, he paid for approximately 10 years, and it was amazing.

However, this is the issue. For young Canadians going forward, an increase to the Canada pension plan is not great. It is a poor return on investment. If people put money in, say, a low-cost indexed fund or something like that, historically, it is shown to have greater returns that one can control. Let us say that, unfortunately, someone passes away early. Their heirs would receive extra benefits. The government's plan would instead provide weaker returns for younger Canadians. It is not helping people. It is deciding for Canadians when they need their savings, now or later, and at an inferior rate of return. That is the second point that the government needs to note.

What problem is the government addressing? Again, this needs to be dealt with. When we discuss retirement, we talk about replacement income. This really is not the issue when it comes to retirement income. The question is more one of whether Canadians are living in poverty at certain times in their lives. I am sure that when most hockey players quit playing in the NHL, they do not get retirement replacement income of 70% of their previous earnings. That is not the point. The question is whether their incomes will drop to a point where they will live in poverty. They have a choice. They have their bulk earning years and they can move things around. That is an extreme example.

I found this statistic earlier today on the Fraser Institute's website, which is that only 3.7% of Canadian seniors live in poverty, whereas it is more than 10% for working-age Canadians 18 to 64. For young people trying to put money into their educations, which for many people is the best investment by far, it is going to be difficult. Again, the government is taking away people's flexibility and making decisions for them, so that, in the end, they will not have the best return on their investments for their lives.

Instead of concentrating on replacement income, retirement policies, from a federal government perspective, should zero in on people who have low incomes. Those are almost always people who have not contributed to the Canada pension plan, because they have not worked over the years or were self-employed and not able to save money.

As my time has just about expired, I will mention another point that can be discussed in questions and comments, which is the cost of CPP versus other low-cost options available for savings. What it comes down to is that we will lose our freedom. We lose our freedom when we allow the government make decisions for us.

Let me reiterate that this bill would not solve the problem for low-income seniors, which is the real problem in retirement. It would provide a poor rate of return for people who view it as an investment, and it would displace savings from one portion of life to another portion of life by taking away people's freedoms. I will be voting against this legislation because it is bad policy. It is bad policy for Canadians now and in the future.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

Madam Speaker, I am proud to rise in the House 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.

Since being elected a little over a year ago, I have had many conversations with my constituents in Mississauga—Streetsville, ranging from security for seniors to things that concern youth. However, one of the more consistent concerns that has been brought to my attention is what our government is doing to help working-class Canadians who are looking to retire.

Many of my constituents have contacted my office and explained to me that even though they have been working hard their entire adult life, they are not confident they can safely retire. I know my constituents are not the only Canadians who have such concerns. All across the country, middle-class Canadians are working harder than ever, yet they are deeply concerned that they do not have enough money saved for a stable retirement.

More than one-quarter of Canadian families are nearing retirement and each year fewer and fewer Canadians have workplace pensions to fall back on. This leaves approximately 1.1 million families facing the intimidating risk of not having enough money saved to maintain their standard of living when they retire.

These Canadians fear that because of this, they will have to work for longer than they had planned and ultimately miss out on spending precious time with their families. As a result of this, a grandfather may not be able to take his grandchildren on a camping trip or may miss their sporting events because he could not get time off from work. A mother may have to cancel the road trip she was planning with her daughter for years, because she was called in for a last-minute shift. Ultimately, many Canadians will miss out on many important moments.

However, it is not just families nearing retirement that are concerned with this issue. Over the past year, I have met with any young Canadians who are just finishing school and are about to enter the workforce. They are concerned that with fewer jobs offering workplace pension plans, they will find it difficult to save enough of their earnings for a stable retirement.

It is no secret that Canadians are living longer lives. Although we should be grateful for this, longer life expectancies ultimately mean that the level of savings required to achieve a stable retirement is increased. With the population of my riding expecting to grow by 4% over the next 15 years and 6% over the next 25, there will only be more constituents with the same concerns if these issues are not addressed. However, I am confident that this bill addresses the concerns of my constituents and many Canadians across the country.

With all nine Canada pension plan participating provinces confirming their support, I know I am not the only person who has confidence in the bill.

Once it takes effect, Bill C-26 will increase the maximum Canada pension plan retirement benefit by roughly 50%. Currently, the maximum benefit is $13,110. However, after this enhancement, the number will increase by roughly $7,000 for a maximum benefit of $20,000.

Bill C-26 would do two very crucial things. It would increase the amount of money Canadians would get from their pension from one-quarter of their earnings to one-third. This means that a hard-working Canadian making $50,000 annually would received $16,000 annually in retirement. The bill would also increase the maximum income range covered by the Canada pension plan by 14% so that those who earn more will receive more in retirement.

We have heard from our colleagues that they are concerned that the cost of the bill would put a significant strain on taxpayers. To answer this, the government is ensuring that the changes in contributions will be phased-in slowly over seven years, which will give individuals and employers sufficient time to adjust to the minor increase. For low-income workers who may be concerned about the change in contributions, the legislation would provide an enhancement to the working income tax benefit designed to provide additional benefits that would offset the incremental Canada pension plan contribution.

Furthermore, it is important to note that contributions to the enhanced portion of the Canada pension plan will be deductible. Providing a tax deduction for new employee Canada pension plan contributions will avoid increasing the after-tax cost of savings for Canadians. For employers, employer contributions to the enhanced portion of the Canada pension plan will be deductible for income for tax purposes. For self-employed Canadians who contribute both the employer and employee share of the Canada pension plan, they will be able to deduct both the employee and employer share of contributions to the enhanced portion of the CPP.

Last week, I visited many local high schools and spent time speaking to hundreds of students. When discussing the proposed Canada pension plan enhancement, these young individuals overwhelmingly supported the legislation. They understood and supported the idea of small, incremental increases in contributions to ensure a secure and stable pension.

It is young people like the ones I met last week who will be inheriting the policies and programs we create today. The support of these young people should be a testament as to why all members in the House should support the bill. We, as members of Parliament, must think of them when debating legislation in the House. I am confident the bill will have a positive impact on the future of young Canadians, which is why I am proud to be speaking to the bill today.

During my campaign last year, I had many young volunteers helping me. When I was elected, I promised to be their advocate in Ottawa. By standing here today to speak to the bill, a bill that would have a positive impact on their future, I know I am fulfilling that promise. The positive impact the bill can have is truly significant. The bill would ensure that every Canadian worker could retire with a safe and secure pension. Young Canadians entering the workforce could enter with confidence, knowing that legislation would be in place to ensure they would have enough saved when the time comes for them to retire.

The House resumed from November 4 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, of the amendment and of the amendment to the amendment.

[Arnold Viersen, Conservative, Peace River—Westlock, AB]

Mr. Speaker, I am pleased to rise today to address Bill C-26, which amends the CPP in this country.

The changes that are being proposed today would not help today's seniors. The CPP tax hike that the Liberals are proposing would only help seniors 40 years from now and in the interim would damage the Canadian economy.

Being from Alberta, I know that our economy right now is in a shaky place. We have seen double digit unemployment rates and all sectors are being affected. This is not just an oil price problem. This is a problem across Alberta's entire economy. I particularly want to push back on the idea that Alberta does not have a diverse economy. For anyone who says that Alberta's economy is not diverse, I would challenge that person to come and visit my riding.

If there is something that starts in the ground it probably comes from my riding. I have a significant agriculture industry in my riding as well as a significant forestry industry and a significant oil and gas industry. All of these industries work hand in hand.

I met with a constituent during the campaign and when I asked him what he did he told me it was hard to explain. He said his family are traditionally dairy farmers. They have a herd of about 120 cows. He said he has a mechanics ticket and on the side he soups up Dodge diesel pickups. He has a lot of fun with that and it makes him about $12,000 a year. He said he also services a number of gas wells in the area.

This gentleman's story typifies Alberta in that its entire economy is integrated. If a person works in one industry, that does not necessarily mean that he or she only works in that industry. A lot of guys are doing multiple things. There is a lot of shift work in the oil and gas industry. People will work for two weeks at a time and then be off for a week, or they will work for 10 days and be off for four. They work a combination of such. A lot of people who work their oil and gas job will have a separate commercial interest going on when they have days off. When the number of oil and gas jobs is reduced, it affects every other sector of Alberta's economy because they are self-funding another project on the go.

A common saying in Alberta is “we're funding our farming habit one way or the other”. A lot of guys will either pick up a job servicing gas wells in their area or they will drive logging trucks. I know a number of guys who farm year-round and they drive logging trucks in the winter. They already have a big rig sitting in their yard so they get a commercial licence, insure the truck, and go logging. They bring in more income that way. These are just some of the things that show the diversity of the economy in northern Alberta.

Then we have all the spinoff that comes from the diversification of our economy, one being the service industry. We also have welders who work for all three of the industries. They will do some welding at one of the sawmills, some welding on one of the oil lease sites, and some welding work for a farmer. The hotel and restaurant industry will service all three of these industries. We have a lot of schools in the area that educate all of the children who live in the towns and whose parents work in one of the three industries.

Alberta is one of the best regulated parts of the country and because of that we tend to be on the cutting edge of new technology, whether that be in farming, logging, or the oil patch.

A number of the lumber mills that I visited said that they were the first in the country to have the technology. When logs come into the mills, they are scanned, a picture is taken of them, and the computer does an algorithm on the value in those logs. Whether they cut two-by-fours, or two-by-eights, or two-by-fives out of a log, it is all planned by the computer as they come through the gate into the mill. The company that provided the technology to the mills is able to go and sell it around the world.

It is the same thing when it comes to the oil patch. The development of the flare stack technology and the ability to create electricity off what used to be flared, was developed in Alberta. Now we go around the world and sell that technology.

People who say that Alberta should have worked harder to diversify its economy should check out what we are doing in engineering, in innovative farming practices, and in harvesting logs.

Our logging companies have a 100-year plan on how they will harvest the logs in northern Alberta. It is fascinating to watch.

Oil and gas is being depressed because of oil prices and a lack of pipelines. It is a huge problem for Alberta. The logging industry is under a couple of threats. The species at risk legislation and cariboo are causing consternation with the logging industry, as well as the softwood lumber agreement. These are the other things that are causing instability in the marketplace. People are not ready to invest in things like that.

Also about a third of the canola crop is laying underneath the snow right now. This is causing a significant hardship for our farmers in the area. Our farmers typically do not have the margins to pay significantly, at the oil and gas level, so they typically pick up oil and gas workers as well.

All of these things are working together. The three major sectors in my riding have significant instability. They are unable to invest right now, because they are unsure of where we will go.

On top of all of these things, the Liberal government is now putting an extra burden on all of these employers and employees by bringing in a new CPP tax hike. This CPP tax hike is going to make it more expensive to hire people. It is also going to cost more for the current employees, which is what we are looking at in northern Alberta right now.

A lot of companies are surviving with a zero margin. If they can get their costs out right now, they are happy to come and do the work. In some cases, they are doing the work at a loss purely to keep their guys so when the price comes back around, they will have the good guys working for them.

What the CPP tax hike will do is drive the costs up even higher, making it more difficult for companies to survive through this economic downturn. It will do nothing for seniors right now. The entire reason why the Liberal government is bringing this in right now, as they have told us, is to help seniors.

This is not going to help them. It is completely preposterous for the Liberals to say that they will bring this in to help seniors, and then say that it will only help seniors 40 years from now. It is incredibly frustrating to watch the government, completely oblivious to the fact of what is happening in northern Alberta, throwing this on there and saying that it is doing it to help seniors. I am at a loss for words to say how frustrating this is.

I know many of my colleague have raised a lot of similar points and I hope we can continue to do this. I feel the government should reconsider its position on the CPP tax hike, go back to the drawing board and come back with something that will not be so detrimental to our economy.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Mr. Speaker, I am pleased to rise this afternoon to speak to Bill C-26, the Liberal CPP tax hike.

Today marks the one year anniversary since the government was sworn in. In that context, it is appropriate, at the outset, to take a step back to look at the past year, because it really has not been a pretty one.

Over the past year, the economy has slowed and more and more Canadians are losing their jobs. In my province of Alberta, more than 100,000 people have been laid off in just the past year since the government came to office. The more than $1 billion surplus left by our previous Conservative government has turned into a massive deficit, with over $100 billion in new debt projected over the next five years and with no end in sight to the red ink. Taxes are going up for hard-working families. The tax credit for families for children's arts and sports is gone. The universal child care benefit has been eliminated. In addition, we can forget about the commitment to reduce the small business tax from 11% to 9%. It turns out that it is just another Liberal promise made and another Liberal promise broken in the long line of Liberal promises made in 2015 and broken in 2016.

Now, we have Bill C-26, a massive Liberal tax hike on hard-working Canadians. What it is going to do? It is going to take money out of the pockets of hard-working Canadians. How much will it take out of the pockets of hard-working Canadians? It will take as much as $2,200 annually out of the pockets of families.

Let us think about that. What is $2,200 going to mean for a young person who has just finished post-secondary education and is starting a career? It means $2,200 less for that young Canadian to pay down his or her student loan. What about a young couple that is trying to put money down on its first home so it can attain home ownership? It is $2,200 less for that young couple. What about the family that wants to save for its children's post-secondary education? It is $2,200 taken out of its wallet, per year. It is $2,200 less for Canadians to save and invest in TFSAs, tax-free savings accounts.

Speaking of TFSAs, let us not forget that it is the Liberal government that is responsible for reducing and rolling back the amount that Canadians can save in TFSAs, from $10,000 back to $5,500.

It is very difficult to swear, on the one hand, the government's assertion that this CPP tax hike is about savings when it is the same government that has rolled back the opportunity for Canadians to save in TFSAs. That is the government's record. The reason for that is this CPP tax hike has nothing to do with savings and everything to do with paying for the government's out-of-control spending.

What is this going to do? What impact is this CPP massive tax hike going to have?

The Department of Finance Canada projects that it will result in reduced employment, a reduction in Canada's GDP, reduced business investment, reduced private savings, and reduced disposal income for Canadians.

Those are not Conservative Party projections, those the Department of Finance's projections. The Canadian Federation of Independent Business projects that as many as 110,000 jobs will be lost due to this CPP Liberal tax hike. In the one year since the government was elected, it has dug Canada into a hole of more than $30 billion without creating a single job. Now, it wants to kill 110,000 jobs with this CPP tax hike.

What does Bill C-26 seek to achieve? What problem does it seek to solve? I would submit that this is really the million-dollar question. The fact is that Canada's retirement system is the envy of the world. According to the Department of Finance, the average Canadian senior is earning 91% of the median Canadian. That is well above the OECD average of 84%.

According to Statistics Canada, the number of Canadian seniors who are living on a fixed income has drastically decreased over the last many years. It was at 29% in 1970. It is now down to 3.1% today. Canadians are saving like never before, when it comes to planning for their retirement. In fact, since 1990, the percentage of income that Canadians are saving has doubled from 7.7% in 1990 to 14.1% today.

It is no wonder that just about everyone is panning this Liberal CPP tax hike, including none other than the hon. Judy LaMarsh, the cabinet minister who was responsible for presiding over the implementation of the CPP in 1964.

In closing, I say that there is not a problem for Canadians when it comes to savings, but the government does have a problem. It has a problem with increasing spending and increasing taxes. Frankly, Canadians have had enough. They cannot take it anymore. It is time to defeat this Liberal CPP tax hike and defeat Bill C-26.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Mr. Speaker, I am very happy today to rise and speak to the proposed legislation, Bill C-26. In order for me to explain my position on this bill, I want to say a bit about the great riding of Mississauga—Erin Mills.

While I was canvassing over a year ago, I had the opportunity to knock on a door in a good neighbourhood. An old lady opened the door. She was very dishevelled. She had bruises on her arms and her hair was a mess. I was still a candidate, and I asked her what she thought our government would need to do to better support Canadians. She said, “After I pay my rent, after I pay my medical bills, I don't have enough money left for food.” That is the plight of many retired people who live not just in my riding but all across Canada.

Over the summer, I had the opportunity to take part in the Red Cross Meals on Wheels program. Together with Red Cross, I went to different homes in my riding. We visited senior citizens who could not afford food. They were getting food from food banks and programs like the Red Cross Meals on Wheels program. I got to speak to them and really understand their plight, their difficulty in finding stability in their age of retirement, in their most vulnerable time.

The average age in my riding is 37. We have a lot of young families. Over the summer, I had the opportunity to knock on doors and get to understand what Canadians were most concerned about. I knocked on over 1,000 doors, and the number one concern, even from young people, was about what they are going to do when they retire. They wondered if they will have stability in their living and if they will have to downgrade their lives at that point, and what the government is doing.

Despite all the current benefits that are provided for retired people, we recognize that it is not doing enough to support Canadians in their retirement. Having understood the concerns of Canadians, the government has introduced Bill C-26. This bill seeks to boost how much each Canadian will receive from the Canada pension plan. The current system provides retirees with up to one-quarter of their earnings. Under the proposed system, this would increase to one-third, up to a maximum benefit of $20,000.

Seniors have for the most part spent their lives contributing to Canada's economy, by working hard, striving for opportunity, and building in their own way the Canada that we love. They have raised families in Canada. Their children will one day grow and continue to carry the torch of progress for this beautiful country.

This legislation will also support and benefit the next generation of workers. Young Canadians who enter the work force over the next few years will benefit the most from the enhancement of the CPP. Young workers visit me in my constituency office on a very regular basis, looking for employment, or they are starting their careers and looking for advice as to how to further their careers. I am very pleased to say that our young Canadians are very dedicated to the progress of Canada and to making sure that we build a strong nation. I am very happy to see that our government, through Bill C-26, will ensure that their future is also maintained in their times of vulnerability.

As I have alluded to earlier, many current retirees face troubling challenges in making ends meet. Recognizing this, our government took steps to improve the quality of life for seniors today. In budget 2016, our government provided a boost to the GIS, the guaranteed income supplement, to help seniors who are single with up to $947 annually. This ensures that the future of Canada is protected.

We will see over the next many years an increase in the number of retired people. As a government, if we do not begin to look to the future and make sure that Canadians are well taken care of after they have spent so much of their lives contributing to Canada's growth, then we do not succeed as a government. We need to ensure that our current and future workers are able to have stability in their workplace, and after they retire in the future.

We need to work hard to ensure that we all succeed as Canadians. Bill C-26 is not the only way we are doing it. There are many other ways. As we know, progress is not a one-step approach, but a multi-faceted approach through our many investments in infrastructure, our CCB, and our recent assistance for our youth. We have raised the bar to bring Canada to a level that ensures we progress as a nation.

I would like to thank our Minister of Finance and the provincial and territorial ministers for their dedication to improving the lives of Canadians with this historic agreement on expanding the CPP. As stated in the Toronto Star:

The agreement...provides for the first substantive change to our national retirement scheme...The deal recognizes that the time has finally come to do something about retirement security.

I am very happy with the role our federal government has played in collaborating and working together with our provincial and territorial counterparts and our municipalities to ensure we are all on the same page, that we really understand the issues, so we can stand in the House and fight to ensure that the work we do as parliamentarians is effective and is what Canadians need.

I am very happy that here has been a lot of debate in the House and a lot of passion shown with respect to helping our seniors, not just the seniors of today but those of tomorrow, and their families.

[Guy Lauzon, Conservative, Stormont—Dundas—South Glengarry, ON]

Mr. Speaker, I have a very brief question for my colleague. I happen to know a couple in their late twenties who are working for their brother-in-law in a small business. Now, under the Liberal's Bill C-26, they are going to have to each contribute, as I understand it, $1,100, and the person who owns the business, who happens to be their brother-in-law, is going to have to match that money. If those folks were to invest in a savings plan, the TFSA or something similar, and the small business owner was allowed to use that money to expand his business, which would be better? Would it be better to put $1,100 of taxes into a CPP that will maybe pay something 40 years later, or save the money themselves? I wonder if he could give me an opinion on that.

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, and of the amendment, and of the amendment to the amendment.

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, it might be helpful, or perhaps even instructive, if I prefaced my remarks by sharing with my colleagues the definition of a tax. A tax is defined as a “compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions”.

I would suggest that anyone with a reasonable outlook would know that hiking the CPP premiums is a form of taxation. It is in effect a payroll tax.

I would argue that raising taxes in times of a sluggish economy, in times of the weak economy we are experiencing here today in Canada, is absolutely the wrong thing to do. Raising taxes would have negative impacts on the Canadian economy. For example, it would restrict and reduce the ability of businesses to reinvest in their businesses. It would reduce the ability of Canadians to have more take-home pay, and it most certainly would reduce their ability to add to their savings. It would reduce the amount of of money they would be able to save.

It is simply the wrong approach to take. This payroll tax is regressive. It harms employers and employees alike. Most particularly, it is harmful to small businesses.

Let me share a small story from just a few weeks ago. I happened to be in Thunder Bay on some business. Since I had never been to Thunder Bay before, I went out for dinner to a restaurant that night with a colleague. I had a lovely dinner. Following dinner, the business owner and I engaged in a conversation. Once he found out I was a member of Parliament, he wanted to talk about the proposed hike in CPP premiums. He told me his profit margin was so skinny that any increase to the CPP premiums would result in only two things. One, he would be looking at a negative profit for the year, which might result in his closing his doors; or two, he would be forced to lay off employees. Neither of those two options was particularly attractive to this young employer. He said he had a business partner in another restaurant in Edmonton who was facing exactly the same situation.

I know it does not matter whether one is a small business owner in Surrey, British Columbia; Edmonton, Alberta; Winnipeg, Manitoba; Thunder Bay, Ontario; or Corner Brook, Newfoundland, because this is a problem for all small business owners.

The frustrating thing about this is there is no need to increase CPP premiums. The government's stated objective is to allow Canadians in their retirement years to retire more comfortably. However, the statistics do not indicate there is a problem today. Statistics indicate that fewer than 4% of seniors are living on a lower income, or below the poverty line. That is a great change from many decades ago. In fact, in 1970, 29% of seniors were living below the poverty line, so we have made great strides in the decades since 1970.

Additionally, statistics indicate that Canadians are saving more money today. In 1990, Canadians saved slightly more than 7.5% of their income. Today, it is almost twice that. Canadians are saving over 14% of their take-home pay, or at least their gross income, and putting it into savings vehicles like RRSPs, TFSAs, and the like.

We are making progress on that, so for the government to say it is doing this out of necessity is, frankly, disingenuous at the very least.

The government appears to be trying to create a solution for a problem that does not exist. The irony of all of this is that because of the government's reckless, out of control spending, the reality is that the government is creating a problem for which there is no solution, because of the billions of dollars of debt it is incurring and throwing upon the backs of taxpayers. It has no solution for getting out of debt. There is no plan to get back to balance.

It appears that the government's economic plan, if we want to call it that, is following very closely the path of the previous Ontario governments of McGuinty and, currently, Premier Wynne. That disastrous economic plan has resulted in the Province of Ontario, on a per capita basis, being more indebted than any jurisdiction in the world. What is even more frightening is the fact that two of the main architects of the disastrous economic policy of Ontario were Gerald Butts and Katie Telford, who are now two of the main economic advisers to the Prime Minister. I would hate to see these two do to Canada what they have done to Ontario, but that is certainly what appears to be happening.

However, I think there are alternatives to what the government is planning and proposing with Bill C-26. I have always thought it is instructive and helpful if opposition members, rather than just criticizing the government, offer alternatives or things the government could at least consider to replace flawed legislation—and Bill C-26 truly is flawed. My suggestions to the government would not cost the taxpayer a nickel.

The first suggestion I would make is this. Why does the government not work with its provincial and territorial counterparts and encourage them to add financial literacy to the K-to-12 educational curriculum? I think it would be extremely helpful for young people to learn why they need to save for retirement. It would helpful for them to learn how to save for retirement, to learn about the investment and savings vehicles that are available in Canada today, so that when they finally enter the workforce, they have a plan, or at least have charted out a course of action, to be able to work their lives and then retire with dignity. That no-cost item would, I believe, be extremely helpful.

The second thing is again a very simple concept. Of course, I believe it is totally alien to the government's thinking, but it would not cost the taxpayers a nickel, and it is simply to lower taxes. Do not raise taxes, but lower taxes. Allow Canadians to take more money home with them. Put more money in their jeans. Put more money into savings vehicles. At the same time, lowering taxes would stimulate the economy.

Our previous government had a low-tax, high-productivity agenda. It resulted in having the lowest tax regime in 50 years. What was the result? Well, we created 1.3 million net new jobs from the height of the recession until the day we left office. Why? It is because lowering taxes increases productivity. That is a concept the current government is totally unaware of. Bill C-26 is totally opposed to lowering taxes, because this bill would raise taxes.

For those reasons, and some of the others I articulated in the few moments I had for my address, my colleagues and I in Her Majesty’s loyal opposition will be vociferously opposing Bill C-26.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Speaker, I would like to start out, as many of the members have this week, by giving recognition to the veterans in my city, particularly in Edmonton Strathcona. I will be joining many at Holy Trinity Anglican Church in my riding, with the Light Horse regiment, where we will have a service and then march to the cenotaph. I look forward to joining Edmontonians in thanking our veterans for their service and remembering those who did not come home.

I am also pleased to rise to speak to the reforms proposed in Bill C-26. The pension reforms are a welcome response to the growing pension crisis in Canada. Contrary to what some members in the House allege, people are not able to save, and we are in a crisis. We need to support those who move to retirement.

My colleagues and I have been calling for these reforms for a considerable amount of time, as have many unions, provincial governments, and seniors organizations, including CARP.

While better was possible, and the full benefit will not be felt for five decades, the proposed benefit enhancements are a good first step. Challenges will remain for those currently retired or approaching the age of retirement.

Today's seniors will not personally benefit from these changes, but as Wade Poziomka, CARP's director for policy, has explained:

CPP enhancement is important to CARP's membership because they recognize the challenges that young people face today when it comes to savings.... With less access to workplace pension plans, a CPP that meets the needs of Canadians today is so crucial.

The federal and provincial governments are to be commended for having reached the agreement that led to this bill. I am pleased that the Government of Alberta was among the first to support this critical step forward, contrary to the case with previous governments of our province.

As has been pointed out by previous speakers on the bill, fewer and fewer Canadians are being provided access to workplace pension plans. Where pension plans are provided, they are in many instances offering reduced retirement security.

Additionally, with younger workers increasingly likely to change their jobs many times over their lifetime, and with many, as my colleague, the member for Churchill—Keewatinook Aski, has pointed out in this place, facing precarious work, the need for secure and adequate public pensions is becoming increasingly important. Only about a third of those who are eligible to do so actually contribute to RRSPs. It is clear that Canadians need support in saving for retirement. This is not because they are profligate or irresponsible. Young families have to prioritize paying for rent or, if fortunate, a mortgage, paying down substantial and growing student debt, and simply putting food on the table. Later in life, they may be faced with helping to cover significant and growing education costs for their children, and retirements needs for their own parents.

The Canada pension plan has proved to be a reliable and safe way to save for retirement. Why would we not use it as a mechanism to ensure retirement with dignity for future generations?

Concerns have been raised by some about the additional costs to employees and employers of increased contributions to CPP. However, with respect to the costs to small business, we are still awaiting the promised—the long promised, frankly, by both the Conservatives and Liberals—reduced taxes to small business.

The economy has taken a hit recently, particularly in my own province. Therefore, the contribution of seniors to the economy remains essential to all of our communities, in particular to small and medium-sized independent businesses, of which my own riding of Edmonton Strathcona has so many. We need future retirees to be sufficiently economically secure to ensure economic health in the future. The most cost-effective way to do that is to enhance CPP and QPP.

CARP has been among those who have pointed out that the proposals in Bill C-26 only go part way toward a full solution of the problems we face in ensuring retirement with dignity for all Canadians.

It is estimated that we need about 70% of our income at retirement to maintain our standard of living. Currently, CPP and OAS together bring us to about 40% of that. The changes in Bill C-26 would increase that to only 50%, meaning that Canadians will still need to have some kind of workplace or private pension plan to stay ahead, or ability to save.

According to a recent Statistics Canada report, currently about 12%, or 600,000 seniors in Canada, live in poverty. This includes more than one in four seniors, most of whom are women.

In my constituency office, we hear from many facing the challenges of insufficient income to pay for the basics of life. This is especially true for those relying solely on OAS and GIS. Many of those who are eligible for those benefits are not accessing them because they are either unaware of those benefits or they do not know how to apply.

The question I wish to put to the government is this. Why should seniors have to apply for these payments? Why not issue them automatically to those in need, as is the case with GST credits?

We are also discovering, while checking on applications for constituents, that the processing times for OAS and GIS have exploded. It is now six to eight months, whether they applied before they turned 65 or after. In some cases, they wait a year. In the meantime, the applicants are relying on nothing at all, bare cupboards. It is important to recognize that few seniors are actually receiving the maximum CPP benefits, as meagre as they are.

If they have some RRSPs and decide to cash them in to get by while waiting for OAS or GIS to kick in, they may be penalized in the following year by having the GIS clawed back. We need to end this GIS clawback.

Among the reasons that our offices hear from so many seniors is that it is almost impossible for them to contact a government department employee to discuss their issues. While it may be efficient to have everything online, it does not suit everyone or every situation. Even at Service Canada offices, it is difficult for people to find someone who has access to the files. It is pitiful that seniors cannot call and talk to a real person over the phone about their pensions.

We have waited a long time for the reforms contained in Bill C-26. Let us make sure we take this important step towards ensuring retirement security for the people we represent. Let it not be the last time we look at the issue of pensions or support for seniors in this place. It is time to ensure greater availability of affordable senior housing and care, including home care, palliative care, and pharmacare. Canadian seniors should not live in poverty. It is our responsibility to make sure they do not.

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Speaker, I am happy to rise in the House today to speak to Bill C-26.

I want to first acknowledge that yesterday the Prime Minister held another news conference to celebrate his first year in office. While I am sure Canadians are getting a bit tired of the Prime Minister's endless PR stunts, it is even more frustrating that he is celebrating a record that is hurting Canadians.

Let us talk about that record: widespread job losses, massive tax hikes, more debt, higher deficits, no plan. It is not a rosy picture, which is why I, along with my colleagues on this side of the House, am a little surprised that the Liberal solution to higher taxes is yet another tax hike, but it is okay, they will call this one a CPP expansion, hide the details, and maybe Canadians will let it go.

The government seems to be selling us a line from the hit Dire Straits song Money For Nothing, but there is no money for nothing. This tax hike will cost jobs, wage growth, and GDP growth.

The Canadian Federation of Independent Business projects that by 2020 total employment in Canada will have dropped roughly 110,000 jobs because of the CPP expansion and higher tax. Two-thirds of small businesses surveyed indicated they would cut hours and wages to offset this tax hike. One out of every three are looking at lay-offs to offset it. The hike is also forecast to move wages lower by 0.8%.

Every time the Minister of Finance stands in the House he talks of the low-growth economy. He forgets to mention his own finance department says the CPP tax expansion will shrink the economy.

We stand opposed to all wasteful tax hikes designed to fund the Liberal government's continued expansion, and this CPP tax hike is no exception. In fact, it is worse, and let me tell members why.

There are several problems with the CPP tax hike besides killing jobs and stifling growth. First, quite ironically, it cancels out the Prime Minister's much beloved middle-class tax relief. Remember the 1.5% Canadians were supposed to see back? Shockingly, the government decided that maybe it likes having more money to take limos, have expensive meals, and take pretty pictures in exotic locales, so it designed a tax hike that will take away that tax relief. One thing the government never seems to realize is that government cannot give what they have not already taken from us.

Let us consider Martha and Henry. They are both middle-class wage earners who work hard and pay their taxes. Tired of being slammed with the new Liberal taxes and a slow-growth economy, Martha and Henry diligently save part of their paycheque every month. They cannot take another hit. However, because the government has priorities that are out of touch with Canadians, Martha and Henry can now see up to $2,200 more deducted every year, wiping out the meagre 1.5% saved with the much vaunted middle-class tax cut. Keep in mind that neither Martha nor Henry will see any of this money back for an extra 40 years.

The government will tell us that it is okay, because at least Martha and Henry will have something to show at the end. The problem is that the government assumes Canadians have no idea how to manage their extra money.

Where could the extra money have gone? Let me tell hon. members because it leads directly to the next problem with the CPP tax hike. The CPP as an investment vehicle is weak. According to the Fraser Institute, the average return, long term, on investment for Canada bonds is 3.5%. The return on investment for Martha and Henry's CPP investment on the new expansion is 2.5%. That is right, 2.5%, barely enough to cover inflation. This is not exactly ideal, because the CPP will need to cover far more than just inflation as more Canadians move into retirement over the next several years, or what is more likely is that the government will simply come back, hat in hand in the future, and demand more money from Canadians to cover the shortfall.

Why does CPP have such mediocre returns? Among a host of reasons, primary ones are high fees for asset management. Andrew Coyne of the National Post comments on a gathering momentum of more staff, higher pay, and rising operational expenses, and he concludes, all for no appreciable payoff for Canadians.

More worrying is that because finance ministers looking for cash have a strong tendency to lean on pension funds as a source of investment for infrastructure projects, the CPP would earn even lower returns. This tendency was confirmed by the Minister of Finance's own economic advisory council, which stated repeatedly that pension funds should be looked at as a source of untapped potential for infrastructure by government.

This approach undermines the independence necessary for a fund to be truly profitable and provide meaningful returns. Without that independence and with constant interference from the Minister of Finance to fund whatever project his government sees fit on a given day, the ability for pension funds to garner higher returns is undermined; hence 2.5%

It is fairly clear the government wants more cash and this CPP tax hike is the way it is going to get it.

I know what members are thinking, Martha makes a decent wage, could she not just move a little more of her income into a fantastic and well-received investment vehicle such as a TFSA? Sure, she could, but the same Fraser Institute, those pesky policy wonks, studied hard and found for every dollar increase in CPP contribution, private savings are reduced by 90¢, fully 90%. This is not a winning formula and misleads Canadians on the benefits of CPP.

Speaking of misleading, the next problem with this hike is that Canadians are rapidly finding out the finance minister is selling them a bill of goods. The finance minister wants to help the vulnerable and this is a good goal, a worthy goal. This goal will not be accomplished by a CPP hike and here is why.

First, CPP only pays those who pay into it. If I die tomorrow, my wife would not receive my CPP pension. If I invested this money in something smart like those fantastic TFSAs I mentioned earlier, my wife and kids would have a tidy sum to walk away with. However, because CPP has punishing rules for the survivor's pension, my wife would receive 60% of the CPP at best. If she collects CPP on her own, she would receive even less.

There are fewer retired Canadians living in poverty now than at any point in our history. For Canadians on our bell curve, our bell is located above the high average. The thing with bell curves is that they all have a tail on the lower end, but the solution is to help the lower end and it is not to move the rest of bell even lower. Those struggling at the lower end of the tail need help directly. Lowering the rest of the bell to meet the tail does not help anyone.

The shame of the bill and the whole deceit of it is that this added CPP expansion will do nothing to address those seniors living in poverty. It is misleading for the finance minister to tell Canadians that this CPP expansion helps those who need help, because it does not.

It is simple. We could double or triple the CPP payouts, but if people have never paid into it, they get nothing. A huge amount of our seniors who are living in poverty are in that position because they, for whatever reason, did not contribute or contributed little to CPP during their working years.

We want to help those who need it. We want to help the widowed grandmother struggling to get by on a fixed income or the disabled grandfather trying to make ends meet. We want to help Martha and Henry ensure that they are planning for their retirement. We want them to use those TFSAs and RRSPs and invest their savings in the market because the market earns far more than 2.5%. A simple ETF invested in the Standard & Poor's 500 would yield a far greater return and allow Martha and Henry to access their savings at any time.

We want to help those who are struggling at the lower end. This is why the previous government expanded the GIS. It is why the previous government expanded the tax-free savings account to $10,000. It is why we introduced income-splitting for seniors and why we lowered the mandatory withdrawal rate for registered retirement income funds. These are evidence-based policies that benefit every senior today and we are proud of our record to help the most vulnerable.

We do not believe it is fair for the finance minister to mislead Canadians, raise taxes on workers, and leave the most vulnerable behind.

I move:

That the amendment be amended by adding after the words “seniors in need” the following: “; and (d) will impede Canadians' ability to save for the future.”

The House resumed from October 25 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, and of the amendment.

Business of the House

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

Mr. Speaker, this afternoon we will continue to debate the Conservative Party motion.

Tomorrow, we will resume debate on Bill C-26, on the Canada pension plan.

Next week, as the hon. member said, we will be working hard in our constituencies and attending Remembrance Day ceremonies on Friday to collectively stand in honour of all who have fallen in the service of Canada.

When we return on Monday, November 14, the House will then have the fifth day of second reading debate on Bill C-26, the CPP enhancement bill. On Tuesday, the House will also have the fifth day of second reading debate on Bill C-29, the second budget implementation bill.

On Wednesday, the House will consider Bill C-16, the gender identity bill, at report stage, and hopefully at third reading. On Thursday, the House will debate Bill C-25, the business framework bill, at second reading.

Budget Implementation Act, 2016, No. 2

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Mr. Speaker, it is a pleasure to rise on behalf of my constituents to talk about Bill C-29.

The first thing I note about Bill C-29, a second act to implement certain provisions of the budget tabled in Parliament, is that it is an omnibus bill. In terms of size, it is 230 pages of omnibus legislation. I remember well when the member for Beauséjour was the House leader for the Liberals and they were the third party in the House, how he used to rail against bills of this size. It did not matter what was in them; it was the fact they were omnibus bills that created so much angst.

The member for Winnipeg North made a career in the last Parliament out of railing against omnibus legislation. It was said to be dastardly thing for a government to choose to implement its budget via a budget implementation act. That is what is happening today. We are talking about an omnibus budget bill. I guess the principles and policies the Liberals had when they used to sit in the third party seats change a little when they cross over to the government side. Now they are a big fan of omnibus bills. That was the first thing I wanted to mention.

This bill is supposed to be the plan to implement the budget. The government clearly has no plan when it comes to budgeting. During the election campaign, Liberals promised there would be a $10 billion deficit that would be paid back within the mandate of a majority government. How long did it take them to abandon that promise? Was it 10 minutes?

I remember Prime Minister Stephen Harper saying that the Liberals' position was that everyone should trust that it would be a modest, little deficit. How right he was. We are going to hear today at four o'clock just how much more than a $10 billion deficit the government has blown in less than a year. The fiscal update will show that the government is, by a magnitude of at least three times, past its initial deficit target. It misled Canadians during the election and has blown through it.

What do Liberals have to show for it? I would argue they have nothing to show for it. There is no increased growth and there are zero net new jobs. The parliamentary budget officer has confirmed that there are zero net new jobs as a result of $30 billion or so of borrowed money being spent. This was supposed to stimulate the economy and take us to untold heights. The Liberals have done nothing they promised and have blown through their deficit target, so they have no budget plan. The plan is just to borrow more money and spend it. Canadians know that debt has to be repaid, that borrowed money has to be paid back. If my generation does not repay it, it will be our children and grandchildren who get this bill, because eventually it will come due.

One of my constituents, a small businessman, has certainly seen that the Liberal government is no friend of his. He told me the government is like a teenager who has one parent who provides him with a credit card with no limit on it, and that parent is very popular, but the other parent who hands the credit card bill to the teenager and says it is his to pay back is the less popular parent. Right now, the Liberals are playing the role of the sugar daddy who hands out the cash, but what Canadians will soon realize is that the bill will be paid by them. That is clearly what is happening.

What have Liberals done in less than a year? They borrowed $30 billion, as I said, and they have also misled small businesses. All parties agreed that the small business tax rate would be lowered from 11% to 9%. How long did it take the Liberals to break that promise? It was broken in their first budget. They broke their promise to small businesses, and I think we know why.

During the election campaign, the Prime Minister made it clear that there were an awful lot of people who were using small businesses to avoid paying their fair share of taxes. That is what the Prime Minister said about the industry that creates the most jobs in this country. He said that small business was just a tax avoidance scheme. We found out during the election campaign that he has set up some of those companies himself to avoid paying a lot of taxes, so perhaps he knew what he spoke of. However, that is not what was promised to small businesses.

I spoke earlier this month in the House about Bill C-26, a bill dealing with CPP rates. Again, that would do nothing for seniors. It would do nothing for people approaching retirement. In fact, the finance minister has admitted that it would do nothing for anyone for more than 40 years. However, what it would do is reduce the incomes of Canadian families by up to $2,200. That $2,200 is taken from the paycheques of Canadians to go into a fund they likely will never be able to access. That is in addition to the $1,100 coming out of the pockets of small businesses who are paying their portion of that tax.

So they are increasing taxes on small businesses. They are also increasing taxes on Canadians through a carbon tax.

I was honoured to be given the role of critic for natural resources. Since the government has taken office, over 100,000 energy workers have lost their jobs. What do we see from the government? We see no jobs plan. We see no lifeline to families in the energy sector. Instead, we see them being thrown an anchor, the anchor of a carbon tax.

What would that do? The member for Oshawa talked about what it would do for manufacturing.

I will tell members what it would do for the energy sector. It would put an already crippled energy sector at an even greater disadvantage vis-à-vis the people we are trading with, the U.S., which has no intention of implementing a federal carbon tax any time soon. They are our major customer.

When we moved a motion at the natural resources committee to have the Liberal members tell us what analysis they have done to show what impact the carbon tax would have on the natural resource sector, they voted against it. We know why. It is because they have not done any economic analysis of that impact. They do not care. They do not care about those 100,000 family supporting jobs that have been lost. We have seen they do not care about that sector because they continue to layer regulatory burden after regulatory burden upon a sector that is already suffering. When there are pipelines to be approved, they do not allow for evidence-based scientific policy to take place. They layer on an extra political layer in which the minister will make the final decision, in which the cabinet will make the final decision, in which red tape is layered upon an already burdensome process. That would do nothing to protect public safety. It would simply add to the regulatory burden.

The government is fond of saying how it has cut the taxes of middle-class Canadians. It is just not true.

The average income of people in my riding is under $40,000 a year. Guess how much they receive from the income tax cuts from the Liberal Party? Zero. They receive nothing. The most vulnerable, low-income Canadians got nothing from the Liberal tax cuts, while people like members of Parliament, who make up to $150,000 a year, get the most benefit one could possibly get out of that tax cut. The Liberals have done nothing for an average family in Chilliwack—Hope with that tax cut, and anything they have done for some families, they are going to tax back with the extra carbon tax and additional payroll taxes. Canadians are not better off.

They also cancelled things like the child fitness tax credit, the child arts tax credit, and tax credits for textbooks. They said that is because they do not like to complicate the Income Tax Act. They do not like those boutique tax credits, they said, that help families, that help moms and dads put kids in sports and in dance lessons. However, what they do like are boutique tax credits for talk show hosts for Canadian shows, or for someone who needs to take a first aid course. They are all for those tax cuts. It does not seem to matter, as long its not a family, as long as it is not people supporting their children. We do not want to support people like that. However, if people are creators of content, then they need a tax break from the Government of Canada.

Their priorities are wrong. They are not looking after Canadian families. They are looking after special interests. We have certainly seen that over the last little while, with the revelations about their fundraising practices, in which they are meeting with the well-heeled insiders they regulate, who are giving them money for access. It is not the right way to go. This is not a budget plan, and we cannot support it.

[Mark Machin]

Thanks for the question.

On the changes in Bill C-26, we recognize that there will need to be separate and joint financial statements, and we're working through those details. We think it will be possible to manage the consolidated fund while taking into account the funding requirements and the difference between the base and the additional CPP. As I said previously, we think there is an additional reliance on investment income in the additional CPP because of its fully funded nature. We think there will be a need for a more conservative asset mix for the additional CPP. That is something the details of which we'll be working through carefully in the coming months.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Thank you, Mr. Chair.

Would the changes to the CPP that are being proposed in Bill C-26 result in adjustments to the CPPIB investment strategies? What would be the nature and extent of any such adjustments?

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

That's been with the pay-as-you-go and you also mentioned that with Bill C-26 we would actually see the fund become self-sustaining and therefore have less tolerance for risk. The question I would have, then, is, do you foresee that this active management strategy, which has doubled in its cost, roughly, over the past seven years, by going from a half a point of assets to now $2 billion of assets...? Will the same approach increase similar costs or will we see marginal returns because there will be less capacity for risk?

[Steven MacKinnon, Liberal, Gatineau, QC]

Thank you very much.

I know that even a $300-billion fund, which is a hard number for Canadians to understand, is not a particularly large fund in a global context, but as we grow with CPP 2 we will move up the league table, so to speak, in terms of size. What I'd like to ask you about is perhaps a more philosophical question in terms of accountability and transparency to Canadians.

In terms of your cost structures and your governance structure, what do you envisage philosophically in terms of how the CPP reports to Canadians? What level of accounting will it provide to Canadians? How understandable will that accounting be? How will CPPIB be governed? Could you provide your reflections on those topics so that we can consider them, both in the context of evaluating Bill C-26, and also in performing our role of oversight and reassuring Canadians that their pension funds will be there when they need them?

[Mark Machin, President and Chief Executive Officer, Canada Pension Plan Investment Board]

Good morning, Mr. Chair and members of the committee.

Thank you for having me here today to speak with you and answer questions regarding the Canada Pension Plan Investment Board and how we are helping ensure that the CPP remains sustainable for future generations.

With me are Michel Leduc, our senior managing director of public affairs and communications, and Ed Cass, our chief investment strategist.

I'm Mark Machin. I joined the CPPIB four and a half years ago as their first president for Asia and then became head of international work in 2013. Prior to that, I worked for Goldman Sachs for 20 years in Europe and Asia. While I'm a new resident of Canada, so far I've had the pleasure of travelling across the country meeting with finance ministers, the stewards of the CPP, and some of our contributors.

I was enormously honoured to be chosen by CPPIB's board of directors to lead such an important professional investment organization with a compelling public purpose. International organizations such as the OECD, the World Bank, the Harvard Business School, and The Economist have all praised the “Canadian model” of pension management due to its strong governance and internal investment management capabilities.

Our governance structure is a careful balance of independence and accountability, enabling professional management of the CPP fund while ensuring that we're accountable to the federal and provincial governments, and ultimately to the Canadian public. We know that contributions are compulsory, so we're motivated to work even harder to earn that trust.

We hold ourselves to an extensive disclosure policy, including quarterly reporting, annual reports, triennial reviews, and special examinations, and we announce all major investments and corporate developments.

It was just over 20 years ago that the Chief Actuary of Canada projected that the CPP would run out of money by 2015 if changes were not made to the management of the CPP. In 1997 the federal and provincial governments addressed this challenge head-on by increasing the contribution rate and creating CPPIB to manage the contributions not required to pay benefits. There was a clear imperative: to expose the fund to capital markets in order to achieve growth objectives.

Since then, CPPIB has been focused on getting the best investment returns possible. Our ten-year rate of return is 7.3%, and our five-year rate of return is 12%. More than half of the assets of the CPP fund today are now the result of investment returns, not contributions. The chief actuary noted in his report last month that over the last three years investment income was 248% higher than anticipated due to the strong investment performance of CPPIB.

Most importantly, the chief actuary reported that the CPP fund would be sustainable for the next 75 years, with an assumed 3.9% net real rate of return after inflation and all expenses. CPPIB's five-year net real rate of return as at September 30, 2016, is 10.5%.

At CPPIB we know we can't take these results for granted. It's a difficult investment climate around the world, and single years can produce very different results. In 2009, we had our worst year ever, losing over 18%, but in 2015, we had our best year ever, with a gain of over 18%. We know we can't focus on the yearly results. Our ability to see past these short-term pressures and pursue the best long-term strategy depends on strong, independent governance and the clarity of our mandate.

With the CPP's risk exposure, including wage growth, demographics, longevity, and economic risks, being highly weighted towards Canada, it's especially important that CPPIB's investments hedge against these risks.

To address these risks, CPPIB is diversifying the fund around the world and across asset classes. Currently, over 80% of the CPP fund's assets are in international jurisdictions and in a variety of asset classes, from private equity, infrastructure, and real estate to public markets.

While we're confident that this is the right strategy, we also know that competing with the largest investment firms around the world to secure the best assets comes with costs.

CPPIB, at approximately $300 billion in assets under management today, is a mid-sized organization competing with global giants. BlackRock, the largest asset manager in the world, has over $5 trillion in assets under management. Closer to home, Sun Life has almost $900 billion. Among global competition, we fall well down the list in size.

To fulfill our long-term investment goals, CPPIB took the decision 10 years ago to pursue an active management strategy that would both maximize returns and create a more resilient, diversified portfolio.

Pursuing an active global strategy was a decision taken very seriously, with considerable analysis. Success depends on sufficient resources to compete and manage risk effectively, and this is important context when looking at our costs. In order to compete, we need expertise and skill as a knowledge-based enterprise. There's no doubt that the winners will be those investment firms with the most talented investment teams and a global footprint to cultivate critical relationships with partners, governments, and others to secure deal flow and manage the risks over time in order to maximize returns and manage risks for our contributors and beneficiaries.

Before concluding, I'd like to address Bill C-26. CPPIB is currently analyzing the legislation to ensure that we are completely ready to implement the amendments that affect us.

With or without reform, the CPP fund is projected to grow significantly in the future, and we're well prepared to manage a larger fund. When we evaluate investment programs, new processes, and supporting technology, we always want to ensure that they can be scaled to take into account increased size. We are very confident that we'll be ready to manage the additional funds.

Bill C-26 requires separate and joint financial statements for both the base CPP and additional CPP. While we're working through the details, we will be able to meet this new requirement.

We believe that it's possible to manage the consolidated fund while having regard to the funding and the requirements of the base CPP and the additional CPP. We recognize the additional reliance upon investment income for the additional CPP due to its fully funded nature and therefore a need for a more conservative asset mix for the additional CPP. We will be working closely with the chief actuary, Finance Canada, and provincial governments to ensure that we are meeting the intent of the legislation.

To conclude, in order to successfully achieve our mandate for Canadians, our competitiveness is predicated on capabilities to buy assets that will create enduring value-building growth. It is a deep privilege to serve, and we believe we are on track. Public confidence is critical, and we must continue to work hard to earn that trust every day. We submit that Canadians have reason to be confident as the hard work continues.

My colleagues and I will be pleased to answer your questions.

Thank you, Mr. Chair.

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

Yes, my colleague is right, Madam Speaker. I thank him.

This year, it is going to cost an extra $3.4 billion and next year it will cost an extra $4.3 billion. What a farce, to put it mildly.

All of a sudden, these people realized that they forgot to index the program, and they are shocked. They forgot one small detail, however: if the program isn't indexed, people will have less money in their pockets than they did under the Conservative government. The worst part about it is that it was not even included in their platform.

I do not want to lecture anyone, but the facts speak for themselves. When managing their personal budgets, would any executives think that their groceries would cost the same in five years as they do now? No, and I do not think so either.

Are there any Canadians who believe that there is no indexing or inflation? No, there are not, aside from these fine people who are before us today. Their management approach is hard on the Canadian economy. It is us and our children who will have to pay for this bad management. Even though we are dealing with basics, the ABC's or 1+1=2, the Liberals forgot to index.

Thank goodness for our Senate colleague, the hon. Larry Smith. I would like to pay tribute to him. I would add that he is a Conservative senator. This is a small detail, but I do not forget details. The senator asked the parliamentary budget officer some very specific questions and, as a result, last May the parliamentary budget officer showed that the Liberals had forgotten to index the program and that, if it were indexed, it would cost twice as much, which is no laughing matter.

When the parliamentary budget officer announced that the Liberals had forgotten to index the program, the government came up with an indexing measure on the fly to ensure that this program will cost $42.4 billion in total, and that number is from the report of the parliamentary budget officer. The Liberals only made a small mistake.

I know that I cannot pull out documents here. However, if I could, members would clearly see the inflationary curve that the government forgot about and which means that Canadians will have to pay tens of thousands of dollars more.

I have listened to the fine speeches by government members who have said that they are thinking of the children and families, that they want to help the poorest among us and do this in a balanced way. No, the Liberals completely forgot about indexation and inflation and, even worse, they are going to make our grandchildren pay for that. That is the irony of the situation.

The members over there gloat about their lofty principles and say they want to help families and children. Of course they want to help the children: they want them to pay the bill when it is their turn to work. That is neither responsible nor realistic. That is not the right approach in our opinion.

That is why when we were in power, when we were implementing these programs, we were also balancing the budget. That is the realistic and responsible way to effect change.

About their tax changes, those guys make such a big deal about leaving more money in people's pockets and cutting taxes. Hang on just a second. Once again, thanks to the hon. Larry Smith, the parliamentary budget officer meticulously analyzed the new tax measures. On page 1, he says, “PBO estimates this amount to be $1.8 billion in 2016”. That is the additional amount the government has to pay. In other words, a measure that was supposed to be revenue-neutral is going to cost $1.8 billion.

They talk about how we need to think of the poorest members of society, but this does not make sense. The new tax brackets mean that there will be no impact whatsoever for people earning $45,000 or less. I would like to remind the House that the average salary in this country is $32,000, so this will change nothing for more than half of all Canadians.

Who is really going to benefit from the new Liberal tax changes? Those who earn between $140,000 and $199,999. I will acknowledge my conflict of interest up front, because I, like all members of the House of Commons, am in that tax bracket.

Where is the supposed sense of fairness and generosity towards the most vulnerable among us? It does not exist in this new change. Sixty-five per cent of Canadians will see no change. It is going to cost Canadians $1.8 billion more, and those who will benefit the most are those who earn between $140,000 and $200,000. It completely flies in the face of what they are claiming. The facts are there, and it is not the nasty Conservatives who are saying this, but the parliamentary budget officer, who was responding to a question from Senator Larry Smith. It is important to know this, and to inform and remind Canadians.

We already had an opportunity to talk about the changes the government is proposing to the Canada pension plan through Bill C-26. Basically, the reality is that the government wants to increase taxes on workers from 9.9% to 11.9%, which is a 2% increase. In concrete terms, this means $1,000 less in the pockets of each Canadian worker, and for businesses, $1,000 more that every company has to pay for each employee. Overall, it means $2,000 for every worker.

Every Canadian who gets up in the morning and goes to work will have $1,000 less, and it is going to take 40 years before it produces any results.

What is the actual impact of this measure on the economy? If we look at employment, GDP, private investment, disposable income, and private savings, all these economic indicators of real growth have been downgraded. At committee hearings, I posed questions to representatives of the Canadian Gas Association, Canadian Manufacturers & Exporters, the Canadian Association of Petroleum Producers, the Canadian Energy Pipeline Association, and even the C.D. Howe Institute. They all said that the proposed changes to the Canada pension plan would negatively impact the Canadian economy and that it could take at least 40 years before there would even be a semblance of balance. That is bad for the economy and it is not the way to go.

We moved forward with our proposal and created the TFSA, a savings plan. We believe that instead of picking people's pockets, the government should give people the tools they need so they can choose how to best save. That approach makes good economic sense. That is great vision. There is a difference between our visions: the Liberal government takes money from people's pockets, whereas the Conservative government lets people choose, and provides the tools so that both businesses and individuals can contribute to economic growth.

The government has totally lost control of public spending. I could be here until Monday talking about all of the mistakes it has made, but I will have to stop because I only have about three or four minutes left. Day after day, this government keeps getting caught with its hand in the cookie jar because of its out-of-control spending. Let us remember the minister who paid $7,000 for a photographer in Paris. I have jokingly said, and I will say it again this morning, that she could have followed the Prime Minister's lead when it comes to photography since he is quite adept at taking selfies and his method does not cost a cent.

Members will also recall that the Minister of Health gave her Liberal friend a contract to drive her around in a limousine. When she was caught red-handed, her friend changed the name of the company to indicate that it provided car services rather than limousine services. The minister apologized and promised to repay the costs, but she should not have to be caught to acknowledge that she made a poor decision and that she should repay the money. Members must make wise choices at all times. I could go on like this for three days, but the point that I am trying to make is that the Liberals have lost control of the public purse. They have also completely lost control of public spending. They were elected on a platform that included a $10-billion deficit, but here we are saddled with a $34-billion deficit, and the Prime Minister is saying that he does not know what is going to happen. It makes no sense.

Canada Pension Plan

[Larry Maguire, Conservative, Brandon—Souris, MB]

Mr. Speaker, it is my privilege to stand to speak to Bill C-26 in the House today. It has been referred to as the Canada pension plan tax hike bill brought on by the Liberals, and that is certainly what it is.

I want to welcome back all of my colleagues after Thanksgiving. I hope they had a good break and everyone enjoyed it. I know there are many happy Conservatives giving thanks in Alberta today and I would like to announce my support for Mr. Motz as he will be coming from the Medicine Hat—Cardston—Warner constituency to join us in the House very shortly.

One of my colleagues said today that the numbers to remember were 70 for the Conservatives and 26 for the carbon tax. I only go there because my colleague from Richmond Centre indicated that the carbon tax is what would kill seniors. However, that is only one thing.

Forcing tax increases on people, such as Bill C-26 would do, is not very democratic, with the government saying it is going to help seniors when, clearly, the bill would not help them for 40 years down the road. Even my colleague from Winnipeg indicated earlier that it might be his children who would benefit from this, and that is absolutely true. My grandchildren would probably benefit from it a bit, 40 years down the road, and none of them are even 20 years old yet.

That is the kind of rhetoric that comes out of bills like this that are not well thought out. It would be a tax on the individuals who are going to put up this money, and because it would be such a long time before they would ever get a payback on it, it would be decades after they retire before they would get back what they put it into it themselves.

I want to go back to what my colleague from Chilliwack—Hope said today. When people put these funds into the account, it would be a long time before they would see any benefit. They would be putting their money into a plan that, if they die early, an unfortunate circumstance, the money they have put away for all of these years would not accrue to them. It would not go to their families upon their death like in a normal pension plan or their own private savings.

I want to make it very clear that I support the public pension plan, as was questioned earlier by my colleague from Winnipeg North. We have both debated a number of these kinds of bills in the Manitoba legislature when we were both there, but this is not the way to enhance the ability of seniors to have more money in their retirement years. If it is put in place to help those who need it today, then there are many other ways of doing that to make it easier for seniors to access those funds in the near future.

What scale of support would this provide? The tax itself could end up being $2,200 a year. That would be the increased premiums people would pay. Of course, $1,100 of that would be paid by the individual and $1,100 paid by the employer. Having been an employer and knowing how the system works, it is a matching fund. I do not have a problem with that, but what it would do is two things. It would not provide the benefit right away that the government may have been targeting and it would certainly, as my colleague just finished saying, reduce people's ability to put funds into their own private pension plans, if they were able to. It would decrease the amount of money they would get back in the near term. I think the number was that it would reduce it by 7%.

It would also make it tougher for businesses to survive. This is not just a Conservative number. There was a study done. If Liberals do not believe it, they should look at Finance Canada. It is the one saying that higher CPP premiums will hurt the economy, as was also just pointed out.

According to the Canadian Federation of Independent Business a full 70% of businesses in Canada today have indicated that they disagree with the notion that this would be just a modest little tax increase as the Liberals are saying. Actually, the Liberals do not use the word “tax”. The only one who uses that word is the environment minister on carbon.

There is a correlation here between the bills that the government is bringing forward. The government is dropping a carbon tax, which could be 11.5¢, on the same seniors whom it wants to put more money into their pension plans. It looks to me like everybody is paying and the government is taking. That is a concern.

It is ironic that the Liberal government is mandating a tax today on individuals to pay more for a benefit that would only be achievable in 40 years, when it cannot even balance its own budget today. Bigger debt hurts seniors more as well. It particularly hurts the very young who will have to pay all of this back in the future. It is a bit ironic for the Liberals to say that there will be a mandated tax and a benefit, but anyone over the age of 40 today would probably not see that benefit unless he or she lives to be 100 years old.

There are many other ways of helping seniors in the more immediate term. We did it by increasing the guaranteed income supplement, the GIS, when we were in government. The Harper government made the largest increase in the GIS in 25 years. The Liberals liked the idea because they implemented a small increase in that in their very first budget.

The Liberals also did away with the increase in the tax-free savings accounts that would have gone up to the $10,000 mark. This would have allowed many seniors to save. It may be a surprise to many Liberal members across the floor but the number of seniors who were using the TFSA was in the neighbourhood of 60%. That is a pretty clear indication that those people were doing what the present government is forcing them to do, which is saving for their own retirements. They were putting this money away so that they could use it in the future.

There are also many other ways to help seniors, whether it is through an increase in the basic personal exemption, or whether it is through a decrease in personal income tax. Those are a number of things that could be done, although the government is going the other way. It has increased taxes on small businesses. They certainly are not going to be at the level that we had announced in our election campaign. When a government is simply taxing these folks and saying it is going to be good for them, when clearly it is not, then it is not a clear direction to emulate.

A member asked the other day if we were in favour of the Canada pension plan when it was first put in place back in the sixties. Of course we were, but back then the plan was only to support other pension mechanisms. I would like to quote Judy LaMarsh in referring to the CPP, “It is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans.” Judy LaMarsh was the Liberal minister responsible for establishing the Canada pension plan in 1964. Even the Liberals felt that when the plan was set up it was only to be a supplement to the other mechanisms that were there.

I could go on with a number of other quotes, but instead I will say that 70% of employed Canadians oppose expanding the Canada pension plan, if it means a wage freeze. Over one-third of employed Canadians say that proposed increases are unaffordable, and 80% want the government to further consult before making any decisions.

I think it is very clear that there are a number of things that could be improved and could be done to help seniors. The bill does not do it and that is why I will be voting against it.

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

Mr. Speaker, I want to go back to the premise of the member's question when he was talking about seniors. I know that this is one of the arguments that members opposite have made in terms of how this is going to help the seniors he referenced when he was door-knocking and hearing from seniors. According to Statistics Canada, the percentage of low-income seniors was 29% in 1970. Today, it is 3.7%. That is clearly a significant improvement.

I would venture to guess that is not just because of CPP, but because of the other tools available to seniors. We know that the best way to prevent poverty in old age is to give people the tools they need to save money today and to let them make their own choices based on their means.

We believe that Canadians know how to manage their money, not the government, especially not this government, which is taking money out of their pockets at every turn.

I know the member is aware that there is old age security and the guaranteed income supplement. That exists also to help seniors who do not have a workplace pension. However, because of the long phase-in period for Bill C-26, we know this would do nothing to support our seniors today.

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

Mr. Speaker, I too am pleased to be participating in this debate on Bill C-26, an act to amend the Canada pension plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act.

First introduced in 1965, the legislation creating the Canada pension plan came into effect in 1966, and was created to ensure that all working Canadians have an opportunity to retire in dignity.

I understand that, as members of Parliament, we have a natural tendency to want to do more for the people we represent. We are tempted to use the incredible financial and regulatory power of the government to do more. With an activist government such as this, there is no problem too small or too complex to be fixed by intervention. We know the Liberal Party believes that the government knows better than Canadians. When we believe that government can and should do everything, there is never a need to say no to increased spending.

As the ancient Chinese philosopher Lao-Tzu said, “Govern a great nation as you would cook a small fish; do not overdo it.” The current government is overdoing it right now.

The reality is that Canada's retirement system is the envy of the world. Canadians are saving more for retirement today than ever before, and poverty among seniors has dropped significantly in recent years. In light of this, I have a few questions.

What should the fundamental role of government be in our country? What percentage of income should Canadians take home at the end of each pay period? Should Canadians be keeping more than 50% of their total income, as a matter of fairness, because they should be deciding how at least 50% of their earnings are spent? What do we believe about the role of government? Do we believe as a country that the individual financial choices that Canadians make are better or worse than those made by government? What percentage of our gross domestic product should be government spending?

According to the 2016 Index of Economic Freedom, government expenditures presently represent 40.7% of GDP in Canada. In comparison, Australia sits at 35.7% and the United States at 38.9%. Therefore, are we better off in Canada than Australia because more of our economy is put through Ottawa? It is obvious that the Liberal government thinks so. However, I certainly do not. To me, limiting government is extremely important, as it has been shown over and over again that once government gets involved in doing something new or doing more of something, competition and choices decrease, which inevitably is a negative for Canadians.

I am proud to be a member of a party that believes that, despite its best intentions, government does not know best. Government should not be forcing Canadians into making decisions that it thinks are best, yet this is exactly what Bill C-26 would do. This bill is about competing visions: a vision of what government can do versus what government should do. This bill is about Canada's finances, and more specifically, the finances of every single Canadian household and every single Canadian business, both big and small.

When government decides that every Canadian must save more, above all through the CPP and not through any other retirement program, and consequently increases premiums on employers and employees, two things happen: first, Canadians have less money in each paycheque to put into an alternative savings vehicle of their choosing; and second, because Canadians are putting more money into the CPP, they feel less inclined to contribute to other retirement savings plans.

As capital is being withdrawn from private sector investment plans, fewer of these would exist, as the demand for them would decrease because retirement contributions would be going to the CPP. This would create an endless feedback loop where increased government intervention would lead to Canadians saving less of their discretionary income for their retirement, which would then lead to government once again looking to top up the CPP through increased contributions, as we have seen in the past. This is an important point, and it is the main reason that I oppose the bill.

Make no mistake, the bill is not some gentle push that will achieve the Prime Minister's stated objectives. The bill would introduce a tax hike. It would be a tax hike because Canadians would not have a choice on whether to pay it. More money would be taken off every single paycheque until retirement. It would be a tax hike because Canadians would not have a choice on how their income would be spent.

The CPP is a mandatory contribution fund. Employees and employers do not have an option to voluntarily participate in the CPP, but are instead required by law to contribute. This distinguishes the CPP from the public pension plans of other countries, such as Britain. Their individuals can opt out of contributing to a central plan in favour other retirement income schemes.

Let us look at how the bill would affect Canadians. The bill would lead to some households paying up to $2,200 more per year. It would be harder for new graduates to pay off their student loans, as more of their income would be going into a pocket they would not be able to touch for 40 years; so rather than pay off the principal of their student loans as quickly as possible, graduates would have to either decide to spend less on day-to-day necessities or spread out the amount of time they take to pay back their student loans. Neither one of these is an appealing choice.

The bill would also make it harder for young people to buy that first home. Everybody who has purchased a house knows that in the first few years of repaying a mortgage, the lion's share of each payment is going to the interest and not the principal of the loan. The bill would reduce the discretionary income that Canadians have to pay down their mortgages more quickly. This would once again force Canadians into a choice: either spend less on items of necessity or take longer to pay down their mortgage. Once again, neither one is an appealing choice.

However, these are the types of choices Canadians would have to make going forward. They would have to make similar choices on whether to invest in a registered education plan, or whether to fly home and visit the family for Christmas, and it would be harder for companies to create jobs and give workers raises.

In conclusion, we know that the Liberal Party of Canada believes the government knows best and that it needs to be a perpetual helping hand to all. “Big Brother” seems hardly adequate to describe the interventionist Liberals' first year in office.

The Liberal government has decided that Canadians are not saving enough for their retirement. I think we can all agree that some folks are perhaps not saving enough, but there are other folks, as we heard in remarks today, who may be saving too much, and then there are folks who are probably saving just the right amount.

People also have vastly different retirement needs, depending on where they live and what their expectations are for their retirement. There are a number of options out there to encourage folks to save, even though a very popular one, the tax-free savings account, was just cut in half.

Getting people to more broadly use these voluntary programs is a good thing that the government should seriously consider. We owe it to our constituents to give them the option on how to save for their retirement. Unfortunately, the government has opted to go the other way.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I appreciate that New Democrats have acknowledged that Bill C-26 is a good bill. I want to reflect on the fact that provincial jurisdictions from all regions of the country were able to come to an agreement that this legislation is forward thinking. It would provide in a very real and tangible way retirement monies for those who are working today and are going to be in the workforce for a while now.

My question deals with the other aspect. There is a lot of discussion about seniors in poverty. Yes, the overall numbers have gone down and we have seen in the last number of months, with the Minister of Finance making an announcement that we are going to be substantially increasing the GIS, that we will be lifting literally thousands more seniors out of poverty through the guaranteed income supplement.

Today we are talking about the Canada pension plan. There are three fundamental public pension programs, the OAS, GIS, and the CPP. Does the member have any thoughts on other two programs the bill does not deal with?

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, it is a pleasure to rise today and support BillC-26 at second reading.

We have heard quite a difference of opinion in the House on the advisability of this bill. Maybe we can start from a place that we do all agree with, that it does not serve the Canadian economy well and certainly does not serve Canadian seniors well to have people retire into poverty. Unless people are going to work their entire life until they drop, we project that there will be a period when they are not working for their income. That income has to come from somewhere, and if it is not coming from their going into work every morning, then it has to come from money they have saved on their own, or it is through a mechanism like the Canada pension plan, or from another kind of benefit if it is not from their working family members.

The kind of system projected by the Conservatives, when they talk about individual savings, is the one we once had when people who were past their working lives had to be supported by their family members. That was great for those who had family members who could support them, and it was very bad for those who did not. So the CPP was by far and away an improvement on that situation, through which people could manage to save for themselves throughout their working life. Things like the OAS and GIS are important in that regard too.

There is a need for income in retirement. We can all agree on that. The gold standard for that would be to have some kind of guaranteed annual income in retirement, I think it is fair to say. But given that we do not provide in that way, the Canada pension plan has been a great mechanism for working Canadians to make sure they do have at least a basic income when they retire. It was based on three pillars, that there would be a CPP there to provide about a third of what people might need in retirement; that their company pension plan would provide another third; and that their personal savings would provide the final third.

In Canada today, two of those pillars are in serious jeopardy. We know that almost seven out of 10 Canadians working today do not have a company pension, meaning that a third of that retirement income scheme is gone. We know that most working Canadians are struggling very hard to save. Many are living pay cheque to pay cheque, so they are not able to save to the extent they need to in order to be able to furnish a third of their retirement income once they are no longer working. That is why there is a need to enhance the first pillar, the public pension. It has to do more, in our view, to make up for the problems in realizing the potential of those other two pillars.

People may be approached by their financial adviser and told there are all these plans, but one plan has 40 million people in it, those being everyone in the country, and it is fully portable.

Particularly in this age, people are having a hard time finding a job that will last the 20, 25, 30, or 35 years necessary for them to be able to buy in sufficiently into a company pension plan, if there is one, to have it produce adequate income for them in retirement. Most Canadians are going to have seven or eight different employers in their working life if they are young now, and it is almost certainly the case that many of those employers will not have company pension plans. Even if they did, they would not have the same plan. CPP provides an important benefit with its full portability. That is an advantage of the plan.

Every working Canadian is in the plan. That is another advantage in spreading the risk. Furthermore, it has been proven to have some of the lowest administration fees and, therefore, it gets the best value for money for the contributors, who do not have to have their money shuffled off to those who are administering the plan.

It has the added advantage, when every working Canadian is in that plan and everyone who has worked is living off a portion of that plan, that it has a certain political backing. That also goes toward mitigating risk. We really are all in the CPP together in a way that we are not in any private pension plan, so Canadians can feel confident that their savings held with the CPP are less likely to fail than those in many of the private options that are out there.

It has another benefit that is even rarer today, even in the case of Canadians who do have private sector pension plans, in that it provides a defined benefit. That is very helpful when trying to project what income people will have in retirement and, therefore, how much they need to save to go above and beyond what their pension plan will provide, whether CPP or a combination of CPP and a private pension.

People who are in a defined contribution plan who do not know what that plan is going to produce once they do finally stop working will find it a lot harder to know exactly how much they have to save. That is another benefit of the Canada pension plan.

I do applaud the effort to raise the benefits of the CPP. I think there are a few things to say about that. One is that I really do doubt whether it is enough. In fact, I do not think it is. I would like to see the government go further in enhancing the Canada pension plan, because I do think it is a great option for most working Canadians, who are not making a lot of money, not just to save for their own retirement in a well-working, proven fund, but also to have their employer make a matching contribution to that.

Indeed, when we talk about Canadians taking charge of their own future and saving their own money through TFSAs, for instance, we do not talk about what is absent, namely employer contributions. That is another important aspect of the CPP.

I would like to see it further enhanced. This is a good first step. It is certainly not worth opposing simply because it is not ideal. However, I would like to see the government push harder for an bigger increase in the CPP. I think it is important.

We also know that this will not do anything for seniors right now. That is important to consider, because it will do a lot for young people over the course of their working lives, but not for seniors rights now. My children, who are three years old and four months old, are going to benefit from this. They will see that benefit. I am quite happy to do that for them. However, for people in my parent's generation who are just looking at retiring, other measures will be needed for them.

I do want to take a moment to address some of the arguments I have heard in the chamber today. The first is that somehow the Canada pension plan is a payroll tax. I simply do not agree with that. It may be true as a term of art in accounting terms, which may be where it is recorded on the ledger. However, for ordinary Canadians who are going into work every day and are working to put food on the table today and for that period in their life they look forward to when they will not go into work every day, the CPP contribution on the part of their employer is part of the wage package. That is part of what they are going into work for, as well. So I do take exception to those who continually refer to this as a tax. It is not a tax. It is part of the wage package.

It is up to Canadians to take charge of their own future and to decide how they are going to save for retirement. In that regard, a perfectly legitimate decision on their part is to decide to do that saving through the CPP, to do it collectively, to have a plan that is better than the options they get through the private sector, and to decide that we are in this together and to elect a government that will implement a mandatory public pension. That is a perfectly acceptable decision. That is something I take them to have done in the last election.

Again, I would like to see it go further. I think many Canadians would like to see this proposal go further. However, part of the decision that was made was also to reject the idea that somehow each Canadian is on their own individually, and that they have to make choices as individuals. I believe we can make a collective decision to enhance our public pension system and that it would be a good way for us all to save for our retirement, and to do it in a way that is fair to each Canadian.

When we talk about individual Canadians who are saving for their retirement and some of the options available to them, what is missing is that Canadians with more money have more options to invest. As people hit certain income thresholds, they can gain access to certain funds and other clubs that provide better returns. It is a fiction to say that all Canadians are equal when it comes to the private retirement investment market, and that we all have the same options. One of the things that the Canada pension plan recognizes is that we all need to be treated fairly. This is another reason to support the plan.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Mr. Speaker, I thank my colleague for a very well-delivered speech on Bill C-26.

I have to say that when we look at young Canadians today, they are not living in the same situation we did, and do, meaning that today, most of us at my age, anyway, including my colleague across the floor, have had the benefit of having a pension at the end to help us and to ensure that the golden years are golden. However, for these young people, when they start off their careers, there is no guarantee of any funds or pensions. It is our responsibility to ensure that we do the right things to make this happen.

We know that in the United States, it could be a crippling situation in 2033, as far as the benefits that would be allowed.

It is not only the Liberal Party and the government bringing this to the table. It is all 10 provinces and the territories. Are we saying that the 10 provinces, the territories, and the government are all wrong and are all doing the wrong thing?

Can you expand on that, please?

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, it is my privilege 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.

While I believe that the Liberal government has good intentions, it has failed to recognize the negative impact this legislation will have on the overall economy.

As many of my colleagues have already pointed out during this debate and in previous debates, what we see in this legislation is a fundamental difference between the Conservative Party of Canada and the other parties in this chamber. In this party, we believe that Canadians are in the best position to make their own decisions, and this includes decisions relating to their retirement.

Let me be perfectly clear. We in the Conservative Party are not against the CPP. We are not against helping Canadians save more for their retirement. We are certainly not happy to see seniors struggling to live out their retirement in comfort. We do believe that government policy should provide opportunities and avenues to save and to reduce taxes so that Canadians can save more of their own money when it is within their means to do so.

We strongly believe in the right of each Canadian to make his or her own choices. Canadians know what is best for them and for their families.

On the other hand, Liberals and New Democrats believe that government knows what is best for Canadians, and they do not trust Canadians to prepare for their own retirement. They seem to believe that the only way Canadians can save for retirement is through a mandatory increase in CPP contributions by both employers and employees.

We saw this ideology from the Liberal government in its first few weeks, when it slashed the tax-free savings account contribution limit by half. The Liberals made this cut even though the TFSA is a popular means of saving for Canadians at all income levels.

Individuals with annual incomes of less than $80,000 accounted for more than 80% of all TFSA holders and about 75% of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000. At the end of 2013, about 1.9 million Canadians had contributed the maximum amount to their TFSAs. About 46% of these individuals were seniors, and more than 70% were age 55 or older. Furthermore, about 60% of the individuals contributing the maximum amount to their TFSAs had incomes of less than $60,000 in 2013.

The tax-free savings account is an avenue for saving that all Canadians should take advantage of. It is an opportunity to have their investment grow at a far higher rate than they would see with the CPP. The money they deposit is readily available in case of an emergency or to make a lump sum payment to pay down their mortgage more quickly. Opposition parties have scoffed at this idea, because they believe that Canadians do not have disposable income to put in a TFSA. If that is true, how can the government justify siphoning off more money from Canadians' paycheques and holding it until they retire?

Canada is heading toward a large increase in the number of Canadians who will be entering retirement over the next decade. This is not the time to be limiting the amount of savings that would benefit these Canadians the most.

The CPP hike will take 40 years to be fully implemented, so none of these new benefits will go to seniors who need it today, or even in the next few years.

This increase will not only not benefit Canadians entering retirement soon, it will directly negatively impact the way families, students, and young employees invest their money now. A CPP increase will take money away from their paycheques, money that could have been invested or spent on immediate needs. I am talking here about new graduates wanting to pay off their student loans, or families saving for their children's education, or a middle-aged couple making a lump sum mortgage payment to reduce overall interest payments. With this plan, some households will be paying up to $2,200 more per year in payroll taxes. That is $2,200 per year that is not available to positively impact our Canadian economy.

As I said at the beginning of my remarks, I believe that the Liberals have the best interests of Canadians in mind, and their intention to help Canadians in retirement is good, but it is clear that they are going about it in the completely wrong way.

Let us not forget the impact these policies will have on job creators. Canadians cannot contribute anything to the CPP if they do not have jobs, and the introduction of this increase will result in job losses across Canada.

At a time when the Canadian economy is losing jobs and struggling to create new jobs, and when we see low growth across the board, we simply cannot impose more expenses on business in Canada. This will mean that companies will not hire that extra worker, not create that new position budgeted for, and not expand into new sectors. In some cases, they will actually have to lay off employees.

In 2015, the Canadian Federation of Independent Business studied a CPP tax hike and found that it would eliminate up to 110,000 jobs and permanently lower wages by nearly 1%. Simon Gaudreault, chief economist at the CFIB, tells us that this agreement will have serious negative impacts on workers and the Canadian economy. The announced changes, including increased contributions, may put Canadian wages, hours, and jobs in jeopardy.

Hendrik Brakel, senior director, economic, financial and tax policy at the Canadian Chamber of Commerce, also notes that increases will have many effects on the Canadian economy. He 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.

It is not just directors and chief economists who are speaking out against this increase. This past summer, a young woman who manages the payroll for a number of small and medium-sized businesses in her area told me that she could not believe that the Liberal government would be increasing this mandatory contribution. She assured me that this would mean layoffs, decreased investment, and postponement of expansion. In other words, no new jobs.

We have heard from experts and ordinary Canadians that Bill C-26 will have negative consequences and will hurt, more than help, our young people and seniors.

Last, I would like to quote Mr. Fred Vettese, chief actuary at Morneau Shepell and co-author, with our current finance minister, of The Real Retirement. He wrote in the Financial Post, on June 5, that:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get. Yes, a little over five per cent of seniors today still have income below the poverty line....

Canada has a world-class retirement system, and the numbers support that, with 83% of Canadian households on track to maintain their current living standard in retirement, according to a study by McKinsey & Company. In addition to that, according to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in 1970 to 3.7% today, which is among the lowest in the world.

I would like to quote Finance Canada, from June 2015:

Overall, Canada's retirement income system is performing well. Canadian retirees achieve relatively high levels of income in retirement, and compare well to retirees in other Organization for Economic Co-operation and Development countries. With support from all three pillars of the retirement income system, the median Canadian senior earns about 91 per cent as much as the median Canadian--well above the Organization for Economic Co-operation and Development average of 84 per cent. Internationally, Canada has one of the lowest low-income rates for seniors.

I agree with the broad intentions of the Liberal government as it approaches this legislation. We, as members of Parliament, should strive toward the goal of having every single Canadian senior retire in comfort. However, as I have outlined throughout my remarks, I believe that the Liberals have not considered the many negative impacts this policy change will have on Canadians.

I cannot support Bill C-26, as the negative consequences are far too crucial for me to ignore.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, that is a very good point. It reminds me of some of the conversations that took place during electoral reform. The problem with our current system of electing governments is that we suffer from policy lurch. It is very hard in this place to take a long-term view when there is a new government, on average, every 10 years that completely clears the deck of the previous government, saying it is going to go in another direction. Then in another 10 years, another new government says that it is going to go in another direction.

Bill C-26 is a very real effort. Yes, it is going to take a long time to get implemented, but it is taking that vision in several decades. Yes, it will only affect the kids of today, but I think those children will be very thankful that we had the foresight to act now before the problem went beyond this.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, I share my colleague's concern about seniors. I am especially concerned that the current fix proposed in Bill C-26 will do nothing to address the problem that elderly widows are having, which is that they may not have worked, their husbands have died, and they do not get any of their husbands' pensions. This bill would do absolutely nothing for them. Could he expound on some of his ideas for a solution?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, I am very pleased to have this opportunity to speak to Bill C-26, which is the government's effort to expand and enhance the Canada pension plan. As many in the House know, the expansion of the CPP has long been a policy objective of the NDP. From the campaigns of both the Liberals and the NDP, I do not think Canadians are under any sort of surprise that this policy eventually would be brought up in the 42nd Parliament.

As we all know, Canada's retirement system is based on three pillars: a combined Canada pension plan and the old age security from the government side; workplace pensions that used to be provided by many workplaces but are increasingly uncommon; and the RRSP and private savings of Canadians.

Unfortunately, two of these pillars are now in not very good shape and it is a moral imperative that we act to do now what we can, looking into the future, to prop up the third one, namely the Canada pension plan and the combined old age security and GIS.

I listened both yesterday and today to arguments from the Conservatives about giving Canadians more choice and putting money back into the pockets of people. I could not agree more with those two. With this measure, we are giving seniors a choice. I believe that in the future, with more money in their pockets, they will have more choice.

I also understand the arguments the Conservatives have made about the cost of living increases going on in Canada. I do not believe that this is a cost of living increase. It is not a payroll tax. It is a very simplistic argument and it misleads the conversations that we ought to be having about our retirement future. This is an investment in our future. I know of no other tax that Canadians pay where they will actually get dividends at a later point. These are deferred wages that they will be drawing from in their retirement years.

I have also heard of the absolute calamity that Canada has experienced now that the tax-free savings account has been dropped from $10,000 to $5,000 a year. The costs to the treasury would have been enormous in later years if the $10,000 limit had been allowed. I wonder how this connects with the increased reliance on the guaranteed income supplement that the Conservatives are always proposing as a measure to help Canada's seniors. I agree that the GIS plays a very important role, but the goal of this place is to get to a point where the guaranteed income supplement is not as necessary. Despite what the Conservatives say, the measure of the TFSA only helps a small segment of the population.

I have also heard the arguments about increasing personal responsibility. That is a terrible argument to put forward to someone who is living paycheque to paycheque and giving up on their own retirement future to help put their kids through college, to make a housing payment, to put food on the table. To tell someone that they are not personally responsible because they are not saving enough is just a terrible argument to make to people in these tough economic times. We are all hard-wired to help our kids. It is something I would do in a heartbeat and without a second thought.

When times are tough, especially when we have minimum wages that do not even come close to what the living wage is, it becomes near impossible to save for retirement. The facts from Statistics Canada back this up.

We also know that defined benefit pension plans, like the Canada pension plan, are one of the most effective tools in combatting income inequality and retirement insecurity.

I want to contrast that with the defined contribution plans of which some in the House are in favour. There has been a push from the right to consider that Canada engage in more defined contribution plans, but we can see examples from around the world of the problems with these plans.

I refer hon. members to the case of Australia. Australia has had its superannuation plans. They are defined contributions. They were instituted in the mid-1990s. Around that time, nearly 80% of workers were covered by these plans. We look 20 years later and nearly 50% of Australian seniors now live in poverty. The country is the fourth highest spender on government assistance. Sixty-five per cent of seniors have no money left in their defined contribution funds by the time they reach age 75. That is completely inadequate.

Another recent study compared the pension income of British citizens with defined contribution plans to Dutch citizens with defined benefit plans. It found that the cost was 1.5% more in fees per year to run the defined contribution plan. Over time, these fees add up. In fact, a British citizen who made the same contributions and earned the same investment returns ended up receiving a pension payment that was 50% lower than his Dutch counterpart. This makes it more crucial for the government to push for defined benefit plans that do not suffer from those same problems. The CPP is the best retirement vehicle we have to ensure that happens.

The proposed changes in the bill are welcome, but they are unfortunately inadequate for what is needed now. I want to give that caveat to the government side. It is a good plan for those who are very young now and would have the full benefits in many years, again looking to our future. However, the plan needs to go hand in hand with solutions for those retirees or soon-to-be retirees right now.

Seniors have been struggling and this plan would do nothing for them currently. There has been unacceptable erosion in workplace pensions over the last decades. Six in ten Canadians have no workplace pension. We have even sold the idea that RRSPs and TFSAs are great options to replace workplace pensions. I think everyone here can see from the evidence that has not worked. These voluntary options have shown their inability to address the issue of lacking real pensions and a weak Canada pension plan.

Among those aged 55 to 64 without access to a company pension, about half have less than half of what they would need to pay their bills. A staggering 32% have less than $1,000 in retirement savings. That is one-third of the population.

This is a crisis that needs concrete solutions. When we have seniors living in poverty and food insecurity, with very little to no retirement savings, it is a moral imperative for the government to act. Not only is it the right thing to do, but this kind of thing if left unchecked becomes catastrophic for the economy.

If we are talking about 10 to 15 years in the future and we have millions of Canadians with little to no disposable income, then the economy tanks because they cannot afford to buy anything.

Poverty deniers on the right like to point to home ownership of seniors as proof that there is no crisis. However, we know that even with accounting for the total net worth of seniors, only 28% of seniors without employer pensions have even five years' worth of replaced income saved. Five years of savings is nowhere near the target needed for a happy and healthy retirement.

Enhancing the CPP is something that we have always fought for in the NDP, and we welcome the government's initiative for this. However, more needs to be done.

This plan would raise the CPP up to 33%. We in the NDP will continue fighting for what was passed at the Canadian Labour Congress, which is the voice of working people. We need to go to 50% benefits of the pre-retirement income if we to be serious about tackling the issues of retirement, security, and income inequality.

We also need to continue tackling the GIS and raising it. While the increase that came in budget 2016 was welcome, it has still left a lot of seniors without the adequate income they will need.

Also, if we are talking about seniors and their state today, what happened to the conversation about universal pharmacare, so we never again have a senior who has to choose between healthy food and taking their proper dosage of medication?

We need to enhance home care and palliative care, which is at crisis levels. I hope to see that in the health care accord.

There are a lot of things we could do.

The bill is a good idea, but it only tackles one small part of what needs to be done. We will support its passage, but it is too important not to lose sight of the larger problem of seniors today. Rather than taking a piecemeal approach to pensions and retirement, we need to develop a national strategy for seniors that completely looks at all facets, a strategy that will respect aging. For seniors who have lived their lives building our country, and who continue to make great contributions, the least we can allow them is to live in dignity and with respect.

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

Tax cuts mean more production, the sale of more products abroad, the creation of more jobs in Canada.

What do you think of Bill C-26, the government bill we are in fact debating in the House of Commons? It aims to increase the Canada Pension Plan by increasing the ratio from 9.9% to 11.9%, which is equivalent to an average $1,000 increase per year, per employee, for each enterprise. When you add the contribution of employers of approximately $1,000 per employee, and that of the employee of about $1,000 more per year, you get a total of $2,000 per worker, even though the increases will only begin in 40 years.

In your opinion, how will this impact our manufacturing businesses, which create jobs and wealth?

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Mr. Speaker, it is tough to follow the member for Richmond Centre after that kind of firebrand speech, but I will do my best.

It is always a pleasure to rise to speak about legislation before the House. Today, we are talking about Bill C-26, which would increase CPP premiums and increase that payroll tax for a benefit sometime in the future. The finance minister has admitted now that the benefit would be realized by workers 40 years from now. That is who will see the benefits from this.

Let us be under no illusion, Even though the government wants us to talk about increasing CPP benefits, this would do nothing for seniors today and it would do nothing for workers approaching retirement. Maybe if people are in their twenties and in jobs that are stable enough that they are making enough money to make the full contribution, this would benefit them, but for the next 40 years they would be paying more. That is our main concern today.

When the bill came forward, when this idea was floated, I sought to consult my constituents, as I do on pieces of legislation like this. I heard back from a prominent local business owner in Chilliwack who is involved in the business community. I want to share his thoughts on this. He is actually in the financial services industry and helps others plan for their retirement, so I think he has a level of expertise that the House should well consider.

I will be quoting extensively from his contribution to my consultation. He said:

If the primary intent is to take care of Canadians, I wonder what other options were explored. If mandatory contributions to retirement plans are desired, was there a “choice” option considered? Perhaps a Canadian could choose to contribute more to CPP, or, instead, open their own locked-in pension plan and make the mandatory contributions there...have restrictions on withdrawals, risks, etc.

Most 'regular Canadians' would not profess to know all the details and the considerations that were explored by the Federal Government, before proposing this solution. Most business owners would like to think that the government is working in their best interest...I sincerely hope it is. However, perhaps incentivising Canadians to save more by increasing the RRSP contribution limit, not decreasing the TFSA limit (as this government has done), providing larger tax benefits for contributing to mandatory Locked-in RRSPs, etc... options like this might warrant more exploration. Not only would Canadians need to take ownership and increase their education on the matter, but it could also increase and improve the private sector...both of these are good for Canadians.

I understand some things are necessary and hard choices need to be made. My fear is that the increased mandatory contributions are not going to solve the real issue. The issue touted by the Federal Government is that Employer Pension Plans are becoming fewer and farther between and Canadians are not saving for themselves. One might make the argument that having an employer or the government say, “we'll do this for you” is part of the problem. If Canadians are not saving enough, then they need to be educated, incentivised and learn to save for themselves. I believe in having a pension plan like CPP, however, if we don't address the real issue (too many Canadians are spending all the money they earn, in order to increase their “lifestyle” as rapidly as possible...not taking responsibility for their own future...) we will need to increase contributions to CPP again in the future, for a similar reason...

I have a family member in his early 30s. He is very aware that he has no pension and needs to create his own pension. He chooses to be content with his lifestyle and does not spend all the money he makes. He continues to educate himself, as well as increase his good habits of contributing to his RRSP, TFSA and savings....this is what Canadians need to do.

I would make the argument that having a public pension plan is a very good thing, for many reasons. However, if the public pension plan begins to try and replace or “take over” the responsibilities of Canadians, it might be considered to be creating and enabling a problem for the future of the very Canadians it wants to protect. I'm not saying that line has been crossed with the current CPP changes, but if the line hasn't been crossed yet, it appears, at least on the surface, that we are headed that way.

Those are words from a very prominent business person in Chilliwack who is concerned about this approach of the government. I share many of those concerns. I think that the proposed changes to the CPP, again, as has been said many times by Conservatives on this side of the House, could result in over $2,000 a year being taken from the incomes of Canadian workers. In a family, that is about $1,100 each.

Earlier, I heard a member from the NDP say that he was concerned about people who come into his office who are living paycheque to paycheque. My riding is not a high-income riding. The average income is under $40,000 a year. My constituents are living paycheque to paycheque. Bill C-26 and increasing mandatory CPP contributions will not help them. It will take money away from them and put it into a CPP plan that they may never be able to access.

That is another part of this discussion that I think we need to be honest about. When we are talking about increasing a mandatory payroll deduction, we are taking $1,000 away from a Canadian worker and putting it into a government-run CPP pension plan. If that person dies before reaching the age of retirement or does not live to the age of 85, this increased amount of money that is taken from each and every paycheque, the reduction in disposable income for the families in my riding, is not saved in an RRSP, a TFSA, or something that is designated to the individual. It is not an asset that can be passed on to the heirs of the contributor, to their family, or to their children like a TFSA or an RRSP.

Therefore, to say that it is for their own good that the government will take more money off of their paycheque and put it into an account that they can draw from in retirement might sound great to people because they might think that they could stand to save a little more. However, what they do not realize and what they are shocked to learn when they learn more about CPP, which most people do not look into until they approach retirement, is that this is not an asset that is transferrable to their heirs. Rather, if they die young it goes into the general revenue of the account. It disappears. Therefore, they have spent their entire working life paying more under this plan and they do not have the ability to pass that on to their heirs.

This is bad for the people who say they want a choice in how they save. It is bad for low- and middle-income Canadians who will not benefit but will see a reduction in take-home pay, a reduction that they simply cannot afford. Certainly, as the member for Richmond Centre said, as the government seeks to increase costs on all Canadians through a carbon tax, they can ill-afford yet another payroll tax that reduces their take-home pay. It is bad for families because they cannot pass along this investment. It is not like other registered investments that can be passed on. It does not help seniors now.

We know that during the campaign the Prime Minister famously accused small business owners of simply being people who were looking for ways to avoid paying their fair share of taxes. Therefore, we should not expect the Liberals to take the concerns of groups such as the CFIB seriously. However, on this side of the House we do. Last year, for the first time in 30-plus years, the CFIB was not invited to make a pre-budget consultation, so perhaps it should not surprise us that the Liberals are not taking its advice as well.

However, Dan Kelly, the president and CEO of the CFIB, stated:

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.... Despite all the talk, it appears that jobs and the economy are not particularly high priorities for the governments that have signed off on this deal.

He went on to say:

Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike....

This is going to affect real, hard-working, taxpaying Canadians. This is not going to help those workers for 40 years. It will not help seniors in retirement who may hear about this and think that they will get a raise. They will get nothing out of this. Rather, this is simply taking away choice from Canadians in planning for their own retirements, and taking away money from their paycheques now, which as far as we are concerned is the wrong direction. We will be voting against it.

[Alice Wong, Conservative, Richmond Centre, BC]

Mr. Speaker, it is my pleasure to rise today to discuss the proposed changes to the Canada pension plan in Bill C-26.

As has been mentioned by my colleagues earlier, this change would raise CPP premium rates. This plan would also increase the maximum level of earnings on which CPP premiums would need to be paid. The net result of these changes would be that both employers and employees would have to pay more. Indeed, the CRA has published a table showing that this amount could be as much as $2,200 more, each and every year, and this number would continue to go higher and higher.

Nearly all Canadians would be affected by this expansion. Everybody earning a salary in this country would be negatively affected and would see their paycheques decrease as this payroll tax takes effect. Likewise, employers would see the cost of hiring employees rise.

As a former small business owner, I have first-hand experience in seeing how a business can be affected by payroll taxes, including CPP premiums. During the past year, I have thoroughly enjoyed my role as the critic for small business, holding the government accountable for its actions and inactions. I have heard from entrepreneurs and small business owners from across the nation in round tables and one-on-one meetings. Each time the topic of the proposed CPP expansion is brought up, immediately I hear the same thing: when the cost of hiring employees rises, employers hire fewer people. Payroll taxes, which include CPP premiums, are one of the largest costs for small business owners.

These employers are leaders of our communities and care about investing in their employees. However, if they cannot afford to pay for their employees, they will be forced to either reduce their workforce or increase the workload on their current staff to avoid hiring new workers.

One entrepreneur from Toronto explained to me that she is already feeling constrained by the increasing tax burden on her business. She said that, if the CPP expansion were to move forward, she would have to expand the job duties of each of her current employees rather than hiring new workers to fill the gaps.

Small business representatives from across the country have also added their voices to this conversation, urging the government to rethink this plan. Among them, the Canadian Federation of Independent Business, the CFIB, is the most notable. It conducted a number of surveys on its members, asking for opinions and potential business decisions they would have to make, should this expansion move forward. The results are troubling.

These surveys indicate that two-thirds of small business owners believe that this expansion would compel employers to freeze salaries in order to account for the changes. The math is simple. Dollars that would otherwise go into salaries would, instead, go into extra payroll taxes. When we consider the government's track record of increasing payroll taxes, increasing small business taxes, implementing a nationwide carbon tax, and cutting tax credits, it is no wonder business owners are choosing to hold onto their wallets.

I would not be shocked to see the Liberals finally decide to raise the GST to pay for their spending spree. Who wants to invest in such a high tax environment? One of the arguments being used to support the expansion of the CPP is that it would help struggling seniors. However, the proposed plan would not be fully implemented for another 40 years, which means seniors would not be receiving the help now that the government says they need. I would challenge the government that there are many other ways they could help seniors and the aging population, but the Liberals have chosen to turn their backs on Canadian seniors.

I am going to let the House know what seniors think. The carbon tax would increase the cost of everything, including their groceries and heating their homes. That would be dramatic. That would be devastating to our seniors.

Now that I have talked about seniors, I will talk about our youth, whom the government claims the bill would benefit the most. Our youth benefit from employment, and this bill would make it more difficult for employers to hire our graduates. Young participants in my round tables are more concerned about their jobs, about their take-home money now, instead of paying into something for 40 years down the road.

Not only that, but we are forcing Canadians to invest in a pension plan that offers a low rate of return. According to a well-quoted study by the Fraser Institute published in May 2016, and externally validated by many other organizations, the projected real rate of return for CPP investees is 2.1%.

I will quote from the study:

Canadian workers retiring after 2036...can expect a real rate of return of 2.1 percent from the CPP.

This basically means the majority of our workforce today, contributing to CPP, is making a real rate of return that is barely above inflation. Remember, when people retire and draw funds from the CPP, that amount is taxed with income taxes.

Some Canadians are comfortable with the CPP and the fact that it is backed by the government, but we are given no choice in the matter. CPP legislation forces all Canadians to participate in this low-return investment. The government has made the decision for the rest of the country, regardless of the personal situation for how Canadians want to fund their retirement.

There are other ways that government could encourage Canadians to invest in their retirement. There are already many options available to individuals, including the well-known registered retirement savings plan or tax-free savings accounts. The CPP is only one method of saving, amongst others, but this is a forced method of saving for retirement.

By highlighting and encouraging other programs, Canadians are able to create a retirement financial plan that suits them best and does not solely rely on government to make this choice for them.

At a time when our economy is struggling and many people are unable to find work, such an expansion of the CPP would only magnify these problems. Our job creators would face another burden in their ability to hire new workers, and Canadians would have less money in their pockets to invest in the economy.

I am convinced the government does not want to help Canadians save. If it did, the Liberal government would not have chosen to reduce the amount of money individuals can contribute to their RRSPs or tax-free savings accounts.

Canada has excellent programs that allow Canadians to choose how they want to save their money for retirement. As I have said before, instead of making it more expensive for our small businesses to hire staff and create jobs, we should be minimizing taxes, cutting red tape, and trusting Canadians to make their own decisions regarding how to spend and save their money. I will continue to fight for our hard-working job creators.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I very much appreciate that New Democrats are supportive of this legislation. I think we share a lot in common. Workers today will benefit from this agreement that was achieved between the provinces and the leadership in this national government.

Today we have Bill C-26, but there are other aspects of the pension program. I am looking specifically at the GIS, the guaranteed income supplement, and how that program also helps supplement individuals who are in need of income.

Does the member have any thoughts on how he sees this as a bill that is one piece of what I would suggest are the three pillars of the pension issue: the CPP, the GIS, and the OAS? Can the member provide some comment in regard to the GIS and the OAS?

[Susan Eng, Counsel, National Pensioners Federation]

Thank you.

Mr. Chair and members of the committee, while seniors today need several measures to help them with their health and financial concerns, they are also concerned about the financial security of tomorrow's seniors. Without reservation, the National Pensioners Federation commends the federal and provincial governments on reaching a historic agreement to increase the CPP.

We welcome the proposals in Bill C-26, which is being debated now, to implement that increase and to amend the Income Tax Act to facilitate deductions for the contributions, but we especially commend the addition of the increase to the working income tax benefit to allow lower-income Canadians to participate in the pension plan, so we encourage speedy passage of Bill C-26.

The CPP and previous availability of workplace pensions are largely responsible for the large drop in seniors' poverty over the past two decades, but the effect is finished and workplace pensions are disappearing, so poverty is creeping up again. As recently reported, seniors' poverty has increased from a low of 3.9% in 1995 to just over 11% today, or one in nine seniors. Fully 28% of single female seniors and 24% of male seniors are living in poverty in this country. In human terms, that's 665,000 Canadian seniors living in poverty, mostly the oldest, mostly single, mostly women.

This issue of financial security is exacerbated by concerns about increasing income inequality, and there has been quite a lot of discussion around a guaranteed minimum income. This committee itself has actually recommended that an expert panel be established so the issue can be properly examined, and we encourage you to do so.

Those are our recommendations. We'd be pleased to take your questions.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I am pleased to rise today in the House to speak on behalf of the New Democrats and express our support at second reading for this important piece of legislation. Bill C-26 amends the Canada Pension Plan act, among other acts, to incorporate the recent agreements reached with the provinces to enhance the Canada pension plan benefits for all Canadians.

While we believe that better was possible and will continue to urge the government to make a more improved plan available for workers in this country, and despite the fact the full effect of these changes will not be felt for 49 years, this CPP enhancement is in theory an important first step in improving retirement security for young Canadians. We congratulate everyone, particularly labour, which worked so hard to lay the groundwork for this agreement.

New Democrats have fought for decades for increases in the Canada pension plan, old age security, and the guaranteed income supplement benefits for all seniors. In fact, the idea of having universal retirement security programs for all Canadians has been a core New Democrat policy going back to the formation of our party. We have urged every government for decades to make meaningful improvements for Canadians, so that every Canadian can retire in security and in dignity.

Our support for the bill is qualified. That is because while the enhanced expanded CPP proposed by the bill is a plan that will benefit a new generation of workers entering the workforce, it does almost nothing to alleviate the retirement income crisis of those approaching retirement now and, quite frankly, in the decade or two ahead. We must now see immediate action by the government to help those seniors and Canadians who are on the cusp of retirement and who will not benefit from these changes. Government must build on the momentum of this agreement and take the next steps to improve long-term retirement security for today's workers, including addressing the valid concerns raised by Quebec about the impacts on low-income workers.

In the New Democrats' view, much more needs to be done to help our seniors live with the dignity they deserve. The high cost of housing and prescription medication, the clawback of the GIS, and the indexing of pensions are just a few immediate issues that we think require more work by the government. We also think that the government needs to keep its promise to introduce a new seniors price index to make sure that old age security and the guaranteed income supplement keep up with rising costs.

Retirement insecurity in this country is reaching a crisis level, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. A large part of this problem is fuelled by the erosion of workplace pension plans to the point that six in 10, or 60% of, working Canadians have no workplace pension.

In the New Democrats' view we need a clear breakdown from the government as to who will benefit the most from this plan and who will benefit the least, and how these changes will interact with other programs, and how we can strengthen the workplace pension regime in this country, as well as the public component that the bill addresses.

By way of background, it is helpful to review what is being proposed by the bill. Currently the CPP covers earnings up to a cap of $54,900. For earnings up to the cap, the CPP is designed to replace about 25% of the income. The maximum pension that a worker who fulfills all the criteria, working for 40 years and contributing the maximum amount, can look forward to is about $1,092 per month or $13,100 per year.

Contributions are 4.95% for the employer and the employee, up to the same cap. The expanded CPP proposed by the bill is a separate new tier. The new tier is added on top of the existing one. The new CPP tier does two things phased in over the next nine years to 2025. First, it takes the replacement rate up to 33 1/3% from the current 25% of earnings, and, second, it expands the upper earnings cap from today's $54,900 up to $82,700.

The net result is that when this plan is fully phased in by 2065, a worker who earns $54,900 annually in 2016 dollars would receive a maximum annual pension of about $18,117 in 2016 dollars by the time he or she retires. For a worker at the $82,700 maximum tier amount income level, CPP benefits would rise to a maximum of $20,352 a year in today's dollars.

The reason I am using today's dollars is that it is important to understand the very limited expansion that the current government has brought forward. If people can imagine that in 2065 they would be at the maximum CPP pension if they contributed for 40 years at the maximum earnings level, with a resulting pension of $20,352 a year, just about every Canadian planning for retirement would see that that is absolutely insufficient to retire with.

We all, though, acknowledge that the Canada pension plan was never designed to be a full retirement plan—although there is a credible argument to be made that a government pension plan could in fact achieve that if it were wanted—but was intended to be supplemented by private savings and workplace pensions. This is why I raised earlier the very alarming statistic that more than half of Canadians have no workplace pension. This is very different from the 1960s and 1970s when a much higher percentage of Canadians had a plan at work.

Canadians who are working today cannot expect to have very much pension income from their employment. Of course, given the rising costs of living in this country, particularly in Vancouver where I come from, it is very difficult for them save the amount of money they will need to supplement their Canada pension plan. So what the New Democrats would like to see and what we have advocated for a long time is a Canada pension plan designed in a way that the worker and the employer would contribute sufficient money to replace 50% of the money a person would need upon retirement. In concert with that, we also propose strengthening the programs, policies, and laws in this country to encourage employers to create pension plans in the workplace to help those workers supplement their pensions. We also believe, for instance, that laws that protect pension funds upon bankruptcy also need to be strengthened so that workers, as we saw in the case of Stelco, would not see their deferred salaries—the money they have saved over the years—distributed among creditors upon bankruptcy. That is a long-standing problem in this country that neither Conservative nor Liberal governments have ever had the political courage to touch, but it is a matter of fundamental justice.

The Canada pension plan is the best pension plan in this country for a number of reasons. It is portable. It does not matter if people quit or leave a job in New Brunswick and move to British Columbia and start working again, because their Canada pension plan will still be activated. It is the cheapest pension plan in the country. There is a associated cost for employers, who normally have to provide a pension plan, as they have to hire pension lawyers and actuaries and custodians of the money, whereas in this case, all of the costs of the plan are borne by the government. Being the largest plan in the country, it is also the safest repository of Canadians' income. In sum, it is the cheapest, most portable, safest pension plan in this country.

I think Canadians from coast to coast would love to see the current government increase Canada pension plan contributions to such a degree that we could phase these in slowly and affordably over time so that the plan would actually do what it is intended to do, which is to make sure it replaces 50% of workers' income upon retirement so that more Canadians can retire in dignity.

I just want to conclude by saying that I often hear the Conservatives use language calling this a payroll tax. Retirement investment is not a tax. It is an investment. There is no secret to pensions. People put away a bit of money for a long period of time. That is savings, and that is how they fund their retirement. When workers and employers both contribute to that pension plan, that is how we get a dignified retirement for Canadians in this country, and it is about time that the Conservatives recognized this and joined the 21st century so that Canadians can retire in dignity and with some level of security.

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

Mr. Speaker, today I rise in the House to speak to Bill C-26, which seeks to enhance the Canada pension plan. Although the bill's intention is good, I think it is important to point out certain facts.

First of all, in order to qualify for a pension, one must first have a job. Just last week, the Minister of Finance painted a very grim picture when he said that we just have to accept that jobs are precarious, and still, the Liberals want to implement a system to enhance the Canada pension plan.

Where are we going to find the money, if jobs are so precarious? Will it come out of taxpayers' pockets? What about creating jobs? The Liberals talk a lot about retirement, but never about creating jobs.

As usual, the Liberals are living on another planet, not the one that middle-class Canadians live on, and they are not creating any jobs. Our current economic situation is disastrous, and the Liberals continue to spend recklessly.

On top of that, some households will have to pay up to $2,200 more a year, when we know that they worked so hard to save that money. These smoke-and-mirrors tricks are the Liberal way. In their la-la land, everything happens by magic. More than anyone, the Minister of Finance should be able to wake up his Prime Minister.

We are not living in the land of unicorns nor are we living the life of the rich and famous. We are real people, people who work, people who are scrambling to work, and people who have trouble saving. Canadians will have to wait 40 years for the CPP to increase. As a result, no new benefits will be paid to the retirees who currently need them.

According to the logic of the Minister of Finance, who said last week that Canadians should get used to mobile employment, temporary contracts, and a number of career changes in their lives, who will benefit from this plan? It is not seniors. Is it the next generation? I do not believe so, since, the way things are going, that generation will be overtaxed and its power to pay will be reduced.

Already today, new graduates are struggling to find jobs. Imagine what the situation will be like in 10 years. It will be more difficult for them to pay back their student loans and buy their first home, especially since the minister just tightened the mortgage requirements. This measure could have a huge impact, particularly on the first-time home buyers market. Those who qualify to purchase a home will have to settle for a semi-detached or a condo. Those who were just able to afford a condo will have to continue renting or living with their parents. It will create more boomerang children.

Bill C-26 is an enormous financial hole for taxpayers. For Canadian families, this means there will be less money in their pockets, and it will be even harder for them to save money for a vacation or for their children's post secondary education.

Young families today will have to deal with this job shortage because according to the Minister of Finance, they will have to get used to seeing certain jobs disappear and adapt to job insecurity. In fact, that is what is happening right now in some of our regions. If we follow the Liberals' logic, young people will not be able to contribute to this plan because job opportunities will be scarce.

When it comes to taking more money out of Canadians' pockets and out of our pockets, the Liberals are champions. They never miss an opportunity to impose another new tax on taxpayers. We do not have to look far in the text of the bill to see that this government plans to take money here, there, and everywhere.

Why is this government so set on taxing Canadians? The Liberals have the nerve to get rid of tax credits for children's sports and arts, and reduce the TFSA contribution limit by half. Why do they not trust Canadians? Do they think they are more responsible than Canadians? Do they really think that taxpayers' money will do better in their hands until retirement comes along? I doubt it. Not all of us have $1,500 to spend to get access to one of their ministers.

When we gave out tax credits and collected fewer taxes, we still managed to balance the budget. This government is doing its utmost to get every last penny from families and yet still finds itself in the red to the tune of over $30 billion. If anyone is truly irresponsible, it is the Liberals opposite.

Basically, the Liberals subscribe to the theory that the end justifies the means. However, they talk mainly about the end, and only whisper about the means, because they know that no one is excited about the new taxes, especially voters.

As my grandfather used to say, heaven is blue and hell is red. Let us not allow the Liberals to lay waste to the Canadian economy with their grandiose ideas.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, as the new official opposition critic for economic development in Quebec, I am pleased to contribute to the debate on Bill C-26, which would increase employee and employer contributions to the Canada pension plan.

It is important that we debate this bill because many Canadians are currently unaware of the consequences of the Liberal plan. What is worse, many of these changes will only be implemented in 2019. Therefore, it will be impossible to assess the impact and the potential harm of this bill before the next election.

Why wait? That is because the Liberals know that every Canadian's income will decrease and that thousands of jobs will be put at risk by imposing an additional burden on businesses, including SMEs, which are the backbone of our economy.

A total of $2,200 a year will be collected from workers and the entrepreneurs and businesses that create jobs. The Liberals are tight-lipped about that. An Ipsos poll published last month provides supporting evidence, by showing that 80% of Canadians want to be consulted before increases in contributions to the retirement program take effect. This same poll also revealed that 70% of workers do not support the CPP expansion if it affects wage increases, which is very likely.

The Liberal government is also claiming that it is listening to young people, but if it took the time to explain to millennials what is about to be imposed on them, they would be taking to the streets to protest this government's attitude.

Let us put this in perspective. The Maple Spring of 2012 in Quebec occurred as a result of the provincial Liberal government's decision to increase tuition by $1,625 a year. Students are supposed to be able to complete a bachelor's degree in three years in Quebec. If a tuition hike of $1,625 a year for three years caused that much outrage among young people, how will they react if word gets out that the federal Liberals are about to take $2,200 away from them every year for the rest of their working lives, which will likely span four decades or more?

I can already tell that the Liberals opposite are going to say that they are investing for the millennial generation's future. Is that really the case? Let us look at the numbers to determine whether young people will really come out ahead. Take for example a taxpayer who earns the maximum amount of $82,700 proposed by Bill C-26. At the current contribution rate of 9.9%, this worker would be entitled to a pension worth 25% of his salary or $20,675. If the contribution rate is increased to 11.9%, as proposed in Bill C-26, the worker would be entitled to a pension worth 33% of his salary or $27,291. That is an increase of less than $7,000 a year. A person who earns an average income of $40,000 would only get $3,200 more, and that income would also be taxable.

However, if instead we allow families to take the $2,000 a year that would be confiscated from them under Bill C-26 and invest it themselves in a TFSA, for example, in 40 years they will have saved over $280,000, which is a rate of return of 5% per year. When they retire, they would have an additional $14,000 a year or double what they are being offered under the Liberals' retirement plan.

What is even better, is that, unlike the CPP payments, that money would be completely tax free. They can always contribute more if they want, although the Liberals chose to reduce the TFSA contribution limit to $5,500 after we increased it to $10,500 in our last budget.

There are also other advantages to preferring a TFSA over an increase in the CPP. If a person dies, the amount of his TFSA goes to his estate. The money goes to family, friends, or the charity of his choice. On the other hand, if a person dies and all his pension funds have been invested in the CPP, the government takes the money. There is only a reduced annuity of 60% for the survivor in the couple, if the couple has remained married, as is not always the case as we can see from today’s divorce rate, or a meagre $237 per month for the children, only up to age 18, or to age 25 if they remain in school. For everyone else, nothing.

Of course, all this applies only if the CPP remains solvent. Our population is getting older, and life expectancy has increased considerably since the introduction of the CPP in the 1960s. Young taxpayers have no guarantee that the money will be there when they need it. The Liberals dipped multiple times into the employment insurance fund under the Chrétien and Martin governments. It is difficult for us to trust them again.

The CPP Investment Board says it will be solvent for the next 75 years. The former Pearson and Trudeau governments thought that as well, with a combined contribution rate of 3.6%, which proved inadequate. The Chrétien government had to triple the rate to 9.9% in the 1990s. Instead of examining long-term solutions, as our former government was doing, to ensure the continuity of the CPP fund by progressively raising the retirement age to 67, the new Liberal government has no other solution but to further tax workers and employers in order to mask the problem. Furthermore, many specialists have said that putting the retirement age back at 65, contrary to what we did, would cost the government billions of dollars in the years to come.

Bill C-26 increases the contribution to 12%, and if the Liberals’ sunny ways and rose-coloured glasses projections again prove incorrect, what guarantee do we have that it will not be necessary to hike CPP contributions again in 10 years or 20 years? If that is not a Ponzi scheme, I would like to know what is.

Faithful to its current policy of buying Canadians’ votes with borrowed money, the Liberal government goes on dreaming that it can continue to ask future generations to pay for its mismanagement. That is cross-generational theft, and it is absolutely shameful.

This is why we are going to oppose the passage of Bill C-26. This bill is going to cost more for workers and entrepreneurs, of whom I am one. I have mentioned several times in the House that I am an entrepreneur. I have 25 employees and, for my company, this policy represents $25,000, even almost $30,000 in additional costs per year. What will probably happen is that I will be forced to abolish a position or a position and a half to be able to provide this amount to the workers’ fund. So this is jeopardizing thousands of jobs, it will be of no assistance whatever to persons already retired, and it will make it increasingly difficult for companies to create jobs.

The government has to consult the people who will be paying the tab. If it had done so, Bill C-26 would never have appeared on the Order Paper.

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, and of the amendment.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, I rise on behalf of the people in my riding of Renfrew—Nipissing—Pembroke to participate in this important debate regarding Bill C-26, an act to increase taxes by charging a job-killing payroll tax on working Canadians. The bill would amend the CPP, Canada Pension Plan Investment Board, and the Income Tax Act to implement a job tax.

In politics, as in business, timing is everything. I want to be clear to all Canadians following this debate that I believe we all agree that any specific action that assists in allowing individuals to retire in dignity is good public policy. However, Canadians need more than platitudes from the party in power to know if what is being proposed is in their best financial interests and in the best interests of our country.

Changing elements of this country's social safety net is not something that should be done on an ideological or partisan basis. Conservatives are individuals who take the position that individual choice is preferable. Choosing one's retirement is no exception to our rule of freedom to choose. Individuals from the left take the position that Big Brother, big government, should make all the decisions, which, in this case, is choosing one's retirement. Somewhere there has to be a compromise, which is the current Canadian system of retirement savings.

Canada is a mix of the old age pension, the supplement, which tops up the OAS in the absence of any other income with an eligibility requirement, as well as a variety of tax-assisted savings plans, such as registered retirement savings plans, tax-free savings accounts, and public and private pensions. Anytime some group, individual, or political party seeks to upset the balance of our society, they must be vigorously challenged.

The main purpose of the pension system is to assist households to achieve a balance of assets and liabilities over its most productive time period to prepare for the time when the household's ability to accumulate revenue declines. This is achieved by transferring resources from working life to post-retirement when income dries up. This is referred to as smoothing consumption over life. What pension plans should not be is a pool of capital for government to take from to fund schemes of dubious or ideological value.

The reason I oppose this plan to expand the CPP at this time is varied. However, it is the Ontario experience that represents the biggest reason why Canadians should be very skeptical of any scheme to tax more dollars out of their and their employers' pockets, particularly under the cover of saving for retirement.

Pension plans exist for the benefit of the pensioners, not for governments in search of cheap and easy capital pools. I send this warning as a direct consequence of comments made by the President of the Treasury Board who has suggested the Liberals see Canadian pension plans as a convenient source of money to finance their party's schemes. I quote from a national newspaper:

...pension funds often invest in infrastructure such as toll roads, airports or other revenue-generating projects. They are seen as less risky and more predictable than financial markets. ...there is no problem with this as long as the fund has the ability to operate wholly independent of the government, and is able to make decisions based solely on their potential to generate a maximum return for the pensioners it serves. But there’s real reason to doubt this would be the case in the Liberal scheme.

Right now, the Canada pension plan is fairly well managed. The same could have been said before the Toronto Liberal Party decided to take what used to be a well-managed provincial crown corporation and run it into the ground. I am referring to Ontario Hydro, or Hydro One as it is now called in my province. I make reference to Ontario, because I believe all Canadians should be made aware of the absolute public policy disaster that occurred in Ontario and what happens when ideology is substituted for common sense, particularly when large sums of taxpayer dollars are involved.

First of all, Canadians need to know why the Ontario debacle is relevant to today's discussion about the job-killing tax of Bill C-26.

The failure of Hydro One can thank what is referred to derisively by Ontario ratepayers as the Green Energy and Green Economy Act. This ideologically driven Toronto Liberal policy has, as one of its principle architects, Gerald Butts. Mr. Butts moved, at great taxpayer expense, it has been revealed, from Toronto to the most senior position in the Prime Minister's Office in Ottawa, along with dozens of other ex-Toronto Liberal staffers at great public expense also.

Lynn Morrison, who is Ontario's Integrity Commissioner, observed that, and I quote from the summer edition of the Canadian Parliamentary Review:

During her investigations into Ontario’s gas plants, she found political staff had ignored long-established procedures and put party interests ahead of public interest.

These staff now surround the Prime Minister in Ottawa.

Under previous Conservative governments, Hydro One, Ontario Hydro, operated at arm's-length from government, much like CPP today. Gerald Butts and his friends changed all that. Through cabinet directives, appointees to the agencies that were supposed to be regulating the electricity monopoly, Ontario Hydro, they forced Hydro One to raise the price of electricity to the highest cost in North America.

This policy to increase the price of electricity has led to energy poverty in Ontario. Tens of thousands of people struggle to pay their electricity bills. For many, it is a choice between heat or eat.

High electricity prices have caused the loss of tens of thousands of jobs in what was once a thriving manufacturing sector in Ontario. This was all done under the cover of climate change, with the smear that if individuals did not support industrial wind turbines in their background, they were a climate change denier, the same sort of left-wing smear that if people do not support this new job tax, they are against a comfortable retirement.

They called the industrial wind turbines so-called green infrastructure and proceeded to hand out fat, juicy contracts to Liberal Party supporters, starting with the then Liberal Party president for $478 million.

To Toronto Liberals like Gerald Butts, wind turbines are green ideology. The fact that some of their Liberal buddies could cash in just made them push harder. Even though the non-partisan provincial auditor identified a $37 billion black hole, which is getting bigger and bigger, there was no accountability. Unfortunately, Ontarians only found out about the misspent funds after the money was gone.

Canadians must ask themselves if they want to gamble their retirement the way the Toronto Liberal Party people gambled electricity prices and lost? Ontario is now the most indebted subnational government in the world.

Let us summarize where this bad legislation will take Canadians.

The CPP job tax hike will take money from the paycheques of hard-working Canadians, put hundreds of thousands of jobs at risk, and do nothing to help seniors who need it.

The Liberals are refusing to tell Canadians exactly how much it will cost, but we know many workers and their families in my riding of Renfrew—Nipissing—Pembroke will be paying thousands more dollars every year out of their pockets.

This also means that it will be harder for new graduates to pay off their student loans or for young people to buy their first home. It will be harder for families to save for vacations or their kids' post-secondary education. It will be harder for companies to create jobs and give workers raises.

Canadians who follow the proceedings in the House of Commons during question period have become very aware of a Prime Minister who is wholly distracted whenever he is asked a direct question on a matter of substance, an unfortunate practice that is mimicked by his chief minister of special access fundraising, who follows the same talking points set out by their handler in the Prime Minister's office.

We are seeing a pattern here, similar to the nightmarish regime at the legislature in Toronto where most of that political Liberal staff fled from after destroying the Ontario economy with their huge carbon tax/global adjustment fee charge on electricity bills, eliminating hundreds of thousands of jobs in the manufacturing sector in the process.

What Canadians have begun to realize is that there is a wide separation between the public utterances of the Liberal Party and what is actually happening in Ottawa. This is called style over substance, which samples of the opinions of voters indicate they understand and recognize how the Liberal Party operates in Ottawa today.

It is important to put on the public record that the before the Minister of Finance and he was in private business, he was saying the opposite about Canadian savings to what he is now telling Canadians about why Canada needs a new job tax. Read the book.

I wonder how the Minister of Finance felt about charging for special access before he started collecting contributions. Let us look at the rise in taxes.

The Liberals will hike the CPP job tax from 9.9% to 11.9%, starting in 2019. As a result, the CPP job tax is up to $2,200 per worker. This CPP job tax in some cases will be split between the employer and employee. For the entrepreneurial self-employed, they will be required to pay 100% of the CPP job tax increase.

Under the guise of helping Canadians save for retirement, in fact the Liberals are pushing through a not so cleverly disguised tax increase on employers and employees.

What this does for employees is take money out of their pockets. What this does to employers is similar except worse. By taking capital away from an employer, the employer has few options.

The first option is to try to raise prices to pay the higher job tax and risk going out business when forced to match the lower wages, safety and environmental standards of a country like China, a country the Liberals are keen to sign a free trade pact with. Option two is to eliminate jobs in the business.

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

Mr. Speaker, I am very pleased to speak today to Bill C-26, which would reform the Canada pension plan.

First of all, I would like to mention that as Quebec MPs we fall under another plan, the Quebec pension plan. Although the Quebec government did not support this agreement because it has its own plan, it nevertheless committed to making similar changes to its plan, and so much the better.

However, debate on this bill provides an opportunity to speak to the set of measures and the situation not only of current retirees, but also of those who will soon retire or even those who will retire in the distant future. Ultimately, one of our main roles as legislators, although this is often forgotten, is to think about and plan for the long term.

Retirement is a real problem today. The cost of living is going up, and people are finding it more and more difficult to save for retirement, whether that time is a long way off, in the very near future, or already a reality for them. One reason for that is that fewer and fewer companies are offering private pension plans. Even when they do, such plans are no guarantee of a secure retirement.

Consider all of the companies that have gone bankrupt and the impact that has had on employee pension plans. We saw some dramatic examples of that during the 2008 crisis. Unfortunately, the present economic situation suggests that nothing can shield us from that kind of thing happening again.

It is also important to note that, despite what I have been hearing from certain Conservative members, poverty among seniors actually is a serious problem that we need to tackle, using tools such as the Canada pension plan, old age security, and the guaranteed income supplement.

The Liberal government promised to improve the guaranteed income supplement and lord knows that is a long awaited measure. The government promised to index the GIS to the cost of living, but that has yet to happen. This is very important because as I said, when we retire the cost of living goes up, but our income remains stagnant and that is a big problem.

Two weeks ago, on October 4, I attended the seniors' forum in Chambly. It was their 10th anniversary. This yearly forum is an opportunity for community organizations serving seniors in the greater Chambly area, representatives from both MPs offices, as well as representatives from the various seniors clubs in the region, to talk about services provided to seniors. It is a good opportunity for us to meet with seniors and talk to the various organizations that serve them in order to get a better understanding of their reality.

I do not claim to know what seniors are going through in my colleagues' ridings. However, some seniors have to live in low-income apartments and some are struggling. Women who live alone have to deal with the financial burden of paying for groceries and housing. These are very difficult situations and if as legislators we do not take our responsibility seriously and ensure that seniors have a stable income and improve the financial tools available to them, then we are shirking our responsibilities and that affects all of us.

Fortunately, we can tip our hats to the government for pushing back the age of eligibility for old age security from 67 to 65. We can commend the Liberals on that because that senseless move did nothing for workers. In fact, it punished workers who work in mines or other jobs that require a great deal of manual labour. One way or another, we want to ensure that they can retire sooner rather than later.

We are reminded that the parliamentary budget officer's reports indicated at the time that the old age security system was entirely sustainable, and we could keep the retirement age at 65.

Contrary to what a number of members from all parties have said, the issue of retirement is not only about our seniors, although they are the ones who will suffer the immediate consequences. However, it also concerns young people my age, even though retirement may seem a long way off. It is particularly meaningful considering our currently reality, and I am referring to the rise of precarious work. Precarious jobs affect everyone. Young people are particularly affected by this issue, but not only young people.

It is very interesting that we are having this debate on the need to provide a secure retirement to the next generation one week after the Minister of Finance said that young people just need to accept precarious jobs and basically chill out, to paraphrase.

The fact remains that it is absolutely unacceptable to ask young people to be content with just summer jobs.

Of course, retirement is far away for young people. However, the fact remains that if we do nothing today and if we do not start taking this reality seriously, there is going to be quite a problem in the future.

The Canada pension plan is not the only solution because, ultimately, if young people work on contract or have precarious jobs, it is only one of the tools in the toolbox that is supposed to ensure their financial and retirement security. For that reason, we are calling on the government to work harder on dealing with these problems. In fact, at this time, the government seems to accept that this will be the reality in the next few years and that that is just too bad. Well, we do not accept it. The situation is unacceptable. The government should do more about it, and these kinds of comments by a finance minister will not help the situation.

With regard to the guaranteed income supplement, for example, we could do other things to make life easier for people who need it. After all, as taxpayers, they contributed to it. These people should receive the GIS automatically. That would make things easier for many seniors who have told us that there are always complicated forms to be filled out in order to receive the benefits to which they are entitled.

I would like to come back to other measures that affect more than just retirement. We need to look at all of the measures in place for people who need them. I heard a Liberal member say that every measure is important. However, I am thinking about someone who came to my riding office recently. I will not mention any names out of respect for privacy, but they know who they are.

A few years ago, my colleague from New Westminster—Burnaby gave my constituents an excellent presentation on the various measures that exist, such as tax credits for people with disabilities. A retired senior couple attended that presentation. They had a child who was benefiting from some of the measures for people with disabilities. Small changes were made that may have gone unnoticed, that were not mentioned in question period, and that are not considered matters of national importance. However, because of these small, subtle changes made in the budget, this couple's child no longer benefits from these tax measures. Who is paying the price now? A retired senior couple who is taking care of their child who used to benefit from those measures.

We are going to support Bill C-26 because we know that the Canada pension plan is very important in helping retirees live with dignity and allowing older and younger workers to have the retirement that they deserve when they reach that stage in life. However, I would like to remind the government that, if it really takes Canadians' financial security seriously, then it needs to review all of the measures, even the small tax measures that do not seem to have an impact. They do have an impact. They affect people's lives. It is very important to look at all of the measures. The government should not content itself with passing a bill like this one and then say that it is finished and that it solved those people's problems. It is much more complicated than that. It is important that the government take this responsibility seriously.

I now invite questions from my colleagues.

[Karen Vecchio, Conservative, Elgin—Middlesex—London, ON]

Mr. Speaker, this week the Minister of Finance tabled Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

I had the opportunity to listen to the minister's speech, and the question and answer portion. I listened to him try to explain to us in the House, as well as to the viewers, how this bill was good for Canadians. I had the chance to ask the first question to the minister during that period, and although he is a great speaker, I did not get the answer I requested.

To start, I am going to pose this question once again, but in a different way and hope that through the following hours of debate that there is finally an answer. I shared with the minister two quotes from the Canadian Federation of Independent Business CEO, Dan Kelly:

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. Despite all the talk, it appears that jobs and the economy are not particularly high priorities for the governments that have signed off on this deal.

Another quote from Dan Kelly stated:

Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike.

These two statements are very troubling, especially with the statistics from 2013 indicating that there are 1,116,423 small businesses in Canada. That makes up 98% of all employer businesses in Canada. This same information shows that 86% of Canadian exporters were small businesses in 2009, that accounted for $68 billion in exports or approximately 25% of Canada's total export value.

Locally, I have received data from my riding of Elgin—Middlesex—London, done by CFIB. When polled on the support for CPP increases, 12% of all Canadians in Elgin—Middlesex—London supported this increase. That is 12%. That means 88% of the people polled did not agree with the CPP tax increases.

With these important figures, I will continue to discuss the concerns with increases to CPP and the impact on small businesses. Rather than continuing with all the stats and figures, I want to share with the House my own personal experience as a small business owner.

Many of us come to the House with different skill sets and different assets, which is very important. One of the assets that I have was being a small business owner. I had the opportunity to run a small business with seven employees. That was run by my former husband and I. When we took this business over in 1998, we purchased it as a franchise. The gentleman was moving out of the franchise business.

At that time, we had received the books showing how well the business was doing, so we were very excited about the first day on the job. However, our first day accomplished $81 in sales. My former spouse and I had paid two staff throughout the entire day. We were open from 7:00 a.m. to 11:00 p.m., and we paid two staffers throughout the day for their shifts.

At the end of the day, our cash received for the items we sold was $81. Obviously the issue here was we needed to look at how to run a proper business. How could we do this? We had many obstacles in front of us, but one of the first things we needed to do was reduce our costs. By doing so, we had to look at what were some of the costs that a business could reduce without impacting what is being sold.

I was in a small coffee shop. We were a coffee house where there was entertainment five nights a week. We served an area where there was a TD Bank and many other local businesses. We were a very common stopping ground for people on their way to work and leaving work.

One of the first things we did was business promotions. That was able to bring in some sales, but at the same time we had extraordinary expenses. I was in a location where our actual cost for rent was $3,800 per month in the downtown core of London. I was dealing not only with an extravagant expense when it came to the rent, but we also had high hydro costs. For anyone who lives in Ontario, believe it or not, it is actually even worse than it was in 1998. We were spending at least $400 and $500 per month on those costs.

We also had other costs that we had to look at, whether it was municipal taxes or different things that we had to go and propose to council, so we could put seating outside. There were many things we had to deal with that had red tape.

The number one thing I did was to reduce costs. It was a really horrible choice to reduce the number of staff. To make that business work, I needed to make sure we had inventory. I needed to make sure there were coffee beans and milk, that the lights were on, and that we paid the rent. That was what was important to me, because without those things, I could not run a business. The first expense I could change was to decrease my staff by two employees. It was a very difficult decision for us to make because it involved the lives of two students going to Western University. We had to take away 15 hours of work per person just to make ends meet.

Over time, we did do better. Nonetheless, anyone who is a small business owner will recognize that we are not just there counting the receipts at the end of the day, but are paying the bills. In my case, I recognized that I could buy a pound of pre-cooked bacon for $7.50, or I could pre-cook that bacon myself in my own kitchen for $3.50. Every single thing mattered, especially when the first day of business brought in $81.

The first thing I had to do was to reduce my staff. Seven days a week, for a year and a half years, I would go in and work. Take into consideration that at the time I had a child who was three months old, as well as a 19-month old, and a child who had just reached the age of 4 and had just started junior kindergarten. This is about a family run business. It is not about rich small business owners. This is about a family that was running a business: a mom, a dad, and three children. I would go in there and scrub the toilets and do all of those things so that we had the business.

By the end of this, we did end up doing very well, and after about 18 months, it was either a matter of our mental wellness and selling the business, or continuing to work every day. We decided to sell that business.

However, one of the biggest things we had to do to keep our costs low was to reduce wages. With wages, we have to look at what payroll means. It is not just the CPP contributions that the government is talking about. Those premiums are matched not only by employers but also by the employees themselves. We have employment insurance premiums. We have WSIB, and I am sure there are very similar programs across the country. Therefore, as a small business owner we are not just dealing with paying the taxes that are removed from someone's pay. We are also doing matching contributions.

There are many things to consider, but I think that is the one thing on which we have to sit back and get into the shoes of a small business owner.

Making business decisions can be very difficult. I fear with this change to the CPP that the government is asking small businesses to make that same decision I had to make in order to have a successful business. To reduce costs, we had to reduce expenses. An easy way of reducing expenses is the hardest job, and that is by cutting staff. It is cutting human resources, and we need to talk about that.

On Friday, I asked the member for Foothills about the challenges in his region, where over 200,000 jobs have been lost in Alberta. In my region I saw a similar thing happen between 2008 and 2010, when we went through the global economic downturn. I asked him in particular if the CPP tax hikes would hurt new businesses. Obviously, the answer is yes.

Changing direction, we also have to make sure that Canadians are aware of what this program is. In the CFIB's Ipsos poll, it was noted that 40% of Canadians think the government contributes to the CPP. We have to make sure that people realize that is not the case. It is the employees and the employers who contribute. It is not about the government here.

We cannot confuse Canadians when we are talking about CPP and are throwing in the point that the GIS has been increased. All we are doing is taking the three pillars of retirement and confusing the average Canadian who has not had an opportunity to sit down and study it.

Retirement is about three pillars. It is about the CPP contributions of the employee and the employer. It is about the social programs, such as old age security and the guaranteed income supplement, and it is about personal savings. This government has reduced personal savings with its changes to the tax-free savings accounts. However, the bottom line is that more money cannot be taken out of Canadians' pockets.

I want to finish with a quote that I am sure the government has heard many times:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get. Yes, a little over five per cent of seniors today still have income below the poverty line...

That was Fred Vettese, chief actuary of Morneau Shepell and co-author of the finance minister's book, The Real Retirement. This segment was taken from The Financial Post, June 5, 2016.

I would really ask that we look at these things and recognize that CPP is not about poverty reduction. These proposed CPP increases would hurt, especially when we are going to be seeing things like a precarious carbon tax and the cancellation of the small business tax reduction by the current government.

[Jim Eglinski, Conservative, Yellowhead, AB]

Mr. Speaker, I am pleased to rise in the House today to speak to Bill C-26 and the Liberals' plan to expand the Canada pension plan.

This expansion would take more money from Canadians' paycheques, place more hardship on small businesses, and do very little for vulnerable citizens. Vulnerable seniors would gain little or nothing from the expanded CPP, as many have not contributed to the CPP and therefore are not eligible to receive CPP entitlements.

I quote from the Fraser Institute, through their colleagues, Charles Lammam and Hugh MacIntyre, who stated:

Instead of expending political energy on debating CPP expansion in the misguided belief that many middle- and upper-income Canadians are not saving enough for retirement, the focus of public debate should be on how best to help financially vulnerable seniors.

For low-income seniors who have contributed, an increase in CPP income could trigger a reduction in other government transfers, meaning little or no net increase in retirement income. If this plan goes ahead, the CPP premium rate will start rising in 2019, and the maximum level of pensionable earnings will go up from $54,900 this year to $82,720 in 2025.

According to a study by the Fraser Institute, this expansion will take money from Canadians, with little benefit in return.

Simon Gaudreault, chief economist at the Canadian Federation of Independent Business, stated that the agreement will have serious negative impacts on workers and the Canadian economy and that the announced changes, including increased contributions, may put Canadian wages, hours, and jobs in jeopardy.

Forcing Canadians to make higher contributions to the CPP will take more money from their paycheques. This means that they will have fewer dollars to invest outside the formal pension system and in private voluntary savings, such as RRSPs and TFSAs. This would result in little to no increase in total savings.

In addition to making it more difficult for Canadians to contribute to their TFSAs, the Liberal government has slashed contribution limits back to $5,500. Our government raised them, because it was such a popular program, from youth to seniors.

Our Conservative Party was proud to introduce the tax-free savings account that encouraged Canadians to be responsible in saving, and many Canadians have come to rely on these savings accounts when planning for their future. Tax-free savings accounts have provided Canadian families and seniors with a secure and flexible savings option that protects their money from being eroded by taxes.

The Liberals cut the limits for these savings accounts, and now they are taking even more money from the pockets of Canadians, making it difficult for them to use these accounts. The changes being made by the Liberals, in my view, will make life less affordable for Canadians who are trying to save for their vulnerable years.

Canadians should be able to manage their own money. With the out-of-control spending we have seen from the Liberals over this past year, they cannot trust the Liberal government with their pensions.

Vulnerable seniors will gain little or nothing from an expanded CPP. For low-income seniors who have made contributions, an increase in CPP income could trigger a reduction in other government transfers, such as the guaranteed income supplement. This would mean little or no net increase in their retirement income.

Our Conservative Party believes in reasonable, evidence-based policies that help Canadians retire with dignity, which is why the previous government expanded the guaranteed income supplement. The Liberals clearly agreed with this approach, since they increased the GIS by 10% in the first budget.

The Canada pension plan expansion may not effectively target those middle-income earners who are at the greatest risk of pension problems.

Employers and employees may decide to shrink their workplace pensions over their earning range when the CPP is newly expanded so the workers are not over covered.

An increase in payroll contributions after 2019 may result in a downward pressure on wages or employment. This would force Canadians to contribute more to the Canada pension plan, and would reduce their private voluntary savings. Canadians should choose how much they save and spend based on their income and preferred lifestyle.

The CPP tax hike will take money from the paycheques of hard-working Canadians, put hundreds of thousands of jobs at risk, and do nothing to help the seniors who need it today.

In 2013, the total household net worth of Canadians was $7.7 billion, split almost equally between pension assets, namely CPP/QPP, RRSPs, employer pensions, real estate equity, and other financial and non-financial assets.

A similar CPP hike scenario studied by the Canadian Federation of Independent Business in 2015 said that it would eliminate 110,000 jobs and permanently lower wages by nearly 1%.

Dan Kelly, the president and CEO of the Canadian Federation of Independent Business stated, “Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike”.

For the above reasons, I will not be supporting this bill.

Throughout my riding of Yellowhead in Alberta there are many unemployed people and many who are still working. Those who are working are the younger generation, many of whom who would look at the Canada pension plan and not trust that there would be funds there when they retired.

When we talk to financial planners throughout my area, we find that many young people, those who are just starting in the workforce and those who are already there, are putting money away for their retirement. They understand what it means to preplan their own destiny. Our government brought in the tax-free savings account specifically for those people who wanted to plan for their own future and use the money they could invest today, knowing that when they took that money out or when they retired, they would not be paying tax.

The difference between the Canada pension plan and the tax-free savings account is that people can put as much money as they wish forward. At the same time, our government gave them the option to make voluntary contributions to the Canada pension plan, which is what I believe should be in place today, rather than having to make greater mandatory contributions.

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

Mr. Speaker, I am pleased to stand 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.

What does this really mean, in layman's terms? It means that there would be a phased-in, mandatory, hike to the CPP premiums for both employer and employee. This hike would be as high as $2,200 per employee.

It is clear from this legislation that the government is not only trying to solve a problem that does not exist, in terms of our system, but does not trust Canadians to make decisions about how they best spend their own money. I think, actually, this bill should really be called the “Wynne bailout bill” or “Liberal election tit for tat” because we know that the Ontario government got itself into a really difficult position with some commitments in terms of what it was going to do with the retirement fund, and indeed, the federal Liberals had to come to its rescue.

I am going to give a few examples about the negative impact of this legislation but, first, I will talk about something that is important and that has been a bit lacking in the conversation we have had today. The tools they are going to use are our Canada pension plan and our Canada Pension Plan Investment Board.

Most Canadians are very aware of this pillar of our retirement program, but very few have much of an understanding of the underlying dynamics. Certainly when I was a young adult in the workforce, I knew there was something called CPP that was coming off my paycheque. However, the big rumour at the time when I was initially contributing was that this CPP was going to run out of money so I really had to worry about saving my own money anyway.

That clearly has not happened, but I think we are making assumptions about this plan, and I think we need to pay some attention to this plan and what it is all about.

I do want to draw members' attention to an October 17 article by Andrew Coyne. He raised some really important issues that have, again, as I noted, not been raised in this debate. I am going to spend a minute or two talking about the issues he raised, by quote or paraphrase, because I think they are absolutely critical and they represent concerns I have had over the last couple of years.

The first is that “CPP is supposed to be cheaper than private plans on account of its larger scale”.

Most Canadians have no idea, but costs at the investment board have increased, times 22, over the past decade. They have gone from $118 million to more than $2.6 billion. That is an absolutely enormous increase that has happened over just a short time frame.

At roughly 1% of assets, and that is not counting the distribution costs, the CPP is now significantly more expensive than most private exchange funds. I think the Liberals should be truly alarmed about that. This is something they need to get a handle on.

He goes on to say:

...the CPP doesn’t “help” you to save, it forces you to. If you’re already saving as much as you’d like to, it’s unclear why the government’s judgement should be substituted for yours; or if you’re already saving as much as you can afford to, forcing you to save more hardly makes you better off.

And so far as forced savings are justified, it’s never been clear why they must also be invested through the CPPIB....

The CPP II, as we will call it, is to be fully funded, and there are systemic risks that are associated with the portfolio as a whole. This fund has greatly increased these risks in the last years: 40% are now in private equity, illiquid assets like roads and bridges that are not traded on the public market.

Again, we have a pretty significant increase in the costs of managing this fund, and we have a very significant change in the risk portfolio.

There is nothing wrong with this if, one, all Canadians know what they are getting into; two, they can tolerate the extra risk; three, they have properly priced and accounted for it; and four, the returns are worth it.

The CPP, in Mr. Coyne's opinion, met none of these tests and for the 19 million contributors—perhaps they are like me when I was a young adult—it comes off our paycheques and we really do not know what is happening with the funds.

The first thing the Liberals have failed to do is look at what is happening and what they need to do about it. We should not blindly move forward in giving a greater monopoly to the CPPIB without some careful review regarding the rapidly escalating costs and risks. What we are creating is a bit of a monopoly in terms of forced government savings.

In addition to the concerns I have just raised, and I think I shared some important information, I would like to give a couple of examples of how this forced savings program would have some negative impacts. A lot of my colleagues have shared a number of examples, but I would like to talk about a few more.

Someone I know quite well has a technology firm that is doing exceptionally well, but it was a real struggle when he was getting this firm up and going. When he was first starting, there were times when he was concerned about making payroll. Like many entrepreneurs, he was putting a lot of energy in, but it took a while to see a return on his investment. It is a small company with a few employees.

We already know that the current government has chosen to raise the small business tax, so even if he was lucky enough to make a little bit of money, that was going to go up. That is money, typically, that would have been reinvested in the business.

Now he would also have, with 10 employees, an additional cost, and it could be $10,000. That $10,000 could be reinvested in the company to make it bigger and help it become successful. With that $10,000, perhaps the employees and the employer might have preferred to have some stock options. The employees could believe in the company, and in terms of their benefits packages, might think they would have more advantage with some other structure for receiving remuneration. Clearly, for that new business that is striving to make it, this is a measure that is going to create some real challenges.

I have some relatives, a young couple, who have been saving for their first home. They both graduated from university and are saving for their first home. They live just outside of Toronto. They had the down payment and were all ready to go, then all of a sudden, the mortgage rules changed. Now that the mortgage rules have changed, they do not qualify for the amount they need to purchase this home. Not only has the government changed the amount they are going to have to raise for a down payment, it is making it more difficult for them to save. They were putting a couple of thousand dollars a year away to pay off their student loans and buy their first home, but all of a sudden, they are going to have to divert some of the money they have chosen to do something else with into the CPP, the mandatory payments.

I could go on and on with examples of where this legislation is going to create a challenge.

In conclusion, I think the government is fixing a problem that does not exist. We have heard clearly that it does not exist. It is forcing Canadians to do something that perhaps is not their priority. We have entrepreneurs who could take that $1,000 a month, who are investors, who might have something else they could do with that $1,000, whether it is their own investment portfolios or investing in their businesses.

The Liberals are going to negatively affect the economy, and they have not fully assessed, in any comprehensive way in recent years, the escalating cost and the risk. I think the Liberals of today are very different from the Liberals of before. When CPP was first introduced, and we have heard this in the debate already, Judy LaMarsh, in 1964, stated:

It (CPP) is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans.

The Liberals need to really reflect on the path they are going down, and we should all have very significant concerns.

[Joël Godin, Conservative, Portneuf—Jacques-Cartier, QC]

Mr. Speaker, I have no idea why people are saying some of the things they are saying in the House this morning. Who said the Conservatives want to destroy the CPP? Nobody. I have no idea what has gotten into them.

I rise today, October 25, 2016, to urge my colleagues opposite to reconsider Bill C-26 on the Canada pension plan.

First of all, this government has many other priority files it should be dealing with before taxing employers and employees even more. I am not sure that employees and employers can trust this government when it comes to economics. That is what we have seen during its first year in office. It is disastrous. The government promised a $10-billion deficit, but it is $30 billion in the March 2016 budget. Now here it is October 2016, and experts are talking about a deficit in the $34 billion to $40 billion range. That is huge. That is the budget for the Liberal government's first year in office. Its fiscal year started on April 1, 2016.

When we Conservatives were in power, we did our homework, and we gave the country a budget surplus in October.

The Liberals began managing and taking full control of the budget on April 1, 2016, and already in October experts are saying that the deficit could reach as high as $40 billion. What a disaster. On top of that, the Liberals are asking Canadians to trust them and accept an additional tax in the form of increased CPP premiums. People do not trust this government.

We governed like a real government. I must point out that our prime minister was all business. He was an economist. He knew how to count. Our country is being governed by a former drama teacher. I have nothing against drama teachers. My son is a young high school student and is in two plays. Teachers do important work. We need to recognize the work that these people do, as they support our teenagers in discovering and developing their talents. I applaud them. Besides, I think our current Prime Minister would be better on the stage than on the floor of the House of Commons.

I have some difficulty in believing that this government is capable of properly managing a CPP premium increase. We can already see all the damage it has caused in just one year. I will refrain from listing all of it here today, because it would be a long list. It has been only one year; imagine all four years.

Let us come back to our seniors, who are such a treasure. We must recognize all the efforts they made to build our beautiful country. Enough with the melodramatics and saying that Canada is not a good country to live in. That is not true. When I meet with people at seniors clubs and retirement centres in the beautiful riding of Portneuf—Jacques-Cartier, which I am proud and honoured to represent, I always thank seniors. I say thank you because we would not be where we are today without them. I thank them for leaving us with the way of life we have today, one which we as parliamentarians work on improving day after day.

When next I see them I will be embarrassed to tell them that the current government introduced a bill under which, 40 years from now, future retirees might be able to have a better retirement and that this measure will be implemented during the next election, in 2019.

We spend time with seniors. I am sure that the 338 members of the House visit old age homes, senior centres, and retirement homes.

People will tell us that it is ridiculous and that they will never see a penny of that money. Seniors are smart. They will surely add that the Liberals are going to waste that money. They will say that they cannot trust the Liberals. Others will add that they do not want to give the Liberals the money that they worked hard all their lives to earn.

We know that the population is aging. We took the necessary steps to help people prepare for a comfortable and dignified retirement. We made it so workers can earn more tax-free income through TFSAs, or tax-free savings accounts for the members opposite who are not familiar with it. However, as soon as the Liberals took office, they quickly reduced the maximum amount that could be contributed to a TFSA. What was the hurry? How did that affect society? All of the brokerage firms experienced a slowdown.

I do not claim to be an economist, but I would still like to give a little lesson on economics. Financial institutions use people's savings to give out loans or make investments, which creates jobs and drives the economy. When the economy is doing well, it creates collective wealth. That helps governments balance their budgets, as we did in 2014-15. It is not hard to understand. As I said, I am not an economist, but this is a basic principle. Experience has proven it to be true.

What a great vision. The Liberals are blinded by camera flashes. We believe in Canadians. We believe that people are capable of saving and that they can afford a comfortable retirement. Before the party of the sponsorship scandal took office, the former Conservative government believed in Canadians and in the regions. We believe that all individuals should keep as much of their hard-earned money as possible so that they can make their own decisions as to how to spend it.

Who knows better than us what is best for us? Who believes in the individual? The former Conservative government, not the Liberals opposite. We believe that Canadians should be able to manage their own money. The current government wants to put more money in its coffers in order to waste more and spoil its friends. The Liberals say they are helping Canadian families even though this new law is going to take up to $2,200 out of their pockets every year. That does not make sense and there is no plan.

We cannot trust the children of the sponsorship scandal, and I am speaking of the Liberal government. I cannot trust them, and they themselves have shown me that. Our government tightly managed our beautiful country's retirement system, had a vision for it, and made it prosper.

As my time is running out, I will jump to the conclusion of my speech. This is a quote that shows this government's lack of coherence, the false debate being used to distract our hard-working Canadians, and that it is treating them like idiots: “Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get.”

Who said that? Fred Vettese, chief actuary at Morneau Shepell. That firm belonged to the current minister, who worked with Mr. Vettese. Along with a gentleman by the name of Bill Morneau, he co-authored “The Real Retirement”, which was published in the Financial Post on June 5, 2016.

I urge the government to go back to the drawing board and put in place measures that will make today's seniors believe in this government. I personally do not believe in it.

[Judy Sgro, Liberal, Humber River—Black Creek, ON]

Mr. Speaker, I know that my hon. colleague battles constantly in his riding and here in the House to improve the quality of life for many people, not just seniors, and that he is well aware of the discussions that have been going on for many years.

As we move forward on Bill C-26, how many folks has he talked to in his riding about how important this issue is?

I ask because if we listen to the members of the official opposition, they seem to think this is not important, not necessary, and that the pooled pension plans they introduced and TFSAs will solve all of the problems.

Does the member agree or disagree with that?

[Brian Masse, NDP, Windsor West, ON]

Madam Speaker, I am pleased to rise on Bill C-26. The Canada pension plan is an iconic part of Canadian life. I am pleased that we are doing something about it. It is important to put a number of contexts in place with regard to why this is important for our seniors, our young people, and the people who are paying into it right now.

With the changes being made, the reality is that by 2025 the pension increase will only be made available to 8% of people, and it will take 49 years for this to come into full effect. In fact, it is those who are 16 years old now who will see the benefits of this.

There is no doubt that we will be supporting this because it is a start. We need to start somewhere.

The government now has an agreement with the provinces. I would also like to thank all of the Canadians who participated in moving on this issue. That is important because one political party is trying to tear down all of the efforts that the rest of the country has put into this. The fact is that whether we like this agreement or not and whether we agree with all of it or not, the provinces have agreed. They have decided that this is something they will do and want to do.

Quebec has its own system, and it will continue to maintain that. However, it has also indicated that it would have some measures that complement and work together with this, in the spirit it has shown in the past with respect to a pension system.

I have seen all of the good work done by the Canadian Labour Congress, Unifor, and also the retirees from various unions across this country. When I say that, I am talking about not only the current workers but also the retirees and their families. I have been at the meetings, which are open to the public and to the media, and there have been lots of contributions made by people who are not part of those organizations. Others come in off the street and talk about seniors' issues and pensions. Many of those people will not benefit from this. Although they will pay into this system and not benefit from it, they believe in it because it is part of a Canadian way of living that they support. They do not have any reservations or the tendency to say, “What's in it for me?” Rather, what they are looking at is their grandchildren and other people who do not have the same benefit.

What is interesting is that the unions are one of the best protected groups in terms of private pensions, and they realize the benefit of this negotiated agreement.

It is interesting to note that, similar to our Canada pension plan, this is a deferred wage, which is what a pension is. It is security and a deferred wage. Therefore, when employers and employees sit down and negotiate remuneration for services, some will take less today to have more tomorrow as part of their benefit. What more tomorrow might mean to them is the sense of security that they would have, whether that relates to mental health, to having a security blanket, to a way of planning things, or to having a certain lifestyle in Canada or many parts of the world, but Canada used to be one of the best places for that.

From an economic standpoint, I would argue that this is one of the best places to invest. Those who have talked about how it will basically crush business, will defer jobs, and all of those different things have not been listening to all of the testimony at the industry committee when we looked at manufacturing and other industries. The business industry has argued different things, such as SR and ED tax credits, and a number of different programs and services. Most recently some businesses want tax holidays, but they do not bring up the Canada pension plan. All of these witnesses have not brought up the Canada pension plan.

What people really need to understand is that I still have members in my community who will not apply for employment insurance because they are too proud. They feel that they do not want to receive that help or that it is reserved for someone else. However, they forget that it is the individual and the company who pay into employment insurance and that it is their money.

Over the years Liberal and Conservative governments have taken $54 billion from Canadians. Canadians need to apply to get the EI benefit if they qualify. It is their money.

It is similar to this issue with respect to the Canada pension plan and pensions in general. If we manage public pension plans properly, they will be there for everyone in the country and allow people to stay off welfare and other types of social assistance paid for by Canadian taxpayers. If people fall through the cracks without having a proper pension, then taxpayers have to pick up the costs. The money will come from taxpayers one way or another.

This is an incredible opportunity. As I mentioned, what businesses want in terms of subsidies, or what some people would define as corporate welfare, are corporate tax cuts, which we could control. However, businesses will not necessarily invest in Canada when they get these benefits, for a variety of reasons.

Let us take taxed holidays for example. A lot of American states have tax holidays, open cash settlements, infrastructure development, and reduced corporate taxes just to win jobs. I wonder if members remember the debates that consumed us here in this place for nearly two decades about lowering corporate tax rates, that by doing so many jobs would be created. To create jobs, we would just have to lower the corporate tax rate. Those jobs did not come. The manufacturing industry and other types of value-added industries have been crushed in this country because of that ideology. The carrot and stick approach with respect to corporate tax rate reductions has not worked. It has not provided any benefits. In fact, we saw private pensions shrink during that time. As a result of those private pensions shrinking, we have now had to resort to stronger public pensions.

One of the factors that would retain young people who are looking for employment in this country, especially when we are considering the brain drain and other things, is a stable retirement program. The Canada pension plan is that program. They will pay into the plan for the rest of their working lives in Canada and get a guaranteed benefit at the end of the day. That is predictable.

Companies tell us they are dealing with a whole series of things that will change, the most recent being the issue of labelling and health. It was on the news last night what industry has to do in putting more labels on things. Companies want a predictable outcome similar to many Canadian youth are looking for right now as their future. Predictability will keep people and companies here.

It was interesting to hear a Liberal member say that we need to “make Canada great again”. I do not know how Trump made it into this chamber, but he has.

It is important to look at the amendment the Conservative Party has put forward. I understand why amendments are put forward. This amendment is against pensions and is peculiar. What we are talking about at the end of the day is having agreement between the federal government and the provinces, and that is what we have here. Different political parties at the provincial level have now said they can do this. Whether a Conservative government, the Saskatchewan Party, a Liberal government, or an NDP government, they have all said they can do this for all of Canada. The federal government is going to be a part of making it happen.

Destroying all of that and putting it back to where so many files are would be a major step back, like destroying relationships with the provinces, most recently with respect to health. It would be a major step back for all of the people who have fought for this in not only my community of Windsor and Essex County but the whole of Canada, which has done so much to make sure we have some movement on pensions.

For that reason New Democrats will be supporting this legislation. We will continue to work to make sure that seniors who are living in poverty and have to make terrible choices and who fall through the cracks will have the support of a government that cares about them. Hopefully this band-aid fix will become a full solution one day.

[Judy Sgro, Liberal, Humber River—Black Creek, ON]

Madam Speaker, I want to thank my hon. colleague for that question. I know the great work he does in his own constituency, consistently, on behalf of the many people who are struggling.

What we are trying to do is to show leadership. That is what I believe the federal government's role is. It is to bring the provinces together and get them all to understand. That takes years. I have been battling for five years on this issue. I understand in politics one has to battle for several years and keep making the case until people start to become sensitive to the issue.

When we are talking to seniors today, they are very supportive of Bill C-26 and pension reform, because they wish it had been there for them. At least they know that with the leadership of our government it is going to be there for their children and their grandchildren in the future.

[Judy Sgro, Liberal, Humber River—Black Creek, ON]

Madam Speaker, certainly nobody is talking about there being a panic, but what would we do if we did not have the CPP? I meet with people in my office all the time who have small amounts in their CPP because they did not contribute long enough. Many of them did not go to work until after their families were raised, and CPP is all relative. What people put in is what they get back.

They may not be in the 91%, but there are an awful lot of people out there who are struggling to make ends meet. I am aware of the good work that my colleague does and I am sure he is very much aware of the seniors today who are suffering. We are talking about wanting to make sure that our children, our grandchildren, and others do not have to figure out whether they will have macaroni and cheese once this week or twice this week because they do not have enough money to make ends meet.

That is the reality today. Seniors of today do not want their families to have to do that. Bill C-26 is moving a step forward in the direction of positive things.

[Judy Sgro, Liberal, Humber River—Black Creek, ON]

Madam Speaker, I am pleased to stand today to talk about Bill C-26. It has been a long time coming for this side of the House.

I have listened to my colleagues in the opposition and they clearly have an ideological slant, which is very different to how we think on this side of the House. Therefore, I am pleased to see that Bill C-26 has been presented.

At one point, I was the Liberal critic for seniors and pensions, and so we have had a lot of to and fro. I am glad to see that today's debate and discussion is being done in a respectful way. However, as the former critic, I think back to the dozens of times that I had asked the previous Conservative government to make changes to the CPP, and I am reminded of its constant foot-dragging and excuses for inaction.

The Conservatives' ideology is very different than that on this side of the House. They said that pension reform was something best left to the provinces. They also said that pension reform had no business on the floor of the House. I am very proud to say that we are going to prove them wrong again, as we did many years ago when we introduced CPP.

Seniors, like those living in my riding at 7/11 Arleta, helped to build our country. They deserve better than to be relegated to the shadows of the Conservative economic inaction plan. For nearly a decade, Canadian seniors were told that better was impossible, and that Canadians needed to tighten their belts and do more with less. This argument might have resonated with the core Conservative supporters, but missed the mark with seniors with a background in physical work, which was work that paid less but demanded more.

Seniors with low incomes, failing health, and challenging circumstances know too well the heartbreak of deciding between groceries and hydro, between rent and a grandchild's Christmas gift, or any number of other impossible choices demanded because of a pension that just did not keep pace with increasing costs. Today, because of this government and our commitment to do the right thing for seniors, that shameful history of taking seniors for granted will finally be behind us.

Today, for the first time in far too long, Canadian seniors, like Paterra Catania, whom I spoke to just yesterday on this issue, have a reason to smile and have hope. Real change is taking root within their homes and bank accounts but, most important, for the future of their children and their grandchildren.

In the last election, the Liberals promised to protect income splitting for seniors, which we did; to restore the old age security and GIS eligibility age to 65, which we did; to increase the annual GIS payments; and to enhance the CPP, which is exactly what we are doing now.

We have protected the income splitting, restored the age to 65; allocated $670 million per year to double up the GIS for the lowest-income seniors; and now we have Bill C-26, which will be to enhance the Canada pension plan. These are not small changes, but this is real help for real people in the future.

In just one year, this government has started to reverse years of contempt and neglect at the hands of the Stephen Harper government and his ideologically-driven Conservatives. Of course, it is important to note that to amend the CPP, the following was required, which we were told was next to impossible for the last five years: agreement from two-thirds of the provinces representing 50% of the population, which is a good achievement for our folks on this side of the House; a fully costed strategy; and an agreement from the federal government, which was something the previous government refused to give for eight years.

Set another way, this change was certainly not easy, but it is amazing what can be done when good people come together with a common goal rather than making excuses for inaction. Change can be hard, but change is necessary.

This brings me back to Bill C-26.

Today, middle-class Canadians are working harder than ever before. Many are worried that they will not have the savings they need to live with dignity during their retirement years. Many people were unaware of just how difficult it was if one had not saved enough money when reaching that age of 65. To make matters worse, each year fewer and fewer Canadians have workplace pensions to fall back on.

The Conservative wait-and-see strategy failed to do anything except make matters worse. It is going to take time to fully reverse the damage done by the years of neglect, but we will start by putting more money into the hands of those who need it most. Bill C-26 would increase the amount of the retirement pension, as well as the survivor's and disability pensions, and the post-retirement benefit. Once fully implemented, Bill C-26 would boost how much seniors would get from their pensions and would help by giving low- and middle-income seniors choice and flexibility in their daily lives.

To make sure these changes are affordable, we will phase them in over seven years. We are not going to bring them in overnight. We will phase them in very gradually from 2019 to 2025, so that the impact on employers is gradual and manageable, and they know that it is coming. Every Canadian deserves a secure and dignified retirement after a lifetime of hard work. Through this enhancement, we have taken a powerful step to help make that happen.

Last year, the Liberals made a commitment to Canadians to strengthen the CPP in order to help them achieve their goal of a strong, secure, and stable retirement. Bill C-26 is an important step along that path. It would increase the maximum level of pensionable earnings by 14% in 2025, provide for the making of additional contributions by 2019, and allow for the creation of the additional Canada pension plan account and the accounting of funds in relation to it. This would be a vehicle for many people who want and have the ability to put an extra few dollars away. They will be able to do that now, knowing that the money is going into a fund that is well run and will be there for them to ensure their retirement.

Many of these measures were part of a detailed pension reform white paper that I prepared in 2010, with the help of many industry experts. As we celebrate this victory today, I would like to thank people like Jean-Pierre Laporte, James Pierlot, Bernard Dussault, and many others who worked on the white paper that made possible the change that we are looking at in Bill C-26 today.

We may have toiled in darkness for many years, but now there is a government that is not afraid of change. Liberal administrations of the past clearly understood the need to protect seniors and help prepare people for those senior years. Whether we are referencing the Old Age Pensions Act, delivered by the Mackenzie King government; the Old Age Security Act, delivered by Louis St. Laurent; or the Canada pension plan and guaranteed income supplement, both delivered by the Lester Pearson government; Liberal governments have a collective legacy of valuing the long-term pension security of Canadians.

Bill C-26 is the next chapter in that story and I am glad to support the legislation on behalf of the people in the communities of Humber River—Black Creek.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Madam Speaker, it is my pleasure to rise today in this House to address Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act.

When introducing legislation, it is important to consider what problem we are trying to solve. One might think, from the rhetoric spouted by the government, that we are in a retirement crisis, but I am fact and evidence based—as the government claims to be but is not—and I can say that, according to a study by McKinsey & Company, 83%, of Canadians are on track to maintain their current living standards in retirement.

Fred Vettese, the finance minister's co-author, says that Canadians are not facing a retirement crisis, nor is such a crisis likely to arise. Finance Canada says that, overall, Canada's retirement income system is performing well.

Canadian retirees achieve relatively high income in retirement and compare well to retirees in other organizations. With support from all three pillars of the retirement income system, the median Canadian senior earns 91% as much as median Canadians. Internationally, Canada has one of the best income rates for seniors.

Statistics Canada has stated that the number of seniors living on low income has dropped to 3.7%, among the lowest in the world. If our retirement system is doing so well, why is the government taking time and money away from other issues in an attempt to change it?

The Canada pension plan is internationally recognized as one of the strongest and most reliable retirement systems, yet here we are about to make detrimental changes.

What problem are we trying to solve? It must be the fact that 17% of Canadians are not on track to maintain their lifestyle when they retire. We therefore need to ask ourselves whether we really should impose a tax hike on all Canadians, including small businesses that are already struggling, in order to help that 17%. Is there a better approach? What impact will this increase in the CPP have on individuals and small businesses?

The Department of Finance Canada, the minister's own department, said that Bill C-26 would reduce employment in Canada and cost 1,040 jobs every year for the next 10 years. That will result in a drop in the GDP, a drop in corporate investments, a drop in Canadians' disposable income, and a 7% drop in private savings in the long term.

It will have a very negative impact on small business. The CEO of the Federation of Independent Businesses says that two-thirds of small firms say they will have to freeze or cut salaries, and over a third say they will have to reduce hours or jobs in response to a CPP-QPP tax hike.

The senior director at the Canadian Chamber of Commerce warns:

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.

Small business creates more than 80% of the jobs in Canada. These businesses are already struggling, especially in Ontario and in my riding, where sky-high electricity costs imposed by the Ontario Liberals and uncertainty about the federal carbon tax and increasing bureaucratic burden have driven many of these businesses to the brink, where this final CPP increase will cause them to exit.

These changes would force industries to leave Canada in favour of lower taxes and contributions south of the border. This would not grow our economy and would only put more strain on Canadian families.

What about Canadians who are self-employed? This would cost them about $2,200 more per year. What about those who are already struggling with incomes below $40,000 per year? The Liberal government has done nothing for them in tax relief. The carbon tax would increase the price of everyday purchases for this group, and the proposed CPP changes would take more money out of their pockets. This has to stop. Struggling families will only fall further into debt, and our economy will stagnate.

Who will benefit from this measure? No one will benefit for 40 years. Meanwhile, this government will have access to that tax revenue for 40 years and we are just supposed to trust that it will not spend that money on anything else. I apologize for being skeptical, but the Liberals have already added $40 billion to their spending spree this year and I do not believe that giving this government more money is a good idea.

Therefore, 40 years from now, let us talk about those people on the plan then.

This plan would increase the income replacement rate from 25% to 33%. That is 8%. The problem is that the basic economic rule of the time value of money tells us that at the current interest rate costs double every 20 years. In 40 years, costs would have quadrupled and yet this benefit would only increase 8%. This measure means people will be even poorer with the proposed CPP changes. These proposed changes will have a negative impact on this generation and will not help future generations.

Let us say we took the current maximum CPP rate and applied the consumer price index rate of inflation of 2.5%. In 40 years, the current value would need to be at minimum 100%, actually 240% greater, not 8% greater.

This proposed CPP change will not help small business. It will not help those who are self-employed. It will not help seniors. It will not help the young generation that will be needing retirement options in 40 years.

Simply put, the proposed changes will do nothing but provide the government with more money to spend. Canadians will not profit from these changes and in reality many will suffer. The immediate and long-term loss of jobs, business opportunities, and disposable incomes will only further shrink our economy and limit the futures of Canadians.

However, I am always one to come with solutions. Here are several possibilities.

I would like to suggest a further increase to the guaranteed income supplement to help seniors who are currently struggling. Sixty dollars a month is not very much compared to Kathleen Wynne's $130-a-month increase in electricity fees. If the government wants to help seniors who are trying to live on less than $40,000 a year, it could use the existing guaranteed income supplement, without incurring any additional administrative costs, and increase the amount given to seniors by at least 3% per year to keep up with inflation. It would be even better if the government increased the GIS by 10% once the carbon tax takes effect in 2018.

I believe access to significant TFSAs and voluntary CPP contributions will give Canadians control and flexibility to invest in their retirement when and how they feel comfortable.

Changes such as the ones presented in the bill will slow our economy. It is simple. The less money Canadians have, the less they are able to save. The TFSA should be increased and savings promoted, instead of taking more money from Canadians families.

The financial instability of these proposed changes will create a significant effect on all Canadians, especially those with lower incomes.

I have an idea for young people who need good retirement options in 40 years. How about creating well-paying jobs with good pension options?

I can create 3,000 well-paying jobs, with full pensions, for young people in my riding with $12 million of infrastructure money if the infrastructure minister is serious about creating jobs.

For small businesses, how about implementing the tax decrease to 9% that the government promised?

Any or all of these solutions would be better than what is proposed in Bill C-26.

As such, I will not support the bill, but I move:

That the motion be amended by deleting all the words after the word "That" and substituting the following:

“the House decline to give second reading to Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, because it will: (a) take more money from hardworking Canadians; (b) put thousands of jobs at risk; and (c) do nothing to help seniors in need.”

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Madam Speaker, I am extremely happy to rise today to speak to Bill C-26, the legislation that deals with proposed changes to the CPP. I am also happy because this is another initiative that our government has brought forward after committing to it prior to the election, and one that we continue to work on.

I want to thank our Prime Minister and our Minister of Finance for not wavering on this issue. This is an important initiative that needed the support of the provinces and territories, which we were able to successfully get.

When we talk about CPP we think about our seniors, but this is also about our youth, because over time they will become seniors. Time goes by quickly. When our youth start in the workplace they do not have any of the benefits that our generation had. The private sector chooses not to invest in the Canada pension plan, so our young people do not really have a guarantee at the end.

We want our seniors to be able to retire with respect and dignity. We want them to be able to live the golden years they worked for all of their lives. However, it is going to be difficult for our youth to do the same, because when they become seniors, there will be no pension funds available for them.

There is also the question of those who are going to soon reach the “senior age”, if I may use that term. Information from the Department of Finance in 2012 indicated that about 24% of individuals who were soon to retire were not saving enough to make sure they could continue their existing standard of living while working. That is a challenge as well.

I should add that Canadians live longer, and everyone is happy with that. I sure am. However, with that comes the need for people to save more, which can be a challenge for some individuals. By proposing changes to the Canada pension plan, the government is putting some protections in place to allow future seniors to retire in a much better way.

I would like to briefly outline what is being put in place with the provinces' agreement. This process will begin in 2019 and end approximately seven years later. The investments will be modest at first, but will increase over the seven years. The money invested will increase benefits from 25% to 33%, which is huge. In 2025, a person who is now earning an average salary of $50,000 will have $4,000 more for their pension. That is a sizeable increase.

The other important aspect is that those who retire and have a lower income will be able to benefit from the gains without contributing more. By the end of this initiative, the pension amount will have increased by 50%.

This means that people who receive $13,100 today could receive up to $20,000, which is a dramatic increase. That is a good example of a government that is working closely with the provinces and territories to ensure that Canadians will benefit more fully.

It also shows our government is proactive. We are not sitting back and risking that times will be really tough and Canadians will not have something with which to retire. We are being proactive.

Let us look at other jurisdictions. Let us talk about the U.S., for example. The social welfare programs could be somewhat in danger. I am quoting from what I believe is called the American social security program that is projecting that the benefits Americans are receiving now when they are retiring will not be guaranteed to still be there in 2033. That could be devastating for Americans, today and in the future and for future generations. That is extremely dangerous.

There is no question that our government is taking a proactive approach to this, and I believe this is a shining example of working together with the provinces and the territories. I believe this is what I would call true federalism, where people, communities, and governments are coming together to put in place an initiative that would make life better for Canadians in the future.

This is not the only initiative that our government has put forward. When we were first elected, the first main initiative we put in place was the 7% tax reduction for Canadians. On top of that, we were the only ones who were willing to and who did put an increase on income tax for the wealthiest Canadians. That was a major initiative that our government put in place.

The second one, which we know—and as I travel across my riding, seniors and Canadians who will retire soon share that—is the fact that the age for OAS was returned to 65 years old. Canadians are extremely happy that they do not have to work those extra two years. That is another major initiative that our government brought forward.

There are all kinds of those. We can look at the budget. The 2016 budget focused on the child care benefit. That child care benefit program, while I was campaigning, was the most important thing.

We are saying Canada needs more people. We want immigrants, we want refugees, and we also want to have more kids, young families; so we need to support them, and we are supporting them with that major initiative of the child care benefit.

The infrastructure investment will create jobs and create foreign investment. Those are initiatives that will be very positive.

I have to say in closing that I am extremely happy with this initiative. I know that the people in my riding will be extremely happy with this, and I also know that Canadians will be happy. This is the Canadian way of doing business, and it is how government should work, working together for the betterment of all Canadians.

[Celina Caesar-Chavannes, Liberal, Parliamentary Secretary to the Prime Minister]

Mr. Speaker, I am very pleased to stand today to speak to Bill C-26, which aims to amend the Canada Pension Plan, the CPP Investment Board Act, and the Income Tax Act.

When I was campaigning last year, and in fact in many meetings and conversations I have had since then, I heard over and over again that people are worried about their financial future and specifically about whether they are saving enough to retire with security and dignity. That is why I am pleased to share my reasons for supporting Bill C-26, which aims to address those concerns in a responsible and meaningful way by expanding the CPP.

Earlier this year, Canada’s provincial finance ministers met with my colleague, the federal Minister of Finance, and agreed that more must be done to ensure all Canadians are able to retire with dignity. They recognized that an expansion of the CPP plays a major role in achieving this. It was a textbook example of the kind of consensus we can achieve when everyone comes to the table as partners in pursuit of better service to Canadians.

Many people in my riding of Whitby, and right across the country, are working harder and longer than ever. According to a 2012 study, almost two-thirds of Canadians are working more than 45 hours per week. That is a 50% increase from more than 20 years ago.

On top of that, advancements in technology mean that workers are on call 24/7. Even with all these extra hours and hard work, many are concerned that they will not have enough money for retirement.

Far too many Canadians are facing significant drops in their quality of living upon retirement. In fact, 1.1 million Canadian families are approaching retirement having not saved enough. That is why we have recognized the need to do more for workers, and we are taking action.

The Canada pension plan has been a source of financial security for Canadians for more than half a century. It provides Canadians with a predictable benefit, year after year. Unlike private investments or pension plans it is not subject to market volatility. It is also one of the more efficient ways for Canadians to save as its massive contribution base allows the CPP investment board to deliver strong net returns.

Despite all the benefits provided by the CPP, there has been a recognition in recent years that it is not doing enough to support Canadians in their retirement. Our government has heard these concerns and is moving to address them. Bill C-26 will significantly boost how much each Canadian will receive from the Canadian pension plan. Under the current system, retirees receive one-quarter of their earnings; after this much needed expansion, that will increase to one-third, up to a maximum annual benefit of nearly $20,000.

As a former small business owner, I know that the CPP plays an important role in ensuring that employees can save for their retirement. Employees work very hard for companies. It is very important to me that they be able to retire with dignity.

It was a priority of our government to move forward with the expansion in a responsible way, which is why we are phasing it in over several years. Starting in 2019, annual CPP contributions will begin to increase modestly over seven years. As an example, a worker earning just over $50,000 will contribute an additional $6 per month in 2019, and by 2025 that worker earning the same amount will be contributing about $40 per month.

The expansion of the CPP will benefit all workers; however, it is very important that workers on the lower end of the income spectrum are not unfairly burdened. Our government understands that while lower income workers want to save more for their retirement, they face tight budgets that will make the increased contributions difficult for them. This is why Bill C-26 also proposes to increase the working income tax benefit to offset increases in CPP contributions. The working income tax benefit will be increased to roughly match the level of CPP contributions. This will allow lower income workers to increase their retirement saving without creating unfair burdens on their tight budgets.

I also want to speak about how this legislation would benefit the next generation of workers. Young Canadians face a much different employment landscape than their parents or grandparents did, many of whom worked in the same job for the same company for decades and have access to private pension plans as part of their compensation, providing them with financial security upon retirement.

That is no longer the norm. It is now common for workers to change jobs, or even fields, a number of times throughout their careers, which can have significant effects on their pension contributions and payout.

Even more troubling is the overall decrease in companies providing registered pension plans to their employees. In those organizations offering pension benefits to their employees, we are seeing a significant shift away from defined benefit plans to defined contribution plans, which often provide less financial certainty upon retirement.

When we combine all of these factors with rising life expectancy, it is becoming more likely that Canadians, in particular young Canadians, will outlive their savings. The expansion of the CPP would mitigate that risk. In fact, young Canadians who are entering the workforce over the next few years will benefit the most from this change to the CPP. As such, this expansion is a tangible investment in the future security of our children and grandchildren.

While recognizing that this expansion would do the most for our younger workers who are just beginning to make investments in their CPP, we must acknowledge that too many current retirees are facing significant challenges in making ends meet. This is why our government is also taking steps to improve the quality of life for seniors today. In budget 2016, our government confirmed that it was boosting the guaranteed income supplement top-up to benefit single seniors with up to $947 annually. This will help lift low-income seniors out of poverty and improve the financial security of about 900,000 single seniors across Canada. This increase is directly targeted to assist those seniors who are most vulnerable.

In closing, I would like to thank my colleague, the Minister of Finance, and his provincial and territorial counterparts for their hard work on this important issue. This expansion is an important part of ensuring that all Canadians have a secure and dignified retirement. I am very proud to stand here and support Bill C-26.

The House resumed from October 24 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.

[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.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Mr. Speaker, I will be splitting my time with the member for Winnipeg South.

Our government is committed to strengthening the backbone of the economy, the middle class, and those working hard to join it. It is with this commitment that our government has delivered on a number of platform promises that were made to hard-working Canadians.

I am proud to stand and 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. This legislation would strengthen Canada's pension system and was a key promise we made to ensure a secure and dignified retirement for all Canadians. I congratulate the Minister of Finance, who delivered on this commitment by working in close collaboration and common purpose with our provincial and territorial partners.

It must be noted that provincial leaders of every major political party, Liberal, New Democratic, and Conservative, worked diligently on coming to this historic agreement that would benefit generations of Canadians, including my two young children, Natalia and Eliana.

What is at stake is simple. We must strengthen our pension system to reflect the realities that exist today and ensure a dignified and secure retirement for all Canadians.

To start our discussion on the proposed legislation, I believe it is best to review Canada's retirement system as it stands today and why a strengthened CPP is required to address trends that are leaving so many Canadians unprepared for their post-work years. Today's multi-pillared system includes old age security and the guaranteed income supplement, which are paid out of general government revenues and act as a basic income floor for low and middle-income Canadians. The CPP and QPP are funded through mandatory employer-employee contributions, and, in the 1990s, the CPP shifted from a pay-as-you-go system to a pre-funded platform. Finally, we have private workplace pensions and discretionary individual savings, including tax-free savings accounts and registered retirement savings plans.

Despite this multi-pillared approach to the retirement system, a number of trends are emerging that are leaving millions of Canadians unprepared for retirement and potentially facing a material drop in their standard of living.

Extensive analysis conducted by the finance department found that around one-quarter of families nearing retirement, approximately 1.1 million families, are facing a drop in their standard of living. Furthermore, it is estimated that as many as five million Canadians do not have access to a workplace savings arrangement, and many of these middle-class Canadians are at a greater risk of under-saving for retirement. We must act to ensure that all Canadians have a secure and dignified retirement.

In addition, younger Canadians today face circumstances not faced by prior generations in terms of saving for their retirement. Canadians now entering the workforce will face the prospect of changing jobs several times in their lifetime, and a portable pension plan that facilitates job mobility is now a necessity in this changing job market.

Since the 1970s, we have seen a material decline in the overall participation in private sector registered pension plans, as well as an ongoing shift from defined benefit to defined contribution plans. Statistics Canada estimates that total private sector workplace registered pension plan coverage has declined from 35% to levels now approaching 20%. Frankly, fewer private sector companies are offering workplace pension plans, and many companies have closed or wound up their defined benefit pension plans.

Defined contribution plans are not in their exact nature true pension plans, as they expose individuals to investment risk and swings in the beneficiary's pension plan assets, and a subsequent shortfall in pension savings. Also, a low interest rate environment, which influences the present value of liabilities and has placed cash flow demands on companies to maintain solvency ratios, combined with, frankly, unfavourable accounting rules on pensions, has hastened the move by many companies away from defined benefit pensions.

Our government, in collaboration with the provinces, has taken a carefully targeted approach with this legislation to address the issues I have laid out while striking the important balance between short-term economic considerations and long-term economic gains.

What does an enhanced or stronger CPP mean for Canadians? Quite simply, it means a secure and dignified retirement for millions of Canadians. It means that individuals retiring can worry less about making ends meet and more about spending time with their loved ones, including grandchildren.

Once fully in place, this CPP enhancement would increase the maximum CPP retirement benefit of approximately $13,000 by up to 50%. In today's dollar terms, the proposed enhanced CPP represents an increase of nearly $7,000, to a maximum benefit of nearly $20,000.

The enhancement in this legislation would do two things to make this happen for contributors. First, it will increase the share of annual earnings received during retirement from one-quarter to one-third. This means that individuals making $50,000 today over their working lifetime would receive approximately $16,000 per year in retirement instead of the roughly $12,000 today. Second, it would increase by 14% the maximum income range, to approximately $82,700, so that those who earn more would receive more in retirement.

Enacting these changes with Bill C-26 would result, as estimated by the Department of Finance, in a reduction of families at risk of not having adequate retirement savings by one-quarter, from approximately 24% to 18%, when we consider all pillars of the retirement income system.

To ensure that these things are affordable, we would phase them in over seven years, starting in 2019 through to 2025, so the impact is minimal and gradual. As noted by David Dodge, former governor of the Bank of Canada, “The fundamental challenge [facing decision-makers] is how to provide for adequate retirement income for the future population of elderly people without imposing an undue burden of taxation on the working population and the business sector.”

We have struck this right balance. For example, an individual with earnings of $50,000 will contribute about $6 more a month in 2019, and by the end of the seven-year phase-in period, contributions for that individual would be about $40 per month. Additionally, and this is very important, we would ensure that low-income Canadians would not be financially burdened as a result of the extra contributions. We would enhance the working income tax benefit to roughly offset incremental CPP contributions with little to no change in disposable income, while still securing higher retirement income for low-income Canadians.

A strong CPP will be good for Canadians, and will also be beneficial to the Canadian economy overall. As estimated by the Department of Finance, greater CPP benefits would increase spending by retirees, providing for a boost to economic output. It is estimated that GDP would increase slightly, from 0.05% to 0.09%, and employment levels are projected to be permanently higher, by approximately 6,000 to 11,000 jobs, based on 2015 levels of employment. In addition, higher aggregate saving rates through enhancing CPP would increase the amount of capital available for investment.

The Canada pension plan is a solid program, and actuarially sound. It is fully funded for future generations. The most recent report noted that 5.3 million Canadians received approximately $38.7 billion in payments while contributions totalled nearly $45 billion. It cannot be understated just what advantages the CPP offers. The CPP as a retirement vehicle for Canadians is, in my view, a model for the world. These advantages include that CPP provides a secure, predictable, and stable benefit. Canadians will not outlive their savings, and benefits are not subject to shocks. CPP benefits are fully indexed to prices, so inflation will not reduce the value of a pension. CPP is fully portable, and it fills the gap of a decline in workplace pensions. Overall, CPP is an efficient way to save.

Finally, the CPP Investment Board operates at arm's length from the government, with a mandate to invest CPP funds in the best interests of plan members. It is a model that is independent, transparent, and accountable. It is well regarded around the world for its impressive record of investment performance and management excellence, with a 10-year annualized rate of return of 6.8%.

In closing, Bill C-26 is the next step forward in ensuring that all Canadians retire in a secure and dignified manner. I ask my colleagues to join with me in advancing this important piece of legislation that was brought forward in a collaborative approach between the provinces and the federal government.

The House resumed from October 21 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.

[John Barlow, Conservative, Foothills, AB]

Madam Speaker, I appreciate the opportunity to speak today on bill C-26. We are seeing the frightening trend of the Liberal government's imposition of punitive taxes without consultation, with very little feedback from stakeholders, and with very little knowledge of the economic impact these decisions and policies are going to have on Canadian families, and Canadian small businesses specifically.

First, it started with the carbon tax, which is going to increase the cost of pretty much everything. The government has also changed the mortgage rules, which will make it that much more difficult for young Canadians to buy their first home. Now it is talking about a hike to the CPP, which is really going to hamper growth in the small business sector. These are all policy decisions that have been imposed by the Liberal government with absolutely no consultation or study of their ramifications for Canadian families, small businesses, and the provinces.

I am the vice-chair of the Standing Committee on Natural Resources, which has been hearing from stakeholders over the last couple of weeks since the carbon tax was announced. All of these stakeholders have said that no one spoke to them about it, that this is going to make the difference between their putting shovels in the ground in some projects, or walking away entirely. What are the ramifications and implications going to be for our energy industry, which is already struggling, if a punitive carbon tax is imposed without any data to back up the economic impacts of that decision?

Yesterday, a motion was put forward in the natural resources committee that the committee do an emergency study of the economic impacts of the carbon tax on the natural resources sector. If Liberals were that confident that the carbon tax and the CPP tax hike were going to have beneficial and positive ramifications for Canadians across the country, then, in my estimation, they would have agreed to go ahead with that study, but they did not. They unanimously voted it down, because they do not know the ramifications of policies like this for hard-working Canadian families.

They are plowing ahead with these kinds of decisions because they think these make great politics for the very vocal minority of union bosses and big companies. Those are the ones driving these decisions. They are not talking to middle-class Canadians, the ones whose pocketbooks are going to be impacted by these decisions. That is what makes these types of decisions so frustrating.

A couple of weeks ago I had an opportunity to speak at a summit in Calgary, which was titled, unfortunately, “The Employment Crisis for Canada’s Energy Professionals—A Lost Opportunity for Canada”. There were more than 200 professionals at that meeting. They were not rig workers or welders, not the people we typically associate with feeling the impact of the downturn in the energy sector. They were petroleum engineers, geophysicists, and geologists. Many of them have not had a job in more than two years.

I asked them if they or their associations were consulted about the carbon tax or the tax increase via the Canada pension plan. I asked if the Liberal government talked to their associations, which include thousands of Canadian professionals across the country. Every single one of them said no, that these things were a complete shock to them. I said there had been ups and downs and booms and busts in the energy sector for decades, and they agreed that these, absolutely, had happened many times but this was the worst they had ever seen.

We heard in question period today and many times over the last week that Alberta has been hit hard by the downturn because of low oil prices. A barrel of oil is now more than $50. A low oil price is not the only reason that Alberta is struggling right now. It is bad policy, it is inaction, it is tax increases on businesses and employers. The professionals said they do not see a light at the end of this tunnel because of the policies being put forward, like a carbon tax that is increasing indecision in the industry, driving away investment, and taking their jobs with them.

They said that intellectual capital is going to be lost because of these decisions and that they are uncompetitive globally in energy, manufacturing, and agriculture, thanks to the decision of the government to put forward a carbon tax, and now a CPP tax hike, not to mention the changes to the mortgage rules that are making it more difficult for young families to buy their first home.

My colleague from Winnipeg North was saying that when he was door-knocking in his community, he was overwhelmed by Canadians asking for these changes. I had zero. Not once did I go to a door and somebody said, “Boy, I am really looking forward to a carbon tax. I am really looking forward to a hike in my CPP taxes, and do you know what? I really hope that you make it more difficult for me to buy my first home.”

Maybe residents of southern Alberta are much more savvy, I am not sure. These issues were never raised in that campaign, so for the Liberals to say that they have this incredible mandate because of what happened a year ago, I think it is disingenuous. I think they are putting through decisions that appeal to a very vocal minority of Canadians but are not in the best interests of hard-working Canadian families.

I would like to talk about some of the things that have been said so far today about how this would help Canadians in their retirement. Having an increase in CPP is great if I have a job, but now there are more than 200,000 Canadians who do not have jobs. I have not heard any decisions or any policies brought forward by the government that would help change that.

We have vehicles in place that will help Canadians save. What I think is most important with those things, including the tax-free savings account, which the government has clawed back, is that, again, in contrast to what my hon. colleague has been saying, that is something I definitely heard at doors. Canadians liked the opportunity to save on their own terms. It is absolutely their money. They want to make the decisions on what they do and how they save with their own money.

It is definitely a step backward to look at government as being the answer to everything. If people do not know how to save, the government will take care of that for them. Canadians are much more savvy than the Liberals are giving them credit for.

We also heard, when the Liberals made the decision to claw back the tax-free savings account, that this is just a vehicle for the wealthy. Only wealthy Canadians have the opportunity to invest in the tax-free savings account. Of those Canadians who have maxed out their tax-free savings account, 60% were making $60,000 or less. Those are not wealthy Canadians. Those are hard-working Canadian families who are making very tough choices for their future.

They are putting money aside to buy their first home, which now, unfortunately, is even more difficult to buy. I would ask where the government got the information that this was a good decision. Maybe it is for Vancouver or Toronto, but it certainly is not for Calgary or rural Alberta. I certainly have not had anybody come to me and say that this is a good decision. I have had the exact opposite. Realtors, mortgagers, credit unions, young families, come to me and say that this is devastating. Now it will take them another decade to save up for that first home, which we know is one of the largest investments they will have in their lifetimes.

When I was going door to door last October, I had so many Canadians, so many residents in my riding of Foothills, talk to me about the importance of the tax-free savings account and how welcoming they were that they would have an opportunity to invest further in a tax-free savings account. As I said, these were Canadians who were making very difficult choices for their families, whether it was a first home, their child's education, or saving for their own retirement.

The key to that is that Canadians had the opportunity to make their own decisions on what they felt was best for them and best for their families and their children's futures. This is a decision, once again, where government is imposing its will on Canadians, and Canadians have not said in any way, shape, or form that this is what they want, whether it is a carbon tax, mortgage rule changes, tax-free savings accounts, or electoral reform.

I do not understand why the government feels that it should be governing with an iron fist, a sledgehammer, and imposing its will on the provinces and Canadians. This is certainly not what I heard from hard-working Canadian families or certainly folks in my riding throughout the election campaign, and even before that.

But what has really been overlooked here is the impact this would have on small businesses. It is ironic that we are having this discussion during Small Business Week here in Canada. I am hearing daily from small business owners in my riding in southern Alberta and across the province that they are struggling. I do not think it is any mystery. The Liberal government will not do anything about it except to say that it has compassion and sympathy for what is going on in Alberta. I say in response, well, do something about it and give us a hand.

Imposing a carbon tax, and now a CPP hike on small business owners, is certainly not the way to do it. We have a very fragile economy right now in Alberta, and to impose these types of decisions when we are struggling does not make any sense. Alberta was the economic engine of this country for decades and, unfortunately, that engine has stalled. Rather than giving us a lifeline, the Liberals are throwing us an anchor. This would push those small business owners off the edge.

Right now in Calgary the unemployment rate is in the double digits. The vacancy rate in downtown Calgary is at 30%. It is unbelievable to me that in a province I have raised my family in and have worked in, I can go to downtown Calgary and see 8th Avenue deserted and entire floors of business buildings and office towers deserted. There is nothing but empty desks and empty offices. Yet our top priority is to impose a Canada pension plan tax hike, which would cost business owners more than $1,000 a year per employee.

Dan Kelly, president and CEO of the Canadian Federation of Independent Business notes that “Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike.”

When we are already struggling with an unemployment rate in Alberta close to double digits, and in some communities well over double digits, and 200,000 direct and indirect energy jobs that have been lost, we would further stress the employment numbers with these decisions. It will be more difficult for a small business owner to hire because of the increased costs from this CPP tax hike, which I do not think anyone was really asking for.

Indeed, Hendrik Brakel, a senior director at the Canadian Chamber of Commerce, has 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.

The Chamber of Commerce represents businesses across the country, as does the Canadian Federation of Independent Business. These people are raising the alarm about the impact of the CPP tax hike on small businesses at the worst possible time.

I know we talk a lot about Alberta, but the energy downturn has impacted Canadians across the country. I was in Nova Scotia a couple of weeks ago, and it was amazing how many people came up to me to say, “I was working in Alberta in the oil sands, but I had to come home, obviously, because there are no jobs. But there are no jobs for me here either”. We need Energy east. We need policies in place that will kick-start our energy industry. But instead, when it is down, we kick it with a carbon tax and now a CPP tax hike. Where does this make sense?

I am going to conclude with this. This has been my question all along: if the Liberals are so confident that these types of policies will bring a great positive change to our economy, with all these great jobs for Canadians they talk about, can they prove it? Can they show me the data? Can they show me an economic impact study they did before they announced the carbon tax and the CPP tax hike? I have not seen it. If they are so confident this is the best thing for Canadians, I ask them to show it to me.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, I can recall what happened, because I was sitting on the other side with my colleague when the announcement was made. I am not 100% sure if we were in session, if it was the following day or the weekend, but the Prime Minister was somewhere overseas when we found out that he was increasing the age of retirement from 65 to 67. The response from my constituents was immediate, and I would suspect it was from Canadians as a whole. They were saying, “Where did this come from?” Then the Conservatives tried to allude to there being some sort of a crisis, but one that was just not there.

Virtually from day one, the Liberal Party indicated that if we formed government, we would decrease the age of eligibility back to 65. That is one of the things we did immediately upon taking office. That is part of this real change that the Prime Minister had promised. I am glad to say that whether it is reducing the age of eligibility from 67 to 65, the increase to the GIS, or Bill C-26, these are all changes that have a profound and positive impact on our seniors and future seniors.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, I want to indicate what a privilege it is to be able to stand in my place and talk about one of those fundamental issues that I believe Canadians as a whole are very supportive of. If we look at what would ultimately happen through Bill C-26, I would encourage all members of all political parties to recognize the historic agreement that was achieved by the Minister of Finance and the government, and to recognize that by voting in favour of Bill C-26.

The previous Conservative member posed a question in regard to the Minister of Finance by saying that the Minister of Finance wrote a book and in that book he said that raising CPP is not going to get rid of poverty for seniors. What the member does not make reference to is that the very same Minister of Finance brought forward a 10% increase to those poorest seniors in Canada by increasing the guaranteed income supplement. That will have a profound positive impact for seniors in the most significant way.

In fact, I would challenge future Conservative speakers on this issue to give me an example of a Conservative policy where they have seen such a substantial increase to Canada's poorest seniors. They would be challenged to find that. That is one of the reasons why, when we look at a policy announcement such as what we are seeing today in a very formal way in the House of Commons, we should always look at it as just one component in terms of dealing with seniors.

Let me now start with something that needs to be said. We campaigned about real change, primarily because one of the things we realized with the former Harper government was that it had lost touch with Canadians. The Conservatives in that government did not understand what Canadians wanted and expected of the government. There are a number of things that we could talk about. I could talk about the outstanding performance by our Minister of Health fighting for health care here in Canada, something which the former government did not do. Canadians see that as a positive. The Conservatives did not understand that. They did not understand what Canadians wanted.

The same principle applies here, where I can clearly demonstrate that of the Conservative Party, not only of the past but of what appears today. Now I will wait to see what happens when the vote actually takes place, but if the Conservatives want to demonstrate that they are listening to Canadians, I would suggest that they really need to support the bill.

Bill C-26 is something that is of a historic nature. It is not easy to get all the different stakeholders together and get an agreement of this nature that would see more money going into the pockets of seniors when they retire. Once implemented, it would be a significant amount of money.

Decisions of this nature do not happen overnight. I was pleased that my New Democratic colleague made reference to others, and how they actually participated in achieving what we have achieved. This is not solely a Liberal initiative. We know different stakeholders not only from labour but also from business have presented and commented on the importance of a Canada pension program. It actually reaches out to the individual, to the corporate body, to our union body, to political entities, and to many different stakeholders.

I said in the past how much I appreciate the fine work that many unions do in terms of advocating far beyond what their core responsibilities are. They think ahead not only for the individuals they represent within the unions, but often way beyond those individuals by talking about the importance of increasing CPP. I have heard presentations of that nature from members of union executives for many years. That is why when I stand up today I say that this is really good stuff.

Our Prime Minister mandated our members of Parliament on this side, even when he was leader of the third party in opposition, to represent their constituencies here in Ottawa, and it was a change. It was part of that real change, because under the Harper government, more often than not, what we saw was Ottawa being represented inside the constituencies. However, we want to see MPs representing the interests and thoughts of their constituents in this chamber, in the committee rooms, in subcommittees, when talking within caucus walls, and so forth. Bill C-26 is a reflection of that.

In essence, Bill C-26 is saying that we believe the workforce in Canada today is going to require additional money when it comes time for pensions. It is no surprise to me, personally, and I suspect that the vast majority of members of Parliament will not be surprised by that.

I remember sitting on the opposition bench arguing that we needed to do more with regard to supporting our seniors. I introduced petition after petition on this very issue, that Canadians expected us to do more. Many, if not most, probably even all of those petitions on the issue of CPP, GIS, and OAS came from residents that I represent in Winnipeg North. They wanted to see a government take action, support those pensions, and expand those pension programs where we could.

The Prime Minister gave a clear indication to the Minister of Finance that we wanted to achieve an agreement on expanding the CPP. I am forever grateful that our Minister of Finance was so successful at achieving that agreement, because it is something the government alone cannot do. We needed the co-operation and the understanding of provinces in order to make that happen.

I remember sitting on the opposition bench and feeling somewhat frustrated, because I would hear, for example, the Province of Ontario saying that it wanted CPP to be increased, but the feds were not interested. The feds at that time, with Prime Minister Stephen Harper, said that they were not interested. The former prime minister had no interest in increasing the CPP. In fact, he was quite prepared to see individual provinces go alone on that.

Members will remember that I said “losing touch with Canadians”. Had the then-prime minister, Stephen Harper, listened to what Canadians wanted on the CPP file, he would have found that Canadians were concerned about their ability to be able to retire and the earnings that they were going to be receiving, and that they supported en masse the need for that increase. However, the then-prime minister did not recognize that.

At the end of day, this is why I talked about the issue of real change at the beginning of my speech. It is because that is what we are seeing in the legislation before us, and members have the opportunity to participate in that real change,

There was a different attitude with the former Conservative government with regard to the CPP. We have taken a complete 180°. The Government of Canada is now saying that it wants to increase CPP and we have taken the necessary action by presenting the bill today.

I have provided some comment in terms of the number of consultations just the Department of Finance alone had. However, individual members of Parliament have also listened to many stakeholders, whether from labour, business, or indigenous people. Some individuals have taken the time to write or correspond through the Internet, or had face-to-face discussions at free meetings throughout this country on important taxation and policy ideas. I suspect members will find that many of those discussions were about the CPP, as I know that I have had many discussions on that particular issue.

Those discussions were then presented to the provinces in Vancouver on June 20, where the agreement was actually accepted. Because of that agreement, we now have Bill C-26.

In the bill's summary, we find that it would do the following:

(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;

That is a significant increase.

(c) provide for the making of additional contributions, beginning in 2019;

That was accepted primarily because there needs to be an adjustment period so that businesses and other stakeholders are able to adjust.

(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.

Why is it such an important issue for all of us to address? I would like to reflect on some issues from my constituency, and I believe that those issues can be mirrored across Canada.

In my constituency are a healthy number of seniors. It is debatable at what age being a senior begins. I was told, as I am approaching age 55 in January, that I will be eligible for some store discounts.

I have had the privilege of knocking on thousands and thousands of doors. I can think of one 94-year-old who one would think was in her sixties. She was very spry and active. Age in good part is how one feels. There are many seniors in Winnipeg North who still feel great and want to have a decent standard of living.

One of the saddest things I often run into when knocking on doors is meeting seniors who talk about having such a difficult time making ends meet. Often they will say that they have an issue of medication versus food. Their budget does not allow them to afford both. This is not just a comment I heard at one or two doors. I have heard it at numerous doors. Seniors in many ways are challenged and have to make difficult decisions related to affordability for basic needs.

We have far too many seniors who opt for buying medication, and as a result, they go hungry, which is not good for their health, or they end up going to food banks. Thank God for the food banks and the huge number of volunteers who make them happen and especially those who contribute to them. They are helping many seniors who are living in poverty. That is a real issue that we hear at the door.

I can recall one incident when knocking on doors with my daughter, Cindy. One lady answered who was virtually in tears, because she had just been hit with an ambulance bill of more than $500. She had no idea how she was going to pay that bill.

I am glad that my daughter went on to ultimately become a local MLA and has raised this issue in the Manitoba legislature.

If someone has a heart attack at home and has to get to a hospital, the person does not have much choice. That is why we need to advocate for our seniors. Situations like this are taking place every day throughout our country.

When we have the opportunity to look at the issue of pensions, we should be supportive. Constituents tell us that they have a great desire that we support our three pension programs and feel that where we can, we should expand them. An increase to the GIS will help them immensely. Some of those single seniors will receive $900 plus more a month than they received last year. That will go a long way for seniors living in poverty in getting some of the things they need.

We are talking about Bill C-26 today, but it is about the social safety net that Canadians truly believe in. If we ask our constituents what makes them feel good about being a Canadian, some common responses are related to our social safety net. What is that social safety net? It is our CPP, which is what we are voting on today. It is also our OAS, our GIS, our health care system, and our employment insurance system. These programs provide peace of mind and comfort to Canadians. These are the things we should be speaking about more, and not just inside the chamber. We should be speaking more about them within our caucuses and within our committees.

We have fantastic standing committees that have the ability to set an agenda to look at progressive and positive social ideas. We could better utilize those committees. I have argued in the past that they are the backbone of our parliamentary process.

I realize that my time is quickly running out, but I want to emphasize how important Bill C-26 is. This is a piece of legislation that should be supported by all members. If we reflect on past debates in the House on this important issue, if one believed in expanding CPP, one would have been disappointed. However, with the change in government and the commitment from the current Prime Minister, we now have a change in attitude, and the CPP will be increased. This will prevent many seniors in the future from having to make difficult decisions. It will even prevent some seniors from going into poverty.

I highly recommend that all members of the House support this legislation.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, I appreciate the comments and the support coming forward for Bill C-26. I think, in good part, the New Democrats are recognizing something which we have recognized in many ways—and which I hope to be able to talk about it—and that is the issue of how we can assist seniors, whether it is from getting out of poverty or being able to continue to be a part of Canada's middle class, and those aspiring to become a part of the middle class. One of the ways that we can deal with that is through the CPP.

I wonder if the member would comment in terms of the process of trying to achieve an agreement with the different provinces and Ottawa. It is not a simple one. That is why many would argue it is somewhat historical to achieve this agreement, which will ultimately see seniors receiving more money as a direct result. Would the member provide his thoughts or his understanding, in terms of what needs to take place in order to get the bill to this level at this point in time?

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, it is my privilege to rise 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. Bill C-26 would amend the Canada Pension Plan Act to incorporate the recent agreement reached between the provinces to enhance CPP benefits.

While better was possible, and the full effect of the changes will not be felt for another 49 years, this CPP expansion is an important first step in improving retirement security for young Canadians, and we congratulate everyone, especially labour, who worked so hard to lay the groundwork for this agreement.

We must now see immediate action to help those seniors and Canadians on the cusp of retirement who will not benefit from these changes. Government must build on the momentum of this agreement and take steps to improve long-term retirement security for today's workers.

Retirement insecurity is reaching a crisis level in Canada, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. A large part of this problem is fuelled by the erosion of workplace pension plans, to the point that six in 10 working Canadians have no workplace pension.

During election 2015, the Liberals promised to enhance the CPP. Once elected, the Minister of Finance was directed in his mandate letter to:

Meet with your provincial and territorial colleagues at your earliest opportunity to begin a process to enhance the Canada Pension Plan to provide more income security to Canadians when they retire.

The Minister of Finance met with his provincial and territorial counterparts in June 2016 and on June 20 announced an agreement in principle on CPP enhancements.

On October 4, 2016, British Columbia was the final province, besides Quebec, to officially endorse this agreement. Bill C-26 was introduced on October 6. Quebec did not sign the agreement but promised to apply some of the changes to the Quebec pension plan, which is similar to the CPP but is managed independently.

The NDP will support the bill at this time, but we feel that the bill does not live up to the expectations Canadians had for CPP reform.

Changes to the plan have been a long time in the making. The last time the CPP was altered was in 1997, although those changes were largely administrative. The most significant change in the 1997 amendments was to move the plan from a pay-as-you-go system to fully funded. This change was done to help protect the financial viability of the plan, and a recent report by the Chief Actuary of Canada shows a healthy fund that will be solvent for at least the next 75 years.

However, during a time when workplace pensions cover fewer and fewer Canadians, when Canadians have been finding it harder and harder to put away money for retirement, and when the rates of seniors living in poverty have steadily increased, there have been no increases in benefits under the Canada pension plan.

Many Canadians held out great hope that the government would make substantial changes to the CPP. Sadly, as with many Liberal promises, we are offered a loaf of bread but receive only half a loaf.

Ken Neumann, national director of the Canadian Steelworkers, summed it up very well when he said that the Liberal government's plan for a modest CPP expansion falls well short of the doubling of CPP benefits advocated for by the United Steelworkers and the Canadian labour movement. The USW is nonetheless pleased that the provinces and the federal government have agreed to a universal expansion of the CPP that will help all workers, and it will continue to push for full doubling of CPP benefits.

New Democrats, along with many in the labour movement and groups working for the rights of seniors and retirees, have long advocated that benefits be increased from replacing 25% of a worker's pre-retirement income to 50% of pre-retirement income, but no, this legislation has offered up a very modest increase, from 25% to 33% of pre-retirement income.

Although we like to see an increase, we feel that the amount is wholly inadequate, especially in terms of ensuring that our seniors do not have to live in poverty and can retire with the dignity and quality of life they deserve.

While many would be happy to finally see some changes to the plan and some increases in benefits, there are many who will be very unhappy. Those are the people who will see very little or no benefit from the changes presented in this bill.

More and more, I am hearing a lot of confusion and misunderstanding concerning who would benefit from the changes being proposed. A recent Ipsos poll found that over 25% of those who are already retired believe they would see bigger CPP cheques as a result of the deal, and more than 70% of Canadians do not realize that current retirees get nothing from this CPP expansion. These findings are totally consistent with what I have been hearing. Many retirees in my riding have asked me when they will be receiving their increased benefits. I have to break the bad news to them that this new legislation will do nothing for current or soon-to-be retirees.

The enhanced expanded CPP is a plan that would benefit a new generation of workers entering the workforce, but does little to alleviate the retirement income crisis for those approaching retirement. Those who would be the first to benefit from the fully enhanced benefits under this plan are now 16 years old. It will take 49 years for this plan to fully kick in. After the increase in premiums are fully phased in, in 2025, a person would have to pay the increased premiums for 40 more years to be fully eligible for the new maximum benefits. Increased benefits will be prorated for those 40 years as people pay the increased premium, but any significant increase for retirees is years away.

Let me take some time to talk a bit more about the specifics of the plan. Currently, the CPP covers earnings up to a cap of $54,900. For earnings up to the cap, the CPP aims to replace about 25% of that income. The maximum pension comes in at about $1,092 a month, or $13,100 per year. Contributions are 4.9% each for the employer and employee, up to the same cap.

The expanded CPP is a new separate tier. This new tier is added on top of the existing CPP. The new CPP tier does two things, phased in over the next nine years to 2025. First, it takes the replacement rate of up to 33.3% from the current 25%; and, second, it expands the upper earnings cap from today's $54,900 up to $82,700.

When the plan is fully phased in, in 2065, a worker who earns $54,900 would receive a maximum annual pension of about $18,117 by the time he or she retires. For a worker at an $82,700 income level, CPP benefits would rise to a maximum of $20,352 a year. Once the phase-in period is reached in 2025, it would take 40 years for a person to receive the fully enhanced benefit. Therefore, the first worker who will be eligible for full benefits is currently 16 years old. A person who is 59 in 2019, pays six years of the enhanced premiums, and retires in 2025 at the age of 65, would receive no additional benefit, or maybe a dollar or two.

It is important to note that much of the discussion about pension benefits relates to maximum benefits, yet only 11.4% will actually receive the maximum CPP benefits. The average benefit announced as of July 2016 was $550. In order to pay for the increase in benefits, contributions from employees and employers will increase. This increase would be phased in between 2019 and 2025. There will be two tiers to the increase. Between 2019 and 2025, those earnings which are less than the yearly pensionable maximum earnings, currently $54,900, would see their premiums slowly rise to an additional 1%. Those workers and employers would then be paying at a rate of 5.9%, up from 4.9%. In real numbers, this means that a person whose rate is set at the maximum would pay an additional $43 per month, as would his or her employer.

The second tier increase would be phased in over two years, starting in 2024. For anyone earning above the yearly pensionable maximum, theirs and their employer's contributions will rise by 4% above the current.

I know this is all very confusing, and it is going to take some time for Canadians to understand the complexities.

The bill also would make some changes to the Income Tax Act, which is supposed to help minimize the impact of the premium increases on Canadians. The CPP premiums that a worker currently pays are treated as a tax credit. An individual is able to claim a percentage of premiums paid as a non-refundable tax, which is then deducted from total federal tax payable. This would not change. These contributions would now be considered as base contributions but will still be treated the same for income tax purposes.

The increased benefits that a worker would be paying in 2019 and thereafter will be considered as additional contributions and will be treated differently for tax purposes. A worker will be able to deduct the amount of the additional contribution directly off their taxable income instead of applying for it as a credit.

The government has also included changes to the Income Tax Act in the bill that would increase the working tax benefit by 14%. The intention is to minimize the impact of increased CPP premiums on low income workers. Employers would be able to write off the increases on the CPP as a business expense, as they do now with the base contributions.

Now I would like to talk briefly about Canada's retirement income system, which is based on three pillars. These pillars are also supposed to interact or work together and are intended to enable seniors to maintain a reasonable standard of living in retirement. The first pillar includes standardized and universal public benefits, such as old age security and the guaranteed income supplement.

The second pillar includes mandatory public workplace coverage, the Canada pension plan and the Quebec pension plan. Almost all working Canadians over the age of 18, earning more than the minimum amount of $3,500 per year, must pay into this. It is mandatory for employees and employers, as deemed by legislation. Contributions are split evenly between the employee and the employer, or borne fully by someone who is self-employed. The amount depends on a person's income.

The third pillar consists of an employer or a union-sponsored plan, known as the registered retirement plan. They are registered with the Canadian Revenue Agency and one of the pension's regulatory authorities, because they are subject to government support in the form of special tax measures and regulatory oversight. This pillar also includes registered retirement savings plans and other personal savings.

The problem for today's seniors is that these pillars are falling behind in terms of enabling seniors to maintain an adequate standard of living. Dramatic increases in the costs of things like electricity and housing are causing great strain on seniors' fixed incomes. Failing to take action now will have a great social cost, forcing many seniors into poverty. The number of seniors being forced to use food banks will rise dramatically.

Studies point to a looming crisis in the retirement income security of Canadians. A recent study by Richard Shillington, done for the Broadbent Institute, shows a large percentage of older working Canadians are heading into retirement without adequate savings to keep them out of poverty. The report goes on to say that half of Canadian couples between 55 and 64 have no employer pension plan between them. Of those, less than 20% of middle-income families have saved enough to adequately supplement government benefits and the Canada or Quebec pension plan. Income trends suggest that the percentage of Canadian seniors living in poverty will increase in the coming years, especially for single women who already face a higher than average rate. The poverty rate for seniors will climb at the same time as a sharply rising number of Canadians hit retirement in the next two decades. More than 20% of the population will be older than 65 within 10 years.

When releasing the report for the Broadbent Institute, Rick Smith, executive director said, “This new data on retirement savings and gaps in support makes one thing perfectly clear - we have a retirement income crisis on our hands that requires requires urgent government action now..”.

Increases in the guaranteed income supplement and these eventual increases in CPP benefits will certainly help, but much more needs to be done to help our seniors live with the dignity they deserve.

The high cost of housing and drugs, the clawback of the GIS, and the indexing of pensions are just a few immediate issues. The government needs to keep its promise to introduce a new seniors price index to make sure that the old age security and the guaranteed income supplement keep up with rising costs.

The NDP will fight for further increases to the GIS and the OAS, a national pharmacare program, and, as well, programs to enhance home care and palliative care. Much work needs to be done to ensure that workers can retire with adequate incomes and access to the services they need to meet their quality of life.

The NDP will continue to work with our labour allies, and others, to improve the lives of Canadian seniors and retirees.

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.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Madam Speaker, I am pleased to rise and speak here today. I thank the members for allowing my colleague to share his time time with me. My colleague gave an excellent speech outlining our position on Bill C-26, introduced by the Minister of Finance.

Seniors today should be worried about what the Minister of Finance said in the House earlier this morning in his speech on Bill C-26. He claimed that they were very clear during their election campaign that they wanted to enhance the CPP. Now that we have seen the Liberals in action for a year, can we really take that kind of statement at face value? Definitely not.

Besides, what are seniors and Canadians in general supposed to think when a party says, during an election campaign, that it is going to enhance the CPP? What does this mean for the seniors in the riding of my colleague from Oakville, who said himself that people in his riding have lower incomes and there are needs to be met? They thought they would benefit right away if they voted for that party.

When people are promised an enhanced pension plan, they expect that promise to be kept sooner rather than later. They expect the government to get to work on it immediately, even if it does not make sense. They expect the party in question to keep its promises. CPP expansion will begin to be implemented in 2019 and be fully phased in by 2025.

When we talk about a long-term strategy, as the Minister of Finance did this morning, we have to put ourselves in seniors' shoes. “Long term” does not mean the same thing for someone who is 75 that it does for someone who is 50. Who are the seniors, who were misled by this government, that are really going to benefit from the CPP expansion? That is what we have to ask ourselves. The scary thing is what the Liberal government is not saying. What they are saying is nothing to worry about because they cannot be believed anyway, but what they are not saying is even scarier.

If during the last election campaign the Liberals had told seniors they were going to improve their pension plan in seven or eight years, not a single senior in my riding would have voted for them. In my riding, the average income is not very high. We have gone through some serious crises in the Thetford Mines region, including the asbestos crisis. Incomes are not very high, the miners do not have a lot of money, and out of the blue they are told that their pension plan is going to go up. Who would not want a better income, especially those who make lower wages?

Unfortunately, that is not what the Liberals intend to do. What is more, they are going to increase taxes for the these people who have limited means, stripping them of their benefits. The government raised taxes right away, and these people will be the first victims of the arrogance of the Liberals, who make all sorts of promises they may well never deliver on. I hope that we will be back in 2019 to clean up their mess. If they are allowed to continue for another four years, it will be terrible and there will be no turning back.

It is important to stick to the facts. The government has been in power one year. It is against that backdrop that they introduced Bill C-26 today. The government broke its promise to have a modest deficit and is borrowing three times the amount that it said it would. Last week, TD Bank reported that the deficit could reach $34 billion because of the economic situation.

What exactly is the economic situation? They promised to create jobs; they did not. They did not even keep their promise to improve the lives of Canadians, because the best way to do that is to give them jobs.

That is the reality. Obviously, I am concerned about the announcement that the Minister of Finance made this morning, but what is even more worrisome is that our Prime Minister is not at all concerned. There is no problem. Yes, perhaps the deficit will be $34 billion because the economic conditions are not good. Yes, the rate of growth is lower than expected and that is not good, but it is not a problem. Canadians will pay for it later.

Will there be any money left in the coffers to pay for the promises that the government made to seniors in Bill C-26? The government does not have an answer to that question because it has been improvising on everything from the start.

The government broke its promise to reduce small business tax rates. What will be directly affected by Bill C-26? Small businesses, which will also have to increase their CPP contributions. The government is promising to help businesses and create jobs, but the reality is once again a different story. The government wants to promise the best of everything; it does not talk about the worst, but imposes the worst anyway. That is the reality of the Liberal government.

Today, I can say, without question, that the Liberal government has betrayed seniors with the false promise that it would immediately improve their lives. That is the reality. When the government promises people who are 75 or 80 years old that it is going to increase their pension benefits, those people do not expect to have to wait until they are 87 for that to happen.

I heard my colleagues opposite telling us that this is going to help low-income seniors. Wrong. The increased benefits will help those with higher incomes. Those with low incomes will not benefit at all from these changes to the Canada pension plan. That is something else that is being left unsaid by the Liberal government.

We will have to learn to always read between the lines of what the Liberals are saying. Unfortunately, that is what Canadians will be learning the hard way in the coming weeks and months.

Still, people can take comfort in knowing that we are here. Our new finance critic, the member for Louis-Saint-Laurent will keep a very close eye on this government, which has no qualms about imposing new taxes on the middle class and businesses. It has no problem letting the deficit grow ever larger so it can achieve its objectives. The worst part is that it does not seem too worried about it.

Higher CPP benefits mean more money coming out of hard-working Canadians' paycheques. Maybe it will help them someday when they retire, but the way things are going now, we should all be leery of the Liberal government's grand promises. As a matter of fact, I have no faith in their projections, which are not even valid for a week, let alone until 2025. Something is going to happen. The Liberals will change things, tweak things. Why? Because they messed up the math. Their projections are inaccurate, and they will not be able to keep their promises.

What really worries me is what the Liberals are going to do if they do not have the money. I would not be surprised if they use that tried and true Liberal tactic: instead of a small increase, there will be a big increase, and it will cost all of us a lot more, and poor people will still have no more than they did before.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Madam Speaker, apparently the government distrusts the ability of Canadians to plan for their own retirement. There is no other reason for this ill-conceived tax hike that the members opposite like to pretend is not a tax on Canadians.

When the Canada pension plan was first introduced in 1965, it was intended to assist those Canadians who were not already part of workplace pension plans. The government apparently felt that such a plan was necessary to assist Canadians in their retirement planning.

The world has changed since then, but the Liberals still believe that we are living in 1965. They still believe that it is the role of the government to tell people what they can do with their money. They still believe that Canadians are not capable of determining for themselves what they will need financially when they retire and of preparing for retirement on their own.

As a result, we have this bill, Bill C-26, which will take money from the pockets of hard-working Canadians who have been given no choice in the matter. The benefits of this tax hike, if any, and do not be fooled when they tell us that it is not a tax hike, by the way, will happen at some point in the far future. These changes do nothing to help today's seniors who may be struggling to make ends meet.

Why do I say that this is a tax hike when the government says it is not? As the cliché goes, if it walks like a duck and quacks like a duck, then it is a duck. If the government taxes money from us and gives nothing in return, that is a tax.

The Canada pension plan receives money from two sources: employers and employees. They make equal payments into the fund, but at the end, only one of them receives a pension from those payments, and that is employees. For the employer, CPP is just one of many costs of doing business. The government, with these changes, is increasing the tax load on employers while pretending that it is not a tax.

I was a small businessman before the people of Edmonton Manning gave me their trust as their representative in Ottawa. I know what it means to be an employer and to have to pay my employees. I know first hand how much government red tape is involved in running a business. Liberals can call this increase in CPP whatever they like, but business owners know the truth. This is a tax grab. The Liberals can put all the lipstick on this pig they like, but at the end of the day, they are telling business owners to pay more money, with absolutely nothing in return.

The return for the country is something different. When business owners are faced with an increase in costs, adjustments have to be made somewhere else. The government is mandating this increase in taxes, for nebulous benefits at some point in the future, but business owners have to deal with this tax now. As I see it, they are faced with two choices in this situation. With this increase in costs imposed on them by the government, they will have to find other areas to cut back. One way would be to freeze or even cut wages so that the employers' tax burden does not increase. How this helps employees I do not know.

The alternative is that they will freeze hiring or even lay off employees. Personnel costs are a big part of doing business, and it does not make sense that the government would increase this burden on business owners. This extra tax is putting thousands of Canadian jobs at risk.

In 2015, the Canadian Federation of Independent Business looked at a similar CPP hike scenario. They found that it would eliminate 110,000 jobs and permanently lower wages by nearly 1%. It is not alone in predicting the negative consequence of an increase in CPP premiums. The Fraser Institute found that a 1% point increase in the CPP contribution rate reduces private savings by 0.9 points. That does not provide much benefit.

What does this tax mean for working Canadians? The government tells us that we should be happy, that there will be more money for us when we retire.

It assumes that Canadians are not using savings vehicles, such as the registered retirement savings plan or the tax-free savings account. That is perhaps why the Liberals reduced the TFSA contribution levels set by the previous Conservative government.

When these changes are introduced, Canadians will take home less pay every week. The government wants us to think that it is not much, that we will never notice it, but every penny less in a person's pocket makes a difference to that person.

What would the effects of this tax be as people see their pay reduced? With less money coming in, it would take that much longer for new graduates to pay off their student loans. That, in turn, would delay their ability to buy their first house. That would have an impact on the economy that perhaps the government has not thought enough about. Conservatives want to encourage Canadians to save, but by reducing their pay, we would take the opportunity away from them.

Through this tax increase, Liberals are saying they do not trust Canadians to be smart enough in how they spend their own money, so they will do it for them. Canadians have already shown that they know how to handle their own money. They do not need the government to do it for them.

We already have a retirement system that is the envy of the world. Canadians are saving more today for retirement than ever before, without this tax grab. Poverty among seniors has dropped significantly in recent years. According to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in 1970, when the CPP was in its infancy, to 3.7% today. It is among the lowest in the world. Conservatives believe that Canadians should be able to manage their own money. It is not the role of government to do so.

Furthermore, Liberal promises on financial matters are somewhat suspect. It was only a year ago that the Prime Minister was promising to hold the budget deficit at $10 billion. We all know how quickly that promise was broken. How can the government expect Canadians to believe anything it says about CPP benefits in 2050? If the government were truly serious about helping Canadians to save for their retirement, it would reinstate the TFSA contribution levels set by the Conservative government. Treat Canadians like adults and let them choose how to save for their retirement.

It appears as if the government has decided that the CPP should be the only method of retirement savings that Canadians use, but that was never the intention. In 1964, the Liberal minister responsible for introducing the Canada pension plan said that CPP “is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans." That was a good idea then, and it is a good idea now. It is time for the government to show Canadians the respect they deserve. For the good of Canada, it should abandon this bill.

[Bill Morneau, Liberal, Minister of Finance]

moved 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.

Madam Speaker, as hon. members know, a stronger Canada pension plan was a key part of the promise we made to Canadians when we promised to help the middle class and those working hard to join it.

On June 20 in Vancouver, we delivered. Canada's governments agreed to enhance the Canada pension plan to give Canadians a more generous public pension that will help them retire in dignity. I would like to think that we showed everyone just how well our country can work when our governments work together, even in the face of tough challenges. We worked through our differences, never wavering on our commitment to the people we serve. In doing so, we proved that collaboration around the federal-provincial-territorial tables can deliver results.

I would like to thank each and every one of my provincial and territorial counterparts for the hard work, diligence, foresight, and principled co-operation they displayed in reaching this historic agreement on behalf of Canadians.

Now that all nine CPP-participating provinces have fully confirmed their support for implementing the Vancouver agreement, we have the obligation to carefully consider the legislation before us today, which will help make this agreement a reality. We must do so with the full understanding of what is at stake: no less than the opportunity to provide future generations of Canadians with a more generous public pension in their retirement years.

A secure and dignified retirement is certainly a top priority for hard-working Canadians. We know that middle-class Canadians are working harder than ever, and many of them are worried about not having saved enough by the time they retire.

The more time we spend knocking on doors, holding forums, and talking to people in the course of our work, the clearer that becomes. We also know that young Canadians in particular, few of whom can expect to have jobs that offer a workplace pension plan, find it challenging to save enough money for retirement.

Toronto high school students aired these concerns during an open forum with me earlier this month. Their concerns are legitimate. In-depth studies by the Department of Finance and provincial governments show that one-quarter of families approaching retirement, 1.1 million families, expect their standard of living to drop significantly in retirement.

Middle-class families without workplace pension plans are at higher risk of not saving enough for retirement. One-third of those families are at risk.

Canada's finance ministers agreed with this conclusion in working towards our agreed upon enhancement to the CPP. We have developed a carefully targeted approach, which is reflected in the legislation we have before us today. Taken together, it is a comprehensive package that will increase CPP benefits while striking an appropriate balance between short-term economic considerations and longer-term gains.

What does a stronger CPP mean for Canadians?

First and foremost, it means there will be more money from the CPP waiting for Canadians when they retire. This means that they will be able to focus on the things that matter, like spending time with their family rather than worrying about making ends meet.

Once fully in place, the CPP enhancement will increase the maximum CPP retirement benefit by about 50%. The current maximum benefit is $13,110. In today's dollar terms, the enhanced CPP represents an increase of nearly $7,000, to a maximum benefit of nearly $20,000.

The enhancement we agreed upon does two things to make this happen for contributors. First, it will increase the share of annual earnings received during retirement, from one-quarter to one-third. This means that an individual making $50,000 a year in today's dollars over their working life will receive about $16,000 per year in retirement, instead of roughly $12,000 today. Second, it will increase by 14% the maximum income range covered by the CPP so that those who earn more will receive more in retirement.

The positive impact of these changes will be significant. They will meaningfully reduce the share of families at risk of not saving enough for retirement, as well as the degree of under-saving. The Department of Finance has estimated that strengthening the CPP will reduce the share of families at risk of not having adequate retirement savings by about one-quarter, from 24% to 18%, when considering income from the three pillars of the retirement income system and savings from other financial and non-financial assets.

A stronger CPP is also the right tool at the right time to improve the retirement income security of younger workers. It is an opportunity for today's hard-working Canadians to give their children, their grandchildren, and future generations a more secure retirement.

The Department of Finance has concluded that retiring in comfort will be even more a challenge for these future generations. That is, in part, because they are expected to live longer than previous generations. Also, if current trends continue, younger Canadians will be less likely than previous generations to work in jobs with retirement benefits that are paid for by their employers, and if the current low interest rate environment persists, their savings may also grow more slowly than previous generations.

In the face of these challenges, our government decided to do what Canadians do best when faced with a problem: we worked together. We worked with the provinces and territories and agreed to strengthen the Canada pension plan so that there will be more money waiting for future generations of Canadians when they retire.

However, that is not all. The legislation we are debating today also includes enrichments to CPP disability and survivor benefits. For most Canadians, all of these increased CPP benefits will come from only a 1% increase in contribution rates.

We are making sure to give individuals and their employers plenty of time to adjust to the modest increase, making sure that it is small, gradual, and starting in 2019. For example, an individual with earnings of $54,900 will contribute about $6 more a month in 2019. By the end of the seven-year phase-in period, contributions for that individual would be about $43 more per month. Furthermore, because new employees' CPP contributions will be tax deductible, as opposed to being eligible for a tax credit, Canadians will not experience an increase in tax with registered retirement savings plan or employee pension plan contributions, which are deductible and are reduced in response to this increase in CPP contributions.

Today's legislation, as agreed upon with the provinces, will also ensure that low-income Canadians are not financially burdened as a result of the extra contributions. It will do so by enhancing the working income tax benefit to roughly offset incremental CPP contributions, leaving eligible low-income Canadians with little to no change in disposal income while still securing higher retirement income for them. Taken together, these tax measures will account for $970 million in federal fiscal support in 2021-22.

Under the circumstances, it is clear that an enhanced Canada pension plan will help all Canadians, which will in turn help Canada's economy as a whole. With higher retirement benefits flowing from an enhanced CPP, retirees will have more money to spend on things such as healthy food, transportation, and housing costs. The knock-on effect of that? New jobs and a stronger middle class.

As I noted earlier, the Department of Finance undertook extensive research on the impact of a strengthened CPP. This analysis included a rigorous study of the potential economic impacts of the various enhancement scenarios being discussed with the provinces.

Our research found that over the long term, greater CPP benefits will boost demand and increase savings overall. This will boost economic output and make more money available for investment. As a result, it is estimated that gross domestic product will increase by between 0.05% to 0.09% over the long term. Employment levels are also projected to be permanently higher, by about 0.03% to 0.06%, equivalent to about 6,000 to 11,000 jobs based on 2015 levels of employment.

We can see from all of these facts that a stronger CPP would be good for Canadians and good for the overall economy. This should come as no surprise, since the CPP is a good and solid program. For over 50 years, the CPP has been helping to ensure that all workers in Canada have a minimum level of financial security in retirement. The most recent statistics tell us that 5.2 million people in Canada received $37.3 billion in benefits from the CPP.

According to a report by the Conference Board of Canada, poverty rates among Canadian seniors have fallen by 25% over the past four decades, dropping from 36.9% in 1976 to 12.3% in 2010. The Conference Board of Canada concluded that this significant reduction can be largely attributed to the implementation of the CPP and, in Quebec, the QPP.

The CPP Investment Board is similarly well-regarded around the world for its impressive record of investment performance and management excellence. The CPPIB operates at arm's-length from governments, with a mandate to invest CPP funds in the best interests of plan members. It has been acclaimed by international bodies such as the World Bank as the model of an independent, transparent, and accountable public pension fund management organization.

As the manager of a large fund program with millions of contributors, the CPP Investment Board is able to take advantage of economies of scale to deliver strong net returns. Over the past 10 years, the CPPIB has delivered a 10-year average nominal rate of return of 6.8% on existing CPP assets. This is above the 6.1% nominal rate of return identified by the chief actuary of Canada as necessary to ensure the sustainability of the Canada Pension Plan.

With this rock solid investment structure as its foundation, the CPP provides a safe, secure, and predictable benefit, which means that Canadians can worry less about outliving their savings or having their savings impacted by significant market downturns. The recently released 27th actuarial report on the Canada pension plan concludes that the existing CPP is on a sustainable financial footing, at its current contribution rate of 9.9%, for at least the next 75 years.

Bill C-26 would make amendments to the Canada Pension Plan Investment Board Act to make the CPPIB the manager of the improved CPP. Now that Bill C-26 is before us for consideration in Parliament, the chief actuary will conduct an actuarial assessment of the enhancement to ensure that it is on a sustainable, long-term financial footing.

CPP benefits are also fully indexed to prices, which reduces the risk that inflation will gradually erode the purchasing power of retirement savings. As well, the CPP is a good fit for Canada's changing job market. It helps to fill the gap left by declining workplace pension coverage and it is portable across jobs and provinces, which promotes labour mobility and reflects how Canadians currently live, work, and retire. With the automatic collection of contributions for all workers, the CPP is a simple way to save for retirement. It also provides important income support through disability, death, survivor, children's, and post-retirement benefits for eligible contributors and their families.

By supporting today's legislation, parliamentarians will not only be boosting how much each Canadian will get from his or her CPP pension in the future, we will be making a great program even greater. With 75% of Canadians in support of a stronger CPP, members will be acting on one of the highest priorities of Canadians.

I am honoured to have been able to work with our provincial and territorial partners to make an enhanced Canada pension plan a reality for Canadians. I encourage my colleagues to share in this success by supporting Bill C-26.

Business of the House

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

Mr. Speaker, I have to agree with the opposition House leader. It has been quite delightful to work together, and I hope we can continue the relationship we have created so we can be productive in this place for Canadians.

This afternoon we will continue debate on the Conservative motion. Tomorrow, we will begin second reading of Bill C-26 respecting the Canada pension plan.

We will call the bill on Monday and, hopefully, conclude debate on Tuesday. On Wednesday, we will commence debate on Bill C-25, the business framework legislation. Thursday shall be an allotted day.

Finally, I would like to thank all hon. member for the progress on legislation so far this week.

Canada Pension Plan

[Jean-Yves Duclos, Liberal, Québec, QC]

moved for leave to introduce Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

(Motions deemed adopted, bill read the first time and printed)