Based on my understanding of the use of vote thresholds elsewhere, 3% to 5% would seem to be reasonable.
In terms of the concern about the proliferation of political parties, it turns out that it's very difficult for a political party to get 3% to 5% of a national vote. It's extremely difficult with first past the post, but it's very difficult nonetheless. Although 34 parties jumped in on the first opportunity in New Zealand, only a small number of those actually exceeded the threshold and gained representation in the New Zealand Parliament, one of them being the Maori Party. A certain number of seats had been guaranteed to the indigenous people, so they automatically had a new party there.
When we look at more reasonable examples, in northern Europe, for instance, Germany has only four parties represented. They have fewer parties represented in the Bundestag than we do in our Parliament, and they use MMP. The same can be said for the Scandinavian countries, with only a limited number of parties. There isn't a problem with the proliferation of parties if you have a reasonable vote threshold, which eliminates a lot of these tiny extremist parties that you find in Israel, for example, which would be an absolutely awful example for Canada to point to. There is absolutely no possibility that we would ever have Israel's model of one constituency for the whole country, no vote threshold, and of course just the social and cultural context that's so dramatically different there.
It just makes no sense to me whatsoever to point to those examples.