No, because.... Sorry, yes--
Evidence of meeting #44 for Finance in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was surplus.
A recording is available from Parliament.
Evidence of meeting #44 for Finance in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was surplus.
A recording is available from Parliament.
5:05 p.m.
Director, Capital Markets, Investment Industry Association of Canada
No, because.... Sorry, yes--
5:05 p.m.
President and Chief Executive Officer, Investment Industry Association of Canada
Well, there could be commissions earned on the transactions in the account completely analogous with either RRSPs or normal securities accounts. The point we were making was that we'd like to see a structure that didn't require a trustee relationship, because it isn't necessary and it would, in effect, reduce one element of cost.
5:05 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
If I just want to run a glorified bank account, why do I need you?
5:05 p.m.
Director, Capital Markets, Investment Industry Association of Canada
You don't. You can go to one of the banks or you can go to a credit union, and you can have an account with them. However, the interest rates nowadays compared to what they were in the 1980s are much lower, so it's a question of the dividend.
5:05 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
But the people you will be appealing to are people who essentially are going to be buying and selling securities in some manner or another?
5:05 p.m.
Director, Capital Markets, Investment Industry Association of Canada
They could be buy and hold as well, though.
5:05 p.m.
President and Chief Executive Officer, Investment Industry Association of Canada
Yes, but they would have a balanced portfolio, which--
5:05 p.m.
Liberal
5:05 p.m.
President and Chief Executive Officer, Investment Industry Association of Canada
But most middle-income Canadians would have that kind of a balanced account. So, yes, you're right--that would be the vast majority, I would think.
5:05 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
So when you argue that this will be of benefit to the lower-income folks, those aren't really the people you would be servicing.
5:05 p.m.
President and Chief Executive Officer, Investment Industry Association of Canada
Well, it would be some of them through mutual fund investments, for example.
5:05 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
If I have $1,000 and I want to put it into an account, your interest....
5:05 p.m.
Director, Capital Markets, Investment Industry Association of Canada
You're right. That is most likely something that would be with the bank--
5:05 p.m.
President and Chief Executive Officer, Investment Industry Association of Canada
You'd go to a bank maybe.
5:05 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
Yes, I would think so.
Now, if I have $1,000 or $2,000 and I have choices, I'm going to go to RRSP, RESP, or a TFSA. Why would I walk away from a tax deduction and shelter--which is your RRSP concept--or why would I walk away from a tax shelter plus grant, which is the RESP, and go to a TFSA if I have only $1,000? It doesn't really make a lot of sense.
5:10 p.m.
Director, Capital Markets, Investment Industry Association of Canada
It is going to depend on the individual circumstances of a particular investor.
Actually, a point I forgot and that I was going to make in answer to the earlier question is that there is now--and I haven't tested this myself--a TFSA calculator on the Finance Canada website, and I believe that is aimed at helping you determine, with your particular fact situation, whether it is better for you to make a contribution to your RRSP or better to make a contribution to your TFSA. With an RESP, the registered education savings plan, because it can be matched as a grant, I would think that's one you would want to consider first. But some people will not be in a position to contribute to an RESP if they don't have children or if they're seniors. Seniors will no longer--
5:10 p.m.
Liberal
John McKay Liberal Scarborough—Guildwood, ON
Which is why I think, frankly, that the folks who are in the upper brackets of income are going to maximize the benefit. You're going to do your RRSP, then you're going to do your RESP, and then you're going to do your TFSA.
5:10 p.m.
Director, Capital Markets, Investment Industry Association of Canada
I'm thinking about seniors. My mother, were she still alive at this point, would have converted her RRSPs to RIFs. She never earned a high income, but she was a serious saver, so she would have had money to put into a TFSA. She would have been able to continue trying to earn income on that, which she then would have been able to withdraw without tax.
5:10 p.m.
Executive Vice-President, Canadian Federation of Independent Business
One of the challenges we have is we're concerned about our employees, and some, even though we match, do not contribute to their RSPs because they're living from paycheque to paycheque. They may get a windfall, but they may not want to put in the RSP because there's a penalty for taking it out. They want to have flexibility because they may need that money for a rainy day. The TFSA gives the flexibility to take it out without penalty, and that's important. You still have that space.
5:10 p.m.
Executive Vice-President, Canadian Federation of Independent Business
Yes, but some aren't looking for the tax deduction. They don't think that way. There are a lot of people who are like that. It just gets them moving.
5:10 p.m.
Conservative
The Chair Conservative Rob Merrifield
Thank you very much.
Now we'll go to Mr. Williams, our last questioner, and then we'll look at our motion.
5:10 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Thank you very much, Mr. Chair.
My first question is to Mr. Weir, who was telling us that one in six manufacturing jobs has disappeared, but unemployment is down at levels we are very proud of and hopefully will stay down for years to come. I'll put my questions to Mr. Weir and Mr. Whyte.
How much emphasis should the EI program put on training for the knowledge industry for the people whose careers have come to a dead end because manufacturing jobs are disappearing overseas? We see a growth in the information age and the knowledge-based workforce. What kind of emphasis should EI be putting on ensuring we have a mobile workforce for the future, rather than trying to preserve something that's disappearing fast?
5:10 p.m.
Economist, United Steelworkers
On the first part of your question, I'll note that unemployment has been trending upwards lately. It's now up over 1.1 million Canadians who are officially recognized as being unemployed in the labour force survey. It's also interesting to note that a lot of the employment growth has been self-employment, as opposed to positions paid by an employer. You've got to ask if Canadians are becoming self-employed voluntarily or because they can't find jobs—
5:10 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
My question was whether we should be emphasizing ensuring people are protected from being unemployed by having skills that society demands, or whether we should stay with the status quo and, as these jobs may disappear overseas to lower-cost manufacturing areas, we just say there's nothing we can do and pay EI? How much emphasis should we put on training?