Mr. Chair and committee members, thank you very much for allowing us to appear before you this evening.
My name is Susan St. Amand and I am chair for the Conference for Advanced Life Underwriting. I have run my own small financial services business in Ottawa for the past 22 years now, and prior to that I spent seven years in management with one of the largest Canadian chartered banks. Our brief provides more information on CALU and our sister organization, Advocis, but I want to remind you that more than 10,000 of our members are largely self-employed, independent small-business owners spread out across Canada. Each one of us advises approximately 300 families, many of whom are owners of small to medium-sized businesses.
Like you, we are very concerned about the ability of our business clients to fund their own retirement and the retirement of their employees, while preparing for the succession of their businesses. Although I have not implemented many individual pension plans myself for our clients, I do know they have a very valuable place in our system. When the new IPP rules were first introduced last March, I understood the proposed changes were directed at a small group of business owners who were obtaining unintended tax benefits from their individual pension plans. It appeared that the Department of Finance was now quite properly dealing with this problem. But then I started getting calls from our members, expressing concerns about the general impact of the proposals on the ability of their business clients to participate in defined-benefit-style pension plans.
Based on this feedback, CALU formed a working group of members who had expertise in this area. In mid-September, the working group completed its submission to the Department of Finance, noting a number of issues and requesting more time for consultation. It appears that the finance department was operating under a tight deadline, and Bill C-13 was tabled a mere two weeks after the close of the consultation period. Thanks to previous dialogue and input, the final IPP regulations did contain a change designed to mitigate the impact of one of the proposals.
However, CALU continues to have a fundamental concern with these proposals. We believe the IPP legislation challenges the ability of business owners and key employees to participate in retirement benefit programs with similar terms and conditions available to employees in larger private and even public companies. We see this as a dangerous trend that seems to assume that business owners will abuse employee benefit plans. We don't believe most of our business clients or their professional advisors design plans with the intention of taking advantage of the rules, and we are concerned about this perception and the role it may play as a basis for the development of tax policy.
I would now like to invite Kevin to make some specific comments on the legislation that will hopefully illustrate my points.