Finance Committee on Feb. 28th, 2012

[Guillaum Dubreuil]

This is in fact a matter we raised with our members. The answers were so varied that we could not really come up with anything tangible.

You need to understand, of course, that our members are young professionals aged 18 to 40 who come from all regions of Quebec. So our membership in itself is extremely varied. We have people who have started up a business a year earlier and were unable to invest in their retirement at this time, but who hope to be able to grow the value of their business, sell it one day and take a percentage of the amount and set it aside for their savings. We also had salaried employees with sizeable funds who could contribute to a pension fund.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

You no doubt got the impression that there was an interest in this issue and that young people are still concerned about their future.

[Guillaum Dubreuil]

Absolutely, this is something that came out very clearly in the survey that we conducted. Young people are very concerned about their future and their retirement. Everyone is interested in contributing to such a program. However, we have to come up with the right way to do this, and we believe that the PRPP is along this line.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

The Government of Quebec has also said that it intends to create a program. Do you think that we should combine the two programs or should we keep a separate Quebec program, so that contributors can choose between the two?

[Guillaum Dubreuil]

What really counts for our small business owner members, the entrepreneurs, is that the management be kept simple. We want to have a system that is easy to use, a simple system, where there will not be numerous levels, bureaucracy or excessive paperwork, so that they are able to use it. We know that this is one of the biggest obstacles to using many of the existing programs.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

I know that you have already submitted some recommendations in your brief. Are there any issues, with respect to the pension funds, that you would like to draw to the attention of our committee?

[Guillaum Dubreuil]

Thank you for giving me this opportunity.

Obviously, I believe that the important points are the ones that I have already mentioned. We have to make sure that the plan is simple and voluntary, for the entrepreneurs and the professionals and for the small business owners, for whom a mandatory system would be an additional tax or financial burden. There also has to be some flexibility; for example, there has to be choice with respect to the financial institution and options available.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

Thank you very much.

[The Chair, Conservative, James Rajotte]

You have one minute remaining.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

That is fine.

[The Chair, Conservative, James Rajotte]

Okay.

We'll go to Ms. Glover.

[Shelly Glover, Conservative, Saint Boniface, MB]

Thank you very much. I too would like to welcome all of the witnesses.

I will continue with Mr. Dubreuil.

Would it be possible to obtain your survey report, so that we can take a look at the questions and answers that you obtained. Did you prepare such a report?

[Guillaum Dubreuil]

Yes, there is a report.

Once again, I would like to state that this was a survey conducted by Question Retraite, a partner organization with whom we work. The survey was conducted from June 2 to 28, and involved 1,605 respondents. We could certainly send the survey and the results to the committee.

[Shelly Glover, Conservative, Saint Boniface, MB]

That would be great. What you are saying is really interesting. We may find some other aspects in your survey that could help us. Thank you.

[Guillaum Dubreuil]

Certainly.

[Shelly Glover, Conservative, Saint Boniface, MB]

I just want to make a comment before I get into my round of questioning.

Unfortunately, it's typical of the Liberals when they speak. This side has never said this is a panacea. Nor have I ever heard the NDP say that this is the Antichrist. It is unfortunately a partisan habit that the Liberal Party has to exaggerate beyond exaggeration these types of things. We've never said it's a panacea.

[Scott Brison, Liberal, Kings—Hants, NS]

We support child pornography too.

[The Chair, Conservative, James Rajotte]

Order.

[Shelly Glover, Conservative, Saint Boniface, MB]

I heard Mr. Frazer repeat it, so I want to make sure Mr. Frazer knows that we do not believe it's a panacea, but we do believe it is another vehicle, which I've heard several times today. We believe that it is a right thing to do so that the people who do not have access to workplace pensions can take advantage of this.

Having said all of that and putting that on the record to dismiss all of the misleading stuff, I have a question for Mr. Wrobel.

You mentioned earlier, with regard to private sector versus public sector, that there are some advantages in the private sector and the expertise and what not that they use. I did note when Ms. Eng was speaking that you had a bit of a reaction. I would ask you, in debating what Ms. Eng said, to tell us why you think it is appropriate that this be in the private sector.

[Marion Wrobel]

To step back, if you look at the retirement system in total, there are a number of pillars. We think of it as a multi-pillared approach. We have pillar one, which is the OAS and GIS, and we know that is designed to provide income support largely to lower-income families over age 65. The second pillar, CPP, is designed to provide a replacement of some level of income for those in the lower- and middle-income levels.

Pillar three, the private sector part, is really a complement. It adds on to pillars one and two. It is designed for those who will have to save and who want to make sure that when they retire they are able to maintain the standard of living they want. All of that is delivered through the private sector. It's done in a competitive framework. It's done individually. It's done collectively through employers.

Again, to the point about the PRPP, for those who don't have access to an employer-sponsored pension plan, the PRPP now provides such an opportunity. It's our sense that the private sector delivers third-pillar savings in a fairly efficient and effective manner, and we see the PRPP as a continuation of that.

[Shelly Glover, Conservative, Saint Boniface, MB]

Very good. We have no evidence to dispute that. I just wanted to hear the two sides of this issue.

I also want to allow a moment for Mr. Kelly, who also had a little bit of a flinch when Ms. Eng brought up the $18. Low-income people are the ones we are targeting. Low-income and modest-income earners are the ones we are targeting, those who are not able to benefit from a workplace pension but who may be able to put some savings here.

Ms. Eng said $18. I want you to address that apples for apples, because you started to talk about the 1.2 million person-years, but that's not apples to apples. I want you to tell me what that $18, which is the one point increase that CARP claims isn't a big deal under CPP, would do to your members.

[Daniel Kelly]

Our research, which uses the econometric model from the University of Toronto, shows that every 1% increase in Canada Pension Plan contributions would kill 220,000 person-years of employment. That's for a 1% increase in the Canada Pension Plan.

Now, there are benefits down the road. The other piece that wasn't said about the CPP doubling plan is that it would actually be phased in over 40 years, so it wouldn't actually benefit anybody even close to retirement today. But the fact is that a CPP premium increase would be an absolute job killer. Our members are not sitting on safes of money that they can just crack open to put into this money. If they do put money into a PRPP, it will be because they are desperately trying to hang on to staff; they want to do the right thing and they're trying to find the best possible tool to allow them to save for their own and for their employees' retirement. But it's not going to be easy for them to do it, and it's going to take some time.

I want to make one point.

[Shelly Glover, Conservative, Saint Boniface, MB]

Sure.

[Daniel Kelly]

We can't measure this in one year. The success and failure of the PRPP tool is going to need to be measured over several years. It's going to be a slow build. The first step will be converting a lot of the group RRSPs to PRPPs. Beyond that, there will be expansion of coverage. Our estimate, though, is that it will be a slow build.

[Shelly Glover, Conservative, Saint Boniface, MB]

We do have low-income and modest-income earners who are small-business owners, and it is those folks I am very much concerned about.