Thank you, Mr. Chair.
The Quebec Employers' Council is comprised of several large Quebec companies and also includes the vast majority of sectoral employer associations. It is the only employers' confederation in Quebec.
The mission of the Quebec Employers' Council is to ensure that businesses have the best possible conditions, especially with respect to human capital, in order to prosper in a sustainable way in the context of global competition.
We thank the Standing Committee on Finance for giving us the opportunity to comment on Bill C-25 as part of its consultations.
The Quebec Employers Council supports the federal government bill providing for the creation of pooled registered pension plans for federally regulated companies. The flexibility and adaptability envisioned by the PRPP will allow federally regulated companies that do not already have a pension plan to provide a simplified one for their employees. Employers, notably those in the small and medium-sized business sector, will thus have the opportunity to offer a plan that ensures financial security for their employees when they retire but will not have the fiduciary responsibility or the obligation to make contributions.
Let's recall that, according to several evaluations, in particular from the OECD and Mercer, Canada's retirement income system is one of the best in the world. The three pillars of this retirement income system enable Canadians to maintain an adequate lifestyle when they retire. But it seems that up to 30% of Canadian workers do not save enough to ensure the same lifestyle after retirement as when they were working.
There is also a challenge for future generations. Some changes are desirable to improve retirement savings, even though we acknowledge that the problem of financial security is not necessarily generalized and that, therefore, the solutions mustn't be generalized either.
We need to keep in mind that, to finance their retirement, Canadians invest not only in pension savings accounts, but also in other assets, particularly the house they own and live in or in various financial vehicles. They can also choose to work full-time or part-time for a few years more, assuming they remain in good health.
The Quebec Employers Council proposes that discussions regarding the retirement savings issues be guided by four main principles: no transferring of the burden to future generations; no hindering of businesses' competitiveness; no removing of individuals' responsibility; and no increasing of businesses' administrative load. Any change should encourage a marked improvement in the investment rather than substituting one form of an investment for another form that already exists. The regulatory structure has to be simple and flexible. The simpler the plan is to put in place and the easier it is to administer, the better chance it has to be successfully implemented.
This bill clearly seems to be moving in this direction, and we have a few specific comments to make.
First, this bill offers a greater number of workers who were not covered by a retirement plan, especially those working in small and medium enterprises, the possibility of being covered. It also allows employees in SMEs to benefit from the economies of scale that large plans do. The intended employees would automatically be enrolled in their employer's PRPP, but could withdraw if they wish to. According to all the examples we have seen, being signed up automatically generally encourages greater participation.
Second, we also want employers to be able to offer their employees this kind of plan without being required to contribute. Companies that wish to may do so, but companies, particularly SMEs, often cannot afford to contribute more.