Finance Committee on Oct. 23rd, 2012

[Mark Adler, Conservative, York Centre, ON]

Wonderful. Did any one of them say to you to say in your appearance before the finance committee today that they favour a carbon tax of $21 billion and we should be setting that? Yes or no?

[Kim Allen]

No, we didn't. We did not specifically consult with members on that question. We had no comments on it.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Adler.

We're going to move on to Mr. Marston, please.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Well, Mr. Allen, I'm going to have to change the order of my questions, thanks to the last one from Mr. Adler.

Were you aware that in 2008 the Conservatives ran on a cap-and-trade proposal in their platform?

[Kim Allen]

Yes.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I thought you might be aware of that.

You made a strong case, Mr. Allen, about federal investment being needed in Canada's infrastructure. Are you aware of Mark Carney's recent comments about the “dead money”, as he called it, this $500 billion in dead money that's not moving?

[Kim Allen]

I'm not very familiar with his comments.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Okay.

Mr. Hayos...?

[Gabe Hayos]

Yes.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Carney made that statement. What are your thoughts around levering, around the government using the low interest rates we have today to get 10-year bonds to help lever some of that money and get it working in the communities in addressing that infrastructure deficit of $100 million and some, as put out by the FCM? They were encouraging that approach. What are your thoughts on it?

[Gabe Hayos]

Well, my thought on this issue of dead money is that I think—and this is the role of the government—you need to set the playing field for businesses to make investments. Businesses are the ones that have to decide how to use their money.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Would levering some money by taking advantage of the 10-year bonds not be a reasonable way of doing it?

[Gabe Hayos]

I'm not sure that's.... I think it's more along the area of promoting the business environment for them to make good investments. I think that's what you want them to do.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you.

Ms. Eng, the NDP, as you're aware—because you've been before this committee a number of times—has expressed our concerns about the 12 million Canadians who have no savings and no pension. You're also aware that we've talked about doubling the Canada Pension Plan.

I'd like your view, CARP's view, on that particular proposal and the fact that we think it should be mandatory. As well, what are you hearing from provincial governments about their support or lack of support for the PRPPs?

[Susan Eng]

I must say that the support and opinions have evolved. I think that originally there was support for a CPP enhancement before there was a change from that and the focus went to the PRPPs.

Now that people have had a chance to look at the PRPPs and realize that they would be insufficient to increase the amount of savings, people are really looking again at enhancing the CPP. The finance ministers we've been in contact with have indicated at their round table nationally that they'd be prepared to push that objective forward. We think that would be a good thing.

Our members certainly support the enhancement of the CPP. When we drilled down to see what aspect of it they liked best, it was the mandatory employer contribution that was relevant.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you.

How much time do I have?

[The Chair, Conservative, James Rajotte]

Two minutes.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

That's great.

On the OAS eligibility change, we're hearing today that there might be a windfall of as much as $10 billion for the federal government in that change. Using Ontario as an example, people on a disability pension from Ontario or Ontario Works through a municipality were hoping to go to OAS at 65, which is a modest increase for them. Now, with this two-year change, they're going to carry the burden of two years of the costs of the government. As well, in these two cases, with it being left on that much longer, it's an added cost to municipalities and the provinces.

I would suggest that this hasn't been about sustainability, but about offloading costs. That's pretty apparent to us now. How concerned are you about the impact this is going to have on our broader community?

[Susan Eng]

In fact, we're very concerned about it. It's not so much on the off-loading between the jurisdictions, but that individuals will be hurt by this.

We appreciate that the government, in announcing the changes, acknowledged that there is a category of people who would be affected and promised to reimburse any provincial programs that came into play that would look after that group of people, but of course in our meetings with these provincial premiers and finance ministers, we found they have no plans. They have not planned to put anything in place, so people are worried as to what's going to happen.

Given that the government has already committed to reimbursing any provincial expenditures that do come into play, they should now set aside the money, commit to doing it, and take credit for it, frankly, so our members and other older Canadians will be at rest that those who are the worst off, at least, are looked after.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Well, there should also be some money directed to the people—

[The Chair, Conservative, James Rajotte]

Okay. Thank you.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you, Mr. Chair.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Marston.

Mr. Van Kesteren is next, please.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Thank you, Chair.

Thank you, all, for coming before us this afternoon.

Ms. Eng, it's good to see you again. We've had the opportunity to speak to you over a number of years.

I want to do a bit of crowing, if you'll engage me, as to some of the government initiatives since 2006.

There was $76 billion this year, through the Canada public pension system. We have provided $2.3 billion annually in additional tax relief to seniors and pensioners, through measures such as pension income splitting and increased age credit. We've removed 400,000 seniors from the tax rolls completely.

We've implemented automatic renewal of GIS; I know that was something you had asked for. We're providing $400 million over two years, over budget 2009, for the construction of housing units for low-income seniors. We've appointed a minister of state, which I think is probably something you've asked for in the past as well—I'm skipping a few here because the chair is going to ask me if there is a question—and we created $13 million over three years in support of the federal elder abuse initiative, all good initiatives.

There's the largest guaranteed income supplement, or GIS, top-up benefit in a quarter century, to help Canada's most vulnerable seniors while ushering in an automatic renewal of GIS. There's been $10 million over the last two years to increase funding for New Horizons, and $50 million over the two years to extend the targeted initiative for older workers until 2013-14.

On top of that, I believe The Globe and Mail had an article recently on a new study that compares public and private pension systems in 11 countries. It has placed Canada fourth in the world. We're behind Netherlands, Australia, and Sweden. If you consider the size of those countries and the pressures we have on our country, I think we're doing very well—not that we can't get a little better.

Finally, I want to tell you about this. I don't know whether Canadians are aware of it, but governments are on the hook for private pensions. To that effect, there was $11 billion that went to the Detroit Three. The majority of that—I don't know if you're aware of this—which I think was $8 billion, the GM portion, went for legacy funds. That's pension and health care.

I'd better add one other thing. I'm sure you're aware that the last quarter returns for CPP were 0.5%.

Do you have any actuaries working in your organization, and are they focusing on future pension drawers? Could you straighten that out for me?

[Susan Eng]

We don't have actuaries.

I think your focus, if I understand your question, is whether or not they're worried about the future for other retirees being able to get public pensions. Is that the essence of the question?