Mr. Chair, I'd like to speak to clause 15, which deals with exception from attribution rules.
This issue, Mr. Chair, is important. Subsection 75(3) of the act exempts a number of trusts from the attribution rule in subsection 75(2) under which any income or loss from trust property held by certain reversionary trusts can be attributed for tax purposes to the persons from whom the property was received.
Mr. Chair, paragraph 75(3)(a) exempts certain trusts governed by plans such as registered pension plans, registered retirement savings plans, and employee benefit plans. This amendment will come into force with the Pooled Registered Pension Plans Act, and again, Mr. Chair, the C.D. Howe Institute's report referred to this in saying that that pooled registered pension plans do not really address some of the challenges.
For instance, the C.D. Howe Institute said that “While the federal government presents PRPPs as a way to ‘bridge existing gaps’ in Canada’s retirement-saving system, they have received a tepid response from many pension experts and commentators.”
Now again, these are pension experts who are looking at it from the perspective of all Canadians and the future of their retirement security. It's important that we differentiate advice we get from tax planners, who are very important professionals and do good work in Canada, from people who are experts in the public policy of pension design. We've listened to people who, directly or indirectly, actually benefit from these new plans and assume that what they said applies to all Canadians. The truth is, it doesn't. As the C.D. Howe Institute says, the PRPPs cannot require mandatory participation and therefore will have very little advantage compared to a group RRSP.
Again, the C.D. Howe Institute has compared the PRPPs to a group RRSP and said that there is very little advantage in a PRPP as compared to a group RRSP. Secondly, the C.D. Howe Institute has identified that unlike employer-sponsored defined benefit pension plans and the Canada and Quebec pension plans, a PRPP represents another savings vehicle that “will not guarantee any particular pension”.
That brings us to the whole issue of defined benefit pension plans, such as the CPP, for example. I acknowledge that there has been a movement away from defined benefit plans, and there have been significant challenges around the prudential strength of many defined benefit plans, but there's a real advantage to defined benefit plans, particularly as people near their retirement and the global capital markets face a downturn. Even though the returns garnered on someone's investment into a defined benefit plan potentially may be lower, the risk is lower as well.
For Canadians, one of the advantages of the CPP as it is now, and as it could be with a voluntary supplemental CPP option, is another option—a defined benefit plan, one that would insulate Canadians against the vagaries of market fluctuations, particularly as Canadians get close to their retirement.
Mr. Chair, we can't expect, even with your initiative and that of others on financial literacy, to turn all Canadian workers and future retirees into Warren Buffetts overnight. In the interim, I have great faith in the Canada Pension Plan and a defined benefit option.
MPs are one of the groups in society with defined benefit options. I can't for the life of me understand why we wouldn't do more to help more Canadians have access to a greater level of participation and investment in individual voluntary supplemental CPP defined benefit options.