Finance Committee on Sept. 9th, 2016

[The Chair, Liberal, Wayne Easter]

I call the meeting to order.

We're here, pursuant to Standing Order 106(4), for a meeting requested by four members of the committee to discuss a request to undertake a study on the Canada pension plan agreement—at least, that's how I read it.

On September 4 there was a letter directed to the clerk of the committee by Ms. Raitt, Mr. McColeman, Mr. Liepert, and Mr. Caron, so we will turn to one of those four.

Go ahead, Mr. McColeman.

[Phil McColeman, Conservative, Brantford—Brant, ON]

Thank you, Chair.

First of all, it's good to see that everybody is in good heath coming back to the committee on this wonderful summer day.

As Her Majesty's Loyal Opposition, we're extremely concerned about the lack of information, the lack of analysis, and the lack of consultation—it has not happened, as far as we know, or we haven't been told of it if it has happened—regarding the changes to the CPP.

It was announced that an agreement in principle came into existence between the finance minister and his provincial colleagues. That's about all we've heard. We've heard that there was an urgency to get something done. We don't know if we're going to see legislation in the fall or if it will be a Governor in Council order outside of Parliament that will do this. There's just a lack of knowledge around this issue, and it's a huge concern.

We've had economic round tables through the summer, in particular with businesses, which are extremely tentative and extremely nervous about the effects these increases could have on them, particularly in the case of small businesses.

From our reading of the situation, there's been no meaningful consultation that we're aware of with organizations such as the Canadian Federation of Independent Business, which represents tens of thousands of businesses in this country, and there's been no consultation, as far as we know—at least, they tell us there hasn't been—with the Canadian Chamber of Commerce, which represents all varieties of businesses in this country. As far as we know at this point, not having been party to any information, we don't know if there's been any meaningful consultation with the public generally and with workers on how their pay will be affected if these changes come into effect.

We realize that the government made this commitment during the election campaign. We acknowledge that, but we think this is the public venue where we let Canadians know how this is going to affect not only them personally but the economy in general and the fiscal policy of the government, and how it intertwines in our system of economics across this country. This is what the finance critic and I heard in our round tables across the country when we were engaging with people.

I will lead off, Chair, with a motion. I'll read the motion:

That the Standing Committee on Finance invite the Honourable Bill Morneau to appear before the committee to answer questions about the Government's June 20, 2016 agreement with the provinces to expand the Canada Pension Plan.

I have copies of the motion. I can pass them out. I can give them to the clerk.

[The Chair, Liberal, Wayne Easter]

Are you going to speak to that motion now?

[Phil McColeman, Conservative, Brantford—Brant, ON]

I'll speak to that motion now.

I'm not sure all committee members are aware that in a lead-up to this meeting, we wrote a letter to the finance minister 15 days ago. It was a letter directed to him, specifically informing him that we were concerned about this issue and about a lack of information, and that we had the concerns I brought up previously. We asked him to consider coming to this meeting, not specifically on this date but on a date that was convenient to him. We gave him 15 days' notice that we were intending to call this meeting today, as the four members have. We asked him to indicate dates that might suit him, and we had no response.

I'll also say that having no response from the minister, we determined that this was such an important issue that we initiated the process for using Standing Order 206(4).

[The Chair, Liberal, Wayne Easter]

It's 106(4).

[Phil McColeman, Conservative, Brantford—Brant, ON]

That's how it came about.

We are saying in this motion that we would like the minister to be here. We think he's the appropriate person to speak to this issue, because he's the lead on it. We would like to have him here at the committee. Frankly, we would have liked to have him today or on a day that he indicated, but we didn't get that.

[The Chair, Liberal, Wayne Easter]

Okay.

I have on my list Ms. Raitt and then Mr. Sorbara.

Go ahead, Ms. Raitt.

[Lisa Raitt, Conservative, Milton, ON]

Thank you very much, Mr. Chair.

I echo the concern my colleague well expressed.

Mr. Chair, we rose on June 17 of this year, and on June 20 the minister made the announcement of changes to the Canada Pension Plan. I am concerned and I'd like to get some answers from the minister on some specific issues, one of them being how that process actually dovetails with the formal legal process that comes under the Canada Pension Plan legislation. Have government officials been instructed to just not abide by what the legislation says?

I prepared to ask officials questions today, and I was hoping they would be here. I don't know if the minister actually knows the answers, because they are technical questions, but I would have appreciated if the officials had shown up. They know we've had these questions for a long time.

Mr. Chair, there's supposed to be a review every three years. Indeed the annual report, which was signed by the Minister of Finance, notes that there is a triennial review, and it's on the basis of this triennial review that changes are made to the CPP. Now, this may seem to be a little bit technical and in the weeds, but I think it's really pertinent to the issue at hand: why the rush?

The only testimony we have on record so far on the CPP comes from Jack Mintz, who appeared on Thursday, June 16, before the Senate Standing Committee on National Finance. He gave evidence, and he was asked, because it was fresh, what he thought about the CPP expansion. His initial advice and evidence led with the following quote: “The question is, what's the problem?”

Mr. Mintz went on to talk about the fact that he has studied this issue in the past. McKinsey has studied it. The truth is that 83% of Canadians are actually doing fine and are in a financially sustainable program of support for retirement.

One of the questions I'd like to ask officials, and what I'd like to ask of the minister when he appears, is that while there may be gaps in CPP—and I recognize that there are gaps that need to be addressed—why did they not go down the road of figuring out how to help those in pain, such as single senior women who end up losing a significant amount of money—$10,000—when their partner passes away? To me, that seems to be something we should fix and we could fix, but it is not fixed by what the minister is proposing to do.

Another aspect I would like to understand, Mr. Chair, as my colleague mentioned, is exactly what process we will be going into. Will we have until October 1, as noted in the legislation? Will a Governor in Council regulation be passed before October 1 so that this measure can be implemented? I'd like to know the answer to that as well, and we're running out of time. That's why we gave two weeks' notice for the minister.

Mr. Chair, I was asked a question by a reporter outside, who said that the minister indicated that he didn't know about the meeting today. I would suspect that you informed the office of the Minister of Finance regarding the request that he appear today. His office is saying that when they get the official paper, they will make sure to make him available. We could have missed that step in the middle. We could have had him here today, and that's why we're moving the motion to bring him in as soon as possible.

I will close, Mr. Chair, with this. The other aspect of the testimony Jack Mintz gave on that day in June was around the question “Why now, and why the rush?” I think that's an important question for Canadians: What is the motivation? He believes that right now there is a movement afoot to try to kill off the Ontario Retirement Pension Plan, otherwise known in Ontario as the ORPP, for a lot of reasons. He says that “It is a terrible idea, the ORPP, one of the biggest mistakes I've seen in public policy in years. There's now an attempt to try to get a CPP expansion to try to kill off the ORPP.”

Well, Mr. Chair, Ontario, although my home province, is only 38% of the country. There's another 62% that should not have a CPP change that has not been described to the public. The cost-benefit analysis has not been given to parliamentarians. The time frames and the understanding of who benefits are cloudy at best. Two polling institutions have indicated that there's a lack of understanding and much confusion about what the benefits are and what the costs are. Indeed, one of the most telling polls recently indicated that a full 25% of Canadians think it's the government that's putting more money into the pension, which we all know is not the case.

For clarity, for having different stakeholders come in to talk about the effect this change would have on the economy today, for understanding from the actuary what the plan is to shoehorn this separate, ad hoc process into legislation that must be abided by, and finally, for the minister to tell us what his true motivation is for these changes are the reasons I support the motion put forth by my colleague.

[The Chair, Liberal, Wayne Easter]

Thank you, Ms. Raitt.

Mr. Sorbara is next.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Good afternoon, everyone. Echoing Phil's comments, it's great to see everybody here again.

I'd like to offer what I would call a friendly amendment to the motion Mr. McColeman brought forward. It would be that the Minister of Finance and officials from the Department of Finance be invited to testify before the finance committee on September 19, 2016, from 12:00 to 1:00, and that the subcommittee schedule a further meeting to hear from stakeholders.”

[The Chair, Liberal, Wayne Easter]

Okay, do you want to read that again so that everybody is clear about what it says? I know that it's an amendment, so it probably isn't typed out.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

It reads, “That the Minister of Finance and officials from the Department of Finance be invited to testify before the finance committee on September 19, 2016, from 12 p.m. to 1 p.m., and that the subcommittee schedule a further meeting to hear from stakeholders.”

[The Chair, Liberal, Wayne Easter]

The amendment has been moved. It's in order, as I see it.

Is there debate on the amendment—sorry, Mr. Duvall; I had you on my list.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Thank you.

I appreciate everybody being here today and giving your valuable time.

We support the main motion. I'll talk about the amendment in a minute.

On the main motion, I think it's crucial that we have up-to-date information about what was agreed to with the provinces. We certainly are very happy with this positive step forward on the CPP expansion, but there are a lot of unknowns out there, and people are very concerned. I think openness and transparency are very important.

I understand the amendment, as I was just saying, but my concern would be whether 12:00 to 1:00 is sufficient time. I think there are a lot of questions about what actually happened and I don't think one hour is going to be adequate.

I'll leave that question to you, Mr. Chair, and maybe they can answer.

[The Chair, Liberal, Wayne Easter]

Mr. Sorbara, do you want to answer that? Then we'll turn to Mr. MacKinnon.

Do you have an answer?

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

On the allocation of time, I think 12:00 to 1:00 for the Minister of Finance, with associated department officials, is plenty. I think the subcommittee can sit down to review the stakeholders and to allocate more time for stakeholders.

[The Chair, Liberal, Wayne Easter]

Just so I'm clear, we would have the minister and officials for an hour on September 19. That will give us an outline of where the government is at. Then the subcommittee would meet to see whether other witnesses were required and when we could have them appear.

I think people have to understand as well that we are in pre-budget consultations and that we will be pretty busy from September 20 to October 31. The suggestion in the amendment is that the subcommittee would meet and determine what other witnesses we would invite as well.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

We could, for the second hour, have the department officials remain to answer further questions.

[The Chair, Liberal, Wayne Easter]

We'll go to Mr. MacKinnon, then to Mr. McColeman, and then to Mr. Duvall.

[Steven MacKinnon, Liberal, Gatineau, QC]

Thank you, Mr. Chair.

Like my colleagues, I am very happy to see you.

Mr. Duvall, welcome to the Standing Committee on Finance.

I think we have to put things in context before we vote. I sense a consensus around the table.

I know that our government is very proud of what has been accomplished in seemingly record time by our Minister of Finance and his provincial counterparts. Nine provinces out of ten signing on to a major expansion in retirement benefits is an important and meaningful step for Canadians, and one that I think has been done prudently. As all of you know, despite claims of lack of information, it will be phased in over a seven-year period beginning in approximately three years and it will represent a meaningful change in the quality of life of Canadian retirees for as far as the eye can see, so I know we'll be very proud to hear the details of this arrangement from the finance minister on September 19.

The other important thing, because I know all of us as parliamentarians take our responsibilities very seriously, will take place this autumn.

This fall, we will hear from the Minister of Finance and his officials, and probably from experts such as the Chief Actuary of Canada and the parliamentary budget officer. We will also possibly hear from other witnesses. We have already invited the representatives of the Canada Pension Plan Investment Board. We will do a very comprehensive review of this arrangement.

To answer the questions asked by my colleague Ms. Raitt, I want to point out that a bill will be drafted to implement this arrangement, and our committee will study the bill. So the Parliament of Canada will have its say. A full debate will be held on the changes the Minister of Finance will propose on September 19.

We are addressing this issue with a great deal of confidence. We are very pleased with the fact that an election promise will be kept. Once again, we will be able to tell Canadians that we are delivering on our commitments and that we will make a positive change to the quality of life of the middle class and of all Canadians.

Thank you, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. MacKinnon.

Mr. Aboultaif is next.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Thank you very much.

Welcome back, everyone, to the game here.

The point is that one hour, as the motion proposes, is not enough time for questioning the minister and the officials together. I think that will be nothing but a complete waste of time. We definitely need more time to be able to discuss the details, since no details at all were released. There has just been big talk about how Canadians are going to feel better going forward, especially the retirees and the people who need the money most, while we know behind the scenes that this is not something that anyone is going to be benefiting from anytime soon. This is a very long-term thing, and God knows who, years down the road, will come back and say to Canadians, “We're sorry. We taxed you all the way on this, and right now we don't know how much you're going to benefit from it.”

It's a very dangerous route we're going down. A lot of people see it as just another tax hike, and that's something we have to be careful about. We're all responsible here for moving forward on any policies that are going to hit Canadians in the pocketbooks, given the hardships we're going through right now with the economic downturn we have been facing.

I believe that one hour is not enough. Actually, even two hours is too short a time. I would like to see us have more time to question the Minister of Finance and his officials.

[The Chair, Liberal, Wayne Easter]

Mr. Duvall is next, and then Ms. Raitt.

[Scott Duvall, NDP, Hamilton Mountain, ON]

As I said before, our position is that this is a very good step, but more work needs to be done. I don't want to keep repeating myself, but maybe we could have some extra time with the officials after the minister is here, since we understand about his time.

My other question is on the definition of a stakeholder.

[The Chair, Liberal, Wayne Easter]

Go ahead, Mr. McColeman.