Evidence of meeting #56 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was benefit.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Pat Trask  President, Saskatchewan Seniors Association Inc.
Monique Moreau  Director of National Affairs, Canadian Federation of Independent Business
Hassan Yussuff  President, Canadian Labour Congress
Francine Lévesque  Vice-President, Confédération des syndicats nationaux
Mark Janson  Senior Pensions Officer, National Office, Canadian Union of Public Employees
Nathalie Joncas  Actuary, Confédération des syndicats nationaux
Chris Roberts  National Director, Social and Economic Policy, Canadian Labour Congress

4:35 p.m.

Liberal

The Chair Liberal Wayne Easter

I'll have to cut you there, Dan.

4:35 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Could I get an extra minute and a half?

4:35 p.m.

Liberal

The Chair Liberal Wayne Easter

You had an extra minute and a half. Can you imagine?

4:35 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Thank you. You're tough and fair.

4:35 p.m.

Liberal

The Chair Liberal Wayne Easter

Mr. Ouellette, five minutes is what we'll start with.

November 15th, 2016 / 4:35 p.m.

Liberal

Robert-Falcon Ouellette Liberal Winnipeg Centre, MB

Thank you, Chair.

Thank you very much, everyone, for coming here today.

I wonder what our lives would be like if the Canada pension plan didn't exist today, what Canadians would do, and what levels of poverty we would experience. When I teach classes at the University of Manitoba and the University of Winnipeg on this and we discuss pension plans, I note that senior poverty was epidemic in our society.

We might be like Mexico or something like that. I don't think that's something that we want in our society.

My first question is to Monique Moreau. I'm wondering how many of your members from the Canadian Federation of Independent Business have defined benefit pension plans or any form of pension plan that they offer to their employees?

4:35 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

I can certainly come back to the committee with a bit more research. I know that we offer group RSPs that tend to be quite popular and other savings mechanisms through employee bonuses or additional income at the end of the year. I'd have to do a bit more research. That's not a piece that we necessarily have research on.

4:35 p.m.

Liberal

Robert-Falcon Ouellette Liberal Winnipeg Centre, MB

Thank you very much.

I was also looking at some of the stats you provided. You offer that Canadians prefer TFSAs and RRSPs over a bigger CPP, going by the number of responses that favour tax-free savings accounts, RRSPs, personal savings, and other investments, Canada pension plan, voluntary retirement savings plans, or none of the above.

One of the things we don't ask is whether people want to see their companies forced to provide a defined benefit plan and every company forced to offer a pension plan. What we've seen in the course of a number of years is that in 2014 only 38.1% of all employees actually had a registered pension plan in this country.

Unfortunately, if the private sector is unable to cover that or to look for ways to ensure that people retire in a good way so that our seniors don't continue to live in poverty, then I think it falls on the government to ensure the public good. I've seen the stats and I just don't think.... Perhaps they can be onerous, but compared with such other jurisdictions as Singapore, it's only 12.5% and moving up somewhat. I don't think the rates are onerous compared with those in other OECD countries.

Could you comment, from your experience in other jurisdictions around the world, on how competitive we might be?

4:40 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

I'm not as informed as you are about other areas of the world and the depth of their pension programs. I know, as I explained earlier, that for our members $11,000 for the average business is quite a bit of money. I know it doesn't sound like a lot, but if your margins are 3% or 4%—which many of our grocery stores, hotel operators, or you name it have at the end of the year—and you need to cough up an extra thousand dollars per employee on average, that's not money that comes from thin air. The business owner has to come up with it.

4:40 p.m.

Liberal

Robert-Falcon Ouellette Liberal Winnipeg Centre, MB

But the interesting thing about it is that if you're a supermarket, you're competing only against other supermarkets, or if you're a convenience store, you're competing only against other convenience stores. It's right across the country in those examples.

I see it as a level playing field, but I also see that there's a long-term benefit to society. Seniors, when they have income to spend, will spend that income. They're so near the poverty line anyway, and it's not like they're going to be saving for 40 years—well, perhaps they might be. When you're 65 years old, it's very unlikely you'll make 105 but it could happen. I hope it happens.

I wanted to ask Chris Roberts about the pension plans for the federal civil service. Generally, when people retire from the federal civil service they've been paying in for a contribution, defined benefits, and then when they hit 65 they see their pension rolled back according to the amount they received from CPP. I was wondering if you had any talks or any discussions about that with the federal government, or if it's part of any negotiations.

4:40 p.m.

Chris Roberts National Director, Social and Economic Policy, Canadian Labour Congress

Thanks for the question.

Yes, indeed, most defined benefit plans are integrated with the CPP. That means the benefit, the workplace pension benefit, is adjusted to take into account the CPP. It's the same with the contribution rate.

There's nothing in Bill C-26 that tells workplace plans how they're going to accommodate the gradual phased-in increase in contributions and the higher CPP benefit. That's up to the bargaining agents and the employers in a unionized situation, or the trustees where there's joint-only trustee plans. It's really up to the plans and the stakeholders involved to decide how they want to adjust to that higher benefit and the higher contribution rate.

There's a gradual phase in, so there's lots of time for plans to adjust. It's true, we do have to do a lot of education with members about it.

4:40 p.m.

Liberal

Robert-Falcon Ouellette Liberal Winnipeg Centre, MB

Should we adjust, though? That's my question.

For instance, I find now that a lot of civil servants or anyone who gets a defined benefit plan often start their careers later than might normally have happened. In the military, where I worked for over 20 years, people would join at 19. Now I see people who are in their late forties joining the Canadian Armed Forces. They don't have the same time to accumulate the same type of pension, yet they still see the same amount of rollback.

4:40 p.m.

National Director, Social and Economic Policy, Canadian Labour Congress

Chris Roberts

You're absolutely correct.

There are a lot of, predominantly women, public sector or third-sector workers who have nominally defined benefit plans, but the pension benefit is very low. They need a bump in their retirement incomes, and the CPP will provide that. They may decide they want the increased CPP benefits stacked on top of their existing workplace plan benefit. That's entirely legitimate, but it's their decision.

4:40 p.m.

Liberal

Robert-Falcon Ouellette Liberal Winnipeg Centre, MB

Thank you very much.

I just want to say I'm very happy to be wearing purple today for violence against women.

4:40 p.m.

Liberal

The Chair Liberal Wayne Easter

We thank you for that. Many people are, which is a good sign.

Mr. Aboultaif, you have five minutes.

4:40 p.m.

Conservative

Ziad Aboultaif Conservative Edmonton Manning, AB

Thank you very much.

I have a few questions.

Mr. Yussuff, have you, yourself, been a business owner? Have you owned a business before?

4:40 p.m.

President, Canadian Labour Congress

4:40 p.m.

Conservative

Ziad Aboultaif Conservative Edmonton Manning, AB

I'll turn to CFIB. In terms of the benefits on the payroll, what do we call those?

4:40 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

I'm sorry....

4:40 p.m.

Conservative

Ziad Aboultaif Conservative Edmonton Manning, AB

The benefits on a company's payroll, are these taxes or not?

4:40 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

To a business owner, if you have to pay it and you don't have a choice, it's usually a tax.

4:40 p.m.

Conservative

Ziad Aboultaif Conservative Edmonton Manning, AB

Exactly. I've seen some of these charts and some of these results....

I was a small business owner before. Actually, I'm still a small business owner.

The problem is that these taxes, which will be going for years, are going to be affecting businesses. When the dollar moves in the economy from place to place, that's going to add taxes across the board. The tax is going to be moving from place to place. We're not talking only about 1% or a small percentage; we're talking about a huge number. If we were to calculate.... Just a simple calculation—and you probably can help me out on this—how many full-time employees do we have in Canada? Do you have any idea?

4:45 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

I don't know the answer to that.

4:45 p.m.

Conservative

Ziad Aboultaif Conservative Edmonton Manning, AB

Can we suggest 14 million?

4:45 p.m.

Director of National Affairs, Canadian Federation of Independent Business

Monique Moreau

I don't know.