Thank you, Mr. Chair.
I will speak in French today. I will try to speak slowly to allow the translation to be effective.
Thank you very much, Mr. Chair, and dear members of this committee.
First, I'd like to highlight the fact that the Quebec Employers Council represents more than 70,000 employers who have activities in Quebec, most of whom also have Canada-wide work implications.
We are very pleased to take part in the work of this committee.
I will not discuss the elements of the bill, since you know them well.
First and foremost, I want to say that Quebec employers support the fact that you are attempting to improve the lot of their fellow citizens regarding retirement plans. They are of course concerned about the impact this could have on their businesses and their production costs, but they are very open to an update of the various retirement plans, such as the Canada Pension Plan.
We would nevertheless like to go over certain fundamental principles and make a few remarks about the Canada Pension Plan and its Quebec counterpart, the Quebec Pension Plan.
Even though it is important to encourage people to save for retirement, a universal solution does not meet the needs, and on the contrary could have a negative impact on economic activity, employment and salaries.
First of all, the need for savings is not generalized, as demonstrated by analyses made by several institutions. Certain groups of workers or citizens have more problems in this regard than others. So targeted measures are necessary in order to improve the financial health of individuals.
In fact, the improvements proposed in the bill recognize, to some extent, that the problem is not generalized, since it does propose relatively targeted solutions, but in our opinion they are not targeted enough.
We would like to talk about the government's decision to take low-income workers into account. The government wants to improve the federal working income tax benefit, which is a refundable tax credit for low-income workers, so as to diminish the impact of the increase in contributions to the Canada Pension Plan for those workers.
All of the people we consulted felt that this is a complex solution. It does not have the merit of being as clear as exempting or excluding low-income workers who could be targeted in this very simple way. Rather than creating a refundable tax credit mechanism, you could, for example, set a percentage of the maximum allowable earnings, and state that anyone having a salary under that threshold would be excluded. This would simplify things for those people, and target that group better.
In fact, this concerns the Government of Quebec, as it intends to propose alternate solutions in that area. If the provinces and the federal government could agree on this, all of the provinces would probably agree to take part in the same type of project.
For workers with higher incomes, you should opt for other solutions to encourage them to save more using the various tools that exist.
Additional payroll charges could reduce the capacity of individuals and businesses to keep the economy turning, and could lead to a decrease in salaries and the number of jobs, which is not the objective being sought here.
We must nevertheless admit that the increases proposed in the bill, and the way in which they are staggered over time, takes into account enterprises' capacity to pay. And so we want to emphasize that the bill shows good intentions. The eventual shock is taken into account, but it is a fact that there is an impact when a premium must be paid. In fact, the figures that circulated in Quebec confirmed that the amount individuals and businesses would have to pay could amount to more than $3 billion, which could not be allocated to expenditures.
This money would be invested either by those who invest pension plan funds, or by the people who will receive the benefits. However, we know that it will take between 20 and 30 years before this money begins to circulate in the economy. In short, there will be impacts and we have to point that out. That is what we wanted to say today, while however acknowledging the fact that employers are not opposed to certain improvements.
Also, new mandatory retirement contributions may simply substitute public savings for private savings. That should not be the objective. I invite you to consult the reports of certain experts on this. That is what I did. They have some very clear graphs that show that after a certain number of years, the amounts that would accumulate in this new fund would even surpass the amounts accumulated in the current plan, the Canada Pension Plan.
The removal of what we would normally find in private industry is significant, and the concentration of savings entrusted to the state, regarding its management, is even greater.
Another...