Finance Committee on June 8th, 2026

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

If I extrapolate from what you're saying, it's an acknowledgement that, yes, these factors do in fact influence the overall sustainability of the CPP fund.

[Kent MacDonald, Liberal, Cardigan, PE]

He's saying that an analysis was already done.

Sooner or later, he will clue in.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

Okay, thank you for that. The question is, are those factors relevant?

I'm going down a road. I'm sorry. I didn't mean for Mr. MacDonald to cut you off there, sir. Please continue.

[Galen Countryman]

I believe those factors are referenced in the chief actuary's 32nd report.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

Why are they included in that report?

[Galen Countryman]

It's because they are factors that influence the financing of the plan.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

I'll bring it back to the reports to Parliament we have here.

I'm speaking about the amendment as it relates to the subamendment. The amendment is talking about the Minister of Finance's preparing a report. Now, the Minister of Finance has access to information beyond what the chief actuary does.

Is that correct?

[Galen Countryman]

I'm not aware of that.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

What I'm saying is that the Minister of Finance is fundamentally serving a different function and role than the chief actuary is. Certainly, what the chief actuary is bringing forward and putting in the report has to be highly germane.

Look at the scenarios in the subamendment. The scenarios in the stress test that the subamendment is seeking to put in place—“immigration levels are lower than expected, productivity and wage growth are lower than expected, life expectancy is higher than expected or Canada experiences a prolonged economic downturn”.... How far out does the report forecast these things, as it is now?

[Galen Countryman]

The chief actuary's reports go out 75 years. They're for a 75-year period.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

There was a movie many years ago called The Butterfly Effect. It talked about the consequences that can flow from something seemingly small. I look at that in this context. We have the existence of black swan events. We have the possibility that many of these factors together could coalesce and do this, or any one of them.

How many scenarios in the existing report is the chief actuary able to envision? It's not just about any one of these as individual.... You also have to look at the overlap between a lot of these things.

[Galen Countryman]

There is a wide array of assumptions and stress tests in the uncertainties appendix in the chief actuary's report.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

I appreciate that. I want to be very respectful of the role you're serving on the committee, Mr. Countryman. It's not your job to weigh in on the politics of this.

I'm having some trouble understanding—if we already have an implicit appreciation of the value of this information—why we would not want it in the report that we believe, if CPC-13 is passed, will be submitted to Parliament by the Minister of Finance.

If any of my colleagues have questions about the subamendment or the factors in it, I would love to delve into some of the problems here, if we get an opportunity. I think some of these are within the purview of the committee—ensuring that we don't have the worst-case scenario with this. In the meantime, I'm happy to leave my comments there.

Thank you.

[The Chair, Liberal, Karina Gould]

Thank you, Mr. Lawton.

Mr. Kelly is next.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

Thank you, Madam Chair.

It's good to be back at the finance committee.

Mr. Lawton made an excellent case for this amendment. Part of why it is important to include stress test scenarios is that we can have better transparency and Canadians can have better confidence in the reports that government tables.

We recently have seen the stress tests that were conducted by the Parliamentary Budget Officer on the most recent spring economic update. The stress tests there revealed that the finance minister had a less than 1% chance of holding to the fiscal anchor that he had declared in his statement only a few.... Well, the new anchor was first tabled in the fall budget, reiterated in the spring economic statement and, only weeks later, debunked by the Parliamentary Budget Officer. That's why these stress test scenarios are important: Many scenarios could significantly affect the state of the Canada pension plan.

The items we've listed here are some very clear ones, such as immigration levels, which will immediately affect contribution levels; productivity and wage growth, which could have an extraordinary impact on the viability of the plan over the long term; and especially life expectancy, which is going to affect the future liability, the payout of the plan.

Any combination of these scenarios could have a dramatic effect on the plan. We have seen that the minister, who is ultimately responsible, has really had his credibility severely challenged by the Parliamentary Budget Officer and their stress tests. When he spoke about fiscal anchors, the anchors that he talked about just do not stand up to the multitude of different combinations of events that were contemplated by the Parliamentary Budget Officer. Likewise, when it comes to the Canada pension plan, Canadians may well have the same concern. They want to know that the plan's viability stands up to all the different combinations of events.

The combinations of events would be far beyond these that are identified in the subamendment. The subamendment identifies just a few things, but there are many different factors, and it's in the combination of them that it gets very complicated to accurately balance and manage the risks of such a large plan. When not just Canadians but officers of Parliament are questioning the credibility of the finance minister, that just creates more need and a greater imperative for greater transparency around any of the reports and any of the data and risk that the finance minister has an obligation to Canadians to manage on their behalf.

I fully support this subamendment and the main amendment as well. I see that overnight we have not seen...it doesn't appear that there is any further indication from the government that they will support the amendment itself, and we hope this subamendment might allow them to consider the merits of greater transparency, better reporting, better data for policy-makers and better data so that Canadians can have confidence in their institutions.

I saw that Mr. Lawrence had his hand up. I don't want to delay him in weighing in on this. I'll leave my comments at that. I'm not sure if anybody else was in the speaking order before him, but if not, I'll defer to Mr. Lawrence.

[The Chair, Liberal, Karina Gould]

Thank you.

Mr. Jackson and Mr. Lawton are before him.

[Pat Kelly, Conservative, Calgary Crowfoot, AB]

Go right ahead.

[The Chair, Liberal, Karina Gould]

Mr. Jackson, please go ahead.

[Grant Jackson, Conservative, Brandon—Souris, MB]

Thank you, Chair.

I'll endeavour to keep my comments brief. I know that Mr. Lawrence is eager to make an intervention on this point, but I want to thank Mr. Lawton for moving this amendment. It quite accurately captures the suggestions or challenges with the lack of stress testing, as currently proposed, that I was elaborating on earlier. I just want to thank Mr. Lawton for encapsulating that in this excellent subamendment.

I'll respond a little to what we're hearing government members heckling about—that this stress testing already exists in another form. I mentioned that in my initial comments. The chief actuary regularly performs sensitivity analysis in broader CPP reports, but this supplement contains little discussion of downside cases. If you're only stress testing and not talking about those cases when you're publishing a report and having it tabled in Parliament, it defeats the purpose of doing the stress testing in the first place.

Our argument is to include that in the amendment, which, to remind them, would require, if passed, new reporting requirements under the act. We acknowledge that when we drafted CPC-13, we missed a few provisions to include stress testing in that amendment. Therefore, we are subamending that on to the provision, requiring these additional reports now. This would more accurately respond to Canadians' concerns and give the government an easier time of explaining to Canadians just how secure their CPP truly is.

I think that's an important provision to include. I'm looking forward to the government's supporting both the subamendment and the amendment to ensure greater transparency. It will include these provisions, which I think will give Canadians the surety they need.

With that, Madam Chair, I'll defer to my other colleagues, who I know are eager to make further interventions.

[The Chair, Liberal, Karina Gould]

We have Mr. Lawton.

[Andrew Lawton, Conservative, Elgin—St. Thomas—London South, ON]

Even I am ahead of Mr. Lawrence.

I'm sorry, Philip.

When we were dealing with this matter previously, our witness had talked about the appendix in the chief actuary officer's report that has an aspect of what we're getting at here. I want to explain why I believe our subamendment would go further.

Also, I would reiterate the point that the amendment itself is referring to a separate reporting requirement. This is referring to a report that must be prepared by the Minister of Finance on the projected impacts of the amendment on the Canada pension plan that's contained in this. We're not actually seeking an opportunity for the Minister to download these responsibilities onto the chief actuary. We're trying to ensure that we have a specific targeted measure here.

On the stress test aspects specifically in my subamendment to CPC-13, I think it's important to explain what the existing reporting data are doing.

Appendix B mentions data, assumptions and methodology. What the report says is:

This section describes the data, assumptions, and methodology that underlie the financial projections in the Results sections of this report.

Future cash flows for the base and additional Plans are projected over a long period of time, i.e. over more than 75 years, and depend on assumptions such as those regarding fertility, mortality, migration, labour force participation, job creation, unemployment, inflation, employment earnings, and investment returns. These assumptions form the basis for the projections of future income and expenditures of both components of the CPP.

To return to our subamendment, we're looking at some very similar core information, such as immigration levels, investment returns, productivity, wage growth, life expectancy and the existence of a prolonged economic downturn. The thing is, we're not making assumptions. We're actually saying the opposite. We need to have a range built in. There's a bit of that, but not to the degree we're pushing for.

The chief actuary even makes this concession in the report:

Although the demographic, economic, and investment assumptions represent the Chief Actuary's best estimates, the resulting future financial states of the base and additional CPP presented in this report should be interpreted with caution. This information is not intended to be predictions, but rather projections of the future financial states of the base and additional CPP.

We all understand, and I would believe even my Liberal colleagues would concede—I certainly hope they would—that the future revenues and expenditures of the CPP depend on a range of economic factors. We need to look at what the Canadian economy is going through and what the global economy is going through.

We understand that one change to one policy at the federal level can have long-ranging implications for other things. Antidevelopment laws from the Liberals affect investment in our energy sector in the long term, down the road. The proliferation and expansion of the temporary foreign worker program over the last 10 years affects youth unemployment, driving it up to nearly 15%.

They're just a couple of the myriad examples of how it isn't even just things that we are passengers on, as a country. Policy decisions made by this government will have effects. When we look at a report that goes out 75 years, as Mr. Countryman said, that's 75 years. That is many governments. That is many policy decisions along the way. Each one is pulling and pushing levers, irrespective of the externalities of it, that are going to have significant implications for this.

I don't see in the report an accounting for the range of options that could really establish the crux of what we're trying to do in our subamendment here. Even the actuarial report.... It's appendix B for those wanting to follow along. I don't have the French version, but it is published, as it should be, in both official languages. People can find that published on the government website, if they so desire.

It says:

Furthermore, the projected continued aging of the population in the future, albeit at a slower pace than observed in the past, combined with the continued retirement of the baby boom generation will certainly create significant social and economic changes. It is possible that the evolution of the working-age population, especially the active population, will be quite different from what has been historically observed and what has been assumed for the purpose of this report.

The chief actuary is doing their best with the information available. Even there, though, what the report is telling us is that we've had to make an assumption. We don't know.

We don't know what's going to happen. Why do we not have a report that accounts for all of these different possibilities, a report that allows for the best-case scenarios and the worst-case scenarios?

Interestingly enough, this is something, just on a smaller scale, that has been heaped on Canadians who are trying to buy a house. You can't even get approved for a mortgage unless you have been approved with a stress test, understanding that driving up interest rates in the future, which may or may not happen, is affecting your potential in the here and now to get a home.

If we're expecting young first-time homebuyers trying to get a foothold in life to deal with a stress test for a report that is affecting the retirement income of the entirety of the country, really, why are we not including that same level of scrutiny in accounting for the best-case scenarios and the worst-case scenarios?

There is an assumption being made that could be wrong. It could be. If the Liberals were the ones making these predictions, I think most of them would probably be wrong, but here we are now, and we have to account for the best-case scenarios and the worst-case scenarios.

I'm grateful that the office of the chief actuary is monitoring the current trends, the emerging trends. They adjust assumptions as needed, but they're still just assumptions. I think it would be better to have—ideally in plain language, but we'll take anything we can get in this report—the best-case scenarios and worst-case scenarios that account for all of these points of divergence that we can't really effectively predict even five years out, let alone 75 years out.

When you look at some of these assumptions here, the demographic assumptions, they look at the historical and projected populations of Canada, less Quebec. This is required—

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

I have a point of order.

[The Chair, Liberal, Karina Gould]

Go ahead, Mr. Lavoie.

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

With all due respect to my colleague, he's been talking about scenarios for a while now. He keeps talking about scenarios. He was told not to repeat himself, so I'd like to know whether the rule still applies. Can he keep saying the same thing about the scenarios?

[The Chair, Liberal, Karina Gould]

Thank you, Mr. Lavoie.

I'd like to remind Mr. Lawton once again not to be repetitive, and if he has additional arguments, to make them instead of repeating the same ones.