Evidence of meeting #24 for Human Resources, Skills and Social Development and the Status of Persons with Disabilities in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was money.
A recording is available from Parliament.
9:45 a.m.
Liberal
9:45 a.m.
As an Individual
That depends on the government and how long they give you. My first disability tax credit was good for 15 years. When I requalified, it was good only for three.
9:45 a.m.
Liberal
9:45 a.m.
Liberal
Filomena Tassi Liberal Hamilton West—Ancaster—Dundas, ON
What input would you give with respect to that, to help improve that experience for people with disabilities, particularly in mental health? What advice could you give us as a committee that would help improve that for people going through that experience?
9:45 a.m.
As an Individual
With mental health especially, for certain mental health disorders that are not going to get better and that you are going to have all your life—you are not going back to work—in those situations, I think the disability tax credit should become permanent without requalification.
There are other mental health situations that can change and get better. For those, I completely understand that the situation can change and there needs to be requalification. They need to go back five or ten years to look at things and see how the situation has changed regarding the disability. But there are other situations where things aren't going to change, and I think that makes a big difference.
9:45 a.m.
Liberal
Filomena Tassi Liberal Hamilton West—Ancaster—Dundas, ON
[Technical difficulty--Editor] the cost of those requalification assessments can go over $1,000. Have you ever heard that?
9:45 a.m.
Liberal
Filomena Tassi Liberal Hamilton West—Ancaster—Dundas, ON
Okay.
When we talk about people living in poverty in Canada, would you define it differently for those who live with a disability?
9:50 a.m.
As an Individual
For people living with a disability, everything is more difficult. There are struggles that anybody living in poverty faces, but it takes that much longer to do anything and there is that much more stigma. You are stigmatized not only for being in poverty but also for the disability you have—especially with mental health, because it is an invisible disability, and the stigma is that much worse.
Unless you've experienced it, it's hard to describe what it's like. Just listening to people here, there are some wonderful ideas, but it really doesn't sound like the people on the panel really understand what it's like to live in poverty, where your income is $10,000 a year or less. To me, that's what living in poverty is like and what struggling in Canada is like.
As a person in poverty, you are not worried about trying to open a TFSA but about whether you are going to be able to buy milk that week, or whether you're going to be able to take the bus because it's raining.
9:50 a.m.
Liberal
Filomena Tassi Liberal Hamilton West—Ancaster—Dundas, ON
Yes, and you know what? That's why your testimony is so important. Thank you very much.
9:50 a.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
Thank you to all our witnesses today. I have a couple of comments and a few questions.
Ms. Morris, I have two parents who are seniors. I have a dad who is 82 and a mom who is 72, and I am concerned about their incomes. They do all right, but my dad, at 82, still works; he is a carpenter still to this day. You said something about doubling the CPP. The current contribution—well, the most current I have is from 2012—is $127 billion per year. When you say to double the CPP contributions, what you are actually proposing, if you average about 20 million taxpayers, is an average of $6,350 increase per taxpayer per year.
It was just mentioned that we don't seem to understand what poverty is. I am concerned about Joe and Jane Taxpayer, who are already close to the line right now and who might be buying Kraft Dinner for the last week before their paycheque. How can they afford another $6,350 per year?
9:50 a.m.
Chief Operating Officer, Vice-President of Advocacy, Canadian Association of Retired Persons
Thank you for the question.
We have repeatedly polled many of our members to ask them about their retirement efforts, and over and over, if there's one story we hear, it's that they wish they had saved more. They wish they had been pushed into saving more. There is a wonderful book called Nudge, about how we can encourage people to do things—
9:50 a.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
That's fine. I think you're asking a particular group of people, though, if you look at the middle-income wage earners, the people who are eating Kraft Dinner...which is a dollar a box, if you've ever bought it. How is that person going to afford...? If you want to double that for a working family, you're talking about mom and dad with about $13,000 before taxes per year. It's impossible.
Brad, I want to talk about the CPP. We call it a small-business tax, and we have the other side saying it's not a tax. Essentially, it is like a tax. It's the Joe and Jane Taxpayer types of small businesses that have to bear this and still be competitive in the market, still make jobs from their hairdressing business, coffee shop, or whatever; and we're constantly asking them to give more.
From your perspective, what is the CPP business tax rate per person going to be, the actual number? We've heard it's more.
9:50 a.m.
Registered Financial Planner, Brad Brain Financial Planning Inc., As an Individual
With the expansion to the larger CPP....?
Maybe I can answer this way. When I first heard the proposal that the Canada Pension Plan was to increase in size, my first thought wasn't as a financial planner but rather as a small-business owner. I have a couple of staff, and it just got more expensive for me to have these people as employees.
Your last question, Bob, was very interesting, when you asked about CPP in terms of your own family's situation. The expansion of the CPP won't help your family. It's one of the things I think people need to be clear on here. Larger CPP is not going to do anything for current seniors. If a person is 50 or older, they're not going to see their benefits change. We're scheduled to have CPP premiums increase, and I believe it's starting in 2019 and will be fully implemented approximately by 2025, but the benefits aren't going to be seen in any meaningful way for decades to come. The current seniors aren't going to get a benefit from this; it's the millennials.
On the point about people not saving enough, without a doubt that's a true statement. The other point, though, is that if people are so inclined to save at the moment, they can. If people want to save for the future they can put money into their RRSP or TFSA, or pay down debt. They can do things with their money. But the increase in the Canada Pension Plan will force people to reduce their take-home income now to save for a future benefit.
To my mind, we do a pretty good job in Canada of providing for seniors as a whole, when you look at the Canada Pension Plan, old age security, guaranteed income supplement, and our health care system. It's not as if we're running in second place. If you look at the international studies, we are doing all right.
9:50 a.m.
Conservative
Bob Zimmer Conservative Prince George—Peace River—Northern Rockies, BC
I have another question for you, Brad, and we haven't even started talking about a new carbon tax thrown into the mix, which will add another $1,000 to $2,500 per family on top of things.
There's an answer here that none of us are talking about. The reason I'm such a promoter of the development of our natural resources is this. As we hear from Aaron, we're getting down to a ratio of 3:10 in terms of working people versus those who are going to need services. The obvious answer to me is that we need to be developing some way to pay for all of this. We're with CARP; we're with all these particular plans; we want to see our seniors taken care of. But at the end of the day, that tax-paying family, that middle-income family, has to pay the bill.
Brad, you had some comments that you wanted to change the clawbacks to the GIS. Can you speak to that quickly?
9:55 a.m.
Registered Financial Planner, Brad Brain Financial Planning Inc., As an Individual
With the Canada Pension Plan, the problem is that it doesn't directly target low-income seniors. The guaranteed income supplement is the program we have now that's targeting low-income seniors. The problem is that it's clawed back, as somebody mentioned, at a 50% rate that starts really early. Anything above $3,500, you start losing your GIS. That's a real conundrum for somebody of modest means. If they go and maybe take on a little part-time work or maybe they get a bit of investment income coming in, they're looking at reducing their government benefits.
The way I look at the guaranteed income supplement is that this is the benefit that brings people “up” to the poverty line. These are exactly the types of people I think you guys would be focused on. What we have is a situation right now where the benefit is quickly clawed back and eliminated at a fairly low hurdle rate. If what we want to do is specifically target seniors poverty, then some ideas would be maybe to have the clawback start a little later, so, let's just say, for the sake of discussion, at $5,000 rather than $3,500. Maybe they don't get eliminated completely at such a low rate, so perhaps rather than $17,000 maybe a person could make $20,000 before they lose their benefit completely. Perhaps it doesn't get clawed back at a 50% rate. Right now, if you make two dollars, you lose one dollar in benefits. Maybe a person could address that.
9:55 a.m.
Liberal
9:55 a.m.
Liberal
Wayne Long Liberal Saint John—Rothesay, NB
Thank you, Mr. Chair.
Thanks again to our presenters for coming in and presenting today.
Mr. Wudrick, thanks again for a good presentation. I did have some questions for you about innovation and poverty reduction. From your federation, can you give me some innovative ways the Canadian Taxpayers Federation would solve or combat poverty and lead the way in poverty reduction?
9:55 a.m.
Federal Director, Canadian Taxpayers Federation
Sure. I think, as with most debates, it comes down to a question of whether government policy can drive it or whether it's.... A lot of our advocacy is focused on leaving money in the pockets of Canadians and letting other forces do the job. Now, some people say that's sort of doing nothing. I think one thing that's important for government to remember, and it's been highlighted by this debate over CPP, is that it can be a blunt instrument, and you can have very unfortunate unintended consequences. If you are targeting help at a group that everyone agrees needs help, for example low-income seniors, asking a question about whether CPP is the right vehicle to do that doesn't mean we don't care about low-income seniors; it just means maybe there is a better mechanism to deal with it.
For example, when Mr. Brain talks about GIS, I think that is a good example of something that would be better suited to the objective here, which is to help seniors who are at risk of poverty or in poverty.
