Citizenship and Immigration Committee on Oct. 31st, 2024

[The Chair, Liberal, Sukh Dhaliwal]

I call the meeting to order.

Welcome to meeting number 113 of the House of Commons Standing Committee on Citizenship and Immigration. We are meeting in public.

Pursuant to Standing Order 108(2) and the motions adopted by the committee on February 12, May 1 and June 12, 2024, the committee is resuming its study of pension transferability and access to the mandatory provident fund, and delays in permanent residence and visas for Hong Kongers.

I would like to remind participants of the following points. Please wait until I recognize you by name before speaking. All comments should be addressed through the chair. Whether participating in person or by Zoom, please raise your hand if you wish to speak. The clerk and I will manage the speaking order as best we can.

Today's meeting is taking place in a hybrid format. In accordance with the committee's routine motion concerning connection tests for witnesses, I am informing the committee that all witnesses have completed the required connection tests in advance of the meeting.

I have to get a couple of things done before I welcome the guests. There is a budget issue and some administrative matters before we begin. We have prepared a supplementary draft budget regarding the study of pension transferability and access to the mandatory provident fund and delays in permanent residence and visas for Hong Kongers, in the amount of $1,000, in order to cover the two extra meetings.

Is there a motion to adopt this budget, Mr. Redekopp or Mr. El-Khoury?

[An hon. member]

I so move.

[The Chair, Liberal, Sukh Dhaliwal]

Is everyone in favour?

(Motion agreed to)

Before I welcome the witnesses, I would like to welcome Mr. Chandra Arya, MP.

Mr. Arya, welcome to the committee.

On behalf of committee members, I would now like to welcome our witnesses for today's meeting.

From Sun Life Financial Services of Canada, we have Ms. Laura Hewitt, senior vice-president and head of global government affairs and public policy. She is with us by video conference. From Manufacturers Life Insurance Company, we have Ms. Maryscott Greenwood, global head of government relations. She is also with us by video conference.

Up to five minutes will be given for opening remarks, after which we will proceed with the rounds of questions.

Now, I'm going to welcome Laura and Maryscott.

Who would like to go first?

[Laura Hewitt, Senior Vice-President and Head, Global Government Affairs and Public Policy, Sun Life Financial Services of Canada Inc.]

I'm happy to go. Thank you, Mr. Chair.

[The Chair, Liberal, Sukh Dhaliwal]

Okay. Go ahead for five minutes, please.

[Laura Hewitt]

I am pleased to be back before the committee to answer any additional questions that members may have about Sun Life's role as an MPF trustee in the early MPF withdrawal application process.

As a reminder, the Hong Kong mandatory provident fund system is a retirement savings program intended to support those over the age of 65 with financial security in their later years. This system is similar to various mandatory retirement programs around the world. This means that money is released to the participants at retirement age, or, in rare circumstances, when someone meets the criteria for early unlocking. Those criteria are set by the relevant regulator and can include permanent departure or terminal illness.

I want to begin by again reassuring the committee that Sun Life does not decline applications for early withdrawal of MPF funds from Canadian permanent residents or Canadian citizens who have permanently left Hong Kong. This is true regardless of what passport they used to enter Canada before receiving their permanent residency or Canadian citizenship status.

As I will outline in my remarks, Sun Life has accepted 97.5% of all applications we received for early MPF withdrawal due to permanent departure between January 2021 and March 2024.

I would like to clearly outline the data points that I provided both during my previous testimony and also in writing to the committee in June 2024.

Between January 2021 and March 2024, Sun Life received a total of 14,590 applications from clients wishing to withdraw their MPF funds due to permanent departure from Hong Kong. Of these applications, a total of 14,238 were approved by both Sun Life and the Hong Kong regulator, the MPFA. The remaining 352 applications were declined either by Sun Life due to errors on applications or the applicant not meeting the criteria, or by the Hong Kong regulator due to the applicant having previously received a payout under the early departure process, making them ineligible to access funds through this stream again.

Allow me to break this down further. Of the 352 declined applications, 180 were declined by Sun Life due to errors on forms or clients not meeting the withdrawal criteria. This type of review process is part of normal due diligence procedures in all markets in which we operate to ensure program integrity. The remaining 172 applications were approved by Sun Life but declined by the regulator.

I would also like to stress that Sun Life must abide by the rules and regulations of every jurisdiction in which we operate. With regard to the criteria for early withdrawal due to permanent departure, those rules are set by the Hong Kong regulator, the MPFA. With respect to the steps required to obtain permanent residency in Canada and how long processing that permanent residency status takes, that is the purview of Immigration, Refugees and Citizenship Canada.

At Sun Life, our purpose is to help our clients achieve lifetime financial security and live healthier lives. In any jurisdiction where we operate, whether in Canada, in the United States or in Hong Kong, Sun Life has focused on meeting the needs of our clients. Each market and each client has distinct needs, and we tailor our approach to best support them. We also ensure that we are compliant with the specific laws and regulations of each of those markets, which enables us to serve our clients to the best of our ability. These principles are true for Hong Kong and for early MPF withdrawal requests by clients who have permanently left Hong Kong.

Maintaining the trust that our clients have in us in overseeing some of their most important financial savings is of vital importance to us. We continue to be committed to working with our clients during the application process, ensuring that any errors on applications are quickly addressed and providing guidance to them in reapplying when appropriate. We have resources available to all of our clients wishing to withdraw their MPF funds due to early departure publicly available on our website, including a direct line to contact our dedicated Sun Life MPF experts.

Thank you again for inviting me here today. I look forward to answering your questions.

[The Chair, Liberal, Sukh Dhaliwal]

Thank you, Ms. Hewitt. That was perfect timing: four minutes and 22 seconds.

Now we will go to Ms. Greenwood for five minutes.

Please, go ahead.

[Maryscott Greenwood, Global Head, Government Relations, The Manufacturers Life Insurance Company]

Good morning.

It is good to see you again and an honour, as always, to appear before this parliamentary committee. I appreciate having another opportunity to discuss Manulife's pension business, and I'll be happy to try to answer any questions you may have.

Manulife has been a proudly Canadian company since its founding 137 years ago. Today we provide financial services to 35 million customers around the world, including seven million Canadians. At Manulife, we are proud of our Canadian heritage. We also support and encourage Canada's ongoing presence in the Indo-Pacific, an important region with the largest population in the world, one where Manulife has had a presence for 125 years.

The international success of Canada's financial services sector injects billions of dollars into the Canadian economy and powers tens of thousands of high-quality Canadian jobs. Financial services are among the country's most important exports, growing at an average of 7.4% a year over the last five years, according to the Conference Board of Canada.

Manulife has been providing financial services in Hong Kong since 1898. We currently have more than 2.5 million customers and approximately 2,500 employees there.

Almost all pension systems, including those in Canada and the United States, put restrictions in place to prevent individuals from accessing their pension savings before reaching retirement age. In Canada and elsewhere, these restrictions exist to ensure that the funds saved for retirement are available during retirement. The pension system in Hong Kong is known as the mandatory provident fund, or MPF. Currently, there are 12 MPF trustees, including Manulife, who offer MPF plans to about 4.7 million members through approximately 360,000 participating employers.

The pension laws in Hong Kong enacted in 1995 allow for pensions to be withdrawn prior to the age of 65 only in specific circumstances, including early retirement after the age of 60, permanent departure from Hong Kong, total incapacity, terminal illness, small balance or death.

These restrictions are very similar to the provincial laws that exist in Canada. In Canada, however, if someone wishes to make an early withdrawal from their pension on departure grounds, they must prove that they have been gone for at least two years, and there is a tax penalty imposed by Canada for doing so. This is not a requirement for those entering Canada from Hong Kong. Those who can provide proof of permanent residence in Canada can access their pension immediately, provided they meet the remaining eligibility criteria.

It is also important to remember that when somebody is deemed ineligible for early withdrawal, their pension funds remain in place and available upon retirement.

We have updated our available data since the last time we met with this committee. From January 2021 to the end of September 2024, Manulife received 5,720 requests from customers requesting that their pension funds be unlocked for reasons of permanent departure from Hong Kong to Canada. Manulife was able to process applications on the grounds of permanent departure for 4,533 applicants who moved to Canada. We were unable to process applications from 1,087 customers for a variety of reasons, including lack of sufficient documentation, forms that were filled out incorrectly or information indicating that the applicant had already unlocked an MPF pension before.

In offering life insurance and pension products, Manulife makes a long-term commitment to our customers for their financial security. We abide by our contracts in accordance with relevant laws. Our commitments span decades, and our responsibility to honour our obligations to our customers has been at the core of our business for 137 years. We are proud that 35 million customers around the world have chosen Manulife to help them save for retirement and to protect their families with life and health insurance.

Thank you very much. I would be happy to try to answer your questions.

[The Chair, Liberal, Sukh Dhaliwal]

Thank you, Ms. Greenwood. I don't know. You and Ms. Hewitt must have worked together: That was four minutes and 21 seconds, so it's perfect timing.

Before I give witnesses an opportunity to answer questions, if you think the witnesses are going too long with their answer, instead of just going back and forth, please raise your hand, and I will stop the clock. Also, before you start questioning, if you can mention who the question is going to, that will also be appreciated.

With that in mind, we can start with Mr. McLean for six minutes.

Please go ahead.

[Greg McLean, Conservative, Calgary Centre, AB]

Thank you, Mr. Chair.

Thank you to the witnesses for the depth of information you have provided us here today and for the meetings you've had with us to try to sort this out.

I know there's a lot of data that goes into this. Please recognize that we're trying to do our best to serve Hong Kongers who have come to Canada, some of whom are telling us directly that they cannot access their funds that are part of their pension funds that they put into the mandatory provident fund. The survey many of them participated in indicated that, sometimes, 80% were having trouble, because they were being blocked from getting that pension. I really appreciate the significant data you put on the table here about how many you actually process and the ones that are held up.

As some of my colleagues would say.... Sun Life and Ms. Hewitt, thank you for the detail you gave us as well, but even if four are left behind, we'd still like those four sorted out at the end of the day.

In that respect, Ms. Greenwood, you have in your letter 861 who were not processed due to ineligibility or insufficient documentation, which is significantly higher than the numbers provided to us by your competitor Sun Life. Can you tell us about the ineligibility we're talking about? Is that as a result of the BNO passport, or is it something you're going to be able to overcome for 861 applicants?

[Maryscott Greenwood]

Thank you for the question. I'll try to give you some detailed numbers to see if they help answer the question that was asked.

From 2021 through to the end of September 2024, we received 5,720 requests for early withdrawal, as I mentioned, and we were able to process 4,533. Let me break that down for you.

Approximately 80% of the early withdrawal applications were processed. Five per cent of applicants did not provide sufficient evidence of the right to permanently reside in Canada. That's 291 people. Overall, of the ones we were not able to process, 942 provided incomplete claim documents, 214 applied with a study visa, 77 tried to use the BNO designation to establish Canadian residency—the Government of Canada, as you know, doesn't automatically give residency based on the BNO designation—30 applicants had missing or unmatched signatures and 136 were not processed for other reasons, including previous early withdrawal, which kicks you out of the system, if you will.

[Greg McLean, Conservative, Calgary Centre, AB]

Thank you very much for that detail.

If you could, please provide in writing to us that detail about why those were rejected.

[Maryscott Greenwood]

Sure.

[Greg McLean, Conservative, Calgary Centre, AB]

We'd really appreciate that for the committee's report here, Ms. Greenwood.

I'm going to turn over the rest of my time to my colleague Mr. Kmiec.

Thank you very much.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

I don't have a specific person to ask this of, so either one of you can jump in.

There are, by my count—and other groups have said this—60,000 Hong Kongers who have come to Canada under our different pathway schemes. About 10,000 of them have been approved for permanent residency, which leaves about 50,000 in between who are going to be seeking residence in Canada on a more permanent basis. Adding up your numbers, this still leaves tens of thousands of people who could be applying to your companies and other companies that are also MPF providers to get their funds out.

I'm going to ask you this. There were two IRCC officials who came to this committee and blamed other departments for some of the problems associated with figuring out how to get the BNO passport entry off the PR cards. One IRCC official told us it was Transport Canada. Another one told us it was ICAO. Both of those organizations have responded to us. ICAO said it's up to the countries. It has nothing to do with ICAO. Canada is a sovereign state. It can decide how it assigns the codes and it's entirely up to Canada. That was in an email from the legal affairs and external relations bureau. Transport Canada said it's entirely within IRCC's remit. It decides what appears on the PR cards, the residency cards, and the codes under IRCC's internal guidelines.

Do you have any concern, as companies, that there seems to be either chaos or confusion in these government departments about who's responsible for what?

[Maryscott Greenwood]

I'm happy to try to answer.

[The Chair, Liberal, Sukh Dhaliwal]

Sure. Please go ahead, Ms. Greenwood.

[Maryscott Greenwood]

Thank you.

If it helps and if this gives clarity, the BNO designation, GBN or any of that is not a reason that we would decline to have an early unlock for someone's pension. The reason we unlock a pension is if they can establish permanent residency. If there's a Canadian PR card that has a BNO, that wouldn't be a reason that we declined.

I'm not sure if that's helpful.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

It's not, actually, because in the case of Manulife.... All of your companies, of course, will say yes and they can pass it on to the Hong Kong administration, which can say no based on what appears in the application.

However, aren't you in any way worried that among two government departments and one international organization, there's confusion within the departments on what should appear on the PR card, which is the underlying issue for why the Hong Kong administration can pick and choose if it wants to deny a Hong Konger in Canada whom they recognize as having come in on a BNO passport?

Do you have any concerns about this confusion?

[The Chair, Liberal, Sukh Dhaliwal]

The time is up.

Ms. Greenwood, please give a brief answer.

[Maryscott Greenwood]

My understanding is that the only up or down vote, if you will, that the Hong Kong authority has on whether to approve an early unlock is whether or not the applicant has applied previously, because you can only unlock it once in your life.

Other than that, the criteria for establishing whether or not you can unlock it have to do with establishing permanent residency. The BNO card, in and of itself, doesn't establish permanent residency in Canada as of today.

[The Chair, Liberal, Sukh Dhaliwal]

Thank you.

That was six minutes and 41 seconds.

We will go to the next person. It will be MP Kayabaga for six minutes.

Please, go ahead.

[Arielle Kayabaga, Liberal, London West, ON]

Thank you, Chair.

I would like to thank our witnesses for being here today.

I do apologize that I'm speaking a little low today. My headphones are not very comfortable right now, so I'll do my best to get through this.

I'm going to start with my first question.

You talked about the data on the approval and rejection rates for application of Hong Kongers who are holding BNO passports. Could you give us a number of how many have Canadian PR or citizenship?

[Maryscott Greenwood]

I need to check the numbers. We were able to process 4,533 applicants of the 5,720 who applied. We were able to process that number. They would have met the criteria.

That's from the period of 2021 through last month.

[Arielle Kayabaga, Liberal, London West, ON]

How does this data align with the claim that 97.5% of applications have been approved?