Debates of Nov. 22nd, 1994

Supply

[Jim Silye, Reform, Calgary Centre, AB]

Mary, the election is in three years, so check that poll later.

[Mary Clancy, Liberal, Halifax, NS]

Exactly, the election is in three years. How grateful I am to the hon. member for Calgary Centre for bringing that up. There are all kinds of promises in the red book that will be fulfilled over the life of the mandate, including this one. I want the hon. members opposite to be calm, to not worry, to be happy-

[Jim Silye, Reform, Calgary Centre, AB]

Why was the Prime Minister in a hurry a year ago and now he is not in a hurry? Why the change? That is what is hurting. That is the perception that is wrong.

[Mary Clancy, Liberal, Halifax, NS]

Did he say which day? He did not say which day. The day will come and it will be a day that the Lord hath made and He can be happy and rejoice therein.

[Stephen Harper, Reform, Calgary West, AB]

Madam Speaker, I remind the hon. member that I knew of a party once that used to brag about its high standings in the polls. We all know where it is today. That may be interesting information but in and of itself will not get anybody re-elected.

The hon. member spent a considerable part of her speech defending what she perceived to be a personal attack on the member for Glengarry-Prescott-Russell. As I heard the speech from the member for Kootenay West-Revelstoke he was really quarrelling with some very specific things that the member for Glengarry-Prescott-Russell had said.

The most ridiculous thing he said was that it could be demonstrated that a private kind of RRSP purchase would be less generous to him than the current MP pension-

[Deborah Grey, Reform, Beaver River, AB]

More.

[Stephen Harper, Reform, Calgary West, AB]

Sorry, if it was more generous, he would resign.

He actually suggested it would be more expensive if the public put us on RRSPs in a 1:1 matching arrangement. We know the current plan is a 6:1 matching arrangement. With all her rhetorical eloquence, is the hon. member seriously suggesting that she can make the number six less than a one?

[Mary Clancy, Liberal, Halifax, NS]

Madam Speaker, there is a long time theory about women and their inability with mathematics. I can assure the hon. member that mathematically I am challenged.

I neither heard the speech of the hon. member for Glengarry-Prescott-Russell-

[Deborah Grey, Reform, Beaver River, AB]

I am too, but I can figure out 6:1.

[Mary Clancy, Liberal, Halifax, NS]

I am sure the hon. member for Beaver River probably can do that. As a teacher she is trained to do it. As the hon. member so kindly put it I am trained in rhetorical eloquence. I will keep to my job.

I did not hear the speech of the hon. member for Glengarry-Prescott-Russell. I did hear the comments of the hon. member for Kootenay West-Revelstoke. As I made very clear, I was making a statement about the contribution as a member of Parliament of the hon. member for Glengarry-Prescott-Russell of his years both provincially and federally and the fact that he deserved to be heard without his motives being questioned, pure and simple.

[The Acting Speaker (Mrs. Maheu)]

I wish to inform the House that pursuant to Standing Order 33(2) because of the ministerial statement, Government Orders will be extended by seven minutes.

[François Langlois, Bloc, Bellechasse, QC]

Madam Speaker, the motion before the House today reads as follows:

That this House urge the government to replace the current Members of Parliament Retirement Allowance plan with a pension plan that reflects the current norms for private sector pensions, with a maximum contribution in accordance with the Income Tax Act.

Its wording is extremely vague, when it refers to current norms for private sector pensions. Which private sector pensions? Are we talking about the pension plan for executives at General Motors or Chrysler Canada, or about the pension plans of employees of small businesses in East Montreal? The standards are not at all the same. The wording of the motion is definitely unsatisfactory, and if the wording is unsatisfactory, we can assume that the substance is as well and that the motion leaves much to be desired, as it will in the course of this debate, especially in terms of what is said by the motion's sponsors.

We in the Official Opposition feel that the pension plan for members of Parliament cannot be dissociated from the issue of members' salaries or the entire budget envelope that is allocated to members.

If members were paid $200,000 annually, as they are in the United States, it would be obvious that a pension plan if any, should be very modest in scale. However, when a member's salary is quite low, as may be the case today, it makes sense to have a more substantial pension plan. The two go together. We cannot separate these issues like the compartments they have in submarines to keep them from sinking.

I think it is just petty politics to take an issue that is already controversial and say: "Look at those people in the House of Commons. They are overpaid, they have too many benefits and privileges, they have a shoe shine service, they have people to cut their hair-" and other people to split hairs. I think we have to take a far more comprehensive view, and that is the approach we support.

We can afford to be very detached about this issue, Madam Speaker, especially considering the role of the Official Opposition in this House and its life expectancy, in the light of its political views. So we have a certain perspective that others may not have, in the circumstances. Of course, members should be treated in a way that is commensurate with their responsibilities. To claim, which is petty politics in my book, that members of Parliament are overpaid and make such a pronouncement out of the blue, based on nothing, further erodes the role of MPs in our society.

There was no shortage of occasions in the past for demeaning the role of parliamentarians, a role which is often not obvious. Very few care about the number of hours MPs dedicate to their work, seven days a week. You know, Madam Speaker, 75, 80 and 90-hour weeks are not uncommon for MPs, but who is counting? So, the entire system, both the pay plan and retirement plan, should be reviewed.

We must also be able to attract quality candidates for the position of member of Parliament. My colleague from Glengarry-Prescott-Russell referred to the 1830, 1832 legislation which was in fact designed to allow any citizen, from the richest to the ones from the humblest origins, to have a chance of becoming a parliamentarian. It is not with this kind of abrupt rollback of benefits that we are going to be able to set the course and stay on course, one which is increasingly difficult to maintain.

One has to realize that, normally, MPs are elected to the House of Commons at the peak, so to speak, of their working life, when they are the most productive, building a career, whatever their line of work is. So, at the end of their mandate or mandates in the House, MPs very often find themselves in a vulnerable situation, especially since, as we know, the turnover rate among members of the House of Commons of Canada is one of the highest in Western Parliaments.

Unlike in the United States, where members of Congress serve some 20 years on average, Canadian members of Parliament serve between five and seven years on average, which is an extremely short time. We know what happens to members after they retire or fail to get re-elected, how difficult it is for them to find new jobs, for all kinds of reasons I will not get into at this time. But this is a reality members from all political parties must face. That is why we must make it a little easier for members

who retire of their own free will or who are forced to retire because voters have decided it is time for them to do so.

Because of their precarious position, members of Parliament must be given sufficient financial resources to get back on their feet after retirement or electoral defeat. There is however one thing on which the Official Opposition has always been clear, that is, when a member of the House of Commons has the right to collect a pension from the Government of Canada. We do not find it normal for a person who is barely 30 but who has completed two mandates to be able to collect a pension from the Canadian government immediately.

In our opinion, we should discuss the age at which former members of the House of Commons should be able to collect this pension, by comparing apples with apples. Let us look at how things are done at the RCMP and in the Canadian Forces. This could help us in trying to determine the age at which former members of the House of Commons should be able to collect their pensions.

Of course, we are also opposed to double dipping, that is, getting two cheques from the Canadian government. We think that this practice should be abolished. For someone who is already receiving a pension or an allowance because of their past services to the Canadian government to be allowed to continue to collect these cheques while sitting in the House of Commons is not normal either, in our opinion.

We do not intend to compromise on the age at which one may collect a pension or on what is commonly called double dipping.

To consider the issue of pensions, we must look at reality. Many members of this House or of previous Parliaments had a job in which they contributed to a pension fund in the company where they worked. When they came to the House of Commons, they contributed to its pension plan and stopped contributing to their other plan. Often, a member who leaves this House finds that he has contributed for a very short time to a private pension plan, so he will have to continue working for quite a while. He will be penalized because the pension fund is not transferable. We should look into this issue.

I do not think that we can solve these problems with an opposition motion. We will have to wait for a government bill to frame the issue so that we can really debate it.

We now have a five-line motion. I think that a fleshed-out bill should have quite a few more provisions and that a non-partisan review should lead to the government presenting a bill, as the Prime Minister said a few days ago.

Finally, we said that we could consider the government bill very calmly, but surely not in the heat of a debate that stirs passionate feelings against members of Parliament, in which people are led to believe that MPs are literally sucking the teat of state. The whole benefit package of members of the House of Commons, particularly their pension plan, must be the subject of a government bill that is considered as neutrally and objectively as possible, certainly not in the heat of passion and especially not one from people who told us at the beginning of the session that they would cut back their salary, or at least part of it, that they would give back 10 per cent of it and then said that they had made a mistake. "I have unemployed people at home and I cannot afford to set aside 10 per cent." Such an issue so easily inflames public opinion that perhaps we should avoid doing it.

For the reasons which I mentioned, the Official Opposition will vote against the motion before us today.

[Art Eggleton, Liberal, President of the Treasury Board and Minister responsible for Infrastructure]

Madam Speaker, today's motion by the Reform Party is premature. The government is committed to honouring the red book commitments with respect to ending double dipping and with respect to dealing with the question of minimum age. Reform of the pensions is clearly a matter of interest.

[François Langlois, Bloc, Bellechasse, QC]

Point of order, Madam Speaker. I would like to know if the hon. member is speaking in the period for questions and comments or if he is opening the debate on the issue.

[The Acting Speaker (Mrs. Ur)]

The hon. minister is on debate.

[Art Eggleton, Liberal, York Centre, ON]

Madam Speaker, the government is committed to the reforms that were outlined in the red book with respect to pensions.

The member for Beaver River, a member of the Reform Party, the third party, is very premature and is wasting her time in presenting today's motion. It has been clearly said previously by the Prime Minister, the Deputy Prime Minister and myself that a presentation will be made to the House before the end of this year with respect to the government's plans regarding the matter of pensions.

One of the hon. member's colleagues mentioned that the Prime Minister had said in the days when he was in opposition that he could bring in the pension reforms in one day. He did not necessarily say it was going to be day one and it does not need to be day one of this Parliament. It does not need to be done with the kind of urgency the hon. member for Beaver River suggests it should be.

As has been stated time and time again in today's debate nobody is retiring between now and the end of this Parliament. Indeed, there are a lot of things on the government plate that relate to reforms in many areas that relate to the whole budget process. Those matters have a great deal more urgency than this matter.

Notwithstanding that, I understand how Canadians feel about the pensions and the need for reform. We have said that within just a little over one year of having taken office we will bring in a reform of MP pensions that is based on the red book commitments.

The red book commitments are to end double dipping. Those members of Parliament who cease to be members of Parliament would not be able to collect both their pension and another full time salary in government service. Whether they were employed in the government service or receive a governor in council appointment, they would not be able to be in full time occupation receiving a full time salary with the crown at the same time as collecting the pension.

That was amply demonstrated today. The bill is not yet before the House and of course it is not yet in effect. Nevertheless, the Prime Minister announced today that the designate for Governor General is a former member of this House and a member of the other house. He will be forgoing his pension while receiving the salary for being the Governor General of Canada. It is a voluntary compliance and the Governor General designate should be commended very much.

Once the law is brought into effect it will prevent those who do retire from this House or the other place from being able to pick up a salary as well as their pension scheme. That is certainly one of the very clear red book commitments. I again say that the government is committed to bringing in legislation and bringing it in early to end double dipping.

With respect to minimum age, again the red book talked about the concern that some members retire from this House at a very early age and collect a full pension. Some members collect it in their 40s, far earlier than the normal retirement age of Canadians. They collect it as an amount of money that would be supplementary to other remuneration they might receive in their new pursuits. It becomes part of a larger income that they then enjoy.

Canadians generally do not enjoy that kind of pension arrangement. A great many people have expressed their opposition and concern about it to me. This government again is clearly committed to dealing with a minimum age with respect to the pension payout for former members of this House. It is a red book commitment and something we will be dealing with very shortly. I reiterate there will be a statement before this House before the end of the year.

There is another thing which was not in the red book but has been added to this consideration. It responds to something the third party members raised earlier in the term. It is with respect to wanting to opt out of or not be included in the pension arrangements, whatever they may be. They want to have the opportunity not to participate.

Although that has not been an option up until now, the Prime Minister clearly stated before this House that members of Parliament would be given that option. Members of Parliament will have the opportunity to opt in to the pension plan in a timely fashion. If as the hon. member for Beaver River and her colleagues have been saying for some time that they do not want to do so, then they are free to not opt in to the plan. Members of Parliament can make their own decisions individually as to whether or not they want to participate in the plan.

A lot of members of Parliament give up some of their best earning years to serve the public. The pension plan for them is some further protection. It is one I know that will be given serious consideration by each and every member of Parliament.

I am sure even members of the third party will give it individual consideration. After all, they seem to be weakening in their resolve with respect to reducing their own salary. They are beginning to understand that they need that kind of money because of the hours they put in serving their constituents. They have to maintain residences both here and in their constituencies and they understand the cost of living and having to do that. They are weakening in their resolve with respect to this matter.

I suspect we might see some change of heart when it comes right down to having to make that momentous decision of whether you opt in to the plan and participate or whether you are completely out and completely unprotected.

I would not say completely unprotected because there are some colleagues of the hon. member for Beaver River who are in that double dipping category who have had previous experience in other houses and legislatures who collect money in addition to the money they gain from this House.

They know what double dipping is over there. I think they understand how difficult it is to give up remuneration. They will also find that they will have to give very serious consideration for their own protection, the protection of their families in the future with respect to the matter of pensions. Opting in becomes another feature.

There have been some suggestions and there are suggestions in this motion today, although I agree with my colleague, the hon. member for Bellechasse, that it is kind of vague. It is ambiguous and awkward in terms of its wording and it is

premature. They are wasting their time debating this today when the matter is coming before Parliament shortly anyway.

They are suggesting in the motion in their vague way that there should be some other changes to the plan. There was as study commissioned by the previous government by the consulting firm of Sobeco, Ernst & Young with respect to remuneration for members of Parliament. That in turn, when it was completed this spring, was turned over to a commission of this Parliament, the Lapointe commission as it is known. It deliberated on it as well.

Through the hon. Speaker the matter was tabled here in the House in July. That report talked about some other changes in the pension plan, suggesting there be some modifications to the accrual benefit package and a number of other aspects of it. It said quite clearly that members of Parliament were undervalued by many in terms of the work they do and in terms of the remuneration they should appropriately receive.

It did say that while there should be some reduction in the total benefit package for the pension, there should be an increase in the remuneration for members of Parliament and that overall it should wash. It should come out as an even package, up on the salary and somewhat down on some of the other provisions, including the pension benefits.

This Parliament has determined there will be no salary increases, not only for members of Parliament, but for the public service, because we are in a time of restraint. We are in a time when getting our fiscal House in order is of the highest priority, a time when we must get the deficit and the debt down. Therefore we cannot afford to give salary increases to anybody in the government system including, having to set an example, the members of this House and the members of the other place.

If there is no increase in the salary then it can well be argued how do we take a decrease in the other parts of the compensation program. We would violate the principle of the Lapointe commission and the Sobeco, Ernst & Young study, which was to maintain the level of compensation but make adjustments internally. Obviously we are not in a position where we can do that. When that day does arrive we can again look at that package of suggestions as to adjustments that might be appropriate.

The final point I want to make is in relation to the vesting period, because much has been made by the third party on the vesting period. Yesterday six years arrived for 52 members of this House with respect to qualifying for their pensions. I want to point out very clearly that vesting does mean that as of now they are being paid out. Vesting means qualification to be paid out, but they are not going to be paid out. They are members of this Parliament. Nobody is planning on resigning or retiring. They will be here for another four years before the hon. member for Beaver River would have to really worry about their collecting that pension.

Yesterday was the qualifying period for them. It is a six-year qualifying period. That is not an unreasonable length of time as a qualifying period for a pension plan. For average Canadians it is frequently less than that. It can sometimes be two years or three years to actually qualify for the pension. When it is paid out is another matter. To qualify in this particular case takes some six years to do. There is nothing magical about yesterday. It was not an occasion that should require this kind of debate today.

There is a qualifying period that has now been met by another 52 members of this House. With respect to the matters of how the pension is paid out and when it is paid out, those are all matters that are still under consideration and are not in any way prejudiced by what happened yesterday. Not one iota has anything changed by what happened yesterday.

That is something you do not seem to understand and you are certainly misunderstanding this. It does not help Canadians when you make this point about the vesting period.

I think it has to be understood quite clearly that six years to qualify for the plan is far different from when you pay it out and the ages you pay it out at. Those are all matters that are going to be dealt with by the government in living up to and completing its obligations under the red book commitments that we have agreed we would do, and do it in a timely fashion, do it long before anybody is going to retire from this House, long before you need to worry about any payouts.

There are more substantive concerns at this point in terms of payouts that relate to getting the deficit and the debt under control, getting the deficit down to 3 per cent of GDP. There is a program review that is going on. There is the social security review. We have gone through a defence review. We have gone through a foreign affairs review. We are reviewing everything. We are reviewing the size and shape of government, the roles and responsibilities that government performs. It is a very major undertaking, so this government does have a lot on its platter.

Notwithstanding that, the government is quite cognizant of the concern of the hon. member for Beaver River that we deal with this at an early stage, and we are dealing with it at an early stage.

This year the sitting of this House has almost a month to go and it is certainly my hope that in that period of time I will be able to rise in the House and advise as to the implementation for the red book commitments, specifically dealing with those items of double dipping and minimum age which we are committed to reforming.

I am hopeful that the hon. member for Beaver River and her colleagues will support the government in its endeavours to do that. I know Canadians want to see reform of MP pensions and we are committed to doing that.

[Deborah Grey, Reform, Beaver River, AB]

Madam Speaker, we are certainly prepared to look at any legislation that the government does bring forward and if it is worthwhile and supportable we certainly will support it.

The Prime Minister has talked about opting out and this minister just mentioned it a few moments ago. He would give the opportunity for some people to opt out if they wish.

I beg the minister to explain to me how that could be ultimately fair in terms of making substantive changes to a pension program. In other words, some may opt out but the rest will continue to pork out. Is that what I understand? Those people who are still in an overbloated pension system because they have qualified now would just continue to pork out while some people would opt out. I hardly think that is a major reform of the MP system.

The minister also said that these MPs who qualified yesterday will not retire tomorrow. Of course not. We are not assuming that these people are going to retire tomorrow. That is not part of this argument. It is superfluous to it.

He said there was nothing magical about yesterday. There was something magical about yesterday and it is that if this government had acted on what the Prime Minister talked about last August when in opposition, if these changes had been brought about before yesterday, the six-year magic marker of qualification or vesting date, then for example my friend from Halifax who is in her 40s would not qualify for an MP pension until her 50s, which is what the red book says.

It talks about deferring the age. It talks about bringing it more in line, ending double dipping, putting it off to a later retirement age.

Someone in their 40s would now qualify. That is magic to me, that is lotto for life, just as simple as pie yesterday that these people qualify. If the government is even thinking of moving this further to a retirement age I do not understand how he can say that there was absolutely nothing magical about yesterday. They are eligible now for pension. We are not saying they are going to go out and collect it right away either. That will be after the next election date, whether they choose to resign or whether the taxpayers in their ridings choose for them to resign. It will be one way or the other.

It is also really important to note that when that day the minister talked about earlier does arrive they will be eligible to collect a pension also. When a government contributes $6 to $1, as my friend from Halifax said earlier, it does not take a mathematical whiz to figure out that this is the most generous kick in for employer-employee benefits. It is almost $6 to every $1 that we contribute. There is no way that is actuarially sound. We can have that proven time and time again.

The minister says they only became eligible for pension yesterday, there was nothing magical about it whatsoever. If they brought it in before those 52 MPs qualified for it yesterday afternoon they simply would not be eligible today. If the government is going to make substantive changes to this MP plan it should make sure that it would affect the people who qualified yesterday.

What part of eligible does this minister not understand?

[Art Eggleton, Liberal, York Centre, ON]

Madam Speaker, I am afraid that the hon. member for Beaver River just does not understand vesting because she talks about if the government had brought in legislation before yesterday then somehow yesterday would have meant nothing. That is not true at all.

The vesting period is not to be confused with benefit payout. We could bring in a minimum age with respect to benefit payout and it does not hinge on what the vesting period is. That is all yesterday was related to.

The member is in a rhetorical fantasy about what yesterday was. It really does not relate to the question of benefit payouts and the age they are paid at.

This government knows full well that Canadians are concerned about people collecting a pension when they are in their 40s, that they are collecting a pension far earlier than any other Canadian and we are going to deal with that issue. What happened yesterday is of absolutely no consequence in dealing with that issue.

We intend to continue to allow these people to qualify. Why would we do anything else? The hon. member has her qualifying day coming up sometime before long.

[Deborah Grey, Reform, Beaver River, AB]

March 13.

[Art Eggleton, Liberal, York Centre, ON]

She knows it is March 13. She is obviously very interested in the date.

Let me also deal with her favourite possibility and that is to be able to opt out so she cannot reach her day. I wonder if she is really going to decide not to allow March 13 to happen. She can opt out. The Prime Minister has said that we will provide a provision that you can opt out or maybe it will be opting in. It will be one or the other. It will work out the same way. You might actually have to opt in. You may actually have to sign a piece of paper saying that you want to be into the plan. However, you have that opportunity. If you feel that you want to save the Canadian taxpayer that money then it is up to you to do that.

I would not cast aspersions on other members of this House who decide to opt into the plan simply because they are understanding that they put a lot of years into the public service. They have the obligation, as any Canadian feels they have, to protect themselves and their families in their retirement years. I would fully expect that most members of this House would want to continue to be protected and be a part of such a plan.

Revisions to the plan to make it a better plan, to reform it, to make it something more reasonable as Canadians are expecting us to do and as we are promising to do, will all be part and parcel of it.

[Deborah Grey, Reform, Beaver River, AB]

You are still getting it in the 40s.

[Marlene Catterall, Liberal, Ottawa West, ON]

He did not say that.

[Art Eggleton, Liberal, York Centre, ON]

No, no. I did not say that at all. I do not know how many times I have to say that we are trying to respond to the concerns of Canadians about a pension being paid in the 40s. We are going to respond to that in our reforms. The member does not seem to want to understand that.

[Deborah Grey, Reform, Beaver River, AB]

Then Mary should not qualify in her 40s.

[Art Eggleton, Liberal, York Centre, ON]

The plan is actuarially sound, if she is concerned about the 6:1 ratio. It is also worth pointing out that the contribution rate is very high by members, an 11 per cent contribution. A lot of money is put in by each individual member.

The hon. member should not confuse vesting with benefit payout. We will be dealing with the question of minimum age for benefit payout. Vesting is a qualifying period of time. It is actually a higher qualifying period of time than what most Canadians have in their pension plans. I do not see why it should be of concern to members of the third party at all. They have really picked on the wrong thing.

They have done this prematurely. They have picked on the vesting period because they do not seem to understand that it does not relate to benefit payout. They do not seem to understand that the government is going to live up to its red book commitments, but it is.