Mr. Speaker, it is with great intent that some of my colleagues are discussing Bill C-2 respecting changes to the Canada pension plan board.
I listened with great interest to the member for Calgary—Nose Hill talk about the importance of a consultative framework. I know from my fellow colleagues on this side of the House that we have already done this. Years ago we went out and conducted town hall meetings in our ridings, asking the people of Canada what they wanted to do with the Canada pension plan.
I conducted three of these meetings in my riding. The conclusions of the people of Durham are very much part of this legislation. In particular, they told us that they wanted to maintain the Canada pension plan. Also they told us that they wanted to see a different investment format.
They were concerned about the government directly investing it and giving money back to the provinces. They wanted to see an independent board. The bottom line is that we have been listening to the people. That is exactly what the people of my riding, and I am sure many ridings, have told our government. They want this money set aside and managed in a businesslike fashion. That is essentially what this act attempts to do.
Some members have mentioned there is going to be an increase in the size of the fund. Some talked about $100 billion and some of my colleagues who like to double everything are up to $200 billion. That is a substantial fund for this country.
It is interesting to note that some members opposite talked about payroll taxes. When some of them spoke I had to reach for my Oxford dictionary because they referred to the CPP as a tax. Perhaps I could buy the members a dictionary because they do not seem to have one. I opened up my Oxford dictionary and it clearly says that a tax is a contribution to the state.
Deductions for the Canada pension plan are either currently being paid to beneficiaries or invested in a fund. They do not come into the general revenues of the Government of Canada. By definition in the Oxford dictionary clearly they are not a tax.
When people talk about Canada pension plan contributions they somehow end the discussion at the payment of premiums. Once again it is the same discussion Reform Party members often get into when they talk about spending, that somehow it is gone, ended and never heard from again.
Members are talking about a $100 billion fund. We have to ask what does it mean. What does the fund go into? The government is empowered to carry on normal market interventions much as mutual funds do now, purchasing equities in Canadian owned companies and bonds. I suspect this is going to have a double effect economically. It is going to provide more capital for small and medium size business. As businesses expand they either borrow or raise equity. Businesses are expanding, building new buildings and plants and facilities. Invariably when they do that they create jobs.
Therefore it is a circular argument that by paying these premiums we are going to lose jobs. However, when we look at the other side of the argument of creating robust capital markets in Canada, we are creating jobs. This is simple economics which the Reform Party often likes to look at, the bad side. The reality is there are a lot of positives.
To take this one step further a lot of people are saying that they are concerned about the amount of money in the fund. If we compare it to a privately managed fund today, the Caisse dépot et placement du Quebec has a fund which is now at about $57.6 billion, the Ontario Teacher's College pension plan is at about $50.9 billion and the municipal employees fund is at about $25.9 billion. By definition those are some very significant funds.
When we talk about the Canada pension plan we have to talk about the demographics, the fact that our population is getting older. As the fund becomes more robust, active and intervening in the private sector it could well have an impact on the reducing interest rates because it will make more capital available, looking for capital and it will be more competitive in the capital markets and thus may reduce interest rates for small and medium size businesses.
Through this fund process the possibility is there for lower interest rates and also we have created the availability of more debt and equity capital for small businesses which will create jobs. The Reform Party is not interested in that because it is a very positive thing.
I also heard the member for Calgary Southwest talk about other negative aspects of the plan.
The important thing is Canadians want to know their funds are being invested. As has been mentioned a number of times in the House, Canadians have said where did that money go, where is it in the system. Now they will be able to see where their money went. There will be a quarterly report which will show where their money has been invested.
Reform Party members often talk about the super RRSPs. The hon. member for Calgary—Nose Hill said that only 1 percent of the payments from the Canada pension plan are related to disability. I suggest she read the financial statements. She will see that Canada pension plan payments to the disabled amount to about 19 percent. The Reform Party has no plan to ensure that factor.
I can tell hon. members opposite that there are many people in my riding who are living on disability payments. It is hard for me to believe they are concerned about the hardships these people face.
Second, members opposite have gone on and on about the intergenerational tax. The hon. member for Calgary—Nose Hill called it a rip-off.
The Leader of the Opposition was concerned about the clawbacks in the old age pension system. Then the hon. member for Calgary—Nose Hill spoke about the 200 percent return on investment that some of these people are receiving.
What is it going to be? Are they going to be concerned about intergenerational transfers? Are they going to be concerned about a 200 percent return on investment? Are they going to be concerned about clawbacks to seniors pensions?
The bottom line is they cannot have it all ways. They cannot argue out of both sides of their mouths all the time.
As the member suggested, there would be a $500 billion deviation if we actually tried to fully fund that plan today. I have not heard any opposition member tells us how they would do it.
We went to the people and we asked them how to do it. This is the plan they told us they wanted. This is the plan which is acceptable to them.
Some of our younger people are worried that the premiums are going up, but everything is not absolute in history. The reality is our younger generation has other benefits which have been given to it by government. It has support in the educational system and other benefits from our system.
Who knows in 20 years what the premium levels or what the benefit levels will be. It will depend on the demographic shifts in our country.
This government has had the intestinal fortitude to look at a situation that was breaking up. Many governments in the past have shifted this on to other administrations. It would be easy for us to do just that, shift it on to another administration. The problem would get worse and worse. However, we have faced reality and are dealing with the problem.
That is what this government has done. This is good legislation. I encourage all my fellow members to support it.