Madam Speaker, it is a pleasure for me to speak on Bill C-2, which will have an impact on the future of Canadians.
In keeping with tradition, I would like to thank the electors of Abitibi who put their trust in me for the next four years.
I represent the largest riding in the ten provinces of Canada. It covers an area of over 802 square kilometres and has a population of 92,000. To give you an idea of its size, it is equivalent to more than half the province of Quebec. There are four PQ members of the National Assembly doing the same work I am as a federal MP. In other words, in the riding of Abitibi, there are four provincial MNAs and that costs four times as much.
To get back to the bill, in compliance with the law, changes to the Canada pension plan must be approved by at least two thirds of the provinces representing two thirds of the country's population. This requirement has been met.
This bill represents a significant step toward preserving, as we said we would, the Canadian income and retirement system. The changes will ensure the plan's viability over the long term while making it fairer and more affordable for future generations of Canadians.
They recognize that the Canada pension plan is fundamental to the public pension system. The proposed changes will strengthen our system to permit it to continue to provide Canadians with the opportunity to create for themselves new and sufficient retirement income.
To ensure the future of the Canada pension plan for all Canadians, last February the federal and provincial governments agreed on changes to the plan to ensure its long term financial viability, while making it more fair and more affordable for future generations.
The proposed changes have the support of the federal government and the provinces of Newfoundland, Nova Scotia, New Brunswick, Prince Edward Island, Quebec especially, Ontario, Manitoba and Alberta.
However I must point out that Quebec administers a plan which parallels the Canada pension plan, that is, the Quebec pension plan. The Government of Quebec, through the Hon. Lucien Bouchard, recently announced amendments to the Quebec pension plan comparable to the proposed changes to the CPP, with the result that premiums will be the same.
Let us take a look at this new investment policy. There are approximately two years' worth of benefits in the CPP at the present time. The assets not immediately required to pay benefits are placed in non-negotiable instruments issued by the provinces. The provinces pay interest on these loans at the rate of long-term federal government bonds, as set at the time they were issued.
Greater capitalization of the CPP will result in significant growth of the assets from approximately two years of benefits to four or five years of benefits over the next twenty years. A new investment policy is necessary to get the best return possible in the interests of contributors. A higher return on the plan's assets will help hold the line on increases in premiums.
The ministers of all provinces, including Quebec, agreed on the following measures. The assets of the CPP will be invested in a diversified portfolio of instruments in the best interests of the contributors and beneficiaries. This new policy is consistent with that of most other pension funds in Canada, and in particular with that of the Quebec pension plan.
The assets will be managed in a professional manner, independent of governments, by an investment board, which will periodically report to the public and to the various governments on its activities.
Finally, with respect to investments, the board will be subject to rules similar to those applying to other pension funds in Canada.
I noticed that schedule II contains a comparison of existing CPP provisions and the proposed changes. This is something we should also mention: early retirement, from age 60, no change; normal retirement, at 65, no change; late retirement, up to 70 years of age, no change. There is no change in the new bill to the maximum annual earnings with pension entitlement, indexed to salary.
There will be no change to the ceiling for the combined survivor's and pension benefit in the new bill. All benefits, except death benefits, are now fully indexed. There will be no changes.
There are several stages to go through still. The bill complies with the terms and conditions agreed upon with the provinces in February regarding such things as a move toward fuller funding, with the new investment policy, changes to the formula for calculating certain benefits and a tightening of the administration of benefits.
It is always important to keep our people informed of what goes on in Parliament.