Mr. Speaker, I just want to make a couple of points on this motion and get some facts on the record.
Canadian pension funds and individuals saving through RRSPs can invest up to 20% of their assets abroad. It is a statement and a fact that I think most Canadians are aware of.
It should also be said that this 20% is a significant amount of international diversification and additional international exposure can also be gained by investing in Canadian companies with international operations. However, the 20% foreign property rule also ensures that a significant portion of tax assisted savings is invested in Canada.
We should also point out the fact that in recent days international markets have not performed well. Present rules are intended to provide a sort of balance for Canadian investors.
It is also important to mention studies by experts like Mr. Slater who stated that Canada's capital markets could absorb the increase in the CPP fund. The fact is that our capital market is quite healthy. It does provide substantial rates of return. Let us also remember that the changes to C-2 are increasing the rates of return to the Canada pension plan. So we are all moving in the same direction.
I also want to point out a statement that was made by the hon. member from the Reform Party who said that it was important to listen to the people because they are connected to the grassroots. I am sure every member of this House takes the opportunity of listening to constituents and trying to reflect their concerns here in this House of Commons.
It is also important to note that Canadians have indicated through public consultations that they want the CPP fund to be invested like other pension funds. Today in Canada pension funds are allowed to invest up to 20% of their assets in foreign securities. The CPP will follow the same limitation. It does allow for diversification to enhance returns but it also ensures that CPP funds are invested predominantly in Canada.
As was stated earlier, the intent of the government is to ensure the financial stability of this plan. It is crucial that the changes that we have been making to the CPP provide for that financial sustainability. With this particular motion we would be treating the Canada pension plan in isolation. Making changes to the Canada pension plan or if we did make changes to other tax assisted programs, it would not be fair.
What we are saying is that the CPP fund will follow the same limitations. If the foreign property rule were to change at some point in the future then we would see the Canada pension plan reflect that change. Therefore, if in the future the 20% foreign property rule were eliminated, although no one is saying it will be eliminated and we are not advocating its elimination, then the Canada pension plan fund, as requested by Canadians through prior consultations, would be treated like other pension plans in Canada.
What C-2 does is treat the Canada pension plan like other pension plans throughout this country.
I believe it is important to make those points. Other members have made similar points. I would certainly encourage members of this House not to support Motion No. 2 for the reasons stated.