Mr. Speaker, I am very pleased to stand and participate in this debate on changes to the Canada pension plan. I congratulate my colleague from Madawaska—Restigouche and the other members of our Conservative Party who have mounted solid arguments and amendments to try to fix this ill conceived plan that the government has brought forward.
Also, and this is probably the only time this will ever happen, I want to commend the Minister of Finance for the amendments he brought forth yesterday. I did not get a chance to speak on them then but I was happy to see that the minister listened to our concerns about his bill and being silent on the auditor general's ability to request documentation on the CPP investment board.
As we pointed out to the House, the auditor general himself indicated that there were no guarantees in this bill that would ensure he could request the documentation that he needed to oversee the board's operation. With the amendments he submitted, the minister clarified that situation and we were very pleased that he finally saw the light even if it was for only a brief moment.
I wanted to speak today so I could talk about Motion No. 15. This motion was introduced by one of our colleagues from the NDP. It proposes that self-employed persons pay a CPP premium rate according to their incomes. We believe this is a very good idea and a very good recommendation.
One has to remember that self-employed persons are required to pay the employee's portion and the employer's portion of the premium. When rates go up even a little, self-employed persons have to bear the brunt of the entire increase. In other words, when rates go up to 9.9% the self-employed have to pay $9.90 to the government for every $100 they make. That can be very hard, especially when we know that in 1997 more than 2.5 million Canadians were self-employed.
Consider for a moment that according to Stats Canada, 45% of the self-employed earn less than $20,000 a year. At $20,000 a year you do not have a lot of disposable income left after you give so much of your pay cheque to the government. We must help those millions of Canadians who are trying desperately to earn their livings and to have their dignity.
We can help low income Canadians by lowering payroll taxes. That is the argument we bring forward today when we say that the hike in CPP premiums should be offset by reductions in EI premiums. I was very pleased to see that the minister came forth after I rose to speak in the House and lowered it by 20 cents. However, according to the actuarial report he should have lowered it by 90 cents because he will still have $40 billion in an account by the year 2004.
We can also help self-employed workers by making them pay CPP premiums according to a sliding scale based on their yearly revenue. If you make only $20,000 a year, you could pay a lower rate than someone who makes $60,000 a year. It is a small measure but it can make a big difference in the lives and the pocketbooks of many Canadians.
For the first time in our history a whole generation of Canadians is unsure that it will be able to enjoy the same quality of life its parents did.
Many Canadians worry that some of our most fundamental institutions and values such as health care and Canada pension plan might not be there for them and their families when they need it. Canadians have every right to expect the federal government to set the right priorities and policies and to chart the right course to achieve what they need for the future.
We need an innovative, realistic plan that sets new priorities for government as part of a long term vision for our future. One of these priorities is security for retirement for all Canadians and more especially the restoration of the Canada pension plan.
In 30 years the average age of Canadians will be higher than the present average age of the population of Florida, with no corresponding adjustment in temperature. A lower birth rate and increased life expectancy, along with a sharp rise in disability claims, also put new stress on the CPP. The CPP has also been jeopardized by inadequate contribution levels and inefficient plan management as a consequence of faulty legislation.
CPP funds, for instance, have been loaned to the provinces at the rate Ottawa pays on its 20 year bonds. This is less than what the provinces pay other bond holders and it is also less than what private sector plans earn. No wonder Canadians think the government cannot add.
The liberal plan to fix the CPP is basically a $11 billion tax hike on working Canadians out there and employers over the next six years. This is coupled with already high EI levels which the Minister of Finance, as I have stated, has refused to lower, the 90 cents he should have done.
What this government is doing with these changes to the CPP is a traumatic tax grab that will have a devastating effect on job creation. If we were in power, we would increase CPP contribution rates to levels adequate to ensure the long term viability of the plan. However, these increased contributions would be offset by a substantial reduction of personal income tax rates and EI premiums. This means putting more money into the plan without asking Canadians to pick up the tab and without creating threats to job creation.
We would also make provisions to finance the extra cost per year of seniors benefits resulting from demographic changes. We would also ensure that the mandate of the Canada pension trust and its trustees would be to advise the government on required contribution levels and to select the best private managers acceptable to the industry to invest the fund's growing surplus to secure long term returns.
It is most important that we guarantee all our young people today, not just the ones who are sitting in the House, but those across the country, that there will be a retirement plan for them, a Canada pension plan for them. It is up to each and every one of us to make sure this happens. Now it is our generation's turn to become nation builders. Part of that responsibility is to ensure that Canadians of all ages and all circumstances can count on a secure retirement.
I would argue that unless Bill C-2 is amended to meet the changes that our party is advocating and that the NDP is advocating as well, the Liberals will be passing the biggest tax increase this country has had in a long time and it will impact and hurt every Canadian very hard.
I urge all members of this House to consider this very seriously.