Debates of May 25th, 1999

Request For Emergency Debate

[The Speaker]

I thank the hon. member for the explanation and for his letter. It is my ruling that this request does not meet the exigencies for an emergency debate pursuant to Standing Order 52.

The House resumed consideration of the motion that Bill C-78, an act to establish the Public Sector Pension Investment Board, to amend the Public Service Superannuation Act, the Canadian Forces Superannuation Act, the Royal Canadian Mounted Police Superannuation Act, the Defence Services Pension Continuation Act, the Royal Canadian Mounted Police Pension Continuation Act, the Members of Parliament Retiring Allowances Act and the Canada Post Corporation Act and to make a consequential amendment to another act, be read the third time and passed.

Public Sector Pension Investment Board Act

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, it is a pleasure for me to rise to speak to Bill C-78. The government claims that the purpose of the legislation is to improve the financial management of the pension fund of federal public servants, the RCMP and the military. We should be very skeptical when the government claims to be doing anything to improve the conditions of the federal public service.

The government has acted in an unprecedented manner in opposition to our public service and has created the lowest level of morale in the history of the public service in Canada. There was the wage freeze our public servants have dealt with under the government. There was the back to work legislation and the government's refusal to utilize binding arbitration as a legitimate negotiating tool. There was the incredible level of layoffs.

For instance, there is the government's latest attack on the public service through the privatization of Revenue Canada and its attempts to create a new arm's length agency to administer the taxes of the country and take up to 40,000 public servants out of the public service. It is part of a continued attack on the public service of our country and ultimately one that will imperil the public service and the quality of services received by Canadians from their public servants.

The government is not interested in improving the financial management of the pension funds of public servants. The government is more interested in the cash windfall of $30 billion that it can take from the public service pension plan through the legislation. The legislation provides the mechanisms through which the government can access that $30 billion. The government is claiming that money will be used against the debt, but it is just a cash transfer on paper. It is not an actual cash transfer in terms of money going from one program to another. It is basically just a paper transfer.

Effectively what the government is doing, and it is quite cynical really, is taking this money and using a divide and conquer type of attack to pit federal public servants against Canadians at large by saying this money will go against the debts of Canadians at large. It is ignoring the fact that this fund was created through contributions by the public service and the federal government into their pension plans and that this fund was created to protect the public servants and their pension plans against the risks of future deficits.

This is particularly important given that part of the legislation will result in the pension being invested in private equity markets where there will be larger risks in the future. It is very important at this time when we are engaging in a potentially riskier investment strategy, which will provide a higher return ultimately. With that higher risk which is commensurate with a higher return we need to ensure the appropriate surplus exists. That $30 billion should be kept either within the public service pension plan or used to improve benefits for public servants who have had an unprecedented sustained attack by the federal government.

This is analogous to the federal government's EI fund strategy. The government has built a surplus since 1993 in the EI fund by maintaining unnecessarily high rates and at the same time slashing benefits. The government has an insatiable appetite for cold cash and that seems to be the only explanation for the continued expropriation of the pension fund.

We heard of expropriation earlier in terms of land and the Nanoose Bay issue where the government has taken the same arrogant approach to the financial management of our country either with the EI fund or in this case the public service pension issue.

To go back to the EI issue, the government is maintaining an egregiously regressive tax on lower income Canadians. For instance, a Canadian making $39,000 per year will pay the same amount of EI premiums in terms of total EI premiums and contributions as someone making $300,000. The government is taking that money from lower and middle lower income Canadians and using it to subsidize other program spending. It is simply not fair.

To add insult to injury, the result is that through the government's slashing of benefits EI programs are only available to 30% of those who pay into them, even with the absolutely devastating seasonal unemployment in Atlantic Canada where the economy dictates that a significant part of employment is seasonal.

There is some agreement that the government has a legal right to the surplus. If the government had a legal right to the surplus it would not need this legislation to access the surplus. The government is in the position to implement legislation, to bring forward bills and legislation to change the rules whenever it wants, and that is exactly what it is doing. The government does not have the ability to access the pensions of federal superannuates and federal public service pensions without the legislation. The government is changing the rules.

A private corporation does not have the ability to change the rules in this way. In a private pension plan there are typically agreements between the corporation and the employees on the contribution rates over the period of time and on the benefits. If there is a surplus there is a set of guidelines which the corporation follows in the division of that surplus.

It was not that many years ago that a gentleman by the name of Robert Maxwell jumped off his boat or fell or something. He faced an unfortunate demise off the side of his yacht. A few weeks later it was public knowledge that for several years he had been taking from the pension plans of his employees, many of whom were left in tremendous financial straits due to the fact that he had been taking from their pension plan over a period of time. That is an example of what would happen if a company took this kind of approach to a private sector pension plan.

The government is saying that this is a defined benefit plan, that the government has all the liabilities and that the people who pay into it do not have any of the liabilities. As such the government is claiming that it would have the ability to do whatever it wants with it. The government sometimes points to a deficit in the fund which existed in the mid-eighties and the fact that the government paid the deficit. It was simply an accounting deficit that existed. The government wiped it out. It used the offsetting interest income surplus to do that.

It is a bit of a red herring when the government says that it paid off the deficit in this fund in the mid-eighties because in fact it used an offsetting interest income surplus to pay off that deficit. What is particularly offensive is that the government is going against its own rules with the legislation.

It was not that long ago that the Pension Benefits Standards Act, Bill S-3, was initiated in the Senate and passed by parliament. It outlined the proper procedure for pension plans to deal with the issues of surplus in private sector pension plans.

If the government were following these rules it would be behaving very differently than how it is actually behaving with the public service pension plan in Bill C-78. The government has set a double standard. It has one set of rules for the private sector and another set of rules for itself. It is changing the rules as it goes to fit whatever short term or long term political goals it has as a government.

This could create a very dangerous precedent in that private sector corporations could seek to forgo the guidelines set forth by the government in Bill S-3 that were designed to protect both corporations and the people who pay into the pension plans. Private sector corporations could forgo the following of those guidelines and legitimately say that the government has broken its own rules.

For instance, under Bill S-3, if a withdrawal takes place logically the plan members would expect to see a significant increase in benefits. Typically it would be commensurate with the levels paid into the private sector pension plan based on the contribution rates. For instance, if it were a 40:60 pay-in, with the employer paying in 60% and the employee paying in 40%, a withdrawal of 60% of the surplus would mean a commensurate increase of 40% in the benefits enjoyed by both current and future pension recipients.

Unfortunately this is another example where the government is participating in an unprecedented level of hypocrisy. It is asking the private sector to play by one set of rules and feels it can get away with playing by another set of rules which it is changing on an ongoing basis. It is also a further example of the unadulterated attack on the public service in Canada.

It has long been acknowledged that public sector workers have accepted in some cases below market wages in exchange for job security and fairly decent but well deserved pension plans. Over time we have seen job security disappear from the public service. The wages in many cases are now far below those of the private sector. One of the arguments the government uses for the privatization of Revenue Canada is that if Revenue Canada were privatized it would have the freedom to pay employees of Revenue Canada or the new Revenue Canada agency more competitively to compete with the private sector.

The government is actually abdicating its responsibility for positive and constructive human resource management by saying that it cannot do that with the public service. It is privatizing a huge arm of the government, Revenue Canada. It refuses to deal with the systemic issues that are pervasive throughout the public service and is dealing with these issues with band-aid solutions that will create more problems in the long term.

Ultimately the morale of the public service is an issue that affects every Canadian. The quality of services and the value we receive for our tax dollars depends largely on the quality of the work of our public service. The quality of the work of our public service depends on the morale of the public service. There is a significant long term cost to Canadians whenever the government takes another attack on the public service. We should take very seriously the long term impacts of this continued attack on the public service.

Another issue is the anticipated premium increases for contributions to this plan which will increase from 7.5% of salary to as high as 11% of salary by 2010. This means that public servants will be paying a higher and higher percentage of their salary into the plan over time.

As the payroll deductions, or payroll taxes as some refer to them, continue to increase, it will become increasingly difficult to retain existing public servants and to attract young people, some of Canada's best and brightest to the public service. They will be attracted to better paying jobs in the private sector.

Our country needs a viable productive public service. Over time Canada has produced some exceptional accomplishments through our public service, as well as through the private sector. If we talk to some of professors and administrators at the universities who teach public administration, we learn that the skills being taught in public administration courses are not dissimilar from many of the courses being taught in business schools.

I come from a private sector background. I was involved in small and medium size businesses. I have an undergrad degree in business. I enjoy the private sector. I also have a public ethic which is why I am here.

Many Canadians who share the skills I have in terms of administrative abilities want to work within the public sector and have a public ethic. They may not be as interested in the private sector. In a lot of cases these people study business and enter businesses but really they would rather work productively to create a better public service. We need a greater focus on attracting some of the best and brightest, not just to business, but also to a public service that Canadians and public servants can be proud of.

The government has continued to reduce the quality of working conditions within the public service. Ultimately it will reduce the quality of services received by Canadians.

I am pleased to see that the government is moving toward seeing that the funds within these pension plans will be invested in external financial markets. I am concerned about some of the elements the government is going about doing this.

It is very important to realize that the public service pension funds will represent in the not too distant future about $100 billion. The capitalization of the Toronto stock exchange is about $650 billion. It does not take a lot of analysis to recognize that this potentially could have a huge impact on capital markets.

This would be a perfect opportunity for the government to move in separate legislation to increase the foreign content limits for Canadian pension investments, not just within these types of public pensions but also within RRSPs. Many people defend the current 20:80 rule on foreign content, that 80% of an RRSP for instance has to be invested domestically and only 20% can be invested offshore. Many proponents of that rule state it would have deleterious effects on the Canadian equities markets if we were to loosen that rule and allow Canadians to invest their own money offshore.

The influx of capital by the Canada pension plan and this public sector pension plan into Canadian equities markets represents a golden opportunity for the government to do what it really should do. It should reduce and ultimately eliminate the foreign content rule. I would suggest that up to 50% almost immediately should be allowed to be invested offshore so that Canadians can enjoy geographic diversification as part of their portfolios. In this case public servants could enjoy the kind of return on investment that is provided by geographic diversification.

The fact is that since 1993 the Dow Jones and other indices in the U.S. including Standard & Poor's, have far outstripped the growth in terms of equities that we have seen in the TSE. The TSE has grown by about 60% since 1993. During the same period of time the Dow Jones has appreciated by about 190% and the Standard & Poor's 500 has grown by around 180%. Wealth being a relative thing, Canadians are getting poorer while our neighbours to the south are actually getting richer. This is a brilliant opportunity. I hope the government moves aggressively to address that.

The other issue is that the government has modelled the pension management board on the Canada pension plan investment board. It has ignored some of the recommendations made in this House and in the other place. A recommendation in the report relative to the Canada pension plan investment board from the banking committee in the other place said:

Directors of the Canada Pension Plan Investment Board collectively have a broad range of experiences and expertise. While the benefits of appointing directors with proven financial ability are clear, the committee believes that a majority of the directors should have expertise in pension fund management and other relevant skills.

That was very sound advice. Pension fund management is a very specific art or science. Someone who has managed a business may not necessarily be good at managing a pension fund. Business experience is not the sole criteria by which we should judge fund managers. This has been ignored by the government in this legislation and it continues to do its own thing.

The government is not seeking constructive input from this House or the other place. The government is not seeking legitimate public policy development. The government is only seeking from this House, from parliament, a rubber stamping of the ideas and legislation it wants to implement. This has to stop because the secular decline of the role of the parliamentarian will ultimately lead to the secular decline of democracy and its benefits to Canadians.

[Angela Vautour, NDP, Beauséjour—Petitcodiac, NB]

Mr. Speaker, I want to thank my colleague in the Conservative Party for his comments.

I want to ask my colleague how he interprets the way the finance minister has been able to go into the UI fund. The finance minister figured out that the government could go in there, and I know there are certain words we cannot use in this House but we can think about them, and find a way to use $25 billion paid by employers and employees. The government did not put a cent into the UI fund, but it found a way to actually take it and use it for other things while we know that less than 40% of the unemployed qualify for UI.

Being members from the Atlantic region, we know the impact. We know how many people right now are going without UI and without income. Minimum wage is very low in New Brunswick. Jobs are seasonal. Unfortunately, when we have programs to help in developing jobs, we often get refused for government funding because only seasonal jobs are being created. How can we try to create jobs in our region?

The government found a way to get $30 billion. That is $25 billion and $30 billion which equals $55 billion that the government has its hands on. It is a lot of money.

I wonder if the member is seeing what we are seeing, what the workers are seeing and what our brothers and sisters in the public service are seeing. This money is being taken. The government has found two pots. Let us face it. The Minister of Finance is very creative in finding ways to get money that is not the government's and using it for its own purposes.

It is also unfortunate that the President of the Treasury Board is refusing to recognize the inequality regarding pay equity. This is directly affecting the public service employees.

Does my colleague agree with me that we sometimes have to question what the government is doing?

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, I thank my colleague from the New Democratic Party for her question.

The issue is that the government has taken the EI program and fund, which existed for the benefit of workers and employers to enhance labour market flexibility which benefits all Canadians and the economy, and has created what is really an EI tax. Only 30% of those who pay into the EI fund actually qualify to receive benefits. As a result, 70% of that is an EI tax. Only 30% of the contributions to the EI fund are actually EI premiums. The government has taken an already complicated Canadian tax code and made it more complicated, less transparent and more confusing.

Through maintaining unnecessarily high EI premiums and slashing benefits at the same time, it has also created increased distortions. For instance, one of the goals of tax reform should be to reduce the distortions taxes may have on a particular part of the economy.

Canada has twice the unemployment rate of the U.S. We should be seeking to reduce the cost of the labour input to encourage more companies to hire people.

Instead by maintaining unnecessarily high premiums and by not developing more innovative programs, particularly in the areas of training and retraining, the government is denying labour market flexibility to Canadian companies and employees. That is absolutely unacceptable in a very competitive global environment.

In terms of the government trend of delving into the EI fund for other types of spending or in terms of using the public service pension plan, which is what we are talking about directly with Bill C-78, the government is in the position where it can change the rules as it goes. It can change the rules that will affect Canadians for decades while it is focused on its own limited goals which are focused on the next election. The impact of the next election and what the Liberals will be doing over the next couple of years to try to win that election could be very negative for Canadians for decades in the future.

I have heard it said that politics is the natural enemy of public policy. I am afraid that in this case that is the case. The Liberals are changing the rules to suit their own short term political goals. They change the rules as they go. Unlike the private sector pension plans, where Bill S-3, the Pension Benefits Standards Act, sets out guidelines for the private sector by which the private sector is expected to abide, this government can actually change the rules.

The government is saying that there is nothing legally stopping it from delving into this fund. If there is nothing stopping it, why does it have to introduce legislation in this House, force closure and deny parliamentary debate in order to implement this legislation so it has access? The government knows that it cannot access the pension fund unless it breaks the rules so it is changing the rules. Why? Because it is the government and it does not respect the parliamentary process.

[Ken Epp, Reform, Elk Island, AB]

Mr. Speaker, we all know that when the government gets its claws on this $30 billion, it does it, as the member has just said, because it is the government and it knows best.

There are many different options that could be used instead of this money being confiscated by the government and used for whatever political purposes it chooses. It could be given back to the people who paid the premiums in terms of refunds. It could be used to increase the benefits to individual members. It could also be used for other purposes.

Would the member of the Conservative Party who just spoke divulge to the House what his party's preferences would be on how this $30 billion should be used since it clearly is opposed to the government taking it as it is.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, a number of times during my speech I referred to Bill S-3, the Pension Benefits Standards Act, which sets out guidelines for the negotiations relative to pension surpluses.

There are guidelines that clearly lay out the role for negotiations with the contributors to the pension over the period of time, the employees and former employees, and with the employers as well.

I would suggest that the government engage in that kind of negotiation and discussion over a longer term and work through that process, as any private sector corporation would, with the employers and the contributors to achieve an agreement as to how that surplus should be divided.

While the size of the surplus seems huge, up to 50% of that money will be invested in the private equities markets. It is very important to note how unprecedentedly high the equities markets are right now. Some economists are even pointing to threats of potential deflation and that our equities markets may be overvalued. Although some members may disagree, the price earnings ratios for our stocks are very high now. I believe they are the highest they have been since just before the Great Depression in 1929.

I do not want to be morbid nor do I want members to rush from the House to call their brokers or anything like that, but I would suggest that a large pension surplus is a good level of security against market fluctuations.

I do support the government moving toward investing this money privately in the equities markets. In the long term, that will maximize the return for public servants. However, in view of the increased risk and the commensurate increased returns, it would be prudent for the government to maintain a large surplus within the public service pension. I think that would benefit not just the government but also the employees and contributors over the long term.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, I will be splitting my time with the hon. member for Wentworth—Burlington.

It my pleasure to speak today on the employee benefit improvements that will ensue from the legislation before us. The first thing I must do is clarify that as far as retirement benefits are concerned, improvements are the only effects that will ensue from the government proposals.

It has been alleged that the government proposals will somehow diminish the pension benefits of federal retirees and employees. I want to make it clear that this is absolutely false. Public service pension benefits are protected and guaranteed by law. Nothing in the bill will or can diminish those benefits. They will continue in full and be fully indexed for inflation as before.

Far from diminishing benefits, they will actually improve the employee benefit package in several concrete ways. As members may recall, two of these improvements have already been discussed in the House. They were introduced in the recent budget bill and will come into force on passage of that bill. Both involve changing the formulas used for calculating benefits and both changes favour the plan member.

The first formula to be changed is the basic one used to calculate retirement benefits for the public service pension plan. Up until now, that formula has been based on the plan member's average salary over six consecutive years of highest paid service. Other public sector pension plans use five as the number of consecutive years in their formula. From now on, under the amended legislation, so will public pension plans. In most cases, averaging over five years instead of six will mean greater benefits for plan members on retirement.

The second formula relates to the integration of the public service pension benefits with those of the Canada and Quebec pension plans. This new formula will produce a somewhat smaller reduction in benefits at that point. Two small changes in formula amounting to two concrete improvements to benefits for current members of the public service pensions.

The legislation before us today further improves the pension benefit package for federal employees. A proposed change will allow a survivor to waive entitlement to benefits after a member's death in specific circumstances.

Another change facilitating the administration of survivor benefit provisions will allow a survivor who cannot be located to be disentitled to survivor benefits. Currently, final determination of the payment of survival benefits can be delayed indefinitely when a survivor cannot be found. This is clearly unfair to those other persons whose benefits are affected.

Finally, for cases where two survivors are entitled to an annuity in respect of one plan member, the method of determining the percentage of the annuity payable to each survivor will be set out in the legislation. Specifically, each survivor will receive an amount that is directly related to the length of time he or she contributed with the deceased contributor in relation to the total amount of time the deceased cohabited with both survivors.

The bill also proposes changes to the supplementary death benefits and term life insurance to employees and retirees payable under the Public Service Superannuation Act. For example, the paid up benefit will be increased to $10,000 from the current $5,000. This paid up benefit will also be extended to another group of pensioners. Persons who retired on or after April 1, 1995, with an entitlement to an annual allowance payable within 30 days of ceasing to be employed will, if they elected to retain their SDB coverage, have entitlement to the paid up coverage at age 65.

Another change would see the coverage reduction of 10% per year delayed until age 66 rather than beginning at age 61. This means that the basic coverage of twice the salary for employees and the covered pensioners under 61 is extended by five years and that benefit coverage would not finally reduce to either one-third of the salary for employees or, in the case of pensioners, to the basic paid up amount of zero until age 75.

The new coverage reduction schedule would apply automatically to those employees and pensioners who have already reached the aged of 61. However, those persons who would prefer to remain on the current schedule would be given the opportunity to do so.

The benefit improvements also include the removal of the provision in PSSA and Canadian forces plans whereby persons dismissed for misconduct could be denied access to any benefit other than a return of contributions.

Finally, there is to be another noteworthy improvement to benefits in the larger sense of the term. It is the new cost sharing dental plan the government intends to establish for present and future public service pensioners.

I will not elaborate here because strictly speaking the new dental plan does not form part of the legislative package but rather will be introduced under the authority of the Treasury Board once consultations are complete and full details are finalized. I merely mention the new dental plan in order to place it in a context to which it truly belongs, significant improvements that public service plan members can expect from their benefits package.

The public service pensioners of the present have no need to fear the proposed amendments to the public service pension plans. Their benefits are defined and guaranteed in law and will in no way be diminished. Today's pensioners can rest assured that the usual cheques in the usual amounts will keep coming as they always have.

As for public service pensioners of the future, they too have no cause to worry. The proposed amendments will leave their future benefits safe and intact. Plan members will continue to receive on retirement all that their pension plans have promised them. In fact, with the improvements currently proposed they will receive even more.

[Ken Epp, Reform, Elk Island, AB]

Mr. Speaker, the member said a number of times that civil servants did not need to worry because everything was in place.

Why are civil servants worried? Why are they expressing their great concern over the bill to members of parliament? Why are they making all kinds of threats beyond that?

It seems to me that the government has failed in either one of two areas. It has either failed to actually provide fairness to the employees or it has failed to communicate it. I would like to know which one it is.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, there is no question that what I have outlined clearly illustrates the improvements to the plan. If anyone is concerned it is probably because they have been listening to the fearmongering by some members on the other side.

The benefits, as outlined extensively by members on this side of the House, clearly indicate that there are significant improvements. There is nothing to fear because the moneys will be there and there by law. I do not know what could be clearer than that. The moneys are there by law. If there is a shortfall it will covered. That has been the case all along and will continue to be so.

I would suggest to the hon. member that the old saying “There is nothing to fear but fear itself”, in this case there is nothing to fear at all because it has been clearly outlined in black and white. If the member reviews the bill again I am sure he will come to the same conclusion.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, I cannot help but comment on this last statement that the money will be there if there is a shortfall in the fund. Many members opposite have indicated to us that the main reason the government wants this $30 billion is because it is the taxpayers' money and the government is protecting the interests of the taxpayer.

I would like to ask the hon. member just exactly which side of the mouth the Liberal government is speaking from? On the one hand it says it is protecting the taxpayer by giving the money back to them and on the other hand it is saying that if there is a shortfall it will be taken away.

One way or another the taxpayer is going to be funding this. Whose money is it? A large part of it was the taxpayers' money and another part was the individual beneficiary's money. Who is going to get this money? Who are the Liberals actually trying to protect? It sounds to me like the only people they are really trying to protect are themselves and their greedy ambitions.

[Bryon Wilfert, Liberal, Oak Ridges, ON]

Mr. Speaker, I do not quite understand the greedy ambitions. I would point out to the hon. member that currently about 30% of the fund is supplied by the employees and the rest has been picked up obviously by the taxpayers. There is no question that when there was a shortfall it was covered by the taxpayers. One would assume then that there is a significant surplus. It has been pointed out by the actuary. There is more The fact is that there is more than enough in the fund to take out the $30 billion and it will be protected.

In whose interest is it? I would presume it is in the interests of the Canadian public, those who are contributing by way of being a taxpayer and those who are contributing by being a member of the plan. In both cases the moneys are there. This is something we accept in this society.

In terms of fairness, if one reads the legislation one would come to the conclusion that if the fund is covered during shortfall times, the moneys would come out when there is a surplus.

[John Bryden, Liberal, Wentworth—Burlington, ON]

Mr. Speaker, I intend to devote my entire remarks on Bill C-78 to the word conjugal which has been the subject of much acrimony on both sides of the House.

I will preface my remarks by saying that I have been extremely disappointed in my government, or the advisers to my government, who chose to use the word conjugal to achieve what I think was a correct purpose to extend survivor benefits to same sex couples. Unfortunately they chose to do it in entirely the wrong way and it has caused a division on this side and unhappiness. I am sorry that has occurred.

I would have thought there would have been very grave concern on the other side of the House about legislation that has the intention of providing survivor benefits to same sex couples, but does no such thing. It is that kind of ineptitude that makes me regret this particular aspect of what is otherwise a very good bill.

What was attempted in order to extend benefits to same sex couples was that the bill amends existing legislation which defines a survivor as a person of the opposite sex. Clause 25(4) of Bill C-78 redefines survivor as someone who is cohabiting in a relationship of a conjugal nature for a period of a year.

That came up during second reading and I saw the word conjugal. I know a little bit about words. I knew immediately that conjugal in any context does not mean same sex. It is a word that goes back 2,000 years, back to the early church in Rome. It is from two Latin words involving togetherness and yoking together. That is what it means explicitly. The history of the word has to do with conjugal rights and the whole idea that in medieval times, in the early church and even in the later church, the idea was that when one got married this legally permitted one to have a heterosexual relationship with the woman and procreate.

That was how the early church regarded it, both the Catholic church at the beginning and later the various Protestant churches. It has not changed. Go to any dictionary including Black's dictionary. One of the members mentioned Black's dictionary and suggested that conjugal means something other than a married relationship or a relationship involving sexual intercourse in the conventional fashion. Everywhere you go you can look it up and find that, Mr. Speaker.

I challenged the officials of the minister's department. I said “Explain to me why you are using the word conjugal in order to provide benefits to same sex partners”. I was led to the 1997 Rosenberg court case. The court was examining the Income Tax Act provisions with respect to benefits to same sex couples. The court decided that same sex couples under the charter of rights should be entitled to the same benefits under the Income Tax Act as opposite sex couples.

The judge looked at a particular clause in the Income Tax Act which said in essence that a spouse is a person in an opposite sex relationship who is enjoying a conjugal relationship. It states that a spouse at any time of a taxpayer includes the person of the opposite sex who cohabits at that time with the taxpayer in a conjugal relationship.

There are three ideas here: opposite sex, cohabits and conjugal relationship. The judge in the Rosenberg case ruled that in order to fulfil the intention of the charter we should read into this clause—and this is a judge creating legislation—that it should be a person of the opposite sex or the same sex who cohabits at that time with the taxpayer in a conjugal relationship. The judge added words but did not change the word conjugal which does not mean same sex. It does not mean that at all.

When I looked at that I said to the officials from the department “That does not prove a thing. Show me anywhere in law, anywhere in legislation, where conjugal is actually defined as pertaining to a same sex sexual relationship”. I looked at all the cases presented for me. There were lots of analyses of cohabit. There were lots of analyses of spouse, but nowhere in any of the things presented to me with my own research or with the assistance of the department could I find a definition of conjugal that includes same sex relationship.

What do we have? Let us go back to the original clause, Clause 25(4), and read it exactly:

For the purposes of this Part, when a person establishes that he or she was cohabiting in a relationship of a conjugal nature with the contributor for at least one year...then the person is considered to be the survivor of the contributor.

If we take that clause literally nothing has happened. In fact the clause entrenches the idea that only married couples, that is people in a conjugal relationship, can receive these benefits. The legislation actually fails to achieve what it was designed to achieve.

Yes, I support the bill, but I do not support the clumsiness of what was attempted in the bill. Let me go on the record as saying I believe the government has an obligation to find a way in which to recognize the genuine dependency that exists between same sex couples. We should enshrine that in legislation and we should pass laws, but we cannot let the courts do it because the courts are at the whim of a judge who is not concerned with writing legislation, who is merely concerned with expressing and interpreting ideas, who fails to appreciate that a word in existing legislation does not mean what he thinks it means.

Now we have the supreme court ruling in the M. v H. case in this past week. The supreme court is suggesting that the Ontario family law should be struck down because it only pertains to opposite sex couples cohabiting. In its decision it mentions that same sex couples can have similar relationships to opposite sex couples including conjugal relationships. I submit that the supreme court judges have made the same error. If they would only go to any dictionary, English or French, they would never find conjugal referring to same sex relationships.

We have the judges and courts through, shall we say, a certain amount of literary ineptitude—and we should not be surprised by that because they are judges, not authors, not legislators—creating changes in the laws that are basically wrong. It belongs to parliamentarians to make those changes.

As a result of the case with respect to striking down the family law act, we understand that the provinces of Ontario and Alberta will have to redo their legislation to make sure that their family law legislation embraces same sex couples. Let them do that, but let them, for heaven sakes, avoid the word conjugal because conjugal specifically means heterosexual sex and married.

The reason there is division on this side is not because members do not want to see gay couples treated like everyone else. The reason there is division on this side is there is a genuine and honest concern about the implications of giving gay couples legally married status because in my view the big danger there is that it would give them then the right to adopt children as opposed to the privilege that they already now have. The right to adopt children would run the danger of extinguishing the rights of children.

In the end, while I will always try to champion the rights of every Canadian no matter what their differences from other Canadians, I have to always remember that it is not the place of this parliament to ever diminish or extinguish the rights of other Canadians, especially children.

I regret this legislation. It is an excellent bill but we used the wrong word. If we had used the word cohabit instead of conjugal, I think it would have been fine. If we had used dependent, I think it would have been fine. Anything but the word conjugal.

[Eric C. Lowther, Reform, Calgary Centre, AB]

Mr. Speaker, I am overwhelmed by the approach of this member. Certainly he has been thoughtful and has studied the bill. I commend him for that, but he leaves me with a number of unanswered questions.

I believe he is correct in saying that conjugal generally refers to a married type relationship. It does refer, though, to the sexual activity within a married relationship generally.

The new term used in the bill which has never been used before by his government is that two parties be in a relationship of a conjugal nature in the past, that they be in a conjugal relationship. They have changed it from one expression to a more loose definition, to a relationship of a conjugal nature. A moot point, perhaps, but it suggests that there is a less onerous requirement for the heterosexual type sex in the way they have used this term.

Regardless of this particular point in the debate, we have pressed the President of the Treasury Board several times to include a definition of what is meant by a relationship of a conjugal nature in the act. There is no reference to any kind of definition of it anywhere in the act so that the debate we are having today would not be necessary. That has been not dealt with. To his point I think that probably where this will end up, if this bill goes ahead, is in the courts. I am as concerned as he is that is where this will be decided.

I just wonder what he thinks the outcome will be in the courts. We had the minister tell us in the House that this was specifically intended to extend same sex benefits to those kinds of relationships. He specifically said the courts made him do it and the lawyers drafted it this way. What does the member think will be the outcome when this hits the courtroom?

[John Bryden, Liberal, Wentworth—Burlington, ON]

In my view, Mr. Speaker, the government has said that it is being driven by the courts but I think it has interpreted the courts entirely incorrectly. The courts have not ruled on the definition of conjugal.

I think the real answer here is for parliament and the government to bring in legislation that sets this matter to rest once and for all: define cohabitation, define spouse, define marriage. We do not have to define conjugal at all because I do not believe we should be in the business of defining ourselves in terms of our sexual orientation. If we look at the legislation, if we look at the court decisions, we will find that what we are really talking about is dependency, cohabitation, this kind of concept. We can leave sex out of it entirely as far as I am concerned.

[Scott Brison, Progressive Conservative, Kings—Hants, NS]

Mr. Speaker, I appreciate the hon. member's erudite and thought provoking interventions today in the etymology of conjugal and its relevance to this debate.

I wonder if the hon. member agrees with me that the Supreme Court of Canada has a very important role in interpreting the charter of rights, which was deliberately and politically developed to protect the rights of minorities; that the political process, particularly one driven by a populist environment, can be very dangerous in terms of the defence of minority rights; and that populism sometimes cannot be guaranteed or majority rules, for instance, which is the tenet of parliament, does not always serve the interests of minorities.

Is it the way parliament or the government has interpreted these rulings that bothers him as opposed to the supreme court making fairly significant and sweeping judgments in defence of minority rights that bothers him? I would like him to clarify that.

[John Bryden, Liberal, Wentworth—Burlington, ON]

Mr. Speaker, I would say both. I think it is very important that the Supreme Court and the courts interpret for us, but where we fail is when we fail as parliament to give the courts the proper tools.

Then we have a case in point where the supreme court is suddenly defining conjugal for us. I think it is a mistake and we have to get in there very quickly as parliamentarians before real damage is done.

[Gurmant Grewal, Reform, Surrey Central, BC]

Mr. Speaker, I will be sharing my time with the hon. member for Lethbridge.

I rise on behalf of the people of Surrey Central, federal public servants, RCMP officers who are retired and currently serving, our military personnel, and the families of all these people to speak to Bill C-78, the government's proposed changes to the public service pension plan.

The bill has become infamous on two counts. On the first count it is because Liberals will steal a one time windfall of $30 billion. Second, it lets the courts decide the definition of marriage. It will allow pension benefits to be delivered based on conjugal relationships.

The Liberals have raided the pension plan surplus federal public servants have amassed in their very successful pension fund. The greed on the other side of the House is disgusting to watch. The lack of respect shown to Canadians by putting a stop to this seizure of wealth and the government preventing debate on this matter in the House is a disgrace.

The government is allowing members of the House four hours to deal with this huge 200 page bill, true to the Liberal's democratic style. It has used outright closure 5 times and it has used time allocation 47 times since 1993.

This is the very same government that has taken $21 billion from the employment insurance fund surplus. The $21 billion should have been returned to the employees and employers who could have created jobs with that money.

Today, through Bill C-78, which we are not allowed to debate for more than a few minutes, the President of the Treasury Board will take $14.9 billion from the public service pension fund, $2.4 billion from the pensions of RCMP employees and $12.9 billion from the pensions of the Canadian armed forces, which adds up to $30.2 billion.

The official opposition maintains that any surplus should remain in the pension plan to cushion taxpayers from future shortfalls. This would ensure the long term viability and guarantee the solvency of our public service pension plans.

In the past Canadian taxpayers have covered $13 billion worth of shortfalls in these pension plans. Taxpayers will be on the hook for future deficits in these plans and we on this side of the House feel that Canadian taxpayers should be protected.

The Liberals want to settle the matter of dealing with the $30 billion surplus by passing Bill C-78 well before the next election in the hopes that the 645,000 pension plan members have short memories. That is not the case.

The Public Service Alliance of Canada says that the surplus money belongs to PSAC members and the government is stealing it. The word the union is using is stealing. It is a very serious charge.

The chief reason for the surplus in the plan is that it was assumed salaries would grow. The six-year wage freeze has reduced the liability of the plan. These surpluses will eventually slow down as wages are increased and today's lower interest rates kick in.

The money the government is taking establishes a precedent and sends a clear message to the private sector that it can follow the lead of the government and help itself to surpluses in employee funds.

This is the sort of government we have. We have a finance minister who cooks the books. We have a government that has no surplus in the Canada pension plan fund. That plan has been so mismanaged for 30 years that it could crash at any time.

Let us look at the history of the $30 billion grab. The President of the Treasury Board created an advisory committee on the Public Service Superannuation Act to look at pensions within the public service. The committee carried on consultations for four years. It was comprised of members of the government, public servants, representatives of employees and pensioner associations.

Now we know that the Liberal minister did not even recognize the further negotiations recommended in the committee's report. The President of the Treasury Board is trampling roughshod over the committee's recommendations and doing what he pleases.

Bill C-78 enables the government to get its hands on surpluses, the ownership of which, while not clearly defined, is morally the property of employees and ex-employees, that is, the pensioners.

This bill will extend pension benefits to same sex couples. It will allow marriage to be redefined and unfairly exclude others. The change in the definition of marriage should not be left up to the courts. It is a decision for members of parliament to take right here in this Chamber.

Granting survivor benefits should have nothing to do with sex, as defined by conjugal relationships. Rather, the definition should be based on a relationship of dependency and companionship. The latter definition would include gay or lesbian couples, but would also apply to a divorced daughter who lived with and cared for her elderly father after he retired from the federal government.

If we believe that what is fair is right, then we should do what is right.

Under Bill C-78 contributions would be deposited in retirement funds and then transferred to the public sector pension investment board. Who will manage the board? That is a big question.

The appointment process will be similar to the one used for the Senate. The appointees, who will be responsible for managing and administering this fund, will be the friends of the government. The Reform Party recommends that the new public sector investment board be comprised of qualified individuals and be accountable for the board's investment decisions.

This is how the Prime Minister appoints his friends to the Senate and the superior court.

Bill C-78 will allow the government, particularly the Minister of Finance, to take $30 billion and say again that it has balanced the budget, paid down the debt and given Canadians some long overdue tax relief. That is what the finance minister will say. He will boast that he is a hero, but he will actually be a zero. If he did all of these things he would be carrying out the official opposition's agenda. Remember that in the health sector alone the government cut over $20 billion in transfers to the provinces. Now, a few years later, it is boasting, saying that it will reinvest $11.5 billion of the money which it siphoned off earlier. The government siphoned off more than $20 billion and now it is reinvesting $11 billion. That is outrageous.

The official opposition would leave the surplus in the account and see that it is well managed. There would be a great deal of consultation between the stakeholders and the government.

There should have been enough time allocated for debate to take place in the House. Shame on the Liberals.

In the little time I have I will quote from a letter I received from a constituent of Surrey. It states:

The height of hypocrisy is to take from the working class to line the pockets of a politician, to make yourselves look good by reducing the debt by 15 billion dollars and to steal from those of us who contribute honestly to a pension that we have come to depend upon for our retirement years.

The letter further states:

We, the regular working Joes and Janes who contribute to this plan, contribute on a dollar for dollar basis and hope to receive back that which we have contributed plus the employer's share for our hard years of service.

If you remove money from any pension fund or EI fund to reduce the debt you are in fact stealing from the people who have contributed to the funds for all these years and are defrauding us of our money when you expect us to pay higher premiums when they are in fact totally unnecessary. Leave my pension fund where it is—

The letter concludes by stating:

As the voice of the people in parliament, if you sit by and do nothing you don't deserve your position of trust and if you allow the deficit to be paid down by the pension contributions of a few you are the biggest thief on the face of the earth and you deserve to be arrested for embezzling my pension money.

That is what my constituent wrote.

[The Acting Speaker (Mr. McClelland)]

Just before we go to questions and comments, I want to put on the record that the use of the term “steal” is not something that we like to hear. I want everyone to know that I am paying particular attention to how it is used. If anyone uses the term “steal” in a general way, not referring to a specific individual, a specific ministry or a specific political party but to government as a whole, I will consider it to be broad enough to be acceptable. If it is used in any other context I will not, just so everybody understands what the ground rules are.

[Tony Ianno, Liberal, Parliamentary Secretary to President of the Treasury Board and Minister responsible for Infrastructure]

Mr. Speaker, it is interesting listening to the hon. member from the Reform Party talk about the taxpayers' money and the government's money. It is all one and the same.

The pension plan is guaranteed. It is a legislated plan. It is guaranteed by the government and by the people of Canada and it guarantees that the pensioners will get exactly what the pension dictates. Their 7.5% is guaranteed. Their pension is guaranteed.

In the public and private sectors, generally, 60% is contributed by the employer and 40% by the employee. This plan is now 70% employer and 30% employee. We are still giving the opportunity over a four year period, starting in 2004, that if the government, the employer, and the people of Canada believe there is not enough money in the pension plan because the actuarial evaluator determines that more money is needed, at that point the maximum that the contribution from the employee can increase is .4% per year, and only if it is determined that it is needed.

The hon. member opposite should understand what this legislation is all about. It would be nice if he had read the legislation, attended some of the committee meetings and was aware of what this bill is all about. I wonder if the hon. member understands some of the precepts in the bill, aside from just having a nice speech written by someone in his office.

[Gurmant Grewal, Reform, Surrey Central, BC]

Mr. Speaker, the hon. member who asked the question showed some ignorance about how the system works. That is quite evident on the other side of the House. That is why they are supporting this bill, although we read in the newspapers that there are some wise men on that side who oppose it. There are a few members who understand what this bill is about and they know to whom this money belongs.

First, I point out to the hon. member that I write my own speeches. I prepare my speeches and I work hard. I am not like other members who bring their papers but who speak without them.

Let me point out that the hon. member knows that under the CPP 30 years ago if someone invested $1 the return should have been $11. Now with that $1 investment we know they are getting 48 cents worth of return from their pension which is managed by the government formed by his party and which was managed by the other party that ruled this country. This money belongs to the pension fund of the employees.

I have received many letters from my constituents who are worried about their pensions. A few years ago there was a $13 billion shortfall in the pension plan. Who covered that shortfall? The taxpayers.

Does the member believe that government can raise the premiums in the pension fund time and again and give a little back to the senior people who depend on their pension as a small contribution for what they did? Is this not another tax? Is that how the hon. member thinks the government should balance the budget? It has already balanced the budget on the backs of the taxpayers.

Now it wants to score some brownie points during the election time by using the pension plan money of the employees, performing some tricks in the accounting of the books and taking money from the pockets of retired seniors to pay down some debt and give tax relief.

The government has already cut $20 billion from health care in transfer payments to the provinces and then it injected $11 billion. It brags that it is injecting $11 billion. Does it not remember that it cut $20 billion in the first place? Those are the mathematics the government is using.

Voters do not have short memories. I am sure that the 654,000 pension plan members will remember when it is time to vote.

[Rick Casson, Reform, Lethbridge, AB]

Mr. Speaker, it is a pleasure to rise to speak again to Bill C-78.

One of the issues we have to address before we talk about the bill is the fact that closure has been moved and the debate has been limited. When we look at some of the reasons the government would want to do that, we see that in its backbenches there is a bit of a revolt going on with a number of its members saying that this bill is flawed. They do not like it and they are not going to support it.

The government also does this to keep things moving along quickly, so the people across Canada do not have the chance to respond to their members of parliament and so we do not have a chance to fully debate the bill in the House.

I think the government also does this to keep some of its own members from gathering momentum to oppose this. It seems that the Prime Minister is going to bring out the big stick and make sure this bill is supported by all members over there. It should be interesting later on when we vote on this.

We heard earlier that there is nothing to worry about and that the money will be there. The money is there now. Why do we not just leave it there? There is a $30 billion surplus in this account and it is to no credit of the government that it has accrued. Anytime the government sees a lump of money, it wants to grab it.

The indication is that this is going to pay the debt, but actually this law is so vague and silent on this that the surplus can be used by the President of the Treasury Board to do whatever he wishes. The government is saying it could go to pay the debt, but it could go anywhere. Canadians have the right to know where it is going to go and to what benefit to them.

We have seen huge increases in CPP premiums. They are going to go up a total of 73% over the next number of years. That still will not solidify the plan. There is a good possibility that premiums will be reduced or the age limit will be raised. Besides that, we have seen the government take the $26 million surplus in the employment insurance fund.

It seems that every time we see a couple of dollars stuck together here, and I realize that $26 billion and $30 billion are huge amounts of money, the government wants to get it and put it somewhere. I am not sure where it is putting it, but closer to the next election I imagine we will find out where it has gone.

This bill allows the government to seize the public service fund surplus. The three funds affected are the public service plan, the Royal Canadian Mounted Police plan and the Canadian forces plan.

That $30 billion has built up over the years for a number of reasons. There is the fact that inflation has been low. The actuaries projected that inflation would rise and the contributions would go up and that has not happened. There are three critical areas. Salary increases have been kept low, interest rates on investments have been good and inflation is low.

Frozen wages for six or seven years, whatever it was, is another thing. Public servants had their wages frozen. They finally got a little bit of an increase and the government came right back and said, “Okay, there is $30 billion in your pension fund and we want to get our hands on it”. This money belongs to the workers. It should stay where the workers can rely on it.

There have been shortfalls in the past. There could be shortfalls again. If this money is not there to pick up the slack, then back we go to another tax to pay for it. That is what this has turned into. They have not been pension contributions. They have not been EI premiums. If the government can take that money without using it for the purpose it was intended originally, then it is not a contribution or premium. It is a tax and it should be called that. The government forgets that this money belongs to the taxpayers and the employees.

We got into quite a debate a minute ago with a government member talking about conjugal relationships. The definition of that is one of the issues that has really caused some concern among members of our party and all parties.

The courts in the last little while have been creating laws. That is our job. That is why people voted for us. That is why we are here, to legislate. When the courts can take that away from us, when nine appointed judges of the supreme court can start making laws, then this country has a serious problem and one that needs to be addressed.

Why would we leave a clause or a word in the bill that is going to cause concern and that is going to have to go to lawyers and courts to be defined? The member for Calgary Centre put forward an amendment to this bill to take that word out and it was defeated by the government. The member stated that he has a problem with that word and if it was not there the bill would be better. Why did the government not support the amendment when it was put forward?

In this new bill survivors benefits have been expanded to beneficiaries. The thing that really puzzles me and many in this country is how we are going to decide if a relationship is conjugal. If the decision is left to the courts, the whole issue will be gone over again and again until everybody is somewhat confused as to what the issue is.

The whole idea of this expanding into relationships of a conjugal nature throws a whole different slant on the bill which does not need to be there. As members from all sides have said, we would have another look at this if that was not in there. It is there and this will eventually end up back in the courts where another decision will be made by the appointed judges. This is where the problem exists. We as legislators are not allowed to make the laws but instead it is the judges.

The people who came to see me from my riding who belong to this pension plan are very concerned. There was some representation from each of the affected funds. These people who are drawing from the pension wanted time to get together to talk to other members from across the country because they are concerned. They do not have the time because of the haste with which the government wants to move this bill through so it can get its hands on the money.

That concern should not be there. People who belong to this pension should feel very secure. They should be able to raise the questions that need to be raised so we can relate to them what the issues are and that they do not need to worry, but we do not have that time.

I believe that if a pension plan has built up a surplus of $30 billion we would have some degree of comfort if things changed, if there was a downturn in the economy, if something happened that the outgoing funds were higher than the incoming, we would have a bit of a surplus. That is gone. If money is not available to pay these people of course they are going to be worried.

If we compound the public service pension surplus being taken by the government with the concern that the CPP might not be available for people when they retire, it adds up. People have a right to feel secure in their retirement after putting money in for years.

The whole idea that the President of the Treasury Board has the authority to take this surplus and use it as he wishes is not right. The pensioners who are coming forward are very concerned with this. They have a real point that there is no accountability here. The fact that closure has been brought in on this bill and they have not had time to put forward all their concerns is not what this House is all about. That is not why we were elected by our constituents.

We oppose this bill. We feel that the money that is in the fund should remain right where it is.

[The Acting Speaker (Mr. McClelland)]

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Halifax West, National Defense; the hon. member for Sackville—Musquodoboit Valley—Eastern Shore, Fisheries and Oceans; the hon. member for Cumberland—Colchester, Nav Canada.

[Ken Epp, Reform, Elk Island, AB]

Mr. Speaker, I am delighted to enter into this debate. I want to take this opportunity to say how miffed I am. Is miffed a parliamentary word, because I am miffed. I am upset that the government is so anxious, as my colleague has just said, to get its claws on this money before anyone wakes up to what it is doing, It will all be swept under the rug. The government will get its spin doctors out there and everyone will be talking about it.

I am not even permitted to give my speech. I have one ready but it looks as if I am not going to get on because the government has said, “We are not going to listen to any reason. We are just going to do what we want to do. We are the government. We know everything. We know best”.

The fact is that the recipients and the people who are still paying into this pension are concerned. I am very disappointed that the government, just because it has a slim majority, thinks it can jam things through. How dreadful it is that the Prime Minister is forcing these people to vote whether they want to or not in the way of the minister.

I would like my colleague who gave such an excellent speech on this topic to comment a little about the lack of parliamentary process in this issue as with many issues that the government deals with.

[Rick Casson, Reform, Lethbridge, AB]

Mr. Speaker, I thank my colleague from Elk Island for his question.

The crux of the issue on this bill and on many other bills that we have dealt with in the House is the limit on debate. When the present government members were in opposition at any time the sitting government brought in closure they screamed bloody murder and rightfully so. It is a breach of the trust that Canadians have in this House.

The last time I rose to speak on this bill closure had been voted on that day. A number of people come to the gallery, come to see this place as the seat of democracy and the seat of government in the country. For them to realize what was going on here, we were being muzzled as their representatives in a democracy. We were being limited in the amount of time that we had to debate this bill. I think that is atrocious. It seems that every report that comes from a committee gets leaked before it is reported to the House. So many things go on that some days we wonder about the relevance of this place. We have to keep pinching ourselves to make sure that what we are seeing is real.

We have to have the support and the backing of our constituents. To have the government bring in closure time after time stifles us so that we cannot perform our job in the proper way. I find it very objectionable as I am sure do many others in the House.