House of Commons Hansard #211 of the 37th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was funds.
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
Order, please. The hon. member is perfectly right. As a member he had every right to move the amendment. The amendment was acceptable under the rules of the House. We are now debating the amendment. Whatever negotiations took place, the Chair was not privy to those negotiations.
On debate, the hon. parliamentary secretary.
Paul Szabo LiberalParliamentary Secretary to the Minister of Public Works and Government Services
Madam Speaker, I was prepared to speak to the bill itself, not to the amendment. The amendment would basically kill the bill, which was not in accordance with the understanding and the agreement between the House leaders. Notwithstanding that, the member decided he wanted to take this attack.
Let me make a few comments on the bill and why the bill should pass. I think members will know from the debate so far that we are dealing with the Canada Pension Plan Investment Board that is charged with the responsibility of investing Canada pension plan dollars. These dollars are kept separate from government dollars that are available for spending on programs and services for Canadians. The premiums are put aside and invested to earn a proper return so that pensioners under the Canada pension plan will be assured long term stability and security.
I would also point out that the Canada pension plan is much more than just a pension for those who contribute to the plan to receive benefit during retirement. Canadians should also know that the pension plan also provides survivor benefits. In the event someone who has made contributions to the plan dies before they can collect those benefits, or even after they starting collecting and subsequently die but have a surviving spouse, the benefits can be transferred to that surviving spouse. There are also death benefits, not only for the estate or for the surviving spouse but also for the children of the deceased.
Finally, there also is the disability insurance. It is an expensive proposition. It was introduced as part of the plan. It represents a very growing part of the cost of the Canada pension plan administration and the system of benefits. It is a very important part of that pension plan. I am not sure if Canadians know why that is in a pension plan. It is there to provide protection to Canadians who might not otherwise have workers' compensation or other disability insurance in the event they become disabled and are unable to earn an income for their families and to take care of their financial responsibilities.
The Canada pension plan system came in 1966. It was in response to an interesting phenomenon. People who were reaching their retirement age at age 65 had come through the depression years. They not only had a lot of difficulty getting work to provide for their families, but they also had no opportunity to put money away for their retirement. Therefore, the Canada pension plan was an important instrument to provide retirement benefits for Canadians.
However, those people were getting benefits immediately on the passage and introduction into law of the Canada Pension Plan Act. The act provided benefits which were paid for by the current contributions of the workers of Canada. We had at the time over five workers in Canada for every one pensioner under the Canada pension plan. That was very adequate to ensure that there was appropriate funding for the pensions of these Canadians who did not have an opportunity to provide for their retirement and who now were drawing benefits from the plan.
Canadians know that as time goes on our society ages. It is estimated that in the next 10 to 15 years we only will have about three workers for every one pensioner. That puts a greater burden on the system to sustain a much larger number of pensioners. Therefore the House approved changes to the Canada Pension plan act which would put it on a long term stable footing.
In the nineties, in my early years as a parliamentarian, I often heard that the Canada pension plan was bankrupt because the premiums were going toward paying pensioners. People felt that was their money. They wanted to know why it was not being accumulated. That is the explanation.
As we move forward and as benefits improve, premium schedules have been put in to ensure long term financial stability for our plan. The Canada Pension Plan Investment Board has also been established. That board was established for one purpose and one purpose only: to ensure that it earned a fair and equitable return on its investments for the protection of moneys of today and future pensioners.
The board was not set up as a policy instrument. It was not set up as a board to direct its investments in certain areas but not others. A very significant amount of Canadian money is involved. Imagine if that investment board had a plan whereby it would invest in high technologies exclusively. That kind of capital being directed totally in one sector of the economy would be terribly disruptive. It could severely impact the market value of other securities on the exchanges.
One proviso of the Canada Pension Plan Investment Board was that its investments mirror the level of activity and the kind of investments Canadians themselves would make in each of the stock exchanges so there would be no disruptive effect of this large amount of capital going into the equity markets.
The bill also has a proviso whereby up to 30% of investments can be made in offshore investments. One reason for that is it mirrors what the Income Tax Act now provides for all Canadians. Canadians know that Canadian markets have a quite satisfactory return rate. However from time to time there are investments abroad unavailable on the Canadian market. Canadians feel for their own retirement purposes, for their RRSPs or for their own personal investments to further provide for their retirement, that they want an opportunity to invest in foreign markets. As a consequence currently there is the 30% foreign ownership limit. That is what is being prescribed again to emulate exactly the laws that are there today for individual investors.
A previous speaker suggested that we not maximize the return for investments but maybe start to use it as a policy instrument or start to invest some money in infrastructure, venture capital operations and other things like water safety. As I said, the purpose of the investment board is not to be an instrument of policy. We have opportunities. We have all the tools we need to invest in infrastructure. We have tools to promote good health, such as tobacco cessation programs and to deal with things like drug problems. The money of the pensioners should not be put at risk on those policy initiatives. We should use the tools which have been directly set up to achieve those policy objectives.
The policy objective of the Canada Pension Plan Investment Board is to protect the money of contributors to the Canada pension plan thereby providing long term stability and survivability of that plan on a sustained basis for all current and future pensioners. That is important to point out.
That is why I oppose the amendment which basically says that the bill should not go forward. It basically eviscerates the bill. I am not sure whether it is constructive to do that. The member should simply speak to the bill, lay out the reasons why he does not support it, step by step, so people have an understanding of the basis for the objection.
The member has a right to table an amendment. However to say that he does not want the bill without giving reasons is really not responsible. I hope we find a resolution to this because the bill should go forward. It is an appropriate bill. It addresses a longer term implementation of getting the Canada Pension Plan Investment Board on a stable footing for the long term sustainability of the CPP.
There were some earlier comments about an ethical screening. Canadians know that there are certain investments and mutual funds. Their investments are based on certain principles. For instance, they will never invest in the tobacco industry or in activities that are damaging to our environment. Some of those have done well and some have not.
Through those investment instruments we might demonstrate our wishes, but I am not sure whether it is the most effective way to address our concerns, whether they be the health of Canadians or protection of our environment, which is also an important health issue, or to improve infrastructure, water, housing or any of the other important social needs that Canadians have and want.
Canadians should also know that the Canada pension plan is a program which is not just operated on behalf of Canadians by the federal government. It is the joint responsibility of the federal government and the provincial and territorial governments to agree on the benefits and administration of the plan. The investment board is a vehicle under the Canada Pension Plan Act to make the investments secure, stable and wisely on behalf of Canadians but not to make policy as to what benefits are given, et cetera. There are certain things that must be done.
This is an important element because one of the members suggested that somehow we needed to have on the investment board representatives of pensioners, non-pensioners, future pensioners, trade unions, labour, white collar and blue collar workers. If we were to say that every government agency and board should represent every identifiable group within Canada, we would have boards of hundreds, if not thousands, of people to appropriately reflect the balance and mixture of groups.
I have always opposed making lists. If we have a list of appropriate people it must mean somebody is left off and that person must be inappropriate. However what about those people who are not represented on the list but are not inappropriate? We get ourselves into trouble by making lists.
The Canada Pension Plan Investment Board was established for the purpose of ensuring that the dollars of Canadians, who invested in their pensions, would get a fair and reasonable return, given the opportunities within the marketplace, and in a way which would not be disruptive to the overall marketplace, given the substantial amount of money being administered by the plan.
The issues are clear. The investment board was established for specific reasons with specific criteria brought forward by the federal-provincial-territorial governments. The administration and continued enhancement of benefits are there so that when the circumstances warrant, Canadians, through their elected representatives at all levels of government, federal, provincial and many of the others, have an opportunity for input. Therefore it is not necessary to have distinct groups represented on the board. The board has its mandate and gets its direction from time to time from the representatives of all Canadians, their elected officials. That is the beauty of our parliamentary democracy.
I oppose the amendment posed by the hon. member. I am sorry he thought he had to do it because it was not reflective of the House leaders' agreement. I know he still wants to exercise his responsibilities.
I hope we have a resolution to the issue in the best interest of all Canadians. I will be voting against the amendment posed by the hon. member.
Don Boudria LiberalMinister of State and Leader of the Government in the House of Commons
Madam Speaker, I listened attentively to the discourse of my distinguished colleague in the House today. He will recognize that some years ago the Government of Canada, through the excellent leadership it has been exercising, put in place the investment mechanisms we know of now.
Does the hon. member remember the previous system? It worked in a rather curious way whereby the funds accumulated on premiums were converted to loans at below prime to the provincial governments, except of course the province of Quebec which has a much better system. It has an investment fund of its own which generally speaking has worked quite well. Does my hon. colleague agree that when we put together that mechanism it was high time to put the Canada pension plan back on a sound footing?
Many years ago I was in the provincial legislature along with my hon. colleague from Halton. He and I and David Peterson who was our leader at the time often questioned the then government of Ontario about how it administered the funds. They seemed to disappear into a black hole.
Perhaps my hon. colleague would agree that unlike the U.S. social security system and perhaps those of other countries, under our government Canada's national pension plan has been put back on a proper and sound footing. First, we have done so by raising premiums as we needed to. We got the consent of the provinces to do this through a federal-provincial agreement as I am sure all members remember.
Second, we have provided for mechanisms whereby in the future income would be generated so that many years from now, Madam Speaker, when you drew CPP benefits and in many fewer years when I did, there would be funding for future generations of beneficiaries.
Paul Szabo Liberal Mississauga South, ON
Madam Speaker, the hon. government House leader is quite correct. In 1966 when the Canada pension plan was instituted there were more than five workers for every pensioner. The premiums started at around $35 a year to create reserves over time which were loaned to the provinces at nominal rates of interest. At the time it was not of concern because there were sufficient workers in the labour force to provide the benefits.
However as all members know, as the plan matured and our aging society started to kick in, changes had to be made to ensure sufficient premiums were being collected. This had to be done to ease the burden on the labour force 10 to 15 years from now when there will be only three workers for every pensioner. The changes were made because Canadians felt the Canada pension plan system was an important instrument for them not only for its pension benefits but for its survivor, disability and death benefits.
Members may not be aware of this, but a person who started working in Canada in 1966 when the Canada pension plan was introduced and who has continued to work up to today and pay all the premiums would have put in less than two year's worth of Canada pension plan benefits. Such a person would have put less than $16,000 of his or her own money into the Canada pension plan.
This shows that the plan is on a substantive footing. We have the actuarial statements. The Canada pension plan is subject to biannual reviews by the federal and provincial governments to ensure all the provisions are respected and that the work of the Canada Pension Plan Investment Board is proceeding as planned. Notwithstanding the variability of the marketplace, the plan continues to perform equitably relative to other investors.
However over the longer term a balance between equity and debt instruments has shown a better performance than simple nominal rates to the provinces. This alone reflects the fact that the decision taken by the Parliament of Canada to institute the investment board was exactly the right thing to do.
Larry Bagnell Liberal Yukon, YT
Madam Speaker, before I ask my question, is there anyone in the House who agrees with the ad hoc amendment that was thrown out at the last--
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
I am sorry, that decision has already been made and you are questioning a decision of the Chair.
Larry Bagnell Liberal Yukon, YT
Madam Speaker, because we had this frivolous last moment amendment, could the hon. member outline or summarize for the House what this important bill would do? The amendment would have pretty well emasculated or blocked the passage of this important bill that would help protect the investments of poor people in the country.
Paul Szabo Liberal Mississauga South, ON
Madam Speaker, there is not enough time to answer the hon. member's important question.
The Canada pension plan system has evolved to the point where the vision for the long term sustainability of the plan was looked at in 1997. Plans have been made. Canadians should be encouraged that the Government of Canada had the vision to look at the plan to find out how to ensure its long term sustainability and put it on the sound footing it is on now.
As a consequence of that work returns are being made which reflect a fair and reasonable return relative to other investment opportunities on a balanced basis and in a way that does not disrupt the financial markets. It gives Canadians a level of comfort level to know their pension benefits, survivor benefits, death benefits and disability benefits would all be there for them in the long term.
Joe Clark Progressive Conservative Calgary Centre, AB
Madam Speaker, the amendment has raised two fundamental issues of importance to parliament. First, it raises the issue of the right of members of parliament to introduce amendments that are important to them, whatever the agreements that might have been made among House leaders. The Chair has ruled on that question. It ruled the amendment to be in order.
There may well be disagreement about the extent or nature of the agreement among House leaders. If that is the case it is a commentary on the obligation of the government House leader to ensure that when he enters into an agreement with House leaders of other parties its implication is understood in the same way in all parts of the House.
Let us not forget that the amendment is about the right of parliament to make decisions on matters of fundamental public importance based on the fullest information possible. Parliament should not have to rush into decisions before the information is available for it to consider, information that is provided at public expense and by the law of the land.
As was made clear in the language of the amendment and the brief remarks of the hon. member for Calgary West, the amendment was introduced because the present situation is unacceptable. Parliament is required to make decisions before receiving and digesting the report required by law to be tabled in the House by the Chief Actuary of Canada.
If this were the only case in which the government had denied parliament access to the information it needed to decide, that would be one thing. However it is about a much larger principle. It is about the consistent and growing practice of the government to deny information about decisions that are essential not only to parliament but to the public of Canada.
The chief actuary reports to the House of Commons of Canada for a reason, and the reason is not to give a running commentary for historians to consider in years to come. It is to ensure parliamentarians who make decisions on public policy have the facts in hand.
The present situation allows the actuary's report to be tabled after decisions are taken. Decisions must be taken without the information in hand. This is not only perverse. It reflects the government's growing practice of trying to deny members of the House of Commons and citizens of the country the information they require to make major decisions.
It happens here with respect to the report of the Chief Actuary of Canada. It also occurs on a range of other questions. Everyone in the House is aware of the government's treatment of the information commissioner. When he seeks the information that is legitimately his, the Prime Minister of Canada intervenes in the courts. He uses the lawyers of the Government of Canada to try to prevent the information commissioner from exercising the rights given to him by the Parliament of Canada to look into the private books of the Prime Minister.
This indicates the elevation of the personal interest of the Prime Minister over the public interest of the country. It demonstrates the government's determination to withhold as much information as possible on as many subjects as possible from the people of Canada.
There are members in the House who have claimed to support the information commissioner. However the government has established a committee of public servants to make recommendations on how to tighten the rules of access to information even further and thereby make it more difficult for parliament and the people of Canada to have the facts upon which decisions can be based. The government has taken the same action with respect to the chief actuary that it has taken with respect to the officer whose role is to ensure access to information.
The instances go on and on. They are before the House today with respect to the extremely limited inquiry being carried out into the question of publicity and sponsorship contracts by the Government of Canada.
Earlier today we heard the President of the Treasury Board and the Minister of Public Works and Government Services say that there is a government-wide inquiry into this matter by the auditor general. That is absolutely false. That is not the case.
The powers of the auditor general are very explicitly limited to conduct an inquiry respecting sponsorship, respecting advertising, only into those agencies where she has the power under the law to conduct an audit. That is not government wide.
She does not have that power with respect to the so-called arm's length corporations, corporations that set up in effect for off the books accounting, a practice that became known in the private sector, to everyone's chagrin, not long ago with Enron. The auditor general cannot audit those matters so she cannot look at the expenditure or the potential patronage on publicity or on sponsorship programs entered into by any of those corporations, which include the millennium scholarship fund and a number of other agencies where the association with the Liberal Party of Canada is already too close.
There is a $7 billion pool of money that can be used for improper purposes by the government that specializes in improper purposes and it is beyond the range of inquiry of the auditor general. Yet the government pretends it is a government-wide inquiry, government wide except for $7 billion.
Worse than that, there is a series of crown corporations for which the auditor general is not the auditor. She is thus not empowered to conduct an inquiry into the abuse of sponsorship or advertising programs in those crown corporations. They include, among others, Canada Post. Who by the surest of happenstance is in charge of Canada Post? André Ouellet, a former government minister, someone who, when he was here, was known to be among the most skillful--
Larry Bagnell Liberal Yukon, YT
Madam Speaker, on a point of order, I realize the House always gives tremendous leeway in debate, which I often use myself, but really, we are debating an amendment to the Canada pension plan and the member has barely mentioned it once. He is talking about the auditor general. He is talking about inquiries. He is talking about $7 billion. He is talking about crown corporations. He is talking about Canada Post. I would appreciate it if he could add some light to the actual amendment we are debating.
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
The question of relevance is always relevant. The right hon. member has experience in the House and I am sure he will return to the amendment.
Joe Clark Progressive Conservative Calgary Centre, AB
Madam Speaker, I am dealing directly, and I have been consistently through my remarks, with the fundamental principle of the amendment before the House. It is an amendment that is designed specifically to ensure that when parliament makes decisions on matters relating to he Canada pension plan it is able to do that having in hand the report of the Chief Actuary of Canada. The present practice denies us that information.
The amendment is about access to information. The reason the amendment is so very important and why we would support it is precisely that it has become a practice of the government on issue after issue, as my friend from Yukon has indicated and he knows as well as I do that the list is long and it is lengthening of areas in which the government tries to shut out the public. I could go on much longer than my time allows to identify those instances.
The point is that in a democracy we need information to decide. The House of Commons which is at the heart of our democracy particularly needs good, current information to make decisions. It needs the information before the decisions are to be made.
Under the present practice, addressed directly by this amendment, it is clear that the information does not come until after the decisions are made. That is wrong and it should be changed. The amendment seeks to change that but it is a much larger practice. The government consistently tries to move forward and it keeps the public and parliament, those who should be informed in a democracy, those instruments of democracy in the dark. That is the relevance of the amendment and the reason I am addressing it so significantly.
I do want to return to the other troubling instance of the practice of holding information back from bodies that have to make decisions.
I was speaking about the inability under the law now of the auditor general to conduct an investigation into the $7 billion that is held right now by the arm's length foundations and the inability of the auditor general to look at agencies like Canada Post which, although we do not know and will not know until we see the facts, may well be abusing its authority and entering into the kinds of contracts with Groupaction or with others that have caused such a furor here. That is why we need to see the facts. The RCMP cannot look into those activities. As well, no committee of the House can. Right now the auditor general is precluded from looking into those by the legislation that guides her decision.
However, that legislation under section 11 also vests in the Government of Canada the capacity to extend the right of audit of the auditor general to those arm's length foundations and to each of the crown corporations where patronage might now be practised. It would take a simple decision by the Government of Canada to say that the auditor general under section 11 has that authority. Once she is given that authority, as night follows day, she then also has the authority to take her investigation into potential patronage and into the activities of sponsorship and publicity into the areas where she is given the capacity to conduct an audit by the government. However, that is up to the government and it knows that.
The President of the Treasury Board today gave me an answer, and I want to be careful of my parliamentary language, designed to mislead. It was successful in its design. However, there is not a government-wide inquiry into this matter.
On the principle here today, we cannot make decisions on Canada pension plan matters based upon the report of the Chief Actuary of Canada if we are asked to make the decisions before we receive the report. It is very simple. Any child in grade school would understand that. The government understands it.
This should not be regarded as a mistake. This is a practice. The government wants parliament to make decisions without adequate information because it knows that information empowers and the absence of information enfeebles. What it wants is a parliament and a public that knows as little as possible about public business.
It is a characteristic of the government and it is a characteristic that is clear in the legislation before us now. It is a characteristic that would be changed if the motion proposed by my colleague from Calgary West were to be supported, which is why we will support the amendment when it comes to a vote today.
John Bryden Liberal Ancaster—Dundas—Flamborough—Aldershot, ON
Madam Speaker, I thank the member for Calgary Centre for his remarks on this particular issue and the amendment. It gives me the opportunity to speak to the issue of access to information as opposed to the more limited and narrow application of the auditor general's right to audit foundations.
This gives me an opportunity to report that the task force on access to information that was struck by treasury board and the Department of Justice two years ago presented its report not a week ago. One of the major features of that report was a recommendation that would bring under the Access to Information Act the foundations and crown corporations alluded to by my colleague, the member for Calgary Centre.
I would submit to him that what we really ought to be doing in this parliament is urging the government to act on that particular recommendation in the task force report, which I suggest to him would have far more sweeping impact on government accountability and the accountability of crown corporations and arm's length agencies than having the auditor general have the right to review those agencies.
I point out to him, in the Groupaction sponsorship files case, a government audit was done on the sponsorship files in 2000 which disclosed all the problems. One of the problems it disclosed was the fact that for years contracts were being let and agreements were being entered into for which there was no documentation. One of the problems for the auditor general, and one of the problems for any police investigation that might be looking into this file, is that one cannot determine what actually occurred because the documents do not exist.
I suggest that a revised Access to Information Act that made sure all those documents that pertained to contracting out, in the sense that was done for the sponsorship program, should have been collected and put on the web so that any citizen, and even more importantly, any fellow colleagues or bureaucrats in the department of public works or any other agency would be able to look into that particular file of the sponsorship contracts. It would have been discovered instantly that the documents that should be created were not being created.
In other words, if we had a reformed Access to Information Act that guaranteed that this type of document when generated is to be publicly available. And if we insisted on a culture in the bureaucracy, and I think the bureaucracy is headed this way in any event, and I should say the government which includes the political government as well, we should be taking advantage of electronic access so this type of document would be readily available to all.
If that had been the system, we would not have had the problems that we have encountered now in the sponsorship file. We are all distressed by that because it is a reflection on the business of the bureaucracy in which Canadians have an enormous trust and any failure, of course, may erode the confidence Canadians have in what I feel is one of the best bureaucracies in the world.
So I submit to you, Madam Speaker, and through you to the member for Calgary Centre, although I certainly heard him on the suggestion about the auditor general but audits are only spot checks. What we really have to have is a system whereby there is always in place the kind of transparency that enables all Canadians and parliamentarians and the media to do their jobs to make sure that all areas of government are being managed in a way appropriate to the interests of all Canadians.
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
Is the House ready for the question?
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
The question is on the amendment. Is it the pleasure of the House to adopt the amendment?
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
All those in favour of the amendment will please say yea.
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
All those opposed will please say nay.
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
In my opinion the yeas have it.
And more than five members having risen:
Canada Pension PlanGovernment Orders
The Acting Speaker (Ms. Bakopanos)
Pursuant to Standing Order 45 the division stands deferred until Wednesday, September 18, 2002, at the ordinary hour of daily adjournment.
Jacques Saada Liberal Brossard—La Prairie, QC
Madam Speaker, I rise on a point of order. I believe that if you were to seek it, you would find that there is unanimous consent to say that it is now 1.30 p.m.