Mr. Speaker, I am pleased to rise on behalf of the Progressive Conservative Party to take part in the debate on Motion No. 197, which would make workers' compensation payments pensionable employment for CPP.
I want to congratulate the member for Churchill for putting forth this motion. The issue is really about injured workers being prevented from contributing to CPP while collecting workman's compensation. Let me begin by enunciating the arguments in support of the motion as presented.
Allowing workers to continue making CPP contributions while injured most likely would result in larger CPP benefits upon retirement. After all, it is income. Another argument is that because CPP is calculated based on the number of months of pensionable employment, workers who are injured for significant periods of time receive significantly reduced CPP benefits upon retirement. Certainly this is a concern for a lot of workers, especially when people have been off work not for six months but for upwards of three to five years.
The important issue here to recognize that it is income; it is income not because workers do not want to work but because they are not able to work. The system really needs to treat this income from an income perspective and from a pensionable perspective as well.
The 15% dropout period in the CPP, which allows workers to exclude 15% of their working months from CPP calculations, is not adequate for workers who suffer severe injuries that require lengthy rehabilitation. In Quebec, injured workers receive benefits through the CSST, the Commission de la santé et de la sécurité du travail. That allows them to continue making contributions toward the Quebec pension plan.
Another argument in support of the motion is that in the federal public service pension plan workers who are absent due to injury or illness are able to, upon return to the workplace, make pension contributions retroactively in order to keep an unbroken record of pensionable service. That sounds pretty reasonable to me.
With a rapidly aging population, Canada is faced with the challenge of ensuring that its senior citizens are able to live out their retirement years in dignity. Because we are talking about pensions, recent studies indicate that approximately 70% of elderly Canadians are dependent on public pension plans. Progressive Conservatives have always viewed the CPP as a fundamental part of the Canadian social safety net, an obligation that governments must honour.
In 1997 Ottawa and the provinces agreed to two major changes to the CPP. First, CPP funds were to be invested in the marketplace and managed by an arm's length agency, the Canada Pension Plan Investment Board. The legislation creating the board was criticized for creating a weak governance structure without sufficient checks and balances. Second, premiums were to be increased more rapidly than previously planned, but capped at 9.95%, the level needed to fund the plan over the long run. By 2003 this equalled an $11 billion increase in annual premium revenues.
Policies must also be developed to enable a greater number of Canadian seniors in need of caregiving to remain in their own homes rather than in more expensive institutional accommodations where their independence suffers. A Progressive Conservative government would double the $800 value of the tax credit currently given to Canadians who care for low income elderly parents, grandparents or infirm relatives in their homes.
In addition to that, a Progressive Conservative government would not raise CPP contribution rates beyond adequate levels to ensure the long term viability of the plan. A Progressive Conservative government would require that members of the Canada Pension Plan Investment Board have pension fund or investment expertise.
We would appoint a minister of state for seniors to ensure that the unique needs of seniors were properly addressed across government departments. We would appoint the Auditor General as the auditor of the CPP Investment Board. A Progressive Conservative government would redirect resources from within the existing budget of Human Resources Development Canada to process the current backlog of Canada pension plan disability applications.
In 2000 the Liberal government announced an increase in the caregiver tax credit amount from $2,386 to $3,500 for the 2001 tax year. The Canada pension plan is financially sound and on track to provide retirement pensions in the future. This was the announcement made by federal and provincial ministers of finance on February 9, 2003, following the conclusion of their financial review of the Canada pension plan.
As joint stewards of the Canada pension plan, ministers of finance are required by legislation to review the plan's long term financial health every three years. In their latest review, they agreed that no changes to benefits or the contribution rates are required. The 9.95% contribution rate should be sufficient to sustain the plan indefinitely.
On February 28, 2003, the member for Cumberland—Colchester, the PC critic for the Canada Customs and Revenue Agency, presented a private member's bill that would see no application for the disability tax credit denied without it first being reviewed by a qualified medical practitioner.
Reducing the debt ratio will free up resources that will also give governments greater freedom to respond to future pressures. For example, the federal government will face pressures from an aging population, either directly through seniors' benefits or indirectly through demands from the provinces to increase transfers for health care.
According to David Zussman, president of Public Policy Forum, as printed in the Ottawa Citizen on November 25, 2002, currently seniors' benefits represent 2.3% of the GDP and are projected to rise to 4.7% of the GDP by 2040.
There are many other ways the government could ensure that we do not waste money so that there is more money for the CPP, for example, the failed long gun registry, which is into its second billion, and advertising contracts that we talked about in the House. The Privacy Commissioner's waste of public tax dollars is another example. So there are many ways of finding resources to fund the Canada pension plan.
In closing, I want to look at some of the arguments against the motion.
First, disability benefits within the Canada pension plan already exist for people who are disabled on the job. Second, if we include workers compensation as income, where do we draw the line? That question is often raised. What about employment insurance, CPP disability income, social assistance and other forms of income?
It is unfair to collect CPP premiums from people already facing a reduced income by way of workers compensation. However, if premiums were not collected to cover the increase in CPP benefits upon retirement, the CPP liability would increase.
Another question often raised is, who would pay the employer's half of the CPP premium for an injured worker? That is quite common. The last comment I have is that the 15% drop out period already exists as a provision for workplace absences.
There are pros and cons in this debate. I have presented them this evening on behalf of the Progressive Conservative Party.