Mr. Speaker, I will repeat the quote that I was attempting to read by the finance columnist from The Globe and Mail, Rob Carrick. He wrote something that I think is quite revealing. He said:
...it's disappointing to see banks, advice firms, investment dealers and mutual fund companies treated solely like part of the solution to the lack of financial literacy in Canada, and not part of the problem as well.
We need to recognize that financial institutions and banks in this country have an extremely powerful role to play with regard to persuasion over Canadians. It is that persuasion that could be used rightly or wrongly to affect the financial lives of Canadians.
As well, members should keep in mind the glaring statistic that 26% of Canadians struggle with even the most basic numeracy and 56% do not have high enough levels of numeracy to demonstrate the skills and knowledge associated with the ability to function well in Canadian society. Keeping that fact in mind, we should all be worried. We should also be worried about the high level of domestic debt. This problem needs to be addressed.
HRSDC reveals that the relevant statistics for financial literacy are 20% and 48%. If we compare that with the United States, Canada has one of the highest levels of annual costs for equity funds, which is 2.31% compared to 0.94% in the U.S. It is no wonder banks want more customers.
The highest earning 11% of Canadians contribute more to RRSPs than the bottom 89% of tax filers combined. Canadian taxpayers subsidized those RRSPs to the tune of $7.3 billion in annual net tax expenditures.
To continue with some interesting statistics, 30% of Canadian families lack any retirement savings outside of the Canadian pension plan. Also, as I mentioned before, Canadian household debt is at 150% of income and 25% of Canadians increased their debt load over the past year. In the last quarter, the CPP outperformed the markets by a margin of 10 to 1.
Why am I referring to all of these statistics? It is because what we are discussing with the bill is the relationship of power between the average Canadian citizen's knowledge of the financial system and that of the banks in this country. If we do not empower Canadian citizens with the ability to understand the financial system and what financial institutions impose on them, then we are on a slippery slope.
The measure proposed by Bill C-28 is a good one. However, from our perspective, it is not enough.
For example, we are concerned that there is no explicit requirement that the incumbent of this position be bilingual. And yet, we live in a country with two official languages.
We believe that the person responsible for improving financial literacy throughout Canada must be able to communicate in both French and English. The minister of state has assured us that the incumbent will be bilingual, but the Conservatives are refusing to put this in the legislation. That worries us.
The conclusions of the task force on financial literacy clearly state that the financial literacy leader must be kept apprised of the situation by an advisory council consisting of representatives of the industry, unions, educators, government and voluntary organizations from across Canada. This provision is included in this bill and will prevent the participation of a number of partners following implementation of financial literacy. The Financial Consumer Agency of Canada and the government have said that an advisory council will be established, but that this does not require legislation. This is confusing.
At committee stage, we proposed some amendments in order to address some of the shortcomings. We proposed that the requirement of bilingualism be added—we did ask for that—that a definition of financial literacy be added and that more responsibility be given to the incumbent of the position to be created.
However, the Conservatives rejected our amendments. Stakeholders told us that creating this position is better than the status quo. The government has at least agreed to create this position. In light of the fact that the expenses related to this position were approved in the 2012 budget, we support the bill. We will nevertheless continue to push the government to go further. Even though it has taken a small step in the right direction, there is still a long way to go.
How could we improve the situation? Financial literacy is an important aspect of consumer protection. The fact that many Canadians do not have savings and the rise in consumer debt are symptoms of the discrepancy between the rise in the cost of living and salaries, not financial illiteracy.
Too many Canadians are living paycheque to paycheque. This situation proves that the government is not taking a leadership role and that it is incapable of addressing issues that are truly important to Canadians. The government has never implemented strict laws and regulations to protect consumers. This bill falls far short of providing any real help to consumers.
We believe that the best way to support consumers is to establish a single-window consumer protection department or agency that would handle all consumer issues. If the government really wants to protect consumers, then it should move forward with credit card regulations, for instance, and implement important regulations that would cap interest rates and eliminate the excessive fees paid by consumers.
We in the NDP have a better plan in mind for financial security for retirement. We need to strengthen the Canada and Quebec guaranteed pension plans by gradually doubling benefits in an affordable manner to a maximum of $1,920 a month, thereby providing Canadians with an adequate level of guaranteed income during their retirement.
However, the government and politicians basically need to ensure that Canadians are educated and have access to financial training, as well as ensure that Canadians are protected, particularly from the banks, credit card companies and other financial institutions such as insurance companies, and the power they can hold over Canadians' lives. To that end, those institutions need to be properly controlled through legislation that focuses on the common good.