Mr. Speaker, our government cannot support Bill C-326. It is not in the best interests of Canadians nor in the best interests of seniors or taxpayers.
I know the bill itself proposes that, rather than having the payments monthly, they would be made biweekly. The member for Bonavista—Gander—Grand Falls—Windsor would say it is a small thing, in terms of the change. However, it is a big thing, in terms of the costs that would be involved and what would be passed on to taxpayers. The member for York West, who was for a short time minister of human resources, would know that these matters administratively cost a lot of money. There is a lot of bureaucracy involved. These proposed changes would needlessly increase expenses and add to the bureaucratic administration of the government at a time when we are looking at ways to reduce spending and ensure more efficient operation of government.
Let me assure members in the House that as a government, we are committed to ensuring Canadians receive the benefits to which they are eligible. There is no question about that. That is why we brought in automatic renewal of the OAS and GIS for seniors who file a tax return.
We also announced in our economic action plan 2012 that we would be proactively enrolling Canadians for their old age security benefits to ensure that every senior receives their full entitlement. We are acting to ensure that government services are streamlined, efficient and take less effort for Canadians to receive the services they deserve.
The current system of monthly payments is the most efficient way to administer old age security and Canada pension plan programs. While we can never be sure exactly how many seniors would take advantage of a biweekly payment schedule, it would not be unrealistic to expect we would almost double the number of transactions for CPP and OAS benefits. Service Canada and Public Works and Government Services Canada estimate that the total cost would increase by $40 million to $50 million per year. It is a small change maybe, but potentially quite costly. We certainly have to take that into account when we are considering streamlining government and reducing expenses.
In this time of fiscal restraint, our government is committed to delivering the highest quality service in a way that is efficient, effective and focused on the needs of Canadians. As we recently highlighted in Canada's economic action plan 2012, the government has recently completed significant reviews aimed at reducing government bureaucracy.
The most immediate exercise was the government's deficit reduction action plan. This exercise examined government spending to reduce overlap redundancy in administrative costs and ensure value for taxpayer dollars. This review demonstrated our resolve as a government to put taxpayers first, while making strategic choices to ensure efficient government spending well into the future.
The second exercise was the red tape panel that led to a one-to-one rule. The principle is quite simple. Every time the government creates a regulation, the department has to eliminate a regulation. This would make interaction with government much more efficient, while also simplifying the administration of government.
I do not understand why the member opposite would like to add to the bureaucratic processes of government. We recognize that today's seniors have played, and continue to play, a vital role in Canadian society. There is no doubt about that. By working hard throughout their lives and paying taxes, they have contributed to Canada's strong fiscal foundation. They continue to contribute by offering their wisdom, their talent and their time in their communities. They are role models for all of us.
Our government is committed to improving the well-being of Canadian seniors. We are certainly open to exploring ways to better assist these respected and valued members of our communities now and into the future. We have made provision for the retirement benefits to be more convenient for seniors.
However, we must question whether the measures proposed in Bill C-326 would address the real problem.
Does the monthly payment system really need fixing? Would a biweekly system really give value for money? If not, it would be irresponsible for us to impose yet another layer of process and drive up unnecessary spending at a time when taxpayers expect us to be prudent in handling their hard-earned money.
Canadians gave our government a strong mandate to complete Canada's economic recovery and return to balanced budgets. This is exactly what we are doing.
Payment processing already involves several departments acting in conjunction. There is more involved than most would think. The processing cost of a single cheque or direct deposit may not seem like much when looked at in isolation, but when the government is issuing millions of cheques and deposits each month, it becomes a whole different matter.
The changes could actually have unintended consequences for seniors that are not desirable. The proposed changes would also increase the burden on the system, just as we are facing increased financial pressures from a growing population of seniors. As members of the House are well aware, the first of Canada's baby boomer generation started to turn 65 in 2011. Within less than two decades, almost one in four Canadians will be over 65. Looking at these numbers alone, the coming challenges are evident. It is important to understand that distributing benefits to seniors requires a lot of organization and coordination.
To ensure the efficient delivery of all benefit payments, Service Canada works in partnership with Public Works and Government Services Canada, Canada Post and the banking sector to coordinate the financial transfers of benefits payments. Each organization has developed work plans around a payment date that is the third last banking day of each month.
This practice of paying all benefits at the end of the month was adopted to provide the best service possible in a cost-effective way. Monthly payments are the commonly accepted standard for government benefits. I want to point out that most federal benefits are paid out on a monthly basis: benefits paid by Veterans Affairs Canada, the universal child care benefit and the child tax benefit, among others. Monthly payments are also typical in programs for seniors in the majority of countries belonging to the Organisation for Economic Co-operation and Development.
Payments made monthly are also the norm for most seniors benefits in Canada at the provincial and territorial level. Let me expand on this last point quickly. There are several provincial and territorial programs that base their benefit level on an individual's OAS and GIS payments. If we changed things at the federal level, it would mean that the systems at the provincial level would also need to be changed to reflect this fact. In the highly automated environment governments operate in today, something that may seem like a small change can have a considerable ripple effect.
In a time of spending restraints it would be difficult to justify the costs involved in changing the system, based on an argument of convenience in changing it from monthly to biweekly.
We fully understand the importance of a secure and dignified retirement for hard-working Canadians. OAS and CPP are the first two pillars of Canada's retirement income system and play a significant role in providing income security to Canadians in their senior years. There can be no question of our commitment to ensure that Canadians receive the benefits for which they are eligible and entitled. However, the change proposed in Bill C-326 would further complicate the system without addressing any pressing need.
The additional cost involved would only draw funding away to underwrite the administrative process. These funds could be better spent on measures that would truly help seniors and other Canadians.
For these reasons our government is in favour of keeping the legislated monthly payment schedule of CPP and OAS. My colleagues and I cannot support Bill C-326. It would be an irresponsible use of taxpayers' dollars.
I would urge members opposite to reconsider their position, to look at the ramifications of what they are suggesting, to look at the millions of cheques and deposits that have to be made, the numbers of departments that would be involved and the bureaucracy that it would take to get there. I urge them to reconsider whether they want to spend those kinds of dollars, those kinds of efforts and that kind of energy to achieve merely the advanced payment from monthly to biweekly when the system we have now is working. It is timely, it has developed, it is something people have come to expect and something that has been a common practice in other areas as well. Other services use that model. It has been something Canadians have accepted over the years and it is something that the opposition should look at. That money could be better spent doing other things for seniors or other members of the Canadian public.
I would ask them to reconsider their position and not proceed with this unnecessary amendment at this time.