Madam Speaker, I rise in the House today to speak to Bill C-38, the jobs, growth and long-term prosperity act, legislation to implement key initiatives contained in the 2012 economic action plan.
When we introduced the first phase of this plan more than three years ago, the Canadian economy was threatened by a looming recession, begun beyond our borders, yet endangering our prosperity. Acting decisively, our Conservative government introduced temporary measures to fight the effects of the global recession through stimulus to safeguard jobs and protect the incomes of Canadians, while making important investments to ensure long-term growth.
Today the positive impact of our plans is abundantly clear, despite the misguided commentary we hear from the opposite side of the House. One should not take that opinion from me. Patricia Croft, former chief economist with RBC Global Asset Management, recently said, “In a global context, I think Canada is in a fabulous position. Canada continues to manage its fiscal affairs in a fabulous fashion”.
Thanks to our plan, our fiscal record is second to none. Although judging from their remarks throughout the debate on the bill, opposition members seem to be ignorant of these facts.
Both the IMF and the OECD have forecast that Canada will have among the strongest record of economic growth in the G7, both this year and next. Not only that, but for the fourth year in a row the World Economic Forum has rated Canada's banks as the most solvent in the world.
We all know that the prestigious Forbes magazine has ranked Canada number one in its annual review of the best countries in which to do business. The three major international credit rating agencies, Moody's, Fitch Ratings and Standard and Poor's have reaffirmed their top ratings for Canada.
I think it is clear to anyone who is listening that under our government's stewardship, Canada has weathered the economic storm with strength and the world has noticed.
This praise is not hollow. In truth, it speaks to the sound fiscal planning that has been the hallmark of this government. Our economic resilience reflects the actions our government took before the crisis, lowering taxes, paying down debt, reducing red tape and promoting free trade and innovation. I am proud the prudence continues to be reflected in action plan 2012 and in the measures contained in Bill C-38.
While my time is limited, I would like to speak specifically to our government's actions to ensure the retirement security of Canadians, as these measures reflect our commitment to fiscal planning that is sustainable well into the future.
This is of particular importance to my constituents in Okanagan—Shuswap, as we are the number two destination for Canadians to retire, and we actually have the largest number of seniors per capita in any place in Canada.
Since 2006, our government has taken steps to strengthen Canada's retirement income system, including increasing the guaranteed income supplement for the most vulnerable seniors, introducing pension income splitting, increasing the age credit and creating innovative savings vehicles like the tax-free savings account and co-registered pension plans.
Economic action plan 2012 takes further steps to ensure that Canadians will have access to a secure retirement for years to come by ensuring the sustainability of old age security and the guaranteed income supplement by gradually raising the age of eligibility from 65 to 67, starting in 2023.
The facts on OAS are clear. The OAS program was conceived at a time when Canadians were not living the long and healthy lives that we are today. We know with certainty that over the next 20 years the number of Canadians over the age of 65 will increase from 4.7 million to 9.3 million. Consequently, the cost of the OAS program will increase from $36 billion per year in 2010 to $108 billion per year by 2030. Meanwhile, by 2030, there will only be two taxpayers to support every senior, down from four to one in 2010.
We are not the first government in the world to recognize this inevitable demographic reality. Many countries are increasing the age of eligibility of their public pension programs. Of 34 OECD countries, 22 have recently increased, or announced plans to increase, the eligibility age. It is a long list that includes: Australia, Austria, Belgium, the Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Ireland, Israel, Italy, Japan, Korea, the Netherlands, the Slovak Republic, Slovenia, Spain, Turkey, the United Kingdom and United States.
This change in Canada does not start tomorrow. It would start in April 2023, with full implementation by January 2029. That is a 17-year notification period and, as such, it would not affect anyone who is 54 years of age or older as of March 31, 2012.
There is no question that this is the right move to ensure that our generous system of retirement benefits is there for Canadians when they need it most. Just listen to the words of the Globe and Mail editorial board, speaking directly to the measures contained in the bill that the opposition is voting against. It said, in part:
The two-year deferral of the Old Age Security for those now below the age of 54 is a fair and reasonable adaptation to an era of greater longevity and mostly prolonged health... Likewise, the reform of public-sector pensions, by higher employee contributions and a normal retirement age, will before long greatly relieve strains on the public purse....[The Prime Minister] and [the Minister of Finance] can, and do, truthfully say that the federal government’s finances are on track....Ottawa’s books of account are headed in the right direction. This is why the Conservatives were elected, to prudently manage public finances in a tumultuous time.
Canadians have told us that as they live longer and healthier lives, many older workers wish to remain in the workforce and increase their retirement income. Our changes to the OAS program reflect this new reality, while assuring that the OAS program is on a sustainable path.
To this end, we are also improving the amount of flexibility and choice Canadians can exercise by allowing the option of deferring the take-up of their OAS benefits to a later time. This way, should Canadians wish to work and save a little longer, they will receive higher annual benefits when they eventually collect their pension.
This too has received support from the strongest voice of Canada's small business community. The Canadian Federation of Independent Businesses has said, “[we are] supportive of the idea that Canadians should be incented to work longer by receiving additional OAS if they push back their retirement”.
Further, we are working to provide increased support to the retirement income system with pooled registered pension plans. These will provide an accessible large-scale and low-cost pension option to employers, employees and the self-employed.
Not only that, we will continue to deliver on promises to Canadians to keep taxes low and return to a balanced budget over the medium term.