Mr. Speaker, I am glad to rise once again in this House and speak again on Bill C-25, pooled registered pension plans act.
This proposed piece of legislation is of vital importance to my constituents in Etobicoke Centre. I have hundreds of businesses, especially small and medium-sized businesses, in Etobicoke Centre. I really do appreciate the opportunity to elaborate on the bill's many merits here today.
As a member of Parliament, I am immensely proud to be part of a party that has the best record in providing retirement security options and for introducing legislation that would encourage the entrepreneurship of the ma-and-pa shops, which are the drivers of our economy and form an essential part of my riding of Etobicoke Centre, as I am sure they do in the rest of the country and in many ridings across the country.
Since 2006, our Conservative government has established a strong record when it comes to aid for small businesses. We have reduced the small business tax rate, provided $20 million to support the Canadian Youth Business Foundation and extended the accelerated capital cost allowance to help businesses make new investments in manufacturing and processing machinery and equipment.
Our government's square focus on incentivizing business has resulted in real growth. Canadians can rest a little easier knowing that our country has the enviable position of creating jobs in a fragile global economy, more than 760,000 so far.
Canadians have come to expect good economic stewardship from this side of the House, and we will continue to deliver that good economic stewardship. As part of this commitment to action, our government introduced the pooled registered pension plans, which would provide for a new accessible, large-scale and low-cost pension option to employers, employees and the self-employed.
In my last speech, I spoke about wide-ranging support for this pension option. I drew particular attention to the fact that all our provincial partners are on board and that stakeholders like the Canadian Chamber of Commerce and the Canadian Federation of Independent Business have urged the government to make PRPPs a reality as soon as possible.
As my colleague, the Parliamentary Secretary to the Minister of Justice, said earlier, Ingrid Laederach Steven, owner of the Swiss chocolate shop in Toronto, is very welcoming and glad of this because there are so many different things for retailers, restaurants, farmers and so on. She wishes it could have been done 25 years ago.
The support is warranted, given the attractive features of the PRPPs, including their portability, whereby many employees will be able to transfer funds between administrators when they change jobs, and their auto-enrolment feature, which would reduce administration costs and increase participation rates in the program.
PRPPs would also have the added bonus of having a very low cost, given their scale, design and lower investment management costs compared to the average mutual fund. This makes it affordable and reachable for the people who work in small and medium-sized businesses.
PRPPs would improve the range of retirement savings to Canadians and provide an accessible option to the 60% of Canadians who do not currently have access to workplace pension plans. In the end, PRPPs are an essential tool, given the aging demographics we face in the future and our need to provide more retirement income options for our constituents.
Instead of acknowledging the many benefits of this plan, as other stakeholders have done, and get working on Canada's economic recovery, as this government does each and every day, members across the way are doing what they do best, trying to delay our economic progress and throwing false accusations our way.
For example, they allege that the pooled registered pension plans would come at the cost of further progress on reforming the Canada pension plan. To that I reiterate yet again what my colleagues have said before me: pooled registered pension plans are meant to complement the services our government has already provided for Canadians' retirement security and not replace them.
Pooled registered pension plans would work in conjunction with new initiatives that our government introduced, including pension income splitting, tax free savings accounts, as well as traditional retirement income vehicles like the CPP.
Furthermore, changes to the Canada pension plan, as the opposition knows full well, require the consensus of two-thirds of the population. We have already seen at the 2010 finance ministers meetings that a number of provinces hold strong objections to expanding the CPP benefit. They are unanimous, however, in pursuing a framework for pooled registered pension plans.
The opposition also glazes over the fact that its suggestion to increase contribution rates for CPP would mean higher payroll costs for small and medium-sized businesses and higher premiums for workers and the self-employed. Since CPP is mandatory rather than voluntary like the pooled registered pension plan, an expansion of CPP would mean that Canadians would face another obligatory reduction from their paycheque and Canadian entrepreneurs would face another barrier in making their business profitable, which is something we cannot abide.
Dan Kelly, the senior vice-president of the Canadian Federation of Independent Business, which represents 108,000 businesses across Canada, said a CPP enrichment would be a payroll tax and is “very worrisome” for businesses.
He went on to state that:
For every one percentage point in CPP premiums beyond the current 9.9 per cent rate, it would cost 220,000 person-years of employment and force wages down roughly 2.5 per cent in the long run.
That is clearly unacceptable.
Our government, unlike the opposition, does not believe in jeopardizing Canadians' economic welfare by imposing higher barriers for job creation. The opposition also objects to the pooled registered pension plans as a private sector solution and takes particular offence at the fact that these plans would invest in the stock market.
However, as one of my hon. colleagues pointed out earlier in the debate, the entire pension system, both public and private, relies upon the stock market. My colleague drew on the example of Canada pension plan, 49.6% of which is invested in equities or stocks.
Last, the opposition has hijacked this debate to make repeated accusations, criticizing our Conservative government's strong record on seniors' issues. I take exception to those allegations, given that my riding has a large and thriving seniors population and I am consistently working hard to ensure that their voices are being heard in this House.
Contrary to what the opposition alleges, our government has created an enviable retirement security system in Canada and has prioritized seniors' issues. After all, it was our government that introduced pension income splitting, doubled the maximum amount of income eligible for the pension income credit and increased the age credit amount. As a result of actions like these taken to date by this Conservative government, seniors and pensioners will receive $2.5 billion in targeted tax relief for the upcoming fiscal year.
A joint federal-provincial research working group, in May 2009, found that Canada's retirement income system was providing Canadians with an adequate standard of living upon retirement. It found, for example, that the disposable income for Canadians age 65 years or over was about 90% of the average disposable income of all Canadians and was the third highest of selected OECD countries.
This report, however, found that despite the many measures already instituted by our government, some Canadian households, especially modest and middle-income households, are at risk of under-saving for retirement, and that is of great concern. It is precisely because of this that pooled registered plans are so needed and this bill is so important.
I am convinced that pooled registered plans are the way forward, as they would offer an enormous potential to improve the retirement security of all Canadians and, particularly, the 60% of those Canadians who do not have the luxury of a workplace pension.
This program has already drawn the interest of small-business employers, stakeholders and all our provincial partners.
In these fragile economic times, a sound, innovative policy like that behind the pooled registered pension plans is essential for Canadian competitiveness and for the welfare of our citizens.
I urge all members in this House to support the bill.