Mr. Speaker, I am pleased to have the opportunity to speak to this private member's bill today, particularly because it deals with Canada's retirement income system. This is an issue about which I and the Conservative government feel very strongly.
Seniors in my riding of North Vancouver, and indeed across Canada, have spent their lives working hard to build stronger communities within a more prosperous Canada. Many seniors have made great sacrifices to provide the lifestyle and privileges that so many of us enjoy and sometimes take for granted. It is their hard work that has helped make Canada the greatest nation in the world.
We have tremendous respect for Canadian seniors. That is why our government has been demonstrating our commitment to them for more than seven years.
For example, we established October 1 as National Seniors Day. We have funded more than 11,000 new horizons for seniors program projects in hundreds of communities across Canada, including in my community of North Vancouver. We have invested in helping seniors quickly access information about the programs and services they need in their communities. We have passed the Protecting Canada's Seniors Act.
The Protecting Canada's Seniors Act is an important piece of legislation regarding a very critical issue. It will help ensure consistent, tough penalties for crimes involving elder abuse. The act confirms that age and other personal circumstances will be considered as aggravating factors for criminals who target the elderly.
Our government has also taken concrete action to ensure that seniors and pensioners continue to have more money in their pockets, so that they can enjoy the quality of life they have worked so hard to achieve. For example, we have introduced pension income splitting, doubled the maximum amount of income eligible for pension income credit, increased the maximum GIS earnings exemption to $3,500, increased the age credit by $1,000 in 2006 and another $1,000 in 2009, and increased the age limit for maturing pensions and RRSPs to 71 from 69 years of age. The government has also introduced the highly praised tax free savings account and cut the GST from 7% to 6% to 5%. Overall, our action has resulted in the delivery of over $2.7 billion in targeted tax relief to seniors.
Let me tell the House about some of the seniors who are benefiting. People like Harold and Shirley, a retired couple, are real people. For many years, they worked hard and paid their taxes. Each year, they receive $55,000 and $25,000 respectively in pension income. As a result of the actions our government has taken since 2006, they now have more money in their pockets.
Harold and Shirley are expected to pay $2,260 less in personal income tax. This includes about $700, which they have saved by taking advantage of pension income splitting, and about $960 from the doubling of the pension income credit and the increases in the age credit. They are also paying $740 less because of our GST cut. This adds up to a total of $3,000 in tax relief for 2013 alone. This allows Harold and Shirley to keep more of their pension income right where it belongs: in their wallets.
This year's economic action plan builds on these efforts and contains more measures to benefit seniors. For example, we are expanding tax relief for home care services to include personal care services for those who, due to age, infirmity or disability, require assistance at home. Our government is supporting palliative care services by providing the Pallium Foundation of Canada with $3 million over the next three years to support training for front-line health care providers. We are assisting in the construction and renovation of accessible community facilities by investing $15 million a year in the enabling accessibility fund.
Seniors are benefiting not only from these measures but also from our country's strong retirement income system. This system is based on three pillars. The first pillar is the old age security program, which provides a basic minimum pension for all Canadians.
The second pillar includes the Canada pension plan and Quebec pension plan. These plans ensure a basic level of earning replacement for working Canadians. They currently provide over $45 billion per year in benefits.
The third pillar of Canada's retirement system includes tax-assisted private savings opportunities to allow Canadians to accumulate additional retirement savings. This includes registered pension plans, registered retirement savings plans, and, as I mentioned earlier, the tax-free savings account we introduced.
Though this three-pillar system is strong, we have taken action to improve it. In 2012, our government passed Bill C-25, the Pooled Registered Pension Plans Act, to provide employers, employees, and the self-employed with an accessible large-scale and low-cost pension option.
For millions of Canadians, PRPPs, as they are called, will provide access to a low-cost pension arrangement for the very first time. They will enable more workers to benefit from the lower investment management costs that result in a large pooled pension plan.
PRPPs are portable and represent a tremendous opportunity for many employees and small businesses that want greater pension plan options as they prepare for retirement.
The Canadian Federation of Independent Business welcomed our PRPP legislation, stating that “PRPPs will be an excellent addition to the retirement savings options for small business owners and their employees.”
We agree. PRPPs are an outstanding addition that will benefit millions of Canadians. It is estimated that 60% of Canadians are not provided with a pension plan by their employer. PRPPs would fill this gap.
I would also like to note that the system our government is building on is one of the greatest retirement income systems in the world. Canada's retirement income system is recognized around the world as a model that succeeds in reducing poverty among seniors. It also provides high levels of replacement income to retirees.
Andrew Coyne of the National Post wrote:
By most measures, Canada's retirement income support system is an outstanding success. The poverty rate for Canadian seniors...is among the lowest in the world.
He is correct.
Unfortunately, the bill we are debating today, Bill C-513, does nothing to benefit Canada's strong and world-renowned retirement income system and brings no value to helping seniors. In fact, the private member's bill from the member for York West could seriously impair key aspects of the existing pension and retirement savings system. It falsely claims to provide a retirement income bill of rights, but in fact the bill would only impact pensions that are federally regulated—that is, less than 10% of all pension plans in Canada. To be clear, over 90% of all pension plans in Canada are not covered by this bill.
The bill also unnecessarily duplicates existing provisions in federal pension legislation, such as information disclosure provisions to pension plan members and retirees, and fiduciary requirements for pension plan administrators.
Bill C-513 also falsely claims to enhance the financial literacy of Canadians. Indeed, the bill is repetitive and would introduce needless complexities to our government's actions in this area over the past years.
With financial products constantly evolving, we know that financial literacy is an increasingly necessary skill for all Canadians to learn. As November is Financial Literacy Month, I am pleased to note that our government has taken action to increase the financial knowledge of Canadians. We began by establishing the task force on financial literacy and committing additional funding to the Financial Consumer Agency of Canada to undertake financial literacy activities.
We passed Bill C-28, the financial literacy leader act, to allow for the appointment of a financial literacy leader. Once appointed, the financial literacy leader will work with stakeholders across the country and direct a national strategy on financial literacy. This will empower Canadians by equipping them with the skills they need to make the best financial choices.
This year's budget also committed to better protecting seniors who use financial services. This initiative will be completed by working with banks and other financial institutions to ensure they develop and distribute clear information. This will help ensure seniors get the information they need about powers of attorney and other bank services geared toward seniors' needs.
Our commitment to financial literacy is clear. What is also clear is that this private member's bill is simply not in the best interests of Canadians.
We will continue to take action to benefit Canadians and seniors and to create prosperity for them and for all Canadians.