Debates of Dec. 9th, 2013

Opposition Motion—Canada and Quebec Pension Plans

[Kevin Sorenson, Conservative, Minister of State (Finance)]

Mr. Speaker, it is a real pleasure to rise in the House. I want to thank the NDP for choosing to discuss pensions on its opposition day today. We often see NDP members focusing on topics that make little difference to Canadians. I am glad they have finally come forward with a topic that does matter.

As we all know, personal financial security in Canada is directly connected to the economy. For eight consecutive years, our government has demonstrated steadfast leadership, under the Prime Minister and the Minister of Finance, and an unprecedented commitment to the Canadian economy.

Creating jobs and securing economic growth have remained our government's top priorities. Our government, prior to the global downturn, tackled debt. It paid down just under $40 billion in national debt. The government has cut spending. We have made the right economic choices. I am pleased to announce that all Canadians are benefiting from them today.

Since the depths of the recession in 2009, over one million net new jobs have been created. Nearly 90% of those million new jobs are full-time jobs, and more than 80% of those jobs are in the private sector. In fact, Statistics Canada recently announced that the Canadian economy grew by 2.7% in the third quarter of this year. This represents the ninth consecutive quarter in which we have seen economic growth in Canada.

What is more, last week, Statistics Canada announced that over 21,000 net new jobs were created in the month of November. That includes solid gains in the manufacturing sector. I know that all Canadians understand that when we see new jobs being created in the manufacturing sector, there is a level of confidence there.

The unemployment rate has remained at 6.9%, the lowest level since 2008. This modest economic growth demonstrates that our economic action plan is working. By making sound economic choices, Canada is doing relatively well where others have faltered.

However, we cannot be complacent. That is why we continue to deliver on our commitment to Canadians while keeping taxes low. After all, two and a half years ago, when Canadians elected our Conservative government to a majority government position, they were clear. Canadians knew that they could not pay the higher taxes the Liberals and the NDP wanted to force upon them.

Unfortunately, the NDP leader, again, just recently, committed to raising taxes. He is adamant about imposing higher taxes on job creators, which would stunt Canada's economic growth. Those taxes would prevent businesses from expanding and would block them from hiring workers. Small businesses, in particular, cannot afford those higher-tax policies.

In fact, families in my riding and across Canada tell me that they cannot afford an irresponsible pension plan either. They cannot afford increased payroll taxes, or deductions, as they are called. They cannot afford a smaller paycheque. They also tell us that with house payments and all the responsibilities they have raising families, they cannot afford to lose their jobs. They simply cannot afford the costly expansion of the Canada pension plan the NDP is suggesting. It would take more money out of the pockets of Canadians and would force employers to cut jobs, hours, and wages. Those are not just the comments of the government. Those are comments from the job creators.

The costs of the NDP plan to increase Canada's pension plan during a fragile global recovery is not responsible. On this side of the House, we share the concerns of employees. We share the concerns of small business, and we share the concerns of many of the provinces in regard to increasing costs during a fragile global recovery.

Canadian families are working hard to build our economy, and we are committed to supporting them. When disaster struck the world economy, our government took immediate action.

The Conservatives navigated Canada through some of the most turbulent times in a generation. The results are clear: Canada, again, is doing relatively well. However, Canada faces global economic risks that are outside of our control. For example, global demand has softened and the prices of some of Canada's exports, particularly resources, are down.

We tend to dwell far too much on only oil and gas, but our base metals, for example, have declined over the spring and summer on expectations of a slowing Chinese economy. Canadian forestry production has also faced price declines from a still weak U.S. housing sector and higher North American production. While Canadian crude prices have improved somewhat since budget 2013, it continues to sell at a larger than normal discount.

The debt crisis in Europe continues to weigh on consumer and business confidence. The Euro area has emerged from a recession of a year and a half. However, growth for this new trading partner, new in the sense that we now have a trade agreement, is still very weak. Moreover, striking disparities remain within that region. Germany, for example, continues to show a modest pace and growth. Spain and the Netherlands have turned slightly positive in the third quarter. In contrast, France posted negative real GDP growth while Italy remains in a recession.

Closer to home, a slow recovery in the U.S., as well as uncertainty surrounding the sustainability of the country's finances, poses the greatest risk to the Canadian economy.

The International Monetary Fund's outlook for real GDP growth in 2013, in both advanced and emerging economies, is 1.2% down from the previous projection of 1.4%. Despite the fragile global economic environment, the NDP is trying to force its risky Canada pension plan on Canadians today.

The NDP has proposed a radical plan to increase payroll tax, which would undoubtedly stunt our economic growth. In fact, Finance Canada officials estimate that the NDP plan would kill up to 70,000 jobs. On average, contribution rates would increase by more than $1,600 per year. A family with up to two workers could be forced to pay as much as $2,600 more every year.

The NDP would increase CPP costs for all Canadian workers, even those who at the current time are struggling to make ends meet. The NDP's plan would send thousands of workers to the unemployment lines and would definitely endanger economic growth. Other proposals to expand CPP payroll deductions, while slightly more modest, would also harm Canada's fragile economy. One recent provincial proposal, according to Finance Canada, would threaten and could kill between 17,000 and 50,000 jobs.

Members do not have to take my word for it. Norma Kozhaya, research director and chief economist of the Quebec Employers Council said:

The proposal of enhancing the QPP/CPP that has been put forth in recent weeks...runs the risk of having adverse effects on economic activity, investments, jobs and salaries, all of which would go against the federal government’s announced objective of maximizing job creation.

She is right.

C.D. Howe Institute's president and CEO, William Robson, said:

...the bigger Canada Pension Plan many unions and provinces are pushing is a bad response. Durable pension improvements for people currently working must rest on more saving by those same people. Instead, “Big CPP” threatens another wealth grab...

Bill Tufts, founder and director of Fair Pensions for All said:

An enhancement of the CPP will be a significant drain on investment capital, at a time when the public sector unions, and even the Bank of Canada, are calling for business to come off the sidelines and kick start our economy. Expanding the CPP now will have the opposite effect.

I could go on all day because Canadians are lining up to oppose this NDP plan. They do not want to see the progress we have made being reversed by irresponsible strategies and plans.

The fact of the matter is that any benefit that these proposals could have years or decades down the road must be weighed against the immediate economic damage. Let me say that again. Any benefit that these proposals could have years or decades down the road must be weighed today on the immediate economic damage that it would cause.

We must comprehensively study the effects on families. What would the effect be on business? What would the effect be on communities? Not only do we need more study on the effects of CPP expansion, but to make major changes we need support from the provinces.

Contrary to what the NDP asked in a question last week, there is no consensus on CPP expansion. For example, let me quote from the British Columbia finance department, the province where the hon. member comes from:

B.C. believes pension reform should not be undertaken before the economy has recovered from the impacts of the recent recession.

The New Brunswick government has expressed its opposition as well. Last month, New Brunswick finance minister said:

We don't think it is the right time to put on additional costs to business owners and employees.

What we are debating today is about additional costs to employees, who, for example, may have both partners in a home working to make a house payment, working to put the kids through hockey and piano.

Most of these finance departments and finance ministers have said that we cannot afford the additional costs today. Let me be clear, and this is why I commended the NDP for bringing this motion forward, we all want a stronger retirement system. However, we cannot move forward with a system that can have negative effects during this time of a fragile economy. An expansion at this time would mean job cuts, reduced working hours or a drop in wages.

Laura Jones, executive vice-president, Canadian Federation of Independent Business said:

A mandatory CPP increase...is a bad idea. An increase in the CPP tax takes more money out of the employees' and employers' pockets. Where will this money come from? Employees may be tempted to lower contributions to their RRSPs, or reduce their mortgage payments. [...] Worse still, small businesses report that a mandatory CPP increase would force many to lower wages and even reduce their workforce.

A recent survey about CPP increases by the Canadian Federation of Independent Business, whose membership, I think, is around 110,000 employers, businesses, across this country, was that 65% of businesses said they would freeze or cut salaries if CPP payroll taxes were increased, and 48% said they would reduce investments in their business.

We know that in a struggling economy where we are also trying to improve productivity, we want businesses to reinvest in their businesses. We know that is going to help with job creation. However, 48% said they would reduce investments in their business. More important, and perhaps the scariest statistic, is that 42% said they would decrease the number of employees.This is a high cost. It is an extremely high cost, especially given the fragile global economy.

Instead, our government is working with a prudent and responsible plan. We will not rush an expansion that carries serious economic consequences. Some of them may well be unintended consequences, but they will be consequences nevertheless. We will continue to work to identify all possible factors that may help us better understand the opportunities and risks of an expanded CPP.

Garth Whyte, who is the president and CEO of Canadian Restaurant and Foodservices Association, said:

The restaurant industry is one of the country's largest employers and the number one place where Canadians get their first-job experience.... Increasing CPP premiums puts these opportunities at risk. There are better options to address concerns about retirement income for middle and higher income earners.

As we can see, this is a complex matter with real world consequences for Canadians. We must first fully understand the economic environment in which an expansion would be implemented. In addition to risks posed to families and job creators, we feel that all governments, both federal and provincial, should first focus on ensuring that their financial houses are in order.

We recognize that some households may be at risk of not saving enough for retirement. That is why we want to make it easier for individuals to save for their own retirement. For instance, our government introduced the tax-free savings account. It provides additional tax efficient savings opportunities to Canadians of up to $5,500 annually. As we are into this season of prebudget consultations and meeting with Canadians all across the country, I receive thanks for tax-free savings accounts at every meeting. People are stepping forward and asking us to perhaps enhance it, but certainly they are thanking us for this opportunity to save. Because we have introduced the tax-free savings account, more than 8 million Canadians are now saving tax free.

This is just one of the many steps we have taken to ensure that seniors and pensioners continue to have more money in their pockets. We want to ensure that when we go into the senior years—and for those seniors who are there already—we have the quality of life that we have worked a lifetime to achieve.

We have not stopped with tax-free savings accounts. We have also introduced pension income splitting. After taxes had been filed and a number of seniors came from their accountants, they realized the importance of the pension income splitting.

We have doubled the maximum income eligible for pension income credit. We increased the maximum GIS earnings exemption to $3,500. We increased the age credit by $1,000 in 2006, and another $1,000 in 2009. We increased the age limit for maturing pensions and RRSPs to 71 from 69 years of age. Overall, our government's prudent responsible action is delivering over $2.7 billion in tax relief to our seniors.

Let me outline how the concrete actions we have taken since 2006 are helping everyday Canadian seniors. A senior couple making $55,000 and $25,000 respectively in pension income are expected to pay $2,260 less in personal income tax. This includes about $700 that they have saved by taking advantage of pension income splitting, and about $960 from the doubling of the pension income credit and the increase in the age credit. They also pay $740 less because of our GST cut. This adds up to a total of $3,000 in tax relief for 2013.

Our party's legislation to protect Canadian seniors has helped to ensure consistently tough penalties for crimes involving elder abuse. I could go on and on about the many things we have done.

We have moved on financial literacy across the country. In November, I had the privilege of meeting many seniors, and also many others who are involved in the delivery of financial literacy programs. Certainly the seniors aspect is one that our minister of seniors and others have taken up, ensuring that seniors have the ability to understand complex financial markets and the things they need to better guarantee their quality of life.

Mr. Speaker, I could go on and on, but I see you are telling me that my time is up. Let me again thank you for the privilege of being able to speak here today. Canadians can count on this side of the House staying focused on the economy. After all, it is difficult to plan for a healthy retirement if someone does not have a job, and much of what the opposition parties would bring forward as far as CPP reform would mean that many Canadians would not have a job today.

[Murray Rankin, NDP, Victoria, BC]

Mr. Speaker, I thank my colleague, the Minister of State for finance, for his speech in this House.

He says that there would be dire economic consequences to our employment rates if we were to proceed and he cites a couple of reports from departments that we have not been shown. However, the evidence from the Canada Research Chair in Public Finance, Mr. Rhys Kesselman, who wrote this on November 8 in The Globe and Mail, would appear to be the contrary:

...the historical record is that the CPP premium rate hikes initiated in the 1990s...did not hamper an economic expansion. Between 1997 and 2003 CPP premiums were hiked 70 per cent while the employment rate rose strongly and steadily except for a slight dip with the 2001 downturn.

How is it that this historical evidence can be squared with these predictions of trade groups and the department? If the minister says Canada cannot do it now, just when can we do it?

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, I wonder exactly where the NDP is coming from when on one hand it is talking about increased premiums and on the other hand it is talking about ensuring that Canadians will have so much more in CPP. We know that the NDP believes that government can fix all societal problems and this would just be the normal way to do it, but I wonder what consequences that member believes would have to be faced if the CPP was increased.

For example, would people have to make the choice with the loss of up to $2,600 in the household each year? What choices would they make? Would they choose to not make that house payment? Would they choose not to save in the RRSP?

We know that not just the finance departments but 42% of business groups have said that they would have to lay employees off. Whether it is the 50,000 that finance departments said or up to 70,000 job losses with the NDP plan, our focus for the last years that we have been in power has been job creation, and we will not compromise that strategy when it is working.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I notice the minister did not answer the last question. Maybe I will have better luck.

There was an article in The Globe and Mail this morning in which the minister is said to have promised that he would provide the details of an analysis that his department did in order to talk about the alleged loss of jobs from CPP premium increases. However, according to the article,

The department did not provide its full analysis. Instead, it provided a six-paragraph statement that the department has done modelling “using a range of assumptions and models” to assess the impact of higher CPP premiums.

That is no answer. Anyone can dream up any number. If we do not have the analysis backing it, how do we know what is true and what is not true?

My question for the minister is whether he will provide solid analysis, not just a few short paragraphs, to back up his claims.

Also, I would wonder why he is talking about the impact of a doubling of the CPP. I know the NDP has talked about that, but that is not what is on the table. That is not the provincial motion that the government rejected. Why is he scaremongering by talking about proposals that are not even on the table?

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, we are working with the provinces. Much of what has been developed by departments has been shared with the provinces. Certainly we are working with the provinces, and next week we will meet with the finance ministers. We will sit down and discuss the economy and a number of issues—many issues, actually. One of them will be the CPP, which has been carried quite extensively over the last three weeks by the media.

We can take the numbers from the job creators and the businesses that have said that 42% will be laying off workers. Departments have said that under the NDP plan, up to 70,000 jobs will be lost. That is straight from Finance Canada. They have also talked about other provincial plans, whereby between 17,000 and 50,000 jobs would be lost. Those are not figures we alone are citing; those are the figures cited by finance departments.

Regardless of the number, I have had constituents and Canadians come up to me to say, “Mr. Sorenson, we are on a tight budget now. We cannot afford to have one of the two of us laid off. We need to be certain that we keep this economy rolling.”

What I do know is that two years down the road I do not want to stand in this place scratching my head and wondering why, if we went five years on a strategy that helped create jobs and prosperity and put Canada in the best position of any of the countries in the G7, we then changed and took action that caused this huge increase in unemployment?

We have a strategy that is working, a Prime Minister who is focused on the economy, and a Minister of Finance who understands the economy. The plan is working. We look forward to continuing to create jobs. We will not bring forward risky strategies that will hurt our economy.

[David Anderson, Conservative, Parliamentary Secretary to the Minister of Foreign Affairs]

Mr. Speaker, I thank my colleague for his great presentation today. As he pointed out, it seems that the only solution the New Democrats can come up with is more government and bigger government.

I would ask the member to talk a bit about the impact of the increases the NDP is suggesting. He is from Alberta. He has not had to live under the pressures that an NDP government can bring. Every place that it has come to government in Canada has ended up with a disaster. Either it has completely ruined the economy in the short term or, as in the case of Saskatchewan, it has left us so far behind Alberta that it is only now, in the last 10 years, that we are beginning to catch up.

The member noted that this proposal will cost approximately $2,600. We have talked about the fact that through our tax cuts, Canadians families are being saved about $3,000 per year. He talked about how seniors have been impacted and are benefiting from it. I wonder if he could talk about how one proposal by the NDP amidst a whole pile of them would take away all of that advantage at one time, and talk as well about the impact on jobs.

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, the member is right that everywhere the NDP has been in power it has been for a fairly short term, because it has totally annihilated the economy of the province or wherever it has been. There is very little credibility there.

To be clear, when I quoted the $2,600, I was quoting for a two-income family. That is not per worker. It is for both.

I have the privilege of living in a province that has always talked about the Alberta advantage. Many years ago when Stockwell Day was the treasurer, the idea was to have a low corporate income tax rate and low personal income taxes, making sure that even with no provincial sales tax, we were sending out the message that this was the place we wanted businesses to come to.

We want to attract business. We want to attract opportunities. We want to attract opportunities for young families. We want people to come here in hopes of prospering, getting a job, and raising a family in a place where they can realize those dreams. That is what we have when we have an advantage. Globally, people are standing back and saying that there is an advantage to doing business in Canada when they see the tax rates, the opportunities, and the plan that is set in place.

I was raised in Alberta. I moved to Saskatchewan for a very short period of time and then moved back to Alberta. Many of my friends in Alberta are from Saskatchewan. Many are now moving back to Saskatchewan, because they see opportunity again. They see a government that is very pro-job creation.

We are focused. We will not stand in front of a mike and talk about the $3,200 more in each pocket that Canadians have and then in another measure turn around and give it all away.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I am very pleased to speak to the NDP motion.

As I said before, the Liberal Party will be supporting this motion. We feel that the issue of whether pensions are adequate for Canadians now and whether they will be in the future is a huge challenge for Canadians and for the middle class in particular.

Everyone knows that our leader, the member for Papineau, is focusing on issues facing the middle class. Given that this is a huge challenge for the middle class, we are very supportive of the principle of this motion. We will vote in favour of it, although we do not completely agree with the NDP about the details.

I would like to begin my speech by explaining why this is a major challenge and what economic factors suggest that to be the case. Then, I want to talk about the policies of the NDP, the Conservatives and the Liberal Party. I would say that we take a centrist position, which falls in between the other two parties' extremes.

First, let us ask why the pension issue is such a huge challenge for Canadians in general and middle-class Canadians in particular. There are a number of reasons, and many of us have heard them before, so I can be relatively brief.

There was a recent CIBC study saying that the average 35-year-old today saves only half as much as that same 35-year-old would have saved a generation ago. That is fairly dramatic evidence of inadequate savings.

We know as well that only some 25% of Canadians who work in the private sector have access to workplace retirement savings plans. We know as well that the Canadian Institute of Actuaries did a study, and they reported that among middle-class Canadians earning $30,000 to $100,000 who planned to retire within 10 years, only one-third of all of those millions of people will have retirement income sufficient to meet basic needs.

Finally, I will mention a report by CARP, the Canadian Association of Retired Persons. CARP surveyed its members to ask whether they felt that they would be comfortable in their retirement. In 2009, 30% of the respondents said they would feel comfortable. That is not a huge number, but 30% said yes.

Over the four years following, from 2009 to 2013, that number fell from 30% to 14%. Only 14% of CARP members today feel that they will be comfortable in their retirement years. Notice that the drop from 30% to 14% occurred during the period when the Conservatives were promoting their pooled retirement pension plan. It also came at a time of economic crisis in this country.

The pension challenge is compounded by record low interest rates, which we have had for many years and which some think will continue into the future. It is compounded by the aging population, by the fact that Canadians are living longer, and for other reasons. The pension issue is more important and more challenging today than it has been in the past, and it is evident from what I am saying that I do not think the Conservatives are providing any answers to this pressing problem.

The Liberal position is that we regard this as a major challenge. Our position is to take what I would call strong but sensible action to address the pension issue. I want to address very briefly what we would do, but I want to have a little bit of a caveat. That is because we have our party policy convention in a couple of months, so what I am about to say is not necessarily the final word. Going forward we will have consultations with Canadians at our convention, but what I am outlining now has been the Liberal position for some time, and as of today it remains so.

First, we will certainly not agree to increase the age for old age security from 65 to 67, and there is no doubt in my mind that position will not change. Second, traditionally we have supported a moderate increase in the regular Canada pension plan, not unlike what is being discussed now by premiers and what has just been rejected by the federal government. Third, we have been on record as supporting a supplementary voluntary Canada pension plan, but subject to what is called “auto-enrolment”, which would supplement the existing Canada pension plan.

I will come back to those positions in more detail, but in broad strokes that is the Liberal position. Let me begin by comparing it with the positions of the NDP and the Conservatives.

The contrast between the New Democrats and the Liberals reminds me a bit of a topic familiar to those in the House. That is the situation involving Senator Gerstein and Senator Mike Duffy. Those two senators turned out to be in agreement with each other on principle, but they differed on the quantum. By that I mean that they both agreed that it was okay to use Conservative Party funds, part of which were paid for by taxpayers, to make Senator Duffy whole. That was okay in principle, but they disagreed on the quantum. For Senator Gerstein, $30,000 was his upper limit, whereas Senator Duffy wanted $90,000 and that is where they disagreed.

The issue we are talking about today is certainly legal and it is perhaps even noble; that is to say it has nothing to do with the Senate but everything to do with the adequacy of Canadians' future pensions. It is fair to say that Liberals and New Democrats agree on the principle, but not necessarily the quantum. We agree that strong action must be taken, that we are facing a huge challenge, but we do not necessarily agree with the NDP proposition that we have to double the Canada pension plan.

We know that originally comes from the Canadian Labour Congress. We are respectful of that idea and we have had discussions with them. However, we think that doubling may be excessive in terms of quantum from the point of view that we know ordinary Canadians are hard-pressed. If they are so hard-pressed with record debt, can they really afford to double their CPP premiums? Second, for companies we know that the job situation is pressing. Can we really afford to ask those companies to pay radically higher premiums?

That is a question of quantum not a question of principle, but we have differences with the NDP on that issue of quantity, if not on issues of principle.

However, where we really differ is with the Conservatives because essentially their policy is to be missing in action on pensions, or if one wants to be charitable, it is a policy of benign neglect. The reason I say I am being charitable is that I am not sure if the word “benign” is appropriate, but certainly “neglect” is appropriate. The position of the Conservatives is well summarized in an editorial in The Globe and Mail that appeared yesterday evening, of which I will read part:

Ottawa’s move last week to flatly reject a provincial pitch to expand the Canada Pension Plan is an unfortunate decision. The federal government is still choosing to back a far less effective retirement savings program.

The Globe and Mail goes on to say:

...PEI Finance Minister Wes Sheridan said last week that the...government could have at the very least countered with a more modest reform as a compromise. Ottawa’s blanket rejection suggests that it never had any serious intention to back the idea.

That is 100% right. I believe that the Minister of Finance is on record as being willing to countenance a moderate increase in CPP pensions, but he was overruled by his boss, the Prime Minister, who as of today, I believe, is still the boss. The Prime Minister is on record over many years as not only opposing CPP moderate hikes today, but opposing the CPP in general.

In one statement, he said that the CPP is a “fictitious obligation that the government can change down the road”. In a second comment, he talked about Mr. Martin's exercise to reform the CPP as “bogus”, to the extent that the investment board fails to function like a private-sector fund manager, it will be inefficient, increasing the likelihood of further CPP premium increases.

Then the Prime Minister stated, “But if [the CPP] succeeds in operating 'just like the private sector'...then there's no real reason for government to run it at all.” In other words, he does not like the Canada pension plan, so I believe that as long as he is the Prime Minister of this country, no time will be the right time for any infinitesimal increase in CPP premiums and benefits. That is precisely the point, which The Globe and Mail attacked yesterday.

The Globe and Mail and others have also attacked the pooled registered pension plans as being entirely inadequate to the job. Let me again quote from The Globe and Mail:

Canada’s experience with RRSPs illustrates why another voluntary savings program is not as appealing an option as an expanded CPP. RRSPs have long provided a tax-effective way to save for retirement, yet three out of four eligible tax filers did not contribute one cent into their RRSPs in 2010. Canadians are already sitting on $633-billion of unused RRSP contribution room, and that figure keeps climbing.

That was in The Globe and Mail. The PRPP is essentially a glorified group RRSP. With only one in four Canadians availing themselves of RRSPs, why do the Conservatives think the take-up will be significant for their new plan?

A second problem is that it is costly. The CPP cost is far lower than the private sector cost and one of Canada's leading pension experts, Keith Ambachtsheer, has done an analysis in which he shows that relatively small differences in the management costs can have enormous differences in the long-run value of the pension, differences on the order of 20% to 40% of the pension. Therefore, one other advantage of the CPP or the supplementary CPP over the government's proposal is cost and that difference in cost can have a major impact on the long-run values of the pensions of middle-class Canadians. I have said in the past, let a thousand flowers bloom, let the private sector offer what it wants, let the supplementary CPP be offered, let Canadians choose, and out of that choice will come the best solution for Canadians.

Another piece of evidence that the government's plan is not working is that there has been very little take up by the provinces. I believe that three provinces have passed the legislation. Only one, Quebec, has so far implemented it, and provinces such as P.E.I. and Ontario would not be proceeding with planned reforms to the CPP if they truly believed that the Conservative government's solutions were adequate.

As I said, if we put all that together, Liberals believe that the government is totally missing in action on the pension issue, or if one wants to be more charitable, this has been a policy of benign neglect by the Conservatives. We believe that the Liberal plan, based on the three points I have mentioned, is the centrist position. These are active but sensible measures to address the pension issue, not the benign neglect of the Conservatives and not the more radical proposals of the NDP.

In my remaining time, I would like to outline very briefly the essence of the Liberal plan. There are three parts. One, as I have mentioned already, we would not—I repeat, not—raise the OAS age from 65 to 70. Actuaries have assured us that the plan is perfectly sustainable the way it is and the way in which the Conservatives are proposing to act would really hit the most vulnerable Canadians, particularly those who have been subject to hard physical work and are unable to work beyond 65. They would lose their OAS and GIS and be thrown onto provincial welfare. This is a totally unacceptable solution for this country.

Second, we want a combination of a moderate increase in the Canada pension plan, the regular plan, and a supplementary plan. We in the Liberal Party have long been proud of the Canada pension plan. It was brought into existence by Lester Pearson. It was radically strengthened by Paul Martin in the 1990s, to the point where it is now recognized as being solvent for 50 years, 75 years. It is one of the few national pension plans in the western world or even the whole world, that is solvent to such a degree. We can be proud of that, but needs have changed so we have to move on.

The needs of 2013 are not the same as they were in the mid-1960s. We have to expand some combination of the regular CPP and the supplementary CPP. We believe that for reasons of cost. CPP is very low cost. As I said earlier, that has a major impact on the value of Canadians' pensions because of the power of compound interest over time, and the supplementary CPP.

I want to talk about the supplementary CPP because it came under attack before the last election by the Conservatives who kind of made stuff up. Recently, a new plan that is being implemented in the United Kingdom called NEST provides further evidence and support to Liberal proposals.

First of all, Conservatives made up numbers saying that the cost of our supplementary plan would be high for various specious reasons, which we said were wrong. We now know, based on the actual implementation of a very similar plan in Britain, that the actual cost of the plan is 50 basis points per year, or half a percentage point, which is a small fraction of the typical private sector costs and which would result in a substantially higher pension than the Conservatives would be providing under their plan. That is now a fact. It is not subject to argument; it is a fact.

The second point that is really important is that I said negative things about voluntary plans and that evidence from RRSPs suggested only a relatively small fraction of people would participate. However, the British have what they call “automatic enrolment” so that employees are automatically enrolled in the British plan called NEST, but they have the option of opting out if they so desire. I suppose there is a certain inertia in human affairs. It turns out that this automatic enrolment has a major impact on participation to the point where so far in the U.K., over 90% of employees remain in the plan and choose to participate. Yes, it is voluntary, but with this auto enrolment, the participation rate is very high.

To conclude, we will support the NDP motion. However, as far as the details are concerned, we feel that pensions are a huge challenge. The government is basically doing nothing, while the NDP is perhaps doing too much by wanting to double the pension plan. We are taking the middle road. Our plan consists of a number of elements. First, the age of eligibility for old age security benefits will remain at 65, not 67. Second, we will expand the Canada pension plan, both the regular plan and the supplementary one.

We think that this strong but sensible approach to addressing the pension challenge is the right way to go. Since the NDP is in principle on the same page, we in the Liberal Party are happy to support the motion.

[Craig Scott, NDP, Toronto—Danforth, ON]

Mr. Speaker, I would like to first make a comment before asking my Liberal friend a question. My hon. friend castigated the Conservatives from the last election for misrepresentations and I would appreciate it if he does not say that we are supporting a doubling. We have never said that. What we have said is that we are looking at a range of plans. We are committed to an increase, but please do not put words in our mouths.

Second, the finance critic for the Liberal Party only a few weeks ago said that no increase at all can be afforded. Therefore, is this a change over the last few weeks, especially since we heard in the speech that maybe the Liberal Party convention is only the point at which we are going to hear what your final position is? Are you indeed going to be voting with us and therefore is the Liberal Party changing its position?

[The Acting Speaker, Conservative, Barry Devolin]

Before I go to the member, I would remind this member and all others to refer their questions to the chair rather than to their colleagues.

The hon. member for Markham—Unionville.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, if the member is saying that it is not the policy of the NDP to double the CPP, then perhaps the gap between our two parties is less than I thought it was.

We have traditionally said, and said in the last election, that the Liberal position was open to a moderate increase in the CPP. That is what I am quoting.

We are still a long way from the election. We have not had our policy convention. We have not presented our platform. We will be consulting Canadians more. However, as to the most recent Liberal position, that is our position and that is what I have been citing today. If the member wants to get a more definitive, up-to-date answer, I suggest that he stay tuned for our upcoming policy convention, which will take place in February.

Our leader has said many times that he does not believe in a top-down approach to policy. He believes in listening to grassroots members and listening to Canadians across the country, and that is how we develop our policy.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I thank the hon. member for his speech. I know that he has thought a lot about this issue and has some expertise on it.

I listened to the minister from the Conservative Party prattle on at great length about how this proposal would be killing jobs and killing the fragile economic recovery and that people cannot afford to put money away for retirement, even though it is perfectly obvious that we have not only a demographic crisis but a pension crisis in this country.

I would be interested in the opinion of the hon. member as to whether there is a scintilla of evidence to support the Conservative minister's position on its impact on jobs.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, my colleague's question is similar to the question I asked the minister, who had promised that he would provide evidence of his job estimates to the press and yet failed to do so, and he did not answer the question.

The short answer is that the minister has not provided a scintilla of evidence, because he has not provided the evidence he committed to provide.

I think it is a question of degree. The bigger the increase in the CPP benefits and premiums, the bigger the effect on hard-pressed Canadian households and companies that have to pay more premiums. However, the provinces are talking about implementation over five years, starting in 2016. Those increases are very moderate, but they have not been agreed to yet. I think increases on that scale are quite likely to be manageable.

I also believe that sometimes the government forgets that the pension increases involve increased benefits as well as increased payments. Therefore, there is a benefit to the economy of the increased payments as well as a cost to the economy of the increased payments. Once we include both of those components, the net effect on these things might be quite negligible, if not totally unimportant.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I agree with my colleague for Markham—Unionville, somewhat, in that he and I both listened to the same speech from the Minister of State (Finance).

I actually learned about the minister of state's wild, unsubstantiated claims about catastrophic job loss not from his speech in the House of Commons but from the website of Finance Canada. Posted on the Government of Canada website is what constitutes a viciously partisan political attack ad against the New Democratic Party, with a series of wild, unsubstantiated claims about hundreds of thousands of jobs being lost and essentially life as we know it coming to an end.

I would ask the member what he thinks of the Conservative government using government communication tools for partisan political promotion, as it were. Does he believe, as a former cabinet minister, that this crosses the ethical guidelines of non-partisanship the Government of Canada is obliged to conduct itself under?

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I wish I could shake with rage and outrage at this, but it has become a commonplace action by the Conservative government in many other departments where it has abused departmental websites. One cannot be shocked if one is shocked by the same kind of thing day in and day out.

To answer the member's question, I have not seen that particular website. However, I am shocked that the government would use official government websites in such a partisan way.

I am also if not shocked then displeased that in response to very clear questions about providing evidence, which he had promised in the media to do, the minister refused to address that question at all. If he will not provide evidence that he has promised to provide, one has to question the quality of that evidence, because if he had it, why would he not give it to us?

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I would like to carry on the conversation about the evidence. The evidence is not in front of us, so each and every person who votes on this motion, whether it is tonight or some other night, will be voting blindly. That is the way the government prefers us, a little like mushrooms, kept moist and in the dark.

This is a consistent pattern. When members, whether they are in the House or in committee, ask for real evidence on any matter, which now is on lapses, we and the PBO continue to be shut out.

I thought the hon. member's answer on the cost and the benefits was quite interesting. The other interesting point is that this money does not just disappear; it actually goes into investments. Investments generate jobs. I would be interested in the hon. member's thoughts on how much this investment would, in effect, create more jobs.

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, while we are a party of evidence, I cannot give a precise numerical answer. However, unlike in the Paul Martin period, when they were increasing premiums but not benefits, here they are increasing premiums and benefits. In that sense, the two things wash. When we take into account the investment and the jobs created thereby, that is another positive effect.

In terms of the member's more general point about the Conservative government not providing evidence, the most egregious case, in my mind, and the stupidest thing it has ever done, if not the most evil, was getting rid of the long form census. It affected people across the whole country, and not just politicians, provincial leaders, and municipal leaders but Tim Hortons and McDonald's, which are wanting to know where to set up their organizations. They were all incredibly hamstrung by the failure of the government to provide this basic document, which provides basic information about who we are as a country.

That failure speaks to the government's incredible inability or unwillingness to provide the evidence that so many Canadians want on every conceivable issue.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, talking about pensions with this government is reminiscent of the story about the grasshopper and the ant. They are the grasshoppers and we are the ants.

They clearly do not realize that the money saved through a pension plan is not a tax, but a guarantee for people to stave off poverty in retirement.

The Conservatives give money without rhyme or reason to their friends and have a party. They dance and sing using other people's money. Once the recession hits, they give the bill to the ant. The worst part is that the grasshoppers are telling the ants to let them manage their assets. Wow. That is promising. They are hoping that people will accept that. Well, no. It does not work like that.

It is unbelievable that someone who claims to be the Minister of State for Finance is incapable of understanding that savings are not taxes, but investments. The minister is incapable of understanding that.

Mr. Speaker, I must tell you that I will be sharing my time with the hon. member for Newton—North Delta, who is also a very good friend of mine. I apologize for letting it slip my mind.

Protecting the savings already made is also crucial. Right now, the future is bleak for Canadians. Their retirement savings are at risk. Pension plans are going bankrupt. I did not hear the Minister of State for Finance talk about Nortel, Air Canada or all his friends who suspended pension contributions in the past and poorly invested their retirees' money. They are saying that they are not responsible or to blame, and they are asking workers who saved all their lives to agree to losing half of their money.

Clearly, when we listen to the speech by the Minister of State for Finance, we understand very well that his decision is to protect and favour his friends, not Canadians. He will have nothing to worry about when he retires because he will have a comprehensive pension plan and his friends will appoint him to the boards of oil companies. However, the vast majority of Canadian workers do not prostitute themselves like that.

How can the government say that the savings generated by enhancing the CPP will not be invested back into the economy?

When people set money aside for savings, they invest it and hope it will generate interest. That is the whole point of saving. If that money is going to earn interest, it has to be invested in Canadian industries and services. That money comes right out of the pockets of all taxpayers to support immediate investment that will produce returns in order to improve people's quality of life and protect them from poverty in retirement.

Not so long ago, people who worked for Nortel and Air Canada lost 40% of their pension. The government is always asking people who save money, who have set it aside, to make sacrifices, yet it absolutely does not want employers to have to take any responsibility in this matter.

The Conservatives put forward a voluntary pension plan. They say their goal is not to take money away. Well, it is the same thing. Savings are savings. They say that workers should be solely responsible for their savings, that the employer should not have to pay and that it will ask pension fund managers for investments or partnerships.

When it is a matter of using workers' money, they have no problem with that, but when it is time for them to do what they should be doing, they tell Canadians that they are not responsible, which is about as much as we can expect from our Minister of State for Finance.

There is one important thing he does not understand. He says that this would be an economic disaster. That makes me think of the dopes in the 1900s who said that women should not have the right to vote because that would turn them into alcoholics or make them hysterical. The Conservatives keep handing us the same old lines—clearly they have put as much thought into this as usual—saying that there will be job losses, the economy will stagnate, and everything will fail spectacularly. They have no proof of that at all. When we ask them to share their analyses with us, they have nothing to offer. It takes some nerve to attack a pension plan based on the delusions and fertile imaginations of people who have nothing else to go on, certainly not competence.

Here is something I need to tell the people across the way, because clearly, they do not know it: once the proposed reform is voted in, it will take three years to implement, and contributions will ramp up over a period of seven years. That means the increase will be spread out over 10 years. The Conservatives have told us to our faces that in 10 years, under their good government, we will still be in a slump. If that is good economic management, I am sorry, but we will do everything we can to get rid of it as soon as possible. Such an open declaration of incompetence is rare.

The Canada pension plan is currently the most secure pension plan. People who put their money into it are certain to get it back. It is not like an RRSP. When you put money into an RRSP, you are investing in venture capital. You risk earning a negative return. This has happened to many people, particularly in 2008. They had less money in their pensions than what they invested.

It is also important to understand that the financial institutions that manage RRSPs factor in a profit rate for themselves. Then, they charge administrative fees. After that, they sometimes have the audacity to give themselves a performance bonus. When things go a bit better than average, they give themselves bonuses and when things go worse than average, they still give themselves bonuses, claiming that it would have been worse had they not been there. In short, investors are the last ones to get paid. Everyone gets paid before them. RRSPs are therefore not the best option.

The CPP is different. First, it provides a return. In order for it to be cost-effective, that return must be about 3%. In addition to that, the CPP has the lowest administrative fees. No financial institution in Canada charges such low fees for that kind of return. I challenge the Conservatives to find evidence to the contrary. We are asking them for proof, not stories, imaginings or idle talk.

The government is not protecting Canadians' right to an effective pension system and that is unfortunate. We are dealing with people who have given up on the role of the Canadian government. The Conservatives are saying that it is not their fault if Canadians end up living in poverty as a result of their governance. It is as though the grasshopper started managing the ants' inheritance. When the grasshopper has spent all the ants' money on its friends, parties and risky investments—when it has wasted all the ants' money—it will have the nerve to tell the ants to tighten their belts.

At some point, the ants have the right to insist that their government act like their government, rather than like the government of its own cronies, senators and everyone but Canadians.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, we have already indicated that we support the opposition day motion. It is something we take very seriously. The leader of the Liberal Party has been talking a lot about the middle class and this will have a very profound impact on the middle class.

I have had the opportunity on numerous occasions to present petitions to the House dealing with the important issue of pensions. Whether it is the guaranteed annual income pension or OAS, Canadians are concerned about the future. They are concerned about pensions. They do not feel the government is doing enough to protect their future for pensions.

One of the issues we have indicated clearly is the need to retain the option for people to retire at age 65. The government is saying that it wants to increase the age of eligibility for our Canada pension from 65 to 67. We have indicated very clearly that it should retain it at age 65. Would member like to provide some comment on that issue?

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, on the issue of raising the retirement age from 65 to 67, all stakeholders, including the Parliamentary Budget Officer, the Superintendent of Financial Institutions, the chief actuary of the Canada pension plan and the inspectors of financial institutions, agree that raising the CPP eligibility age from 65 to 67 is not the solution. Financially speaking, that is not the problem.

The hon. member for Winnipeg North is quite right. This was done with just one goal in mind: to cut $10 billion in order to justify $10 billion worth of tax cuts for the wealthy. The middle class is being asked to do without $10 billion in the future so that the government, which favours private enterprise, will be the only one to benefit.

This will not solve the problem for the people of Nortel, among others. It seems that this government does not like hearing about the people of Nortel. I am sorry, but these people lost 40% of their pensions, and the government did not lift a finger.

[Pierre Jacob, NDP, Brome—Missisquoi, QC]

Mr. Speaker, I would like to thank my colleague from Marc-Aurèle-Fortin for his very sincere speech, as always.

He said that the Conservative government was like a grasshopper. I would add that the government misled those people, because it repeated ad nauseam that it would not reduce pensions and then it did exactly that. In the next few years, seniors are going to make up a significant portion of the population. All they want is to live in dignity. I wonder if my colleague could explain what the NDP plans to propose for them.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, I am not going to get into the technical formulas concerning disbursement, but I do want to point out one thing: in May 2011, the government members swore, with their hands on their hearts, that they would leave pensions alone.

Now we know just how much a grasshopper's promise is worth—it is worthless. They gutted and are continuing to gut the Canada pension plan. They refuse to assume the government's responsibility for ensuring that the middle class gets its money.

The middle class is now doing without in order to save for the future. The government is sending the message that it will do what it wants to with their money. The middle class will have to do without until the age of 65, 67 or 70—we do not know where the government will draw the line—whereas the government will be flush with money. That is what the Conservatives are proposing. They are anti-Canadian.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, it is a pleasure to rise today to speak to our opposition day motion. I want to acknowledge the work of the member for Victoria. He has done an amazing amount of work on this file. I thank him for bringing the motion forward today.

It is important that we discuss this today. This Friday the Minister of Finance will be meeting with the premiers and his provincial counterparts to discuss pension benefits under the Canada and Quebec pension plans.

Because the Minister of Finance is going to this meeting, we want to urge our colleagues across the way and sideways, from all parties, to support the motion today to send a very strong message, which is that as parliamentarians we support the position that CPP be increased incrementally.

We are going to hear a lot of horror stories and we know our colleagues across the way are very good at shock and awe. However, the reality is that we are putting forward a plan for incremental increases to CPP, not only because it is the right thing to do but because it makes economic sense. We have to take a look at it from the economic side of it.

Besides looking at it economically, we have to remember the people who draw their pensions are the ones who built our beautiful country. They have worked all their lives and they deserve to live their retirement in dignity. There is stark evidence that a growing number of our seniors are living well below the poverty line and out of that a large percentage of that population is women.

I also want to commend the work done by CARP, which has done an amazing amount of work on this file. If we listen to my colleagues across the way and hear their arguments, “The sky is falling, the sky is falling”, one would think this is an idea or something they have just heard about.

I want to draw to the attention of my colleagues across, and this is really worth paying attention to, that increases to CPP is not just an NDP idea. They should not think they have to oppose it because it comes from the NDP. This idea is supported by the provincial governments, the Canadian Labour Congress, Canada's largest retirement organization, CARP, financial experts, the chief executive officer of the CIBC and the chief actuary of the Canada pension plan.

When we look at the diverse support for this, we should consider what goes on in the minds of the members of Parliament who would oppose modest increases to CPP that would lead to lifting many of our seniors out of poverty.

Not only that, I really want us to think about something today. All this week, ever since Thursday, we have all been engulfed in emotions. Those emotions run very deep and run across all party lines and right around the world. Mandela was a gift to the world. What did he talk about? I found an excerpt from one of the speeches he made. He said this:

Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by the actions of human beings....overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life. While poverty persists, there is no true freedom.

And overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life. While poverty persists, there is no true freedom.

When I read those words, it sent tingles down my spine. I am reminded that there have been so many great people who have gone before us, including our predecessors who established CPP.

The CPP, the Canadian pension plan, is not one of those funds that is very small; it is a huge fund. That huge fund has massive opportunities for investment that small funds do not have, and individuals do not have. To me, it is leveraging a huge fund in the Canada pension plan with a modest increase over a number of years so we can get the return to lift our seniors out of poverty.

[The Acting Speaker, Conservative, Barry Devolin]

Order, please.

I must interrupt the hon. member for Newton—North Delta at this time. The time for government orders has expired. She will have four minutes remaining when this matter returns before the House.

2014 Winter Olympics and Paralympic Games

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

Mr. Speaker, Winnipeg was the place to be this past week for anyone who loves curling. We were the proud host of the Tim Hortons Roar of the Rings, the Canadian curling trials to determine our teams that will represent Canada at the 2014 Winter Olympics in Sochi, Russia.

I want to congratulate everyone involved in this great event at the MTS Centre, from the Canadian Curling Association to event organizers, and all the hard-working volunteers, who made the week such a success.

On Friday, I had the pleasure of participating in the news conference that introduced our wheelchair curling team that will represent Canada at the Paralympic Games in Sochi.

Today, I am proud to congratulate the Jennifer Jones team, from Manitoba, who will represent Canada in Sochi. Jennifer and her team: Kaitlyn Lawes; Jill Officer; Dawn McEwen; coach, Janet Arnott; and alternate Kirsten Wall. They won it all in front of their hometown fans. As Jennifer said, this is a dream come true.

Canada will be well represented by a team that has won four Canadian championships, a world championship in 2008, and a world championship bronze in 2010.

With that, all that is left to say is “go Canada, go”.