Mr. Speaker, I rise today to speak in support of my colleague's motion to increase the Canada and Quebec pension plans for all Canadians.
Canada is facing a retirement security crisis. Today's seniors just do not have the money they need to retire. Nearly one-third of Canadians will face a drop of 20% or more in their living standards by retirement. Also, nearly one-third of our workforce, as many as 5.8 million Canadians, are facing a steep decline in their standard of living upon retirement. As per usual, with the changes by the current Conservative government, young Canadians are left with a more dire situation to deal with. As The Globe and Mail recently reported:
A CIBC Economics report warned this year that middle-income Canadians are not saving enough for retirement. The report said the situation “will be at its worst decades from now,” when people born in the 1970s and 1980s retire and face a drop of 20 per cent or more in living standards.
Without an increase to CPP, Canada is facing a retirement security crisis. For seniors living in poverty, transfer payments make up over 90% of their incomes. This is not sustainable. Canadians make contributions to the CPP throughout their working lives, and they expect it to count once they reach retirement age. We can do better.
I must also mention that I will be sharing my time with the member for Toronto—Danforth.
Unfortunately, the reality is that Canada cannot afford to not invest in improving the lives of our seniors. As the Conservatives hand out billions of dollars to well-connected insiders and buy fighter jets that our forces say will not meet their military needs, they are ignoring the very real challenges Canada's aging population is facing.
CPP is stable. Many experts are now advocating a phased-in increase in the Canada pension plan and the Quebec pension plan, the CPP and the QPP, as the most practical and effective way to help ensure the retirement security of Canadians. As the government's own data show, a modest increase in CPP premiums could finance a substantial increase in benefits.
The simple truth is this: a great many Canadians are not saving enough for retirement today. The provincial governments, the Canadian Labour Congress, and various financial experts have all been calling on the federal government to move forward with plans to increase the CPP.
What other experts would the Conservatives like people to ignore? The chief executive officer of the CIBC, Gerald McCaughey, has been speaking out about the need to improve our public pensions. The Conservatives would rather people ignore what they have said, that enhancing the CPP would help boost savings and that increases to the CPP are “a way for Canadians to make the big investments and get better returns with relatively low cost”.
The Conservatives must be thinking, “What do those socialists at the bank know about managing the economy anyway?” Everybody is a socialist except them.
The Canadian Association of Retired Persons has been campaigning for increases to CPP for at least the last three years. In its own words, it has said:
It has been three years since the finance ministers acknowledged that Canadians were not savings enough for retirement and that the existing vehicles were inadequate. Most important, they acknowledged that government had a role to play. Think tanks and pension experts have had enough time to line up behind CARP’s call to enhance the CPP. There is no reason to delay this any longer.
Even the PBO, the Parliamentary Budget Officer, has said that CPP is stable. Instead of listening to their own data, the Conservatives would rather use the CPP to instill fear in the hearts of Canadians. On one day, the Conservatives say that the Canadian economy is strong, but today the Conservatives are telling Canadians that the economy is so weak that there is no way we could increase the CPP.
The New Democrats, along with the provinces, are calling for a gradual phasing in of increased benefits in an affordable, sustainable manner. The increases to the CPP and QPP in 1997 have been shown to have not hampered growth in our economy. The Conservatives would like Canadians to believe that if they are re-elected in 2015, then, and only then, will they start fixing what is broken. To be honest, 2015 could just be too late. The problems may be too big to fix. There is a crisis in retirement security we need to tackle today, but we must do so in a responsible manner.
How dire is the retirement security crisis in Canada? Canadians used to be able to count on a workplace pension plan in retirement. Now, more than ever before, seniors are left to depend more on their private savings, especially in comparison with other OECD countries.
A recent OECD survey on pensions shows that the number of seniors, especially women, who live in poverty has been rising in Canada under the Conservatives, even as it is dropping in 20 other OECD countries.
Depending on the poverty measure used, the before-tax income for elderly couples ranges from $14,700 to $22,000. For unattached seniors, the average before-tax income ranges from $11,550 to $16,900.
In my community of Scarborough—Rouge River, just over 12% of our population is over the age of 65. That number will only increase. The average income in my community is $28,328. This really does not paint a rosy picture of the retirement security of the people living in my community. Many families in my riding who came to Canada to invest in their futures soon may find that their investment will come up short.
I am sure we all know of at least one senior who is working past the age of retirement. I want to share a personal story, if I may.
My mother has been working in a warehouse for many years, for over 25 years. She is around the age of retirement now, but she has to keep working. Without a full-time job, my mother would not be able to pay for medication that she and my father need. I am so proud of my mother for being the breadwinner and for taking care of our family, but she should not have to put off her retirement for fear of retiring into poverty. This should not be a decision that any senior needs to make. Life should not be this way for our seniors in Canada. That includes my mother.
In fact, it is senior women who are really feeling the crunch today. No matter what measurement or indicator we use, women make up the clear majority of poor seniors, at 70%. We know that senior women who live alone rely on the government for 62% of their income. While men are more likely to have private pensions, government pension plans are the major source of income for women over the age of 75.
What about the rest of Canadians? What about Canada's future, our youth? With youth unemployment at record highs today, many young people do not have the luxury of thinking about retirement. They are too busy worrying about paying the bills today to think about their retirement many decades away.
As I touched upon earlier, nearly a third of our workforce is facing a steep decline in their standard of living upon retirement. In the case of our young Canadians, that number would be even steeper. We need to make changes now so that we can deal with the changes of Canada's aging population before it is just too late.
With all this support from grassroots activists and from our banks, with increasing demand, with all the facts in front of us, and with the possibility of such a harsh reality for our young people, why do the Conservatives not want to increase CPP and QPP? I just do not get it.
It was just last year that the finance minister agreed to move forward on increasing CPP and QPP benefits. Our finance minister never wants to disappoint us, but he seems to do that quite frequently. The finance minister even promised to meet with the provinces and territories over the summer to discuss how to move ahead. Shockingly enough, that meeting never happened.
In 2005, the Prime Minister campaigned on fully preserving old age security, the guaranteed income supplement, and the Canada pension plan. I think we can all admit that the current situation is a far cry from the campaign promise in 2005.
Why should Canadians trust the Conservatives with their retirement savings, when we know that we really cannot trust them on anything else?
We know that by 2030, Conservative cuts to old age security would slash $11 billion in retirement income from seniors by raising the retirement age from 65 to 67.
I will end there and will leave the rest for questions and comments.