Debates of Oct. 25th, 2016

Canada Pension Plan

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, would the member acknowledge that the bill we are debating today is, in part, because provincial governments entered into discussion and, through strong national leadership, came up with the idea that CPP needed to be increased and we needed to start thinking about the future of workers? At some point, they are going to retire and we need to ensure they have somewhat decent pensions for the work they have done.

Would the member comment on the importance of getting the different stakeholders together, specifically the provinces, with Ottawa to come up with an agreement for the betterment of today's workers?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, it is very important to underline in this debate, especially for the Conservative side, that so many provincial premiers came together, even Conservative superstar, Premier Brad Wall, who I think many Conservatives wish was running for leadership. Yes, he was a reluctant partner, but he did come on board at the end. He got the necessary delays to ensure it was implemented and that businesses did not get that shock.

It is very important to remind the Conservatives that there is provincial support, that this has satisfied the seven out of ten rule, with eight provinces coming on board. Quebec has its own pension plan, so it was automatically on the outside. However, that is a very important point to underline.

[Pierre Nantel, NDP, Longueuil—Saint-Hubert, QC]

Mr. Speaker, I would like to congratulate my colleague for his speech, which once again I found to be extremely well grounded in the reality of his riding. He is a new MP, even if it has been a year now, and I know how enthusiastic he is about the work we have to do in this great democracy and about the discussions we have among ourselves.

I would have liked to have his opinion on a thought that someone expressed to me just recently, which is that, at this time, we are seeing a confrontation between two schools of thought on the same problem, and that clearly, what we are referring to when we say that in 50 years’ time, 16-year-olds will have access to a better pension plan, is a vision, a blueprint for society.

And it does not stop there, I imagine. I assume that the situation in his riding is similar to the one in mine, in Longueuil—Saint-Hubert, where we have some major social housing issues. I think we should move on to other things and look after today’s seniors and their situation as quickly as possible.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, that is a very good point. It reminds me of some of the conversations that took place during electoral reform. The problem with our current system of electing governments is that we suffer from policy lurch. It is very hard in this place to take a long-term view when there is a new government, on average, every 10 years that completely clears the deck of the previous government, saying it is going to go in another direction. Then in another 10 years, another new government says that it is going to go in another direction.

Bill C-26 is a very real effort. Yes, it is going to take a long time to get implemented, but it is taking that vision in several decades. Yes, it will only affect the kids of today, but I think those children will be very thankful that we had the foresight to act now before the problem went beyond this.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, it is my privilege to speak to Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act.

While I believe that the Liberal government has good intentions, it has failed to recognize the negative impact this legislation will have on the overall economy.

As many of my colleagues have already pointed out during this debate and in previous debates, what we see in this legislation is a fundamental difference between the Conservative Party of Canada and the other parties in this chamber. In this party, we believe that Canadians are in the best position to make their own decisions, and this includes decisions relating to their retirement.

Let me be perfectly clear. We in the Conservative Party are not against the CPP. We are not against helping Canadians save more for their retirement. We are certainly not happy to see seniors struggling to live out their retirement in comfort. We do believe that government policy should provide opportunities and avenues to save and to reduce taxes so that Canadians can save more of their own money when it is within their means to do so.

We strongly believe in the right of each Canadian to make his or her own choices. Canadians know what is best for them and for their families.

On the other hand, Liberals and New Democrats believe that government knows what is best for Canadians, and they do not trust Canadians to prepare for their own retirement. They seem to believe that the only way Canadians can save for retirement is through a mandatory increase in CPP contributions by both employers and employees.

We saw this ideology from the Liberal government in its first few weeks, when it slashed the tax-free savings account contribution limit by half. The Liberals made this cut even though the TFSA is a popular means of saving for Canadians at all income levels.

Individuals with annual incomes of less than $80,000 accounted for more than 80% of all TFSA holders and about 75% of TFSA assets as of the end of 2013. About half of TFSA holders had annual incomes of less than $42,000. At the end of 2013, about 1.9 million Canadians had contributed the maximum amount to their TFSAs. About 46% of these individuals were seniors, and more than 70% were age 55 or older. Furthermore, about 60% of the individuals contributing the maximum amount to their TFSAs had incomes of less than $60,000 in 2013.

The tax-free savings account is an avenue for saving that all Canadians should take advantage of. It is an opportunity to have their investment grow at a far higher rate than they would see with the CPP. The money they deposit is readily available in case of an emergency or to make a lump sum payment to pay down their mortgage more quickly. Opposition parties have scoffed at this idea, because they believe that Canadians do not have disposable income to put in a TFSA. If that is true, how can the government justify siphoning off more money from Canadians' paycheques and holding it until they retire?

Canada is heading toward a large increase in the number of Canadians who will be entering retirement over the next decade. This is not the time to be limiting the amount of savings that would benefit these Canadians the most.

The CPP hike will take 40 years to be fully implemented, so none of these new benefits will go to seniors who need it today, or even in the next few years.

This increase will not only not benefit Canadians entering retirement soon, it will directly negatively impact the way families, students, and young employees invest their money now. A CPP increase will take money away from their paycheques, money that could have been invested or spent on immediate needs. I am talking here about new graduates wanting to pay off their student loans, or families saving for their children's education, or a middle-aged couple making a lump sum mortgage payment to reduce overall interest payments. With this plan, some households will be paying up to $2,200 more per year in payroll taxes. That is $2,200 per year that is not available to positively impact our Canadian economy.

As I said at the beginning of my remarks, I believe that the Liberals have the best interests of Canadians in mind, and their intention to help Canadians in retirement is good, but it is clear that they are going about it in the completely wrong way.

Let us not forget the impact these policies will have on job creators. Canadians cannot contribute anything to the CPP if they do not have jobs, and the introduction of this increase will result in job losses across Canada.

At a time when the Canadian economy is losing jobs and struggling to create new jobs, and when we see low growth across the board, we simply cannot impose more expenses on business in Canada. This will mean that companies will not hire that extra worker, not create that new position budgeted for, and not expand into new sectors. In some cases, they will actually have to lay off employees.

In 2015, the Canadian Federation of Independent Business studied a CPP tax hike and found that it would eliminate up to 110,000 jobs and permanently lower wages by nearly 1%. Simon Gaudreault, chief economist at the CFIB, tells us that this agreement will have serious negative impacts on workers and the Canadian economy. The announced changes, including increased contributions, may put Canadian wages, hours, and jobs in jeopardy.

Hendrik Brakel, senior director, economic, financial and tax policy at the Canadian Chamber of Commerce, also notes that increases will have many effects on the Canadian economy. He said:

...we’re worried a big tax increase is headed for the middle class like an elbow to the chest....

This comes at the worst possible time—an economy reeling from weak commodity prices and slower consumer spending will be lucky to eke out growth of 1.5% next year. It’s difficult to stimulate the economy while pulling money out of the pockets of Canadians.

It is not just directors and chief economists who are speaking out against this increase. This past summer, a young woman who manages the payroll for a number of small and medium-sized businesses in her area told me that she could not believe that the Liberal government would be increasing this mandatory contribution. She assured me that this would mean layoffs, decreased investment, and postponement of expansion. In other words, no new jobs.

We have heard from experts and ordinary Canadians that Bill C-26 will have negative consequences and will hurt, more than help, our young people and seniors.

Last, I would like to quote Mr. Fred Vettese, chief actuary at Morneau Shepell and co-author, with our current finance minister, of The Real Retirement. He wrote in the Financial Post, on June 5, that:

Whatever the reason might be to expand the CPP, it is not to eliminate poverty. The poverty rate among seniors is now as close to zero as we can get. Yes, a little over five per cent of seniors today still have income below the poverty line....

Canada has a world-class retirement system, and the numbers support that, with 83% of Canadian households on track to maintain their current living standard in retirement, according to a study by McKinsey & Company. In addition to that, according to Statistics Canada, the share of Canadian seniors living on low income has dropped from 29% in 1970 to 3.7% today, which is among the lowest in the world.

I would like to quote Finance Canada, from June 2015:

Overall, Canada's retirement income system is performing well. Canadian retirees achieve relatively high levels of income in retirement, and compare well to retirees in other Organization for Economic Co-operation and Development countries. With support from all three pillars of the retirement income system, the median Canadian senior earns about 91 per cent as much as the median Canadian--well above the Organization for Economic Co-operation and Development average of 84 per cent. Internationally, Canada has one of the lowest low-income rates for seniors.

I agree with the broad intentions of the Liberal government as it approaches this legislation. We, as members of Parliament, should strive toward the goal of having every single Canadian senior retire in comfort. However, as I have outlined throughout my remarks, I believe that the Liberals have not considered the many negative impacts this policy change will have on Canadians.

I cannot support Bill C-26, as the negative consequences are far too crucial for me to ignore.

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Mr. Speaker, I thank my colleague for a very well-delivered speech on Bill C-26.

I have to say that when we look at young Canadians today, they are not living in the same situation we did, and do, meaning that today, most of us at my age, anyway, including my colleague across the floor, have had the benefit of having a pension at the end to help us and to ensure that the golden years are golden. However, for these young people, when they start off their careers, there is no guarantee of any funds or pensions. It is our responsibility to ensure that we do the right things to make this happen.

We know that in the United States, it could be a crippling situation in 2033, as far as the benefits that would be allowed.

It is not only the Liberal Party and the government bringing this to the table. It is all 10 provinces and the territories. Are we saying that the 10 provinces, the territories, and the government are all wrong and are all doing the wrong thing?

Can you expand on that, please?

[The Assistant Deputy Speaker, Liberal, Anthony Rota]

I just want to remind the hon. members, when they are speaking, to speak through the Chair and not directly across the floor.

The hon. member for Kitchener—Conestoga.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, I think my colleague hits exactly the point I was trying to make in my speech, and that is that my concern is for our youth. It is for our young people.

If we go through with the changes suggested in this bill, as I pointed out, it will result in people not expanding their businesses. Small and medium-sized companies across Canada are faced with really tough choices. When we increase the payroll tax, we end up possibly reducing the likelihood of an increase in wages, or, at worst, we my run the real risk of a layoff or not getting a job.

Yes, I hope our young people have the ability to start off their careers, because they have to start those careers if they are going to actually be able to pay into the CPP and then someday benefit from the CPP.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Mr. Speaker, I would like to know what my colleague thinks of the fact that this is an election promise that will be fulfilled very late for the people who will benefit from it.

I say this in the sense that a promise was made to improve the Canada Pension Plan, and those who heard this promise certainly thought that they would be receiving increased benefits.

Does my colleague feel, as I do, that this promise was made to attract voters, and that those voters, the seniors receiving benefits today, have been somewhat misled by the government?

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Mr. Speaker, again, he hits directly on the implication of our debate today. I think most people, when they hear about potential increases in Canada pension plan benefits, assume that it will happen now or in the very near future. We are going to increase the CPP. That is a great thing. We all agree that we would like to see CPP benefits improve.

However, what the average Canadian may not know is that before this move is actually fully implemented, 40 years will have passed. My colleague across the way who asked the question earlier and many of my colleagues who are beyond 50 will not benefit from this change in the CPP. I think that is the downside of what we are doing today. We are talking about increasing CPP benefits, but these benefits will not actually be realized in my lifetime, in all likelihood.

The other thing I would like to point out is that at different times we hear that the provinces and the federal government have all come to an agreement, so we should just approve what they are doing and get on with it. However, not everyone feels that way. I conducted a round table in my riding just a few weeks ago, and to a person, these owners of small and medium-sized businesses are very concerned about the impact the increase in the CPP premium will have on their ability to expand and hire new workers.

I just want to quote Mr. Dan Kelly:

It's tremendously disappointing to see that finance ministers are putting Canadian wages, hours and jobs in jeopardy and willfully moving to make an already shaky economy even worse.

I could go on, but I see that I am out of time.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, it is a pleasure to rise today and support BillC-26 at second reading.

We have heard quite a difference of opinion in the House on the advisability of this bill. Maybe we can start from a place that we do all agree with, that it does not serve the Canadian economy well and certainly does not serve Canadian seniors well to have people retire into poverty. Unless people are going to work their entire life until they drop, we project that there will be a period when they are not working for their income. That income has to come from somewhere, and if it is not coming from their going into work every morning, then it has to come from money they have saved on their own, or it is through a mechanism like the Canada pension plan, or from another kind of benefit if it is not from their working family members.

The kind of system projected by the Conservatives, when they talk about individual savings, is the one we once had when people who were past their working lives had to be supported by their family members. That was great for those who had family members who could support them, and it was very bad for those who did not. So the CPP was by far and away an improvement on that situation, through which people could manage to save for themselves throughout their working life. Things like the OAS and GIS are important in that regard too.

There is a need for income in retirement. We can all agree on that. The gold standard for that would be to have some kind of guaranteed annual income in retirement, I think it is fair to say. But given that we do not provide in that way, the Canada pension plan has been a great mechanism for working Canadians to make sure they do have at least a basic income when they retire. It was based on three pillars, that there would be a CPP there to provide about a third of what people might need in retirement; that their company pension plan would provide another third; and that their personal savings would provide the final third.

In Canada today, two of those pillars are in serious jeopardy. We know that almost seven out of 10 Canadians working today do not have a company pension, meaning that a third of that retirement income scheme is gone. We know that most working Canadians are struggling very hard to save. Many are living pay cheque to pay cheque, so they are not able to save to the extent they need to in order to be able to furnish a third of their retirement income once they are no longer working. That is why there is a need to enhance the first pillar, the public pension. It has to do more, in our view, to make up for the problems in realizing the potential of those other two pillars.

People may be approached by their financial adviser and told there are all these plans, but one plan has 40 million people in it, those being everyone in the country, and it is fully portable.

Particularly in this age, people are having a hard time finding a job that will last the 20, 25, 30, or 35 years necessary for them to be able to buy in sufficiently into a company pension plan, if there is one, to have it produce adequate income for them in retirement. Most Canadians are going to have seven or eight different employers in their working life if they are young now, and it is almost certainly the case that many of those employers will not have company pension plans. Even if they did, they would not have the same plan. CPP provides an important benefit with its full portability. That is an advantage of the plan.

Every working Canadian is in the plan. That is another advantage in spreading the risk. Furthermore, it has been proven to have some of the lowest administration fees and, therefore, it gets the best value for money for the contributors, who do not have to have their money shuffled off to those who are administering the plan.

It has the added advantage, when every working Canadian is in that plan and everyone who has worked is living off a portion of that plan, that it has a certain political backing. That also goes toward mitigating risk. We really are all in the CPP together in a way that we are not in any private pension plan, so Canadians can feel confident that their savings held with the CPP are less likely to fail than those in many of the private options that are out there.

It has another benefit that is even rarer today, even in the case of Canadians who do have private sector pension plans, in that it provides a defined benefit. That is very helpful when trying to project what income people will have in retirement and, therefore, how much they need to save to go above and beyond what their pension plan will provide, whether CPP or a combination of CPP and a private pension.

People who are in a defined contribution plan who do not know what that plan is going to produce once they do finally stop working will find it a lot harder to know exactly how much they have to save. That is another benefit of the Canada pension plan.

I do applaud the effort to raise the benefits of the CPP. I think there are a few things to say about that. One is that I really do doubt whether it is enough. In fact, I do not think it is. I would like to see the government go further in enhancing the Canada pension plan, because I do think it is a great option for most working Canadians, who are not making a lot of money, not just to save for their own retirement in a well-working, proven fund, but also to have their employer make a matching contribution to that.

Indeed, when we talk about Canadians taking charge of their own future and saving their own money through TFSAs, for instance, we do not talk about what is absent, namely employer contributions. That is another important aspect of the CPP.

I would like to see it further enhanced. This is a good first step. It is certainly not worth opposing simply because it is not ideal. However, I would like to see the government push harder for an bigger increase in the CPP. I think it is important.

We also know that this will not do anything for seniors right now. That is important to consider, because it will do a lot for young people over the course of their working lives, but not for seniors rights now. My children, who are three years old and four months old, are going to benefit from this. They will see that benefit. I am quite happy to do that for them. However, for people in my parent's generation who are just looking at retiring, other measures will be needed for them.

I do want to take a moment to address some of the arguments I have heard in the chamber today. The first is that somehow the Canada pension plan is a payroll tax. I simply do not agree with that. It may be true as a term of art in accounting terms, which may be where it is recorded on the ledger. However, for ordinary Canadians who are going into work every day and are working to put food on the table today and for that period in their life they look forward to when they will not go into work every day, the CPP contribution on the part of their employer is part of the wage package. That is part of what they are going into work for, as well. So I do take exception to those who continually refer to this as a tax. It is not a tax. It is part of the wage package.

It is up to Canadians to take charge of their own future and to decide how they are going to save for retirement. In that regard, a perfectly legitimate decision on their part is to decide to do that saving through the CPP, to do it collectively, to have a plan that is better than the options they get through the private sector, and to decide that we are in this together and to elect a government that will implement a mandatory public pension. That is a perfectly acceptable decision. That is something I take them to have done in the last election.

Again, I would like to see it go further. I think many Canadians would like to see this proposal go further. However, part of the decision that was made was also to reject the idea that somehow each Canadian is on their own individually, and that they have to make choices as individuals. I believe we can make a collective decision to enhance our public pension system and that it would be a good way for us all to save for our retirement, and to do it in a way that is fair to each Canadian.

When we talk about individual Canadians who are saving for their retirement and some of the options available to them, what is missing is that Canadians with more money have more options to invest. As people hit certain income thresholds, they can gain access to certain funds and other clubs that provide better returns. It is a fiction to say that all Canadians are equal when it comes to the private retirement investment market, and that we all have the same options. One of the things that the Canada pension plan recognizes is that we all need to be treated fairly. This is another reason to support the plan.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I appreciate that New Democrats have acknowledged that Bill C-26 is a good bill. I want to reflect on the fact that provincial jurisdictions from all regions of the country were able to come to an agreement that this legislation is forward thinking. It would provide in a very real and tangible way retirement monies for those who are working today and are going to be in the workforce for a while now.

My question deals with the other aspect. There is a lot of discussion about seniors in poverty. Yes, the overall numbers have gone down and we have seen in the last number of months, with the Minister of Finance making an announcement that we are going to be substantially increasing the GIS, that we will be lifting literally thousands more seniors out of poverty through the guaranteed income supplement.

Today we are talking about the Canada pension plan. There are three fundamental public pension programs, the OAS, GIS, and the CPP. Does the member have any thoughts on other two programs the bill does not deal with?

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, first of all, I concur with the member that one of the important aspects is that the provinces are onside. I would recall for the sake of the chamber that provincial premiers for a long time had wanted to meet with the federal government about the Canada pension plan. The previous government was not willing to engage in that conversation, so I think it was with a sense of relief and gratitude that they came together and finally were able to talk about it.

Again, I think we could have done more with that opportunity and I want to see more done in the future, just as I would like to see more done with the OAS and GIS. There has been talk about some increases. Part of that conversation has to start from what is really an acceptable level of income to get an apartment here in the current Canadian economic context, and given the cost of food. We need to figure out what that number is and then start having a serious conversation about what we need to be able to get Canadian seniors to have that income.

What I have seen myself in Elmwood—Transcona is unacceptable. I have been in the living rooms of women who were not working and have shown me that their cupboards and fridges are bare, because all of their disposable income is going to pay rent. That is unacceptable. I know that we have the resources in Canada to make sure that people are not living in those circumstances. We have to start talking about how we are going to do it.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, I want to talk about a couple of risks that occurred to me. One I thought of was when a New Democrat colleague spoke about how new governments overturn what previous governments did. I thought what if the current government were in for a number of years and collected everyone's money, and then the next government just turfed the whole plan? That would be one risk.

Another risk occurred to me when someone talked about the possibility that they might take the CPP fund money and invest it in infrastructure with Gerald Butts influencing that after he has already run Ontario into the ground. I wonder if the member could comment on those risks.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, the idea of a reliable pension plan requires it to be responsibly managed, but there is a great record of success when it comes to the Canada pension plan that shows it has been successfully managed to date. If there are proposals on the table that would imply unsuccessful management, then those are bad proposals. But they do not preclude the idea of expanding the Canada pension plan and its benefits. That is a question about how the fund should be managed.

I think it is also important to talk about the fact that there are a lot of irresponsible things done with people's retirement savings by private investment funds and the banks they invest with. It is a fiction to pretend that somehow there is a big risk by investing retirement savings in the Canada pension plan and that somehow if people deposited those funds in their bank or some other private financial planner, their savings would be perfectly safe. I would argue, from the evidence, that Canadians have a lot more to worry about from private investment options than they do from the Canada pension plan, which has a long public track record.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Mr. Speaker, I too am pleased to be participating in this debate on Bill C-26, an act to amend the Canada pension plan, the Canada Pension Plan Investment Board Act, and the Income Tax Act.

First introduced in 1965, the legislation creating the Canada pension plan came into effect in 1966, and was created to ensure that all working Canadians have an opportunity to retire in dignity.

I understand that, as members of Parliament, we have a natural tendency to want to do more for the people we represent. We are tempted to use the incredible financial and regulatory power of the government to do more. With an activist government such as this, there is no problem too small or too complex to be fixed by intervention. We know the Liberal Party believes that the government knows better than Canadians. When we believe that government can and should do everything, there is never a need to say no to increased spending.

As the ancient Chinese philosopher Lao-Tzu said, “Govern a great nation as you would cook a small fish; do not overdo it.” The current government is overdoing it right now.

The reality is that Canada's retirement system is the envy of the world. Canadians are saving more for retirement today than ever before, and poverty among seniors has dropped significantly in recent years. In light of this, I have a few questions.

What should the fundamental role of government be in our country? What percentage of income should Canadians take home at the end of each pay period? Should Canadians be keeping more than 50% of their total income, as a matter of fairness, because they should be deciding how at least 50% of their earnings are spent? What do we believe about the role of government? Do we believe as a country that the individual financial choices that Canadians make are better or worse than those made by government? What percentage of our gross domestic product should be government spending?

According to the 2016 Index of Economic Freedom, government expenditures presently represent 40.7% of GDP in Canada. In comparison, Australia sits at 35.7% and the United States at 38.9%. Therefore, are we better off in Canada than Australia because more of our economy is put through Ottawa? It is obvious that the Liberal government thinks so. However, I certainly do not. To me, limiting government is extremely important, as it has been shown over and over again that once government gets involved in doing something new or doing more of something, competition and choices decrease, which inevitably is a negative for Canadians.

I am proud to be a member of a party that believes that, despite its best intentions, government does not know best. Government should not be forcing Canadians into making decisions that it thinks are best, yet this is exactly what Bill C-26 would do. This bill is about competing visions: a vision of what government can do versus what government should do. This bill is about Canada's finances, and more specifically, the finances of every single Canadian household and every single Canadian business, both big and small.

When government decides that every Canadian must save more, above all through the CPP and not through any other retirement program, and consequently increases premiums on employers and employees, two things happen: first, Canadians have less money in each paycheque to put into an alternative savings vehicle of their choosing; and second, because Canadians are putting more money into the CPP, they feel less inclined to contribute to other retirement savings plans.

As capital is being withdrawn from private sector investment plans, fewer of these would exist, as the demand for them would decrease because retirement contributions would be going to the CPP. This would create an endless feedback loop where increased government intervention would lead to Canadians saving less of their discretionary income for their retirement, which would then lead to government once again looking to top up the CPP through increased contributions, as we have seen in the past. This is an important point, and it is the main reason that I oppose the bill.

Make no mistake, the bill is not some gentle push that will achieve the Prime Minister's stated objectives. The bill would introduce a tax hike. It would be a tax hike because Canadians would not have a choice on whether to pay it. More money would be taken off every single paycheque until retirement. It would be a tax hike because Canadians would not have a choice on how their income would be spent.

The CPP is a mandatory contribution fund. Employees and employers do not have an option to voluntarily participate in the CPP, but are instead required by law to contribute. This distinguishes the CPP from the public pension plans of other countries, such as Britain. Their individuals can opt out of contributing to a central plan in favour other retirement income schemes.

Let us look at how the bill would affect Canadians. The bill would lead to some households paying up to $2,200 more per year. It would be harder for new graduates to pay off their student loans, as more of their income would be going into a pocket they would not be able to touch for 40 years; so rather than pay off the principal of their student loans as quickly as possible, graduates would have to either decide to spend less on day-to-day necessities or spread out the amount of time they take to pay back their student loans. Neither one of these is an appealing choice.

The bill would also make it harder for young people to buy that first home. Everybody who has purchased a house knows that in the first few years of repaying a mortgage, the lion's share of each payment is going to the interest and not the principal of the loan. The bill would reduce the discretionary income that Canadians have to pay down their mortgages more quickly. This would once again force Canadians into a choice: either spend less on items of necessity or take longer to pay down their mortgage. Once again, neither one is an appealing choice.

However, these are the types of choices Canadians would have to make going forward. They would have to make similar choices on whether to invest in a registered education plan, or whether to fly home and visit the family for Christmas, and it would be harder for companies to create jobs and give workers raises.

In conclusion, we know that the Liberal Party of Canada believes the government knows best and that it needs to be a perpetual helping hand to all. “Big Brother” seems hardly adequate to describe the interventionist Liberals' first year in office.

The Liberal government has decided that Canadians are not saving enough for their retirement. I think we can all agree that some folks are perhaps not saving enough, but there are other folks, as we heard in remarks today, who may be saving too much, and then there are folks who are probably saving just the right amount.

People also have vastly different retirement needs, depending on where they live and what their expectations are for their retirement. There are a number of options out there to encourage folks to save, even though a very popular one, the tax-free savings account, was just cut in half.

Getting people to more broadly use these voluntary programs is a good thing that the government should seriously consider. We owe it to our constituents to give them the option on how to save for their retirement. Unfortunately, the government has opted to go the other way.

[John Oliver, Liberal, Oakville, ON]

Mr. Speaker, when I was knocking on doors in Oakville I ran into many seniors who were struggling and were in very difficult financial situations, and the CPP was simply insufficient for them, combined with their own savings.

For me, personally, the old adage about a tree comes to mind. The best time to plant a tree is 20 years ago. The second best time is today.

When I hear the member speaking about government involvement and her preference that government not be into this, I look at the CPP and ask what the advantages are of the Canada pension plan, which really is not government involvement.

First, it is predictable retirement income, because it is a defined-benefit plan on which people can rely, long-term, looking forward to what the benefit will be from it.

Second, it is pooled risk, so the risk of long-term investments with Canada pension plan is shared and there is a very strong professional management of the Canada pension plan, which further reassures people that they have a level of investment security that they could not achieve on their own.

I come back to the issue of predictability if individuals are left to put money into their own investment strategies and the uncertainty of those strategies over time.

Could the member reflect on the benefits of the Canada pension plan? What are the benefits of a defined-benefit plan versus the contribution models she is proposing?

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Mr. Speaker, I want to go back to the premise of the member's question when he was talking about seniors. I know that this is one of the arguments that members opposite have made in terms of how this is going to help the seniors he referenced when he was door-knocking and hearing from seniors. According to Statistics Canada, the percentage of low-income seniors was 29% in 1970. Today, it is 3.7%. That is clearly a significant improvement.

I would venture to guess that is not just because of CPP, but because of the other tools available to seniors. We know that the best way to prevent poverty in old age is to give people the tools they need to save money today and to let them make their own choices based on their means.

We believe that Canadians know how to manage their money, not the government, especially not this government, which is taking money out of their pockets at every turn.

I know the member is aware that there is old age security and the guaranteed income supplement. That exists also to help seniors who do not have a workplace pension. However, because of the long phase-in period for Bill C-26, we know this would do nothing to support our seniors today.

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Speaker, I would like to thank my colleague for her well-reasoned thoughts and logic on the bill. I wonder if perhaps my colleague could share something with me.

We have heard constantly from across the way and to the far left of me about how Canadians do not have any money left over to save. They do not have enough to pay for their grocery bills. They do not have enough to put aside for their children's education. How does she imagine Canadians would be able to have money taken off their paycheques when at the same time they have no extra money for their rent or savings? How would this new government-imposed tax of $2,000 a year be doable?

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Mr. Speaker, I thank my colleague for his question, and I have really appreciated all the comments that have been made during this debate. Certainly, I appreciate that we have a public square right here that respects the diversity of opinions.

Finance Canada's own analysis shows that the higher CPP premiums would hurt our economy. We know it would reduce employment by 0.04% to 0.07%. That is 1,050 fewer jobs per year for 10 years. We know it would reduce the GDP by 0.03% to 0.05%. We know it would reduce business investment, it would reduce disposable income, and it would reduce private savings over the long term.

[Larry Maguire, Conservative, Brandon—Souris, MB]

Mr. Speaker, it is my privilege to stand to speak to Bill C-26 in the House today. It has been referred to as the Canada pension plan tax hike bill brought on by the Liberals, and that is certainly what it is.

I want to welcome back all of my colleagues after Thanksgiving. I hope they had a good break and everyone enjoyed it. I know there are many happy Conservatives giving thanks in Alberta today and I would like to announce my support for Mr. Motz as he will be coming from the Medicine Hat—Cardston—Warner constituency to join us in the House very shortly.

One of my colleagues said today that the numbers to remember were 70 for the Conservatives and 26 for the carbon tax. I only go there because my colleague from Richmond Centre indicated that the carbon tax is what would kill seniors. However, that is only one thing.

Forcing tax increases on people, such as Bill C-26 would do, is not very democratic, with the government saying it is going to help seniors when, clearly, the bill would not help them for 40 years down the road. Even my colleague from Winnipeg indicated earlier that it might be his children who would benefit from this, and that is absolutely true. My grandchildren would probably benefit from it a bit, 40 years down the road, and none of them are even 20 years old yet.

That is the kind of rhetoric that comes out of bills like this that are not well thought out. It would be a tax on the individuals who are going to put up this money, and because it would be such a long time before they would ever get a payback on it, it would be decades after they retire before they would get back what they put it into it themselves.

I want to go back to what my colleague from Chilliwack—Hope said today. When people put these funds into the account, it would be a long time before they would see any benefit. They would be putting their money into a plan that, if they die early, an unfortunate circumstance, the money they have put away for all of these years would not accrue to them. It would not go to their families upon their death like in a normal pension plan or their own private savings.

I want to make it very clear that I support the public pension plan, as was questioned earlier by my colleague from Winnipeg North. We have both debated a number of these kinds of bills in the Manitoba legislature when we were both there, but this is not the way to enhance the ability of seniors to have more money in their retirement years. If it is put in place to help those who need it today, then there are many other ways of doing that to make it easier for seniors to access those funds in the near future.

What scale of support would this provide? The tax itself could end up being $2,200 a year. That would be the increased premiums people would pay. Of course, $1,100 of that would be paid by the individual and $1,100 paid by the employer. Having been an employer and knowing how the system works, it is a matching fund. I do not have a problem with that, but what it would do is two things. It would not provide the benefit right away that the government may have been targeting and it would certainly, as my colleague just finished saying, reduce people's ability to put funds into their own private pension plans, if they were able to. It would decrease the amount of money they would get back in the near term. I think the number was that it would reduce it by 7%.

It would also make it tougher for businesses to survive. This is not just a Conservative number. There was a study done. If Liberals do not believe it, they should look at Finance Canada. It is the one saying that higher CPP premiums will hurt the economy, as was also just pointed out.

According to the Canadian Federation of Independent Business a full 70% of businesses in Canada today have indicated that they disagree with the notion that this would be just a modest little tax increase as the Liberals are saying. Actually, the Liberals do not use the word “tax”. The only one who uses that word is the environment minister on carbon.

There is a correlation here between the bills that the government is bringing forward. The government is dropping a carbon tax, which could be 11.5¢, on the same seniors whom it wants to put more money into their pension plans. It looks to me like everybody is paying and the government is taking. That is a concern.

It is ironic that the Liberal government is mandating a tax today on individuals to pay more for a benefit that would only be achievable in 40 years, when it cannot even balance its own budget today. Bigger debt hurts seniors more as well. It particularly hurts the very young who will have to pay all of this back in the future. It is a bit ironic for the Liberals to say that there will be a mandated tax and a benefit, but anyone over the age of 40 today would probably not see that benefit unless he or she lives to be 100 years old.

There are many other ways of helping seniors in the more immediate term. We did it by increasing the guaranteed income supplement, the GIS, when we were in government. The Harper government made the largest increase in the GIS in 25 years. The Liberals liked the idea because they implemented a small increase in that in their very first budget.

The Liberals also did away with the increase in the tax-free savings accounts that would have gone up to the $10,000 mark. This would have allowed many seniors to save. It may be a surprise to many Liberal members across the floor but the number of seniors who were using the TFSA was in the neighbourhood of 60%. That is a pretty clear indication that those people were doing what the present government is forcing them to do, which is saving for their own retirements. They were putting this money away so that they could use it in the future.

There are also many other ways to help seniors, whether it is through an increase in the basic personal exemption, or whether it is through a decrease in personal income tax. Those are a number of things that could be done, although the government is going the other way. It has increased taxes on small businesses. They certainly are not going to be at the level that we had announced in our election campaign. When a government is simply taxing these folks and saying it is going to be good for them, when clearly it is not, then it is not a clear direction to emulate.

A member asked the other day if we were in favour of the Canada pension plan when it was first put in place back in the sixties. Of course we were, but back then the plan was only to support other pension mechanisms. I would like to quote Judy LaMarsh in referring to the CPP, “It is not intended to provide all the retirement income which many Canadians wish to have. This is a matter of individual choice and, in the government’s view, should properly be left to personal savings and private pension plans.” Judy LaMarsh was the Liberal minister responsible for establishing the Canada pension plan in 1964. Even the Liberals felt that when the plan was set up it was only to be a supplement to the other mechanisms that were there.

I could go on with a number of other quotes, but instead I will say that 70% of employed Canadians oppose expanding the Canada pension plan, if it means a wage freeze. Over one-third of employed Canadians say that proposed increases are unaffordable, and 80% want the government to further consult before making any decisions.

I think it is very clear that there are a number of things that could be improved and could be done to help seniors. The bill does not do it and that is why I will be voting against it.

[The Deputy Speaker, Conservative, Bruce Stanton]

The hon. member for Brandon—Souris will have five minutes remaining in his time for questions and comments when the House next returns to business on this particular question.

It being 5:42 p.m., the House will now proceed to the consideration of private members' business as listed on today's Order Paper.

The House resumed from September 20 consideration of the motion that Bill S-201, an act to prohibit and prevent genetic discrimination, be read the second time and referred to a committee.

Genetic Non-Discrimination Act

[Majid Jowhari, Liberal, Richmond Hill, ON]

Mr. Speaker, I am pleased to speak in support of Bill S-201, the genetic non-discrimination bill previously introduced in the Senate.

I begin by thanking my colleague, the member for Don Valley West, for bringing this important bill to the House.

At the end of my speech, there will be four key takeaways. I will highlight some of the benefits of genetic testing, its importance for preventing life-threatening diseases, and its critical contribution to scientific research and innovation. I will then show how discrimination can hinder these benefits due to the lack of protective legislation.

To avoid repetitiveness, I will not speak directly about what specific legislative changes this seeks to make, as this has already been eloquently covered by my other colleagues.

In the 21st century, we have at our disposal highly advanced mechanisms to extract information and to further our knowledge. We have also learned innovative ways to utilize this knowledge, create new machines, develop techniques, build things, and save lives.

Significant breakthroughs in the medical field have benefited from this abundance of knowledge. Life-saving surgical procedures were improved and life-changing drugs have been developed and tested.

The next prominent medical breakthrough on the table is genetic mapping, acquired through genetic testing.

A genetic test is a test that analyzes DNA and RNA, or chromosomes, for purposes such as the prediction of disease, vertical transmission risks, monitoring, diagnosis, or prognosis, in other words, a test that provides potentially life-saving knowledge. There are currently 6,000 known genetic diseases. This means 6,000 possible causes of death and 6,000 possible individuals living a life of hardship.

Simultaneously, there are 48,000 genetic tests. This is not an insignificant number. This means there are 48,000 possible genetic cases to be discovered, 48,000 ways to save a life, or 48,000 opportunities to gain knowledge.

Taking a genetic test can save a life. Armed with this knowledge, people can take action to protect themselves. They can take preventive measures or monitor themselves for symptoms to catch a possible disease early on.

Due to the diversity and advancement of discoveries, there are many other opportunities for taking preventive action through genetic testing. For instance, there are tests for genes associated with heart disease, cancers, and kidney diseases, many of which are easily preventable through simple procedures, provided there is early detection and treatment.

Monitoring and treating at an early stage would likely save an individual from having to go through tedious medical treatment procedures, hospitalization, medication, and hardship.

I can go on and on about the many diseases that can be prevented with having early knowledge of an individual's genetic makeup, but I will not. The main takeaway is that research about the benefits of genetic testing to saving lives is certainly not lacking.

Furthermore, genetic testing increases the potential for significant innovations. For instance, the field of genetics and genetic testing is interacting with stem cell research, where scientists are exploring ways to replicate genetically mutated cells for the purpose of closely investigating the functions of the cell and how it leads to manifestation of the diseases.

A recent discovery has been the use of induced pluripotent stem cells, also known as IPS cells, for the modelling of human genetic diseases.

I am neither a doctor nor a medical practitioner, but what I know for sure is that scientists are on the verge of understanding diseases by replicating their functions. They are doing that by using stem cells.

In furthering their understanding of how a disease functions, how it manifests, and why it affects certain tissues and not others, scientists will be better equipped for further innovations to reversing the negative outcomes of genetically mutated cells.

I can easily imagine a world where individuals with a genetically mutated gene or an inherited genetic disease will no longer be affected by the genes simply because scientists have found a way to neutralize the negative impact of the disease. I may be getting ahead of myself here, it may be just wishful thinking, but one thing is for certain. Science, research, and innovation will always find a way, and I strongly believe in that.

In order to gain the ability to conduct their research, scientists need to conduct genetic testing. They need to be able to collect large samples of genetically mutated cells to validate their findings. This is where the problem emerges in Canada.

In Canada, there are strong gaps in the legal system where individuals who take a genetic test will likely suffer unnecessary consequences. Canadians who cannot be sure they will be protected by the law have chosen to forgo undertaking genetic testing. They have chosen to give up on the knowledge and understanding of their genetic heritage. They have chosen not to participate in clinical trials for the purpose of furthering medical advancement and possibly curing genetic diseases.

I am referring to the gaps that would be addressed when we pass Bill S-201. These gaps, if not closed, will allow for individuals to be subjected to discrimination: the gaps in the Canada Labour Code where employees are not protected from being fired or refused employment based on the results of a genetic test; the gaps in the Canadian Human Rights Act that do not recognize genetic discrimination as a violation of the human rights of Canadians; the gaps that do not protect an individual from being discriminated against before receiving goods, services, or entering into a contractual agreement; and the gaps that do not protect individuals from being forced to take or disclose the results of genetic tests.

If we do not pass Bill S-201 and close the gaps in our legislative system that allow for genetic discrimination, Canadians with an inherited genetic disease will less likely have the chance to learn about their disease prior to its symptoms. They will be fearful of losing their employment through coercion. Our medical and scientific research will likely suffer from having limited test subjects who fear that participating in a breakthrough clinical trial will lead to discrimination in other areas of their lives.

Bill S-201 does not seek to introduce newfound laws. It does not seek to change Canadian values. Bill S-201 simply seeks to close the current gaps in our legislative system and to align our values with our legislation. If our values are not perfectly embodied in our laws, how can we ensure this continuity?

Canada must close the legal gaps with regard to genetic discrimination. I strongly believe this bill will provide Canadians with much-needed protections with no insurmountable ramifications. I encourage my colleagues in the House to closely consider the bill, to consider its positive impacts on Canadian society, and to vote in its favour.

Message from the Senate

[The Deputy Speaker, Conservative, Bruce Stanton]

I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed the following bill to which the concurrence of this House is desired: Bill S-205, An Act to amend the Canada Border Services Agency Act (Inspector General of the Canada Border Services Agency) and to make consequential amendments to other Acts