Debates of Nov. 14th, 2016

Canada Pension Plan

[The Assistant Deputy Speaker, NDP, Carol Hughes]

Before we go to the next question, I want to remind members that we also do not chastise other members because of their passion while asking questions.

Questions and comments, the hon. member for Hamilton Mountain.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, the member mentioned the cost to small and medium-sized businesses that this bill would introduce. He mentioned that it would be about $2,200, if I understood him correctly. That is the maximum contribution to get the maximum benefit, but most small and medium-sized businesses would not actually pay for that maximum premium.

Has the member done an analysis of what the average cost would be for small and medium-sized businesses, instead of exaggerating what the maximum is going to be?

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, it is unfortunate that he is chastising me. I was not exaggerating anything. The reality is that pensionable earnings are set at 9.9% of employees' levels right now and are going to go to 12%. He is right that $2,200 is the maximum, but the reality is that every single employee in this country is going to pay more because of this legislation, and every single employer in this country is going to pay more because of this change in the CPP.

Conservatives believe that is not a good choice to be made for Canadians, that they should have other choices. We know we are at odds with the government because it believes that it can dictate to Canadians what it thinks is best for them. We believe it is best for people to make their choices, manage their own money, and that they will best save for their own retirements when they do that.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Madam Speaker, a concern that my constituents have expressed to me is that while the government is taking away an additional $1,000, or $2,200 when we factor in the employer contribution, and is supposedly setting aside that money for Canadians' retirement, if an individual passes away before being able to access that benefit, that money does not get passed on to their heirs. It is simply an additional $1,000 a year that has been taken away from them.

I would like the member to contrast that to some of the other retirement savings vehicles and how this will eliminate the ability of some Canadians to save and prevent them from passing on those savings.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, we believe that it is important that families can support each other in their retirement incomes, retirement savings, and so we believe in those vehicles that allow people to do that. It is obvious that the other side has a real problem with that.

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

Madam Speaker, I am pleased to participate in this debate on the amendment to Bill C-26.

I had the opportunity to speak on Bill C-26 at second reading and will readily admit that my position on this ill-conceived bill has not changed. In fact, after spending a week in my riding, I am more convinced than ever that the bill needs to be scrapped.

I had the privilege of meeting with many constituents and holding a series of round tables with members from the chambers of commerce from the communities of Rosetown, Martensville, Warman, and Humboldt, just to name a few. Without fail, everyone spoke to what the impact of the CPP premiums increase would be on their businesses. Their responses were unanimous: this tax hike would hurt their businesses both indirectly and directly. Every single attendee said that they will have to consider this payroll increase when they budget for staffing next year, and that overall employee compensation will be affected.

Since the bill was introduced, I have been hearing a lot of conceptually wrong statements and value judgements from the members on the other side.

For starters, Bill C-26 would not create new money for today's retirees or for low-income Canadians nearing retirement. The bill would increase CPP premiums from 9.9% to 12% and would increase the benefits that people receive once they retire by the amount of the increase.

The increases in benefits are only made possible due to the increased contributions that workers and their employers are being forced to make today. The CPP is a contribution program. The benefits received once a contributor retires are equal to what they contributed to the program plus whatever investment returns the CPP investment fund realized.

The CPP is not an income redistribution program. It was never designed to be. It does not support low-income seniors. Quite simply, what one puts in is what one hopefully will get out plus interest. This is why retired Canadians or folks who are nearing retirement will see no change to the benefits they can expect to receive.

The Liberals claim they are raising the CPP premium because my children's generation is not saving enough for their retirement. Undoubtedly, there are some Canadians who are not saving enough, but this is not a universal problem. This CPP increase would end up costing an individual more than if the Liberals increased the sales tax from 5% to 7%, which, given the fact that Canada is in the midst of the largest year-over-year peacetime increase in federal government spending, is becoming more and more likely.

When the CPP was first created in 1965, the contribution rate was set at 3.6%. Over time, governments have increased this rate by three and a half times to the 12% being proposed by the current government.

Because CPP contributions are made as a percentage of income up to a maximum each year, there is no need to increase contribution levels to account for inflation. The CPP Investment Board returns are sufficient to ensure that the fund grows at a faster rate than inflation. The chief actuary reviews the solvency of the CPP fund every three years, and the last report indicated that the program was fully funded for the next 75 years. Therefore, this increase in the contribution rate is not being done to ensure the fiscal health of the plan.

Of course, Canadians deserve to retire with the peace of mind that their retirement is fully funded, but that does not give the government free rein to collect a growing part of every Canadian's income. The CPP was never designed to be the only pillar of retirement. It was designed to be one of many.

Also, young Canadians are faced with many expenses, like their first home, first car, and starting a family. Should retirement income be considered more important than having 2% more of one's after-tax income to pay for today's necessities? It is absolutely reasonable for many young families to want to keep more of their income at a time when their living expenses are at their highest.

With this proposed CPP tax hike, the current Liberal government actually would be discouraging young people from saving by taking the small amount that they might have been able to put into a TFSA or an RRSP and taxing it away. We have heard the Liberals say that because of the child care benefit, they now have carte blanche to increase the taxes of families. However, it makes no sense to give some money back to families and then tax it again. All that ends up happening is the government forcefully becoming more involved in the day-to-day lives of Canadians.

I believe the CPP is important, but how much further can the contribution rate really be increased? What if, according to the government, in the future Canadians are still not putting enough aside to maintain their standard of living? How much more should contribution rates be increased? Will we see an increase to 14%, to 16%, or maybe even to 18%? What is the limit? I am confident that Lester B. Pearson never envisioned that the combined contribution rates for the CPP would grow to 12% and that government would seek to take over retirement planning for Canadians, but that is the road the Prime Minister and his finance minister are taking Canadians down.

Beyond the basic problem that this would be a tax hike when businesses and employees can least afford it, it would also contribute to an endless feedback loop. The more that government gets involved in managing retirements, the less people will feel the need to save for their own retirement; and then government will once again feel the need to get involved in forcing Canadians to save more, and on it goes.

For my colleagues on the other side, here is another reason to consider this as a tax hike. If contributors die before they are eligible to claim CPP benefits, the benefits that were accrued would not flow to their partner or their dependants. Unlike other retirement-saving options, CPP contributions are not money that contributors or their beneficiaries will necessarily get back.

In conclusion, on this side of the House we trust Canadians with the money they have earned. We believe they should keep their hard-earned money and make the decisions on how to save and invest for their future, not the government. That is why I will be voting in support of this amendment.

[Ken McDonald, Liberal, Avalon, NL]

Madam Speaker, I would like to ask the member to clarify something. She mentioned that if a person who pays into the CPP through payroll deductions passes away, the benefit is lost. I would like the member to explain that. It is not lost. Either the member does not know the difference or she is trying to mislead the House. The benefit is turned over. I receive the CPP benefit for that very reason. It is called a survivor benefit. Survivors get 50% of what the owner of the plan was entitled to. Could the member please clarify that?

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

Madam Speaker, of course we know that there is a death benefit that is paid out to the family. It is in the amount of $2,500. While the member raises the point that there is a benefit that is paid to perhaps the surviving spouse, what we are talking about is the ability to receive 100% back of what contributors have paid into it, and the opportunity to make that decision for themselves. That is what we on this side of the House are speaking to when we talk about Canadians' right to choose how they will invest their hard-earned money.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Madam Speaker, when it was proposed by the previous government under the former prime minister, Mr. Harper, to change the age of retirement, we talked about the expectations of taxpayers and workers who for all those years had been looking forward to retiring at 65. There was no consultation before that. I know it is history now, but I ask the hon. member if it troubled her at the time that there was a unilateral decision to postpone the CPP benefits that Canadians had a right to expect at age 65.

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

Madam Speaker, of course in the last Parliament I was part of the party that was governing and that made that decision. At the time, we were taking a look at what was sustainable for seniors. Of course, we know that the current government has opted to roll that back.

But no, what we did in the previous Parliament was done in order to ensure the sustainability of the program. Again, what we are speaking to today is the opportunity for Canadians to make the choice to determine how they will invest their hard-earned money to ensure that they can afford the standard of living that they choose.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Madam Speaker, when I meet seniors on the doorsteps in Courtenay—Alberni, they tell me that it was not enough, that we have not collected enough and people have not had an opportunity to save enough, and because of the increased cost of living, people cannot afford to pay for their much needed medicine. We are seeing record numbers of seniors at our food banks and in homeless shelters.

I ask the member, how can we mitigate this and help it from happening in the future if we do not invest in CPP? I see contributions to CPP as an investment in our pension fund. It is exactly that, not as an expense and not as a cost. Small business employers are matching and investing in CPP and EI to make sure employees get benefits when they are unemployed and have savings for their future and they can retire in dignity. We know that is not happening today.

Conservatives tell us that fewer than 3% of seniors are living in poverty. That is not what we are hearing from people on the doorsteps. We know that 30% of single senior females are living in poverty.

Can the member come up with some real solutions so we do not end up here again?

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

Madam Speaker, I will make my answer very short. The member asked this question earlier in terms of the seniors he spoke to when he went door to door. The long phase-in period of Bill C-26 will do nothing to support those very people he was talking to today. Nobody will benefit from this for 40 years.

I am not sure why he is making the connection between Bill C-26 and the things he was hearing from seniors on the doorsteps today.

[The Speaker, Liberal, Geoff Regan]

Is the House ready for the question?

[Some hon. members]

Question.

[The Speaker, Liberal, Geoff Regan]

The question is on the amendment to the amendment. Is it the pleasure of the House to adopt the amendment to the amendment?

[Some hon. members]

Agreed.

No.

[The Speaker, Liberal, Geoff Regan]

All those in favour of the amendment to the amendment will please say yea.

[Some hon. members]

Yea.

[The Speaker, Liberal, Geoff Regan]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Speaker, Liberal, Geoff Regan]

In my opinion the nays have it.

And five or more members having risen:

Call in the members.

[Andrew Leslie, Liberal, Orléans, ON]

Mr. Speaker, I request that the recorded division on the amendment to the amendment at second reading of Bill C-26 be deferred until the expiry of the time provided for oral questions tomorrow, November 15.

[Gord Brown, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Mr. Speaker, I request that you further defer the vote to the end of government orders tomorrow, November 15.

[The Speaker, Liberal, Geoff Regan]

Therefore the vote is deferred until the end of government orders tomorrow.

Statements by members, the hon. member for Montcalm.

Leonard Cohen

[Luc Thériault, Bloc, Montcalm, QC]

Mr. Speaker, Leonard Cohen's deep voice is now silent.

Montreal, Quebec, and the entire world are in mourning because Mr. Cohen did not belong just to Montrealers and Quebeckers. He belonged to everyone.

Leonard Cohen's deep voice is now silent, but his words will continue to live on as a light in the darkness, the soundtrack to our joys and sorrows. One need only listen to Sisters of Mercy, So Long Marianne, Waiting for the Miracle, Famous Blue Raincoat, Hallelujah, or countless others to be transported to a deeper, sweeter, and more meaningful place.

On behalf of the Bloc Québécois, I would like to offer my sincere condolences to Mr. Cohen's family, friends, and fans. We will all miss this man who tried in his way to be free.