Mr. Speaker, it is a privilege to speak in this debate and discussion on the CPP, something which affects almost all Canadians. I spoke to this bill at second reading, and it is interesting to see at report stage how the debate has gone forward, or in some cases not gone forward.
Before I get to the main body of my speech, I want to deal with an issue that the parliamentary secretary has continuously repeated, that all of the provinces have come onside to support this change, and citing the Conservative premiers, of which there are very few. It should be noted that the premier of my province, Mr. Brad Wall, said very clearly that the reason he was backing this was because he was concerned that a worse agreement was going to be put in place. This was not exactly a ringing endorsement.
As he said, he was more concerned that a more aggressive Ontario Liberal plan would be put in place. He signed on to the Liberals' changes, not because he thought it was a good idea, but to prevent something worse from happening. When someone endorses something because the person fears the government will do something worse, I do not know if the government can honestly claim that as a ringing endorsement, as was presented to the House. I wanted to note that. I am sure the parliamentary secretary will address that in questions and comments.
When looking at the overlying issue with the CPP, the Conservative Party has objections to it, and the government is pushing it forward. The reasoning is very similar on both sides, but comes to very different conclusions. The government is arguing that for the cost of living and people's retirement, this is a good bill. The Liberals are saying that the cost of living for seniors is too high and it is difficult for them to make ends meet. It is difficult for seniors to make a living, so we therefore need to make these changes so that future seniors should benefit.
Interestingly, we in the opposition, in some respects, are arguing a similar issue. The cost of living makes it difficult, and people need every cent they can get. The Conservative Party is arguing that people should be allowed to keep doing what they are currently doing with their funds and decide for themselves what they should do with their money. As has been noted, this could end up being an $1,100 hit for the average person, assuming the average person pays the maximum. While, for some people, $1,100 a year is not significant, for people whose budgets are tight, that is very significant.
As has been noted frequently in debate, there are studies by the Fraser Institute and other institutions that have noted that almost all of the increased premiums will come from savings. However, some of it will come from consumption. One way or the other, Canadians have a problem. They have a problem because they do not have enough money to pay for their necessities of life, now or in the future. Every circumstance is different, but this needs to be noted.
We are not dealing with abstracts for people at the high end of the income scale, and, frankly, this does not target people at the really low end of the income scale, because the OAS, and particularly the GIS, are used to deal with that. That is how the current Liberal government and past Conservative governments have dealt with the issue of poverty. The CPP deals more with middle-class Canadians, the broad swath, the centre, economically and socially, of our society, and their cost of living.
The question we are really debating here today is how we can make things more affordable for Canadians now and in the future. How can we make things more affordable and create a better standard of living for Canadians in the present, in the future, and in retirement? This needs to be underlined in this whole debate. The largest cost for all Canadians across the board is taxes. In Canada, over 40% of our GDP ends up getting sucked up into taxes. That is the size of it when we put everything together.
One of the reasons why seniors are struggling and having a difficult time today and why the Liberals are arguing that they need increased CPP benefits in the future is because we continually have taxes that are too high. The Liberals like to talk about the one element of tax changes that was positive in their budget, but they do not talk about the positive tax changes from the previous government that they eliminated: income splitting and assistance to families. Parents with children is one particular group that is going to be under fiscal pressure due to these changes with the CPP.
Just think about when in life people have the greatest expenses. When is the time that they have a mortgage? It is also a time that they frequently have their children. People's children are growing up, spending more money, wanting to do sports, and to do things with their schoolmates. Those are the years when people are trying to earn their peak amount of money. It is not their retirement, but their earning years.
Along came the Liberal government. First it eliminated income splitting, which was again a policy that benefited Canadians at the middle of the spectrum of our society. Most Canadians, depending on where they are in life, would have benefited from that for a good portion of their life because we know that as they go through their lives they are all in different income strata for different seasons.
When they are students they are technically very poor, maybe living in their parents' basement. Most of their income may go to pay for tuition, but they get by. They are considered poor.
The years when people are paying the maximum in CPP premiums are often when they have the greatest expenses. They need to take care of their house. They perhaps have parents to take care of. Generally that is when they have children. This is when the government again is coming after people with tax hikes and, as I noted earlier, the elimination of income splitting.
That is why we in the opposition have been referring to the CPP hike as a tax hike. It would take money directly from people, reduce their freedom, reduce their choice in what they could do with it, and give them a worse rate of return than they would otherwise have if they had invested it in private savings plans. This is something that has been documented by researchers looking at this.
For my grandpa, the CPP was a marvellous investment. He paid into it for practically the minimum number of years, and since he lived to be 92 years old he collected well above the average amount. It was fantastic, better than a 20-some per cent rate of return, which was the average for people. He made way more on his investment than he could have anywhere else.
But for people of my age, a generation Xer born in 1974 and younger, the rate of return after inflation for CPP that is invested is barely 2%. That is horrendous. People could do better. That is why we are referring to it as a tax. The government takes the money and people ultimately lose money. It drives up their cost of living.
What could people be using this money for if the Liberals were not taking it away? Electricity prices are going up, in many cases due to the wrong-headed environmental policies of federal and provincial governments. Property taxes are going up, again something that often hits people in their prime earning years with children and families the most. Inflation and various other expenses are all going up. Here we are, taking away more of people's money.
The basic argument is this. If the government is taking money away from people, not returning to them the amount that they should have and could have earned had they been able to invest and control their money privately, it is definitely a tax hike, because what people are doing with this money is subsidizing the government. It allows the government to get away with lower OAS premiums. It allows pension plans that are integrated with the CPP to get away with lower premiums. People are losing money. That is why it is a tax hike. It is a tax hike that raises people's standard of living and, as has been noted, taxes are the most expensive thing that we have to deal with in our society.
That is why I and my fellow Conservatives oppose this bill. It is the wrong policy for Canadians. It is a bad investment. It takes money out of people's pockets. That is why we as Conservatives are opposing it.