Madam Speaker, the Canada pension plan is the bedrock of our public retirement income system in Canada. Millions of Canadians rely on it today, and many millions more will rely on it in the future. It is one government program that touches virtually every Canadian.
It is our duty, as parliamentarians, to ensure that the CPP is not just in place for future generations, but also to ensure that it is strengthened so that all Canadians can retire with dignity. After a lifetime of hard work, Canadian families deserve to retire comfortably.
We know that the CPP is an integral part of many people's retirement plan. With fewer and fewer Canadians having a workplace pension to fall back on, its importance is only growing. Our government recognizes the importance of the CPP. That is why we have made a commitment to strengthen and enhance the plan. My hon. colleague, the Minister of Finance, worked incredibly hard with his provincial counterparts to reach a historic agreement to make important and meaningful changes to CPP. As a result, more than one-quarter of Canadian families nearing retirement, about 1.1 million more families, will be able to retire with dignity.
Every week, in my constituency office in Cambridge, my staff see seniors who are struggling to make ends meet. We try our hardest to ensure that they are receiving every benefit they are entitled to; but the fact of the matter is CPP needs to be enhanced. I know how much an expanded CPP would mean to the people of my riding. I can think of thousands of retirees who rely on CPP to fund their retirement and to stay productive members of our society.
I want to take a moment to talk through several key provisions of the bill and speak directly about how I would anticipate those changes enhancing and benefiting the lives of my constituents in Cambridge and, frankly, of constituents across this entire country. I think it goes without saying that CPP needs to be enhanced, in that it needs to see an increase in the amount of retirement pension that Canadians receive. With Bill C-26, however, the enhancements would go further than that. Canadians can expect to see increases to the survivors and disability pension provisions, as well. As our population ages, those survivor benefits ensure that a lifetime of paying into CPP still has benefits even after the death of a spouse.
The increase in Bill C-26 would ensure that the maximum level of pensionable earnings is increased by 14% by 2025. That level of support would be unprecedented in Canada, and it would arrive just as many more Canadians are retiring.
I know that these provisions come with additional costs, but they also come with additional spinoff benefits that would reach deep into our economy. In this case, the benefits would far outweigh the costs. As retirees are unable to participate fully in our economy and many withdraw more and more because of lack of retirement savings, those individuals are not full participants in everything Canada has to offer. This has some very direct issues; for example, not being able to afford things like food and medications. Those concerns are heartbreaking and well-documented, and one of the reasons there is currently a strong push for national pharmacare and increased support for food banks and other emergency social service providers. We see these cases in my office in Cambridge every single week.
However, not having enough retirement savings also causes many seniors to withdraw in many other ways, as well.
I can think of many seniors in my riding who choose to participate in fewer events, to go out less, and to stay in more because of lack of funds. These have several direct and negative effects. We know that seniors and retirees live better and longer lives when they socialize more and when they remain active. For many seniors, this means having the financial ability to go out, drive, and participate in events. Even if these events are low-cost, which many events for seniors are, it is critical that we create a society where they are financially able to continue participating for as long as they are able.
That activity or social time saves health care costs, mental health costs, and housing costs. More importantly, it allows for aging with dignity.
Since the Second World War, the number of company-provided pensions has fallen at a significant rate. This is due to a number of contributing factors, each of which is worth exploring but none of which is likely to be reduced in the short term. StatsCan says that in the 1970s about half of all men had defined benefit pension plans. Now, in 2016 we are at about half that number. That is a significant decline, but is even more significant when we consider the very large population bubble that we call the baby boom. When we consider the rates of company-provided pensions for younger people today who are not part of the baby boom generation, the rates are significantly lower.
I have used men as an example because the work dynamics were significantly different in the 1970s. Women have historically had fewer workplace pension plans and never crossed even the 50% threshold. We know this is causing an impending crisis, one this government is taking steps to fix. Enhancing CPP would allow the young people of today, those who are least likely to have a workplace-provided defined benefits plan, to see a significant increase in their retirement incomes.
It is also worth noting that this new plan would have no major infrastructure costs because the CPP infrastructure is already in place. This means that the new system would be much easier to put in motion, be more easily adopted by Canadians, and would fit within our existing policy structures. All of these reasons would make it cheaper, easier, and better to implement than many other ways to enhance post-retirement income for Canadians. I applaud the government for working to achieve increased CPP benefits.
We currently have more seniors than kids in Canada. I want to take a moment to go back to considering what happens when retirees and seniors withdraw from the system. The benefits and issues are not only in terms of mental health and health care, but also in terms of their significant impact on our economy. The longer a senior is able to participate fully, he or she is able to contribute to the economic robustness of our society. The longer seniors are able to participate fully, the more likely they are to volunteer and remain an economic force in our society. Obviously, solving these long-term demographic trends is not the duty of the CPP solely, but I believe it is the right place to start. It says that we are taking this seriously and are working toward solutions.
I have mentioned in the past that prior to my working in this wonderful profession that we find ourselves in, the people of Cambridge knew me from the YMCA. Prior to working for the YMCA, almost all my involvement was working with youth. The YMCA offers a number of programs for seniors. It is interesting because the span of the demographic that we call seniors can be as wide as 30 years. If we take that same age range and put it at the beginning of life, we are talking about infant, toddler, preschooler, school-aged child, teenager, young adult, and adult all within that same 30 years. We have to be thinking outside the box when it comes to seniors. They are living longer, but they are living differently as well. This approach that we have reached with the provinces is an amazing first step.
I will leave it with one final thought. No matter what the House decides on the CPP, and I am asking everyone to carefully consider supporting the plan laid out in Bill C-26, we will still have a long way to go toward ensuring that all members of our society are prepared for retirement.