Mr. Speaker, I am pleased to respond to the question posed by the hon. member for Carleton. Our government knows that the economy and the environment go together. That is why we are committed to making investments that will lead to a cleaner, more innovative economy that will not only help us achieve our goal of reducing emissions but will create well-paying jobs for middle-class Canadians and those who are working hard to join them. We are taking concrete steps to protect our planet for our children and grandchildren.
The motion before us today references information that bears no reflection to our plan. Our government's plan to address climate change involves working with the provinces and territories to determine mechanisms and impacts in various regions of our country.
As was noted during the first ministers meeting last December, climate change is indisputable, as are the significant impacts it is having in Canada and around the world. We are already facing the social and economic cost of climate change, which poses significant risk to our environment as well as our health, security, and the future prosperity of our nation. This is why we have shown leadership by working together in close collaboration on behalf of all Canadians. We are working to develop a plan to grow our economy, reduce greenhouse gas emissions, and build resilience to the impact of climate change.
Our government is approaching this challenge in a prudent and flexible manner. We are committed to collaboration with provinces and territories on climate change issues. We will ensure that the provinces and territories continue to have the flexibility to design their own policies to meet their targets, including their own pollution pricing policies. Provinces are actively pursuing their own climate policy agenda and are introducing pollution pricing measures as part of their plans.
We have developed a pan-Canadian approach to pricing carbon pollution. Under the new plan, all Canadian jurisdictions will have pollution pricing mechanisms in place by 2018. To facilitate this plan, the government has set a benchmark of pricing carbon pollution at a level that will help Canada meet its greenhouse gas emissions target while providing greater certainty and predictability for Canadian businesses.
Each jurisdiction will be given a choice on how to implement carbon pricing. They can put a direct price on carbon pollution, or they can adopt a cap and trade system. We propose that in jurisdictions with a direct price on carbon pollution, the price should start at a minimum of $10 per tonne in 2018, rising by $10 a year to $50 per tonne in 2022. Jurisdictions with a cap and trade system will need to set their annual caps to achieve at least the same emission reductions that would result from a carbon price in a price-based system. Cap and trade systems will also need a 2030 emissions reduction target equal to or greater than Canada's 30% reduction target.
Each jurisdiction will also have the flexibility to keep revenues to use as they see fit, whether it means giving it back to consumers, supporting their workers or families, helping the most vulnerable, including communities in the north, or supporting businesses that innovate and create jobs for middle-class Canadians.
Take the case of British Columbia, where carbon pricing is revenue neutral. Since 2008, B.C. has proven that it is possible to reduce emissions while growing the economy and creating good-paying jobs. B.C. has the highest broad-based carbon tax in North America. Its carbon tax sets a transparent and predictable price on carbon while returning all revenues to B.C. individuals and businesses. The price signal creates a real incentive to reduce emissions across the economy.
Again, jurisdictions have the freedom to use the revenues from this source as they see fit. It is their choice. In the case of B.C., it has meant that every dollar generated by the carbon tax is returned to British Columbians through reductions in other taxes. In fact, during the period between 2008 and 2015, the net benefit to taxpayers was $1.6 billion.
It also goes without saying that because of the very flexibility that defines the pan-Canadian framework, attaching a benefit or a cost to households or individuals at large is not as straightforward as the member opposite would have us believe. In fact, it is terribly misleading.
Since each province and territory has the flexibility to design a system that works for it and to use the revenues as it sees fit, much work remains to be done in the way of further analysis and modelling in collaboration with the provinces and territories before a relevant estimate can be provided.
It is important to understand as well that the memo being debated today and much bandied about by the member for Carleton was written before the current government was in office. Its data in no way reflects our government's pan-Canadian collaboration and flexible approach. It will not help him or anybody better understand the impact of our plan. How could it? It was drafted a year before it was even hatched. Its release could cause confusion for Canadians, industries, provinces and territories, and our partners around the world about Canada's actual plan and the cost associated with it. That is not something to toy with. That is my opinion. Members opposite may feel differently.
Luckily, as the member well knows, the professional public service manages access to information in the Government of Canada and applies certain restrictions to information that is released according to the rules set out by the Access to Information and Privacy Act. The impartiality and non-political nature of this process is important and must be upheld by all members of the House. It is in Canada's best interest that we not undermine these carefully considered decisions with partisan barbs.
In summary, pricing carbon pollution will give Canada an edge in building a clean-growth economy, will make Canadian businesses more innovative and competitive, will bring new and exciting job prospects for middle-class Canadians, and will reduce the pollution that threatens our clean air and oceans as well as the health of Canadians.
Together, we will create the clean-growth economy necessary for the collective health, prosperity, and security of this generation of Canadians and the next.
The government's overall approach will be reviewed in 2022 to ensure that it is effective and to confirm future price increases. The review will account for actions by other countries.
As far as Canada is concerned, I am pleased to say that we are working from a position of strength. We are in an enviable fiscal position. Our debt-to-GDP ratio is well above the average for the G7. This means that we have the flexibility needed to implement our long-term vision of ensuring that Canada's economy works for the middle class. If the economy works for the middle class, it works for everyone.
The measures to support the middle-class is what the Canadian economy needs and what Canadians deserve. It is what Canadians wanted and what we provided and will continue to provide in the future.
On January 1, 2016, nearly 9,000 Canadians had more money in their pockets thanks to the middle-class tax cut. This measure was not only the right thing to do, but also the smart thing to do for our economy.
The middle-class tax cut and the measures that go with it help make the tax system fairer to give all Canadians the opportunity to succeed.
Specifically, the government lowered the tax rate in the second personal income tax bracket from 22% to 20.5%. Single individuals who benefit from the reduced second personal income tax rate will see an average tax reduction of $330 every year, while couples will see an average tax reduction of $540 every year. Only the higher income earners, the wealthiest 1%, will pay more taxes with the introduction of the 33% personal income tax rate on individual taxable income in excess of $200,000.
Finally, the government returned the tax-free savings account, or TFSA, annual contribution limit to $5,500 from $10,000, effective January 1, 2016. Returning the TFSA annual contribution limit to $5,500 was consistent with the government's objective of making the tax system fair and helping those who need it the most.
When combined with other registered savings plans, a $5,500 TFSA annual contribution limit will enable most individuals to meet their ongoing savings needs in a tax efficient manner. Furthermore, indexation of the TFSA annual contribution limit was reinstated. Thus, the annual limit will retain its real value over time.
Another cornerstone of the government's plan to help the middle class and those working hard to join it is the Canada child benefit. The benefit will help parents better meet the needs of their children. The CCB is simpler and more generous than the old benefit system it replaced, and it is completely tax-free. In addition, it does a better job of targeting the people who most need it.
I firmly believe that the many parents who receive this assistance agree that it is greatly needed and appreciated. With the introduction of a much better-targeted Canada child benefit, about 300,000 fewer children will be living in poverty in 2017 as compared to 2014. That means that Canada's child poverty rate will drop by about 40% relative to 2014.
Since the Canada child benefit was introduced in July 2016, nine out of ten families are now receiving more money than they did under the previous system. They are receiving an average increase in annual benefits of $2,300 in 2016-17.
Parents with children under 18 will receive a maximum annual benefit of $6,400 per child under the age of six and up to $5,400 per child between the ages of 6 and 17. Whether these additional funds are used for things like buying school supplies, covering part of the cost of registering for sports activities, helping with the family grocery bill, or buying warm coats for winter, the Canada child benefit helps parents cover the high cost of raising their children.
Finally, the Canada child benefit will be indexed to inflation starting in 2020 so that families can continue to count on this additional support for a long time, with their benefits keeping pace with rising expenses.
As on pricing carbon pollution, our government has achieved other goals through collaboration with the provinces. We have reached a historic agreement with provincial governments to enhance the Canada pension plan. This project was undertaken given our knowledge that one in four Canadian families approaching retirement, 1.1 million families, is at risk of not saving enough to maintain the family's current standard of living. The risk is highest for middle-class families. Families without workplace pension plans are at an even greater risk of under-saving for retirement. In fact, a third of these families are at risk. Saving more through an enhanced CPP will mean Canadian families are more confident about their future and about their ability to secure a dignified retirement.
Our government is particularly concerned about the situation of young Canadians. They tend to have more debt than previous generations and, in most cases, they will also live a lot longer than previous generations. They are faced with the challenge of trying to save enough money for retirement at a time when fewer of them can expect to have a job with a pension plan.
In summary, the measures that our government has taken show our commitment to helping the middle class and those working hard to join it. We have taken action to strengthen the Canada pension plan. We introduced the middle-class tax cut, which benefits nine million Canadians. We introduced the Canada child benefit, which provides additional financial assistance to nine out of ten Canadian families.
We will continue to work for Canadians in order to build a stronger and more equitable economy where all families can grow and prosper.
If it is a real, relevant, and factual debate the member for Carleton is looking for, I am hoping that we can use our time to talk about those numbers.