Jean Dubé

[Child Benefit, February 5th, 1998]

Madam Speaker, my colleague, the hon. member for Shefford, has presented a motion concerning a review of the level at which the national child benefit is indexed.

As the human resources development critic for the Progressive Conservative Party of Canada, I feel duty bound to defend children and the quality of life to which they have a right to aspire.

Let us recall briefly that the question of child poverty has been raised on a number of occasions in recent years. I was not an MP at the time, but I do recall this Parliament being unanimous in resolving the problem in 1989. There was a projection that child poverty would be eradicated by the year 2000. In 1989, one child in eight was considered poor. Now the figure is one in four. In some regions, this proportion might be one in three, and in others perhaps a bit higher.

Yet the principle is a simple one. Today we are working to get an economy working that will redistribute benefits to strata of society where people are less active in the work force, whether the young, the old, the sick, or those forced into inactivity by the economic context. If we do not focus on our children and provide them with a good quality of life, adequate health care and quality education, we will pay for it later. We will end up paying for not having invested in our most important resource, people.

First of all, families have the prime responsibility for raising their children. They must look after their development. They are our front line workers. However, as a government, we must give them support. We also share in the responsibility. Many of us are involved in looking after society's greatest investment, its children. Parents, federal, provincial and territorial governments and community and private agencies must join together to help those who come after us achieve their full potential.

I need not tell you that the experiences of our young people will shape their behaviour later on, that the living conditions we provide for them today will affect their future health and well-being and that their ability to learn and adapt is closely linked to the environment in which they grow up.

Another conclusion, which my colleague mentioned, seems relevant. If children are poor, it is because their parents are. Naturally, the best solution would be job creation. This would be the best way to eliminate child poverty.

I will not fall into a partisan speech on the merits of the Conservative approach to job creation, of reducing taxes and employment insurance premiums. Although no one has a monopoly on truth, I do know that we are proposing the most realistic way to put hope back into the hearts of Canadians.

Let us admit that these issues are closely linked, that it is difficult not to deal with all of them at the same time. There are poor children because there are parents who do not work, or who work in bad conditions. And bad working conditions stem from another problem I have not mentioned: education.

Investing in our children also depends very much on the framework in which they are given the chance to develop their skills. With everything moving ahead so rapidly nowadays, how can investing in education not be regarded as a priority?

If the technological evolution of the last 30 years is any indication of the next 30, investing in education is no longer a priority, but an obligation. If I mention education or employment when talking about child poverty, it is only because there is not just one solution to a problem such as poverty. A series of solutions implemented simultaneously might help. Taken singly, each solution would not solve the problem, but each has its importance and the whole would not work as well if one were missing.

There is one solution that would play an important role in the national benefit reform that has been announced. It is the only cash benefit that will be left once the federal program is inaugurated, hence its significance. Under the new distribution of government responsibilities, the central government's role would be to deliver the cheques. This money will constitute the only money coming in every month for many families, and in some cases would mean the difference between falling below the poverty line and managing to make ends meet.

Unfortunately, these benefits are only partially indexed, a policy that was set at a time of rampant inflation. Inflation is nibbling away at the benefits of people for whom every dollar counts. Now that inflation is stable, it is our duty as legislators to tailor the legislation to society.

For this reason, I support the motion of my colleague for a review of the level at which the child benefit is indexed. I encourage all members of this House to do so as well.

[Marcia Adams And Marlene McCutcheon, December 10th, 1997]

Mr. Speaker, I rise today to honour two people whose lives touched many in my community.

Last Friday a terrible car accident took the lives of two school teachers, Mrs. Marcia Adams and Mrs. Marlene McCutcheon. The entire community has suffered a tremendous loss.

Marcia Adams was an exceptional woman and an example to all young teachers entering the profession. Her devotion and her love for her job and the children she taught were only surpassed by the respect she gained in the community.

Marlene McCutcheon was just starting in her career, but already she was distinguishing herself as someone who cared about the young people she taught and the betterment of her school.

While we mourn our loss we also remember their lessons of determination, self-esteem, compassion and devotion. We will all miss them.

[Postal Services Continuation Act, 1997, December 2nd, 1997]

Mr. Speaker, if there is one thing we can say today to the hon. minister, it is that it is about time.

Millions of dollars have been lost by charity groups, businesses and others who are a vital part of our society. What do we say to these people?

The hon. minister mentioned that he will start discussions for different mechanisms to avoid this in the future. I ask the minister who will participate in these discussions, government, unions, business, charity groups? Does his department have any ideas of different mechanisms that he would suggest can be put in place?

[Division No. 33, December 1st, 1997]

Mr. Speaker, I believe what I heard was resuming debate on Group No. 7. I believe we are still on Group No. 6.

[Canada Pension Plan Investment Board Act, November 27th, 1997]

Mr. Speaker, I would like to correct the hon. member. This grouping contains a Conservative motion as well as his amendments.

I have the pleasure to propose an amendment to Bill C-2, based on the principle of equity for all Canadians.

As it stands, Bill C-2 freezes the basic annual exemption at the $3,500 level. I wonder on which planet the authors of this bill live, but they seem not to know the word “inflation” over there. It reminds me of the George Orwell novel 1984 . Whenever the characters in that book wanted to get rid of a reality, they would ban the use of the word depicting that reality.

However, we all know that this is not how things work in the real world. Everybody knows that it is not because Bill C-2 ignores inflation and its impact on low income workers that inflation will disappear.

Bill C-2 in its present form does not provide for a review of the basic exemption. How much do you think the $3,500 of today will be worth in 2017? In 2037?

In clear terms, workers who think they can manage with this exemption will gradually get smothered by inflation.

The government pretends that freezing the year's basic exemption at $3,500 accounts for as much as 1.4% of the premium decrease, but in fact such a case cannot be considered as a real premium decrease of 1.4% since they will end up paying a higher premium on higher income.

Is this what we call creative taxation?

The government should not have the power to change a fundamental and essential program such as the Canada pension plan without explaining to Canadians all the consequences of the changes.

However, that is exactly what it is doing because it does not explain the impact of this deindexation of the basic exemption and it does not specify which Canadians will be affected.

The freeze of the basic exemption in contributory earnings will have more impact on low wage earners, particularly women, students and residents of disadvantaged areas. I should say will have, again, more impact on these people. And I thought that the message sent to the government on June 2 by several regions had been received loud and clear!

The Progressive Conservative Party strongly believes in equity. If the growth of the plan is stronger than forecasted by the last actuarial report, we could have some room allowing us to restore indexation.

We believe that there should be a mechanism to allow for a review of the year's basic exemption. Bill C-2 already provides for a review of the plan every three years. What we propose is that the year's basic exemption be reviewed also in 2006.

If we manage a return on investment comparable to the return of private plans over the next ten years, it would not be necessary to freeze the basic exemption forever. This is the only way to have some equity in this bill. We should not forget that the people most affected by the freeze on the year's basic exemption are the young, women and the self-employed, 45 per cent of whom earn less than $20,000 per year.

In fact, young people are severely affected by the reform of the pension plan. In simple terms, they will pay much more than those before them and get back only a fraction of what those before them received and will be receiving. So much for intergenerational equity.

As for women, it is a secret for no one that their socio-economic profile is generally such that they will not be able to benefit from the plan as much as men. Does Bill C-2 contain anything that may help counteract this? No.

What this government chose to include for these women is a year's basic exemption, which will gradually be eaten up by inflation. The same goes for self-employed workers who, in addition, have to bear the burden of paying both the employee's and the employer's share of premiums. The same goes for people from depressed areas struggling with horrible and outrageous levels of unemployment. The same goes for all low income earners.

There is nothing, absolutely nothing, in Bill C-2 for these people. There is nothing in here to ensure that Canadians are treated equitably, nor, for that matter, in the employment insurance program, the other major social security program, which once was the pride of Canadians.

Instead of compensating working taxpayers by reducing employment insurance premiums by a fair amount, which would help consolidate existing jobs and create many new ones, the government stubbornly insists on offering symbolic reductions and mini-reforms.

Naturally, observers agree that this is a step in the right direction. The problem is that, when I leave my riding, in New Brunswick, and head west toward Vancouver on the Trans-Canada highway, I am also going in the right direction, but I am very far from my destination. At the rate premiums are going down, I will not even make it to Regina by New Year's day.

To conclude, we, in the Progressive Conservative Party, believe in equity for all Canadians. Since this quest for equity is also one of our fellow Canadians' most serious concerns, it is essential that a mechanism be provided for in Bill C-2, that will allow the amount of the year's basic exemption to be reviewed on a yearly basis.

And because equity is a value shared by the members of this House, I encourage them all to vote in favour of this motion.

[Canada Pension Plan Investment Board Act, November 27th, 1997]

Motion No. 14

That Bill C-2, in Clause 61, be amended by replacing lines 8 and 9 on page 31 with the following:

“(2) For each year beginning in 1997 and ending in 2006, the amount of a Year's Basic Exemption is $3,500.”

[Canada Pension Plan Investment Board Act, November 27th, 1997]

moved:

Motion No. 12

That Bill C-2, in Clause 59, be amended by adding after line 33 on page 30 the following:

“(3) Any increase in the contribution rate referred to in subsection (2) for the year 1997, 1998, 1999, or 2000 shall not come into effect unless the cumulative increase in anticipated revenues under the Canada Pension Plan resulting from the changes in the contribution rate after December 31, 1996 are offset by at least a cumulative decrease in anticipated combined employer and employee contributions under the Employment Insurance Act for the years 1998, 1999, and 2000.

(4) The contribution rate for self-employed persons shall not exceed 10.25 per cent even if the Chief Actuary of the Office of the Superintendent of Financial Institutions, in preparing the report under section 115, is of the opinion that a higher contribution rate is warranted.”

Madam Speaker, this amendment concerns the rate of contribution to the Canada pension plan and accordingly to the employment insurance program.

We all know that excessive payroll taxes kill job creation. Small and medium size businesses are hit hard by increases in payroll taxes. We must encourage them to expand and not force them to limit their projects because they simply lack the means to hire the staff it takes to do the job.

The first part of our amendment would tie CPP premium increases to EI premium cuts. It would require that at least for the first three years, increases in cumulative CPP revenues from the combined CPP employee and employer CPP premium increases be at least offset by cumulative EI revenue decreases from combined employee and employer EI premium decreases.

We know that the government's internal reports show that the EI premiums could be cut to less than $2 and still cover the cost of the program. This amendment would ensure that at a minimum, higher CPP premiums are at least offset with EI premium cuts over the next three years.

We are deeply concerned about EI and CPP payroll taxes. We have been talking about this since the very beginning and we are not the only ones. Business leaders and organizations from across this great country have been telling the government the same thing. If we want to create jobs, start by cutting payroll taxes. Put people back to work. Give them the opportunity to make our economy grow. The government chooses not to do that. Last Friday it announced new EI premiums for the year 1998. While it had the opportunity to give Canadians a much needed tax break, the government decided to spin a mere 20¢ reduction in EI premiums as good news.

It is not good news to Canadians who have to foot the bill for an $11 billion tax hike with CPP premium increases. That is an $11 billion tax hike.

It is not good news to a small businessperson who come the new year will have to lay off people. It is not good news for the Canadian economy. Actually it may be good news for the Canadian economy, the underground economy that is. A lot of people will be forced to lay off because the cost of having skilled workers will simply be too high.

In the last election we heard the Prime Minister say during the campaign that he could see the light. I recommend to him today to turn on his lights and bring the cuts necessary so that employment in this country can grow.

To the extent that this can be done, increases in one program should be offset with decreases in the other. The current EI premiums are now set more than 50% higher than EI benefits justify. This year alone the EI surplus is expected to be $7 billion. Hello profit, profit on the backs of Canadian workers, profit that equals deficit as far as employment growth goes.

This is a shame and I sincerely hope the government will choose this opportunity to see the light.

The levels of contributions to the Canada pension plan are of grave concern to Canadian workers. This is why I think we must amend Bill C-2 by adding another paragraph.

I would, however, like to draw your attention to a small omission in the French version as it compares to the English one. The second line of subclause (4) should read “même si” rather than just “si”. This omission is important, because, as you will agree, it radically changes the meaning of the sentence.

Thus amended, the French text of the subclause reads as follows:

Le taux de cotisation des travailleurs autonomes ne peut dépasser 10,25 p. 100 même si l'actuaire en chef du Bureau du surintendent des institutions financières est d'avis, au moment de préparer le rapport prévu à l'article 115, qu'un taux de cotisation plus élevé est justifié.

As it stands, the bill, which affects almost all Canadians, permits an increase in contributions without new legislation. If we let that go through, we will be giving the government a blank cheque essentially. This is unacceptable.

What I propose is that we preclude any increase above 10.25% without a decision by this House on the matter.

To put it plainly, any increase over 10.25% would require new legislation.

This would mean the consent of the provinces was essential for any premium increase. The CPP cannot be changed except with the agreement of at least seven provinces representing 50% of the population.

Why this amendment? The answer is very simple. By their very nature, actuarial estimates are subject to error. Even if CPP premiums were to exceed 10.25%, there would be such a discrepancy between the basic actuarial estimates and those submitted to Parliament that there would automatically have to be a review.

If the government is serious when it says that amendments to Bill C-2 will keep premiums from climbing past 9.9%, it should not be afraid to ask Parliament to review amendments if the rate were to reach 10.25%.

It should also be emphasized that the fact of making it more difficult to increase premiums beyond 10.25% is not just the result of some bloodless number crunching. On the contrary. CPP premium rates have a direct impact on the lives of millions of Canadians, whether they are employers or employees. So imagine what is like for Canadians who fall into both categories.

Self-employed workers are hard hit by higher premium rates. They must shoulder the heavy burden of a combined premium. When there is talk of a 10.25% premium rate, the self-employed worker does not need a calculator: he knows he has to turn over $10.25 of every $100 earned.

Some people will perhaps say that the self-employed represent only a small proportion of the labour force and that, on the whole, this is not an issue of concern to Canadians generally. Wrong. It is indeed of concern to Canadians generally, increasingly so.

It is precisely about the 2.5 million self-employed Canadians that members should be thinking as they consider Bill C-2 and the proposed amendment. We have an obligation not to allow premium increases until the House has examined the consequences to Canadian workers, particular those who are self-employed.

[Canada Pension Plan Investment Board Act, November 27th, 1997]

Madam Speaker, if I can continue, this is 1997, not 1966. Canadians are looking for good management and that is what we are proposing. We are proposing to secure the CPP fund for future generations.

[Canada Pension Plan Investment Board Act, November 27th, 1997]

Madam Speaker, I have listened very carefully to the hon. member's comments on this bill and the amendment he is bringing forward on preferential loan rates to provinces.

I think Canadians are telling us that they are looking for people to manage their money. Over the past 20 years we have been lending money to provinces at a preferred lending rate, but where are we today? There is a shortfall of $600 billion in the fund. I do not think that Canadians were looking for that.

We have to provide Canadians with the best bang for their dollar. They are looking for maximum returns, guarantees that the CPP will no longer be affected. They are looking to have a Canada pension plan in 20 years.

I also heard the hon. member talk about New Brunswick and how this would help to create jobs. I will say that for 20 years we have been lending money to provinces at a preferred rate and the unemployment rate is still very high. I do not believe the status quo would work. There are other vehicles to create employment in New Brunswick. The way to do that is by electing a Conservative government in the next election.

We are talking today about saving the CPP. The hon. member mentioned keeping the status quo. Well today there is a $600 billion shortfall in the CPP fund. Imagine if the NDP were the government today and passed this type of bill. Maybe in 20 years the CPP fund would be a trillion dollars in the red. That is scary. I hope that Canadians can see exactly what is going on here.

I know that for my investment, my money, I want the best bang for my dollar. This is 1997, not 1966.

[Canada Pension Plan Investment Board Act, November 26th, 1997]

moved:

Motion No. 8

That Bill C-2, in Clause 53, be amended by adding after line 15 on page 28 the following:

“(1.1) A regulation made under paragraph (1)(b) must reflect the objects of the Board as set out in section 5.”

Mr. Speaker, this is another amendment to Bill C-2. It is still time for government members to see the light and to support amendments that will make the Canada pension plan more fair, more transparent, more performing and more accountable to those who contribute to it. I hope government members will support this amendment.

This is an addition to clause 53 of the bill, which deals with the regulations that the governor in council may make.

In its current form, clause 53 basically provides that the governor in council may make regulations: (a) specifying which provisions of the Pension Benefits Standards Act of 1985 apply to the board; (b) respecting the investments the board may make; (c) prescribing anything that the act provides.

Clause 53 also deals with the coming into effect of regulations. We are pleased to see that a regulation has no force or effect until it has been approved by at least two thirds of the participating provinces having in total not less than two thirds of the population.

The purpose of our proposed amendment to clause 53 is to require the governor in council to take into account the objects of the board, as set out in clause 5 of the bill.

Allow me to read clause 5 so that hon. members can understand the scope of the obligation that we want to impose on the governor in council:

1. The objects of the Board are a ) to manage any amounts that are transferred to it under section 111 of the Canada Pension Plan in the best interests of the contributors and beneficiaries under that Act; and b ) to invest its assets with a view to achieving a maximum rate of return, without undue risk of loss, having regard to the factors that may affect the funding of the Canada Pension Plan and the ability of the Canada Pension Plan to meet its financial obligations.

Therefore, by passing our amendment the governor in council would be bound by this mission as it is detailed in clause 5. This would ensure that after the three year phase-in period the government exercises its ability to restrict investment under clause 53(1)(b) in a manner that reflects the best interest of the beneficiaries.

This would be done by requiring that such regulations be made with a view to ensuring that the plan's investment advisers are subject to the prudent person rule. To take effect, any regulation that is not passed with a view to those objectives would have to be approved by two-thirds of the participating provinces with two-thirds of the population.

Bill C-2 provides the government with the ability to set through regulations the kinds of investments the board may make. This may preclude the board from making investments that are in the best interests of the beneficiaries, for example, through limits on foreign investments or the government could choose to simply list certain sectors at the expense of others.

We want to ensure that this plan operates in the best interest of the beneficiaries free from any political, economic and social objectives.