Mr. Speaker, I am glad to have this opportunity to speak with my hon. colleagues to Bill C-405, which would amend the Pension Benefits Standards Act of 1985, or the PBSA, as well as the Companies' Creditors Arrangement Act, or the CCAA.
Before turning to the bill, I want to remind us all that Canadians work hard and expect their government to do the same. They expect us to make smart and responsible investments that grow the economy now and for the long term. Canadians understand that when we invest in the middle class and in people working hard to join it, everyone benefits.
Canadians expect their hard work will bring about a better quality of life, one where their families and children have greater opportunities and a bright future ahead of them. As well, after a lifetime of hard work, Canadians have earned a safe, secure and dignified retirement. That is why we have some concerns with the bill before the House today.
Bill C-405 was introduced in the spirit of providing greater flexibility for companies to address their pension deficits and protecting Canadians' retirement security. However, the bill contains problematic and unnecessary changes that would endanger Canadians' hard-earned pension benefits.
To give a bit more context, I would like to remind the House of some of the measures the government is undertaking to support Canadians' retirement goals.
In June 2016, we reached a historic agreement with the provinces to enhance the Canada pension plan. The strengthened CPP will provide more money to Canadians when they retire, so they can worry less about their savings and focus more on enjoying time with their families. Increased CPP contributions will be slowly phased in over a seven-year period, starting next January. It will take roughly 40 years of contributions for a worker to fully accumulate the enhanced benefit, which will raise the maximum CPP retirement benefit up to 50%.
To make this clearer, I will provide an example. Today, the current maximum benefit is just over $13,850. If the CPP enhancement were fully in place today, it would represent an increase of nearly $7,300 on that amount, to a maximum benefit of more than $21,100 in today's dollars.
The increase is due to two changes. First, the government is increasing the level of earnings replacement provided by the CPP from one-quarter to one-third of eligible earnings. This means an individual making $55,000 a year in today's dollars over their working life will receive approximately $4,500 more per year when they retire.
Second, it will increase by 14% the maximum income range covered by the CPP, so those who earn more will receive more in retirement.
Now that similar enhancements to the Quebec pension plan are also in place, all Canadian workers can look forward to a more secure retirement. In 2017, the government built on this achievement by reaching an agreement with provincial partners to further strengthen the CPP. Budget 2018 included measures that will give greater benefits to parents whose income drops after the birth or adoption of a child. It also included measures that will provide greater benefits for persons with disabilities, for spouses who are widowed at a young age, and for the estate of lower-income contributors.
These new benefit enhancements will be implemented without raising CPP contribution rates. Strengthening the economy and growing the middle class are important, but so too is making sure people working hard to join the middle class have the help they need to succeed. This is why the Government of Canada has taken steps to ensure more and more people benefit from Canada's economic growth.
In addition to enhancing the CPP, the government also strengthened the guaranteed income supplement. This action provides greater income security for close to 900,000 low-income, single seniors, 70% of whom are women. The enhanced guaranteed income supplement has lifted 57,000 vulnerable seniors out of poverty.
Coming back to Bill C-405, this bill would weaken the security of retirement benefits for workers and pensioners, undermining the government's achievements in enhancing our retirement income system.
The bill would allow the restructuring of employees to reduce pension benefits, subject only to the consent of a minority of plan members. It would allow employers to walk away from their pension promises instead of fulfilling their legal obligation to fully fund all benefits.
As such, the bill runs counter to the government's commitment to find a balanced way to address retirement security. The bill would also harm the ability of companies to retain key employees when undergoing restructuring proceedings. This could make it more difficult to complete a successful restructuring that keeps the company in business and preserves jobs.
In conclusion, over the last three years, our government has been focused on strengthening and growing the middle class, offering real help to people working hard to join it. The government is also focused on building an economy that works for everyone, and the results speak for themselves.
Since we came to office, Canadians have created more than half a million new full-time jobs; the unemployment rate is at the lowest level this country has seen in four decades, and the youth unemployment rate has dropped two percentage points since the beginning of last year. The Canadian economy was also remarkably strong last year, with growth that outpaced all the other G7 countries. It is expected that Canada will remain among the fastest-growing economies this year and next.
We are proud of these achievements, because they are proof positive that our investment and innovations are reaping rewards for all Canadians. However, Bill C-405 would weaken benefit security, running counter to the achievements our government has made and those we are pursuing. For that reason, I urge every member of this House to oppose the bill.
