Joe Preston

[Income Tax Act, November 1st, 2006]

I am glad to hear that the member opposite agrees with me.

Budget 2006 discards the previous $3,000 partial exemption and proposes to make all scholarships and bursaries received by students enrolled in post-secondary studies completely exempt from tax.

Budget 2006 also proposes to improve access to student loans by reducing the parental contribution required for students from middle income families for the purpose of student loans. It is estimated that this change will enable 30,000 students to gain access to assistance and 25,000 to have access to increased loans.

The government will also provide a one-time payment of $1 billion into the post-secondary education infrastructure trust, providing that the 2005-06 surplus is in excess of $2 billion. The trust will support critical and urgent infrastructure and equipment in colleges and universities.

Budget 2006 also included funding for research and development and measures in support of apprenticeships and trades.

Let me turn to the assistance that is already provided for education saving. RESPs are given preferential tax treatment to help parents save for their children's post-secondary education. Up to $4,000 can be contributed to an RESP in a year for each beneficiary to a lifetime maximum of $42,000 per beneficiary. Funds invested in the plan grow tax free until they are withdrawn. Contributions are not deductible, but can be withdrawn tax free. Investment income earned in the plan is taxed in the hands of the students when withdrawn for post-secondary education. In short, the tax benefits in an RESP come from two sources: the deferral of the tax would be investment income and the fact that this income is taxed at a low rate because students generally pay little or no tax.

In addition to the tax preferences I just described, RESP savings qualify for the Canada education savings grant, or CESG, which makes saving in an RESP even more attractive. Under this program, which is aimed at encouraging saving for post-secondary education, the government provides a 20% grant on the first $2,000 in RESP savings for each beneficiary in a year.

To illustrate how this works, assume a parent contributes $2,000 to an RESP for his or her child, the contribution would earn $400 in CESG and the income on both the contribution and the CESG would grow tax free until the funds were withdrawn to cover the cost of the child attending college or university.

Further, because it is more difficult for low and middle income families to save for a child's post-secondary education, the Canada education savings grant provides a higher grant rate on the first $500 in contributions by these families. Depending on family income, the grant rate could be as high as 40%.

In addition, since 2004, the Canada learning bond kick-starts education savings for children born after 2003 and who are in families entitled to the national child benefit supplement. Up to $2,000 in total Canada learning bond grants could be paid in a child's RESP by age 16. These measures were adopted with our support.

In fact, the current RESP limit, saving $2,000 annually into a child's RESP, means that almost $75,000 could be available for that child's post-secondary education by age 18, and about $95,000 would be available if the parent contributed $4,000 annually until the $42,000 lifetime limit was reached.

The combination of the generous tax treatment of the RESP and the CESG that tops up private savings has provided powerful incentives for parents to save for their children's post-secondary education. At the of 2005, these plans held almost $18 billion in savings for future post-secondary education, seven times their value nine years ago.

Since 1998, $2.7 billion in Canada's education saving grants have provided for over 2.2 million children. Over $440 million in grants was paid into RESPs under the program in 2005. In addition, the tax deferral provided by RESPs represents about $130 million per year in forgone revenue for the Government of Canada and about half that amount to the provinces.

In total, the Government of Canada devotes over $570 million annually to tax relief and grants to help parents save for their children's post-secondary education. I believe nobody would dispute that the current RESP regime has been extremely successful at promoting savings for post-secondary education.

Let us consider the impact of the measures under Bill C-253.

First, the bill proposes to provide a deduction for contributions to RESPs made in 2006 and future tax years, with contributions withdrawn being taxed in the contributors hands rather than tax free as is currently the case.

Second, contribution limits would be raised to be the same as those applying for registered retirement savings plans, or RRSPs, that is 18% of the earned income up to $18,000 for 2006.

The bill is supposed to encourage parents to save more for their children's post-secondary education, but I suggest that the measure proposed in the bill would be ineffective and would be expensive.

For these reasons and many others, I am unable to support the bill and invite my colleagues to do the same.

[Income Tax Act, November 1st, 2006]

Mr. Speaker, it is a privilege to engage in debate today with my fellow colleagues on Bill C-253, sponsored by the hon. member for Pickering—Scarborough East.

The bill proposes two major changes to registered education savings plans, or RESPs, that would affect contributions made in 2006 and future tax years.

We all agree that post-secondary education is important for the future of our children and for the future of this country. A well-educated workforce is a critical factor to improving Canada's productivity and raising our standard of living. In a knowledge based economy, our young people must have the skills to compete successfully in an increasingly sophisticated labour market.

More than half of the new jobs created today require post-secondary education. We can only expect education requirements to increase over time. We want our children to have access to post-secondary education and we want that education to be second to none.

The bill before the House today proposes an increase in support for post-secondary education by providing additional tax preferences for RESP savings. However, I believe this bill is not the best way to promote post-secondary education.

First, I will give a brief overview of the considerable support the Government of Canada provides for post-secondary education; second, I will explain the significant support that is already provided for education saving; and third, I will explain why measures proposed in the bill presented by the hon. member for Pickering—Scarborough East would not be cost effective ways to support post-secondary education.

The Government of Canada provides significant support for post-secondary education. In addition to transfers to the provinces, the Government of Canada provides over $5 billion annually in direct support to post-secondary education. Of this amount, $1.7 billion is provided to educational institutions for research to help ensure our brightest researchers stay in Canada and contribute to maintaining Canada's edge in innovation. Also, $1.8 billion is provided in grants, scholarships and loans to improve access to post-secondary education for low income students and rewarding those who attain academic excellence. We also provide $1.7 billion in tax relief to students and their families in recognition of the cost of post-secondary education through measures such as the tuition tax credit and the education tax credit.

This government's commitment to post-secondary education was evidenced in the 2006 budget presented in the House on May 2, 2006. The budget follows through on our platform commitments by proposing to create a textbook tax credit. The credit will be provided of $65 per month for full time study or $20 per month for part time study.

This government also recognizes that post-secondary students need to be supported in their hard work in the pursuit of academic excellence.

[Committees of the House, October 24th, 2006]

Mr. Speaker, the member opposite gave a strong intervention, but I have a couple of points to make. As he recognizes, it was this party, in cooperation with others, that put together the provisional Standing Orders in the 38th Parliament.

The spirit of cooperation in the House is the lubricant that gets things done while partisanship is the friction that causes it to come grinding to a halt. If we remove the lubricant of cooperation, how can we get the job done? We agree with him that the provisional Standing Orders need to pass.

I guess the point being made was that there were some slight and small changes to them. He brought up the one about the amendment. He agrees that it probably should not change, but does he agree that, in their entirety, the provisional Standing Orders are exactly how he would like them or is there a small amount of work that still needs to be done to fix a couple of them?

Apparently, that was the spirit of cooperation at the House leaders' meeting, when it was agreed they would be put off and looked at by staff in order to fix some of the small pieces that needed to be fixed. Could the member tell us whether they are perfect or is there a small amount in the provisional Standing Orders that even he would still like to see fixed?

[Committees of the House, October 24th, 2006]

It should be the member for Montmorency—Charlevoix—Haute-Côte-Nord.

[Committees of the House, October 24th, 2006]

Mr. Speaker, I would like to point out to the member opposite that we agree with the provisional Standing Orders. I will repeat it again very slowly: we agree with the provisional Standing Orders. In fact, we helped write most of them in the 38th Parliament, when they were originally created.

The point is not whether we want the provisional Standing Orders implemented permanently, because we do. The point is keeping one's word. The point is lying in one meeting and going to another and doing something different.

I hope the member opposite now can give us a little response as to whether he thinks this place could work if every time we meet we tell a lie.

[Business of Supply, October 5th, 2006]

Mr. Speaker, I understand the purpose. The question is will it accomplish what the member would like it to accomplish, or are we looking at a cross-Canada approach to this, or trying to fix it in a way that may not fix it?

As I said in my remarks, the statistics tell us that as older workers are displaced from their jobs, they may be unemployed for a longer period of time. Support would certainly need to be there as one of the mechanisms. The true mechanisms are getting back to work. We have to look at the labour shortages from a pan-Canadian point of view as to what is the best solution.

We recognize that these workers share skills, mindsets and life skills that are so valuable to other employees out there. We certainly would like to put those to the best advantage.

[Business of Supply, October 5th, 2006]

Mr. Speaker, the efficient operation of labour markets will continue to be central to what the government will do to help in the area of market flexibility.

Canada has well functioning markets and, in particular, the labour markets. We have looked at what we need to do so we can be flexible so workers can move from one sector to another. The days of one job for one's life are perhaps gone. The flexibility needs to be there.

We are also exercising leadership to secure the efficient operation of the national labour market. The federal government is uniquely positioned to facilitate a cross-Canada approach. We must be able to look at this as the federal government from a pan-Canadian point of view, rather than simply looking at it in regional or community situations. We must, as the government, react as the Government of Canada.

[Business of Supply, October 5th, 2006]

Mr. Speaker, I will discuss those issues with the member for South Shore—St. Margaret's.

We certainly appreciate the hardships being faced by older workers who face unexpected changes in their employment, environment and communities. We are focused on providing the tools needed for retraining and helping them move on to other jobs.

We should not forget, though, that we need to encourage older workers. They all possess a set of skills, even life skills, that they can share with other workers. They can help us with labour shortages and with regional difficulties, as mentioned by the member.

[Business of Supply, October 5th, 2006]

Mr. Speaker, I will be splitting my time with the member for the beautiful riding of South Shore—St. Margaret's.

I thank the member for Chambly—Borduas for raising this issue. I also reassure him that Canada's new government shares his concerns regarding the distinct challenges facing older workers.

Our government recognizes and appreciates the hardships faced by older workers who face unexpected changes to their work environment in communities and regions with limited employment alternatives. However, what the member opposite sees as simply challenges, we also see as an opportunity.

There are strong indications that people can and want to work longer, even if only on a part time basis. While all Canadian workers face new challenges to adapt to the fast-changing global economy, such challenges are often especially difficult for older workers, particularly following the unexpected loss of employment.

As statistical data has constantly found, when older workers lose their jobs, they tend to remain unemployed longer compared to their younger counterparts. Some older workers lack the education and skills needed for many of today's jobs. Others have skills that are not easily transferred to jobs found in the new knowledge-based economy. Moreover, some employers are reluctant to invest in retraining for workers who may be close to retirement.

Overcoming such realities represents a challenge for Canada. Losing the knowledge and experience of older workers would represent a loss we cannot afford in an era increasingly marked by labour shortages. However, what we identify as a challenge, can sometimes be an opportunity in disguise. Older workers provide a valuable contribution to the labour market, which is important to the economic well-being of the country. By ensuring the continued participation of older workers, we are not only helping to address labour market shortages but we also simultaneously ensure that the vast experience and expertise will be passed on to future generations.

We should continue to encourage older workers to share their skills and talents well into retirement age, as their participation in the workforce will play an important role in meeting the demands of the labour market. Indeed, in the context of an aging society, Canada's older workers are becoming an increasingly critical component of Canada's labour force.

As indicated by a recent OECD report, the labour market situation of older workers has improved considerably in recent years. Employment rates for older workers have increased rapidly over the decade, from 43% in 1995 to 55% in 2005. Older workers have a lower unemployment rate at 6% than the total workforce at 6.5% in 2006. At the same time, many employers in Canada, such as Alberta's oil patch, are experiencing skills shortages and lagging behind their potential due to a lack of workers.

As our population ages, older workers hold the key to ensuring continued growth and prosperity, and offer a means of helping address Canada's labour shortages. As Judy Cutler of the Canadian Association of Retired Persons recently stated:

There's a shortage of workers, and as more and more people retire, there will be a greater shortage....We have older workers who want to work. Why not embrace their expertise?

More specific, we need to find new ways to reintegrate older workers into Canada's labour force. We need to offer support to older workers who may be in danger of losing their jobs. With access to opportunity, we know these Canadians can keep contributing their enormous talent and experience to our economy.

That is why budget 2006 committed to conducting feasibility studies to look at measures to help displaced older workers. This wide-ranging study will examine the need for improved training and enhanced income support, including early retirement benefits as proposed in the motion of the hon. member.

We do recognize the challenges faced by older workers, particularly those in communities that are dependent upon single industries. Turning to the forestry sector, we are spending $400 million over the next two years to boost the competitiveness of this vital Canadian industry. This includes funding to support worker adjustment.

In the meantime, we are offering unemployed older workers practical assistance, such as skills development and new work experience. Through part II of employment insurance, we are helping older workers to access the tools, programs and services they need to upgrade their skills and successfully re-enter the job market.

Under these innovative measures, older workers across the country receive training, work experience and support to start their own businesses. At the same time, many are receiving income support while they participate in the program.

Across Canada more than 80,000 older workers are benefiting from these employment programs each year. In fact, nearly 230,000 displaced older workers receive $1.4 billion in income benefits each year.

We want to harness the skills, energy and leadership of older workers in jobs that benefit their communities. In short, the government wants to lend a hand to help older workers get back to work. We want to work with Canadian unions, employers and communities to find new ways to tap into the wisdom and experience of older workers. We want to find ways to empower older workers to continue their participation in the labour market, in our forests, our fisheries, offices and factories.

Our government's focus is on getting results on issues that matter most to Canadians. We want to do it in a way that will benefit all Canadians now and in the future.

As older workers represent the single largest pool of labour supply, carrying out an early retirement program, without fully assessing the labour market impacts of this initiative, would be irresponsible. That is why we need to take time to consider the results of our feasibility study and make an informed decision.

Additionally, we will build on lessons learned from our older workers pilot project initiative, conducted in partnership with provinces, to improve federal and provincial employment programing to better meet the needs of older workers. However, our government's first priority is to assist those older workers seeking employment to find and retain jobs.

That is why I cannot in good conscience support this motion.

[Liberal Party of Canada, October 5th, 2006]

Mr. Speaker, apparently the Liberals are so ashamed of their party's debt that they are avoiding calls and not returning emails from Liberal International. This blatant attempt to avoid communication is shocking, given that the Liberal Party of Canada is a founding member.

Yesterday the secretary general of Liberal International, Jasper Veen, sent an email to the Liberal Party president reminding him of the $25,000 owed. What is interesting to note is that although the largest political party in Liberal International is the Liberal Party of Canada, it is one of the smallest financial contributors, as compared to the member parties from sub-Saharan Africa.

It is shameful. The Liberals are piggy-backing off the poor nations of Africa, while continuing to rack up debt.

Perhaps this just shows how much the Liberals care about their values when they cannot even support an organization designed to do just that.