Madam Speaker, part of the problem is that we have been dealing with this legislation for so long. If things would move faster around here we could get through this. People tend to talk about other issues because there are other things happening here today. However, this is an important piece.
I am going to come back to the CPP, but it is a program where the employer and the employee pay in, and it goes to a Canadian pension program savings board that looks after the savings that go into that program. It does the investments. It invests in the stock market, which for some reason the opposition members in previous speeches indicated they did not realize. It invests in government bonds and in the stock market. It is a relatively safe investment portfolio. There is always risk in everything one invests in and even during the recession the board's numbers went down, but overall it is a very secure, well-managed program. It is part of the savings program. Of course, one has to be an employee; one has to work to qualify for CPP because it is an investment piece.
A third piece is the registered retirement savings plans, which have been around for about 40 years or so, maybe a little longer. I believe they were introduced in the early 1960s. It is a program that is voluntary, which maybe the Liberal Party will want to talk about a bit. It is a voluntary program and does not have full take-up. Even in my own investment plans, I have not used all of the room available in my RRSP. There is still room for me to invest. However, it is a savings tool. I want to come back to that. It is a savings option. It is a savings tool for people to save for their retirement. There are RRSPs that are a lot more aggressive than others. It depends on one's level of tolerance for risk. That is why the vast majority of people have some sort of financial advice, whether through a bank or through an independent organization, on where they should invest their RRSP money, their savings, to help them in their retirement years.
We have made some changes to the RRSP system to allow for people to invest for longer. Then when people come out of the RRSP it turns into an annuity so they can have an income stream, hopefully, for the rest of their life.
We have also introduced a new savings tool, which is very popular. Even my own 21-year-old daughter has invested in it. It is a tax free savings account, which did not exist before our government took office. It is another savings tool where people can save money for retirement, and for other things, but it is also a retirement option where people save their money and hopefully it grows through the investments they choose for their TFSA. That growth is tax free. There is no tax on the money when they take it out. Therefore, if it is needed in the short term it can be used. A lot of people are considering the TFSA option as part of their retirement plan options.
Of course, there are other savings vehicles, like straight savings and a number of other options that are available to most people. However, there is something missing for many of those who are working, whose employer does not have a registered retirement savings plan that they are involved with or a pension plan. There is nothing for them. If people are self-employed, there is really nothing for them.
Our has done an excellent job of consulting with the provinces and all Canadians on the pension system over the last number of years. In fact, the government is so concerned about the pension system in our country, and the retirement savings and ability of senior Canadians to have a quality of life after retirement, that we have a minister of state for finance, which did not exist before, to deal almost exclusively with the pension issue and seniors issue. This is a worldwide issue, but in the context of Canada we have taken it very seriously and added a cabinet position. This is a position at the table at cabinet to deal specifically with this issue.
The pooled registered pension plan has a number of components. There is a bit of a gap of course in terms of the retirement piece, even though I have listed out all the options that are available. I want to talk about that gap.
One of the pieces is that it is accessible and straightforward, and it is a low-cost option. I will get into why that is important. It allows for individuals who currently do not participate in a pension plan, whether they are self-employed or employees of companies that do not have pension plans, to get involved in a registered pension plan. The key is that It is an opt-out plan and not an opt-in plan. This is very important, and it is different from what has been suggested by other parties.
More people will benefit from its low-cost investment management, which will result in better returns. Whether it is an RRSP or other investments, part of the cost of the investment goes against what one would have in one's retirement. If we can lower the costs, which the pooled registered plan would do, it would mean more money in the pockets of the retirees.
Another very important component is its portability. A pooled registered pension plan is portable. If a person leaves one company to go to another, that person could take the retirement savings in the plan and either move it to a new plan that the new employer has or just keep it in the existing plan. It would be the employee's decision, but it is portable. I have left jobs before, and the money that was invested in my pension plan had to be either put into a locked-in RRSP or taken in cash.
Let us face it: in today's marketplace, my generation and generations after mine are not staying at the same company for 35 or 40 years. We are changing jobs every four or five years. My university friends have all had four or five careers in the 30 years since we graduated from university. I hate to say it, but it has been approximately 30 years, which is hard to be believe. I was only 12 when I graduated.
However, we have all moved, and the portability of this new program is very important. The investment in the funds would be there for those who have invested in it.
There is a company whose management I know very well. I will use it as an example of why this important, and I will start with the automatic enrolment piece.
This company is in the high-tech medical business. It is very high end. There are about 30 employees in the company, and about half of them have a Ph.D. in chemistry. They are highly intellectual, highly skilled individuals.
This company has a group RRSP program. The employer adds a certain percentage—up to 5% or 6%, I think—of whatever the employee puts in the plan. I talked to the owner and asked how it was going. He said that he had all of these highly skilled, highly educated individuals, but only 30% of the 30 people take advantage of the company's money. They are not investing on their own, even though there is an automatic 5% return in that system.
That is an example of what happens across the country in company after company. Canadians often have an opportunity but do not take advantage of it. However, the advantage of the pooled registered pension plan, in my view, is that there is an automatic enrolment.
That means that when people join a company that has taken advantage of the pooled registered pension plan, they have, I think, three months or six months—off the top of my head, I cannot remember the timeframe—to decide not to be part of the program. Otherwise, they are automatically enrolled, which in my view makes a big difference.
We often hear the opposition asking why we do not just increase the CPP role. There is no doubt that the advantage of the CPP is automatic enrolment, but this plan takes the positive aspect of the CPP and adds to it.
There are two fundamental differences between the CPP and this plan. First, as we all know, we can talk to ourselves until we convince ourselves, but we need two-thirds of the provinces with two-thirds of the population to agree to make changes to the CPP. That is the law. We can see if we can change the law, but that is the law that runs the CPP program.
The has worked very hard at discussing what options are available that the provinces will buy into in terms of changes. The response has been that some provinces are in favour and some are not, so we cannot proceed with CPP changes.
The official opposition has said that we should just change the CPP and have et the employers and employees pay more. Of course it will take 18 to 20 years before anyone sees the benefit of that, but it is an option, and we have discussed that option with the premiers of the provinces. It is just not feasible, because they are not interested. Maybe we should just stand up for it and say so, but we like to take action on this side of the House. We like to make a difference in people's lives.
When the previous leader, who has unfortunately passed away, was at the kitchen table, as he used to say, he was doing things and making things happen for Canadians. This is making things happen for Canadians. Is it the final answer on all the pension requirements for our future generations of seniors? Absolutely not. We are not saying it is the only or the final answer, but it is part of the puzzle and part of the options.
As I listed from the beginning, there are four or five options that exist now. We are adding another one. We are adding an opportunity for Canadians to invest and to save for their future and their retirement. The automatic enrolment is a key element of making sure that in this registered system, Canadians will have to choose not to save for their retirement. In this case, with this plan, we are requiring them to do so. That is why I think there will be a huge take-up on this program.
Even with this program, we can put the legislation into effect for nationally regulated industries, but we need the provinces on board too. We need each province to pass legislation so that they can recognize these pooled registered pension plans for employees at the provincial level, which we have no influence over.
I am hearing that the vast majority of provinces are interested in doing this. They were supportive. Unfortunately, Ontario has now indicated that it is not interested. I do not think it is good for Ontarians if the province takes its ball home because it does not want to play.
I am from Burlington, Ontario, and as a member of the Ontario caucus here, I want to see Ontario take advantage of this plan. It is of no cost to the province. It is an opportunity for the people of Ontario, as it is for every province. I think the province is being very short-sighted by not taking advantage of this plan. Ontario will say that it is not the final solution, and I agree with that. It is not the final solution. It is part of the puzzle of opportunity and options that should be available to all Canadians, regardless of what province they live in.
The portability piece is very key to me. I had asked the minister and his team about that. What if employees are moving around? It is portable. My concern is that if we do not get all of the provinces on board, I do not know what would happen to portability if people move from one province to another. It does not make sense. I want it to be portable, not just within Ontario and not just within federal government-regulated industries, but also through every business, including self-employment businesses.
The self-employed work very hard every day. We all know those individuals in our ridings who are entrepreneurs, who are risk-takers, who are out trying to make a living and trying to better themselves, their livelihood, their family's livelihood and their community. There is nothing more satisfying than when a local entrepreneur is involved in community events.
They have not had the same opportunities in the past to save for their retirement. Often they hope that their business is their retirement plan. Perhaps they own the real estate that their business is on, but they hope to have some value in it so that they can sell it at the end of the day and retire, or else pass it on to their children or whomever they wish to.
Normally there is a cash-flow system that will help them with their retirement, but here is another opportunity for them. It will encourage entrepreneurship and self-employment and encourage people to create jobs and wealth in this country, and they will have an opportunity to save for their retirement. They themselves can sign up as individuals for the pooled registered pension plan.
With the concept of low cost, the issue is that just as in anything else we do, the greater we spread the risk and have economies of scale, in normal circumstances the less the cost will be for individuals to take part. It is a simple concept that works. No matter what it is, it works. It is a simple concept, and that is what these pooled registered plans would do.
There would be regulations about how much whoever is administering the plan would be able to charge, whether a bank or an insurance company. We would have some control over that level, so we would ensure it would be affordable. We have a large variety of people who have said positive things about this plan.
We had an amendment at report stage yesterday that would have gutted the bill. The New Democratic Party, the official opposition, voted against it. I just do not understand.
I can understand the opposition's argument that this is not the final answer—absolutely, we are not denying that—but why is the NDP denying Canadians an opportunity for another tool in the toolbox for their retirement? I can understand that the NDP members would like to see other things happen or that they have other suggestions. However, they had an amendment that would have gutted the bill completely. I do not understand denying the opportunity. The majority of provinces are on board and the majority of businesses are on board. I can go over quotes of different individuals and organizations saying that this is an important piece.
We need to provide the tools for savings. In our view, part of people's retirement planning is their individual responsibility. I do not think the majority of people in this country are interested in having the government completely control their retirement plan. There needs to be opportunity. It looks like I—
Mr. Speaker, it is very important to continue in this debate because there is a real divergence of opinion, which has a great deal to do with the fact that the proposed pooled registered pension plan would do nothing to solve Canada's pension crisis.
The pension crisis has been the subject of debate for the past several years. The issue is that more than 11 million Canadian workers do not have a workplace pension plan and the public pension plans, old age security and the Canada pension plan that everyone has, do not provide enough for people to live on in retirement. Even worse, the plan by the current government is to increase the age of retirement for OAS and seriously undermine the ability of workers who live with disabilities, or workers who have very stressful jobs to retire at an age that would allow them to have some quality of life in their senior years.
To make matters worse, most Canadians are not making up for their lack of a pension plan by saving for retirement on their own. Less than one-third of the people entitled to contribute to RRSPs actually do so. There is now more than $600 billion in unused RRSP contribution room, all of that being carried forward. Only about one-third of Canadian households are currently saving at levels that would generate sufficient income to cover their non-discretionary expenses in their retirement.
It also needs to be noted that the market is not a reliable place in which to gamble retirement security. Turmoil in financial markets has had, and will continue to have, a devastating impact on workplace pension plans. People who have saved for retirement through RRSPs have found all too often that the value of their investments has dropped so much that they are now faced with having to postpone their retirement or to struggle to replace retirement savings by attempting to find some kind of work.
The reality is, however, that finding employment at ages 66, 67, 68 is profoundly difficult. The workplace has changed and the skills that retirees once brought to the job are no longer marketable.
There is indeed a pension crisis, but this bill seems to have been simply thrown together hastily, in response to pressure from labour, seniors groups, political parties, notably the NDP, as a result of a national campaign to increase the CPP-QPP. There was no thought, just a knee-jerk response.
According to the Conference Board of Canada, 1.6 million seniors live in poverty in Canada and 12 million Canadians lack a workplace pension plan. Statistics Canada tells us more than 14% of senior women on their own are living in poverty, according to standard LICO measurement.
The sensible NDP proposal to increase the GIS enough to eliminate poverty among seniors would take care of this issue. Unfortunately the government is not interested.
By OECD standards, Canada's CPP-QPP system is relatively miserly. We are not terribly generous at all. Other countries similar to Canada provide much more generous public and guaranteed pensions. For example, social security in the United States has a maximum benefit of about $30,000 a year. The maximum benefit in Canada is less, at $12,000 a year.
Even if we add old age security to that, and that would be a maximum of just under $7,000 a year, the total is still far below social security and places seniors in that poverty range of which I spoke.
As I indicated, most Canadian workers have no RRSP because they cannot afford it. Last year, only 31% of eligible Canadians contributed to their RRSPs and unused RRSP room is now about $600 billion, according to the Canadian Centre for Policy Alternatives.
Meanwhile, the latest numbers for the return on the CPP investment show that it barely lost ground, less than 1% during this current downturn in the economy, while the stock market, which is where the government wants Canadians to park most of their retirement savings in this pooled private plan, fell by 11%. That is significant.
The Australian experiment has been mentioned. Australia tried about 10 years ago to introduce a similar plan and had less than encouraging results. The Australian plan was mandatory with an opt-out provision. It was called the Australian superfund and it required employers to enrol their workers in one of many defined contribution plans offered by the private sector.
A recent review of the Australian superfund was commissioned by the Australian government after 12 years of experience. The review shows that, while people were saving as a result of the mandatory contributions, the investment returns were no better than inflation. The report attributed the poor results to high fees and costs despite the presumed role that competition was supposed to play in keeping these fees at a reasonable level. I will speak to that again in regard to the pooled registered plan.
There has been for several years a clear consensus among many experts that real pension reform was, and continues to be, critical. However, rather than intelligently and positively engaging in practical reform, the government has instead introduced its pooled registered pension plan, which, according to the federal , is this incredible panacea. He said that it would make low-cost, private sector pension plans accessible to millions of Canadians who have, up to now, not had access to such plans.
The legislation introduced in mid-November would allow employers to offer PRPPs to their employees. The scheme would be run by insurance companies and other financial institutions. According to the minister, they would pool the savings of workers whose employers sign up for the program. The financial institutions would run these programs on behalf of employers and, of course, will charge a fee for doing that. Employers would not need to contribute to the plan and workers' savings would be locked in, although if employees provide notice in writing they. apparently. would be allowed to opt-out.
No pension would be guaranteed by this program. In effect, it is yet another voluntary savings scheme that would do nothing to address the pension crisis since very few people take advantage of existing voluntary retirement savings schemes now. It is not clear why officials are claiming that the proposed PRPPs will prove more attractive than anything that currently exists.
So far, the only advantage being promoted for PRPPs is that management fees would apparently be lower than individual RRSPs because of the pooling. There would be no cap on the management fee and therefore no guarantee of lower fees, nor is there any certainty that this would be a big selling point for the plans.
It is also worth noting that there is no evidence that people are not saving through RRSPs because of high management fees. It is far more likely that they are not saving because individuals are busy raising families, paying bills, trying to manage the cost of housing and trying to educate their kids. There is no money left at the end of the month for an RRSP.
As I said, there are no guarantees for lower fees. The PRPP is not a defined benefit plan. It would not provide a secure retirement income with a set replacement rate of pre-retirement income and it would not be fully transferable. The plan would not be indexed to inflation and it would not increase with the increasing cost of living.
Employers, not employees, would decide the contribution levels. As I indicated, it would not be mandatory for employers to contribute or even match employees' contributions. Without employers' contributions, it is not really a pension plan. In fact, employers who do not help their employees save for retirement could end up with a competitive advantage over employers who do.
Canada does not need yet another voluntary tax-assisted retirement savings program. It needs public pensions that provide all Canadians with a basic guarantee of adequate income that will protect their standard of living in retirement.
Expanding the Canada pension plan would meet this objective. In fact, federal and provincial finance ministers seemed set to take this route when they assembled for their meeting in Alberta in December 2010. Only one province opted out. That gives us our 66%. Despite the fact that only one province opted out, the federal government decided to abandon talks and introduce this pooled registered pension plan scheme instead.
Improving the replacement rate of the CPP retirement benefit would provide much better retirement pensions to virtually all Canadians. A relatively modest increase in contribution rates would be required but that could be phased in over a period of time, as the Canadian Labour Congress and others have proposed. The CPP covers all workers, including those who are self-employed, and its benefits would be guaranteed in relation to earnings and years of service. They would be indexed for inflation and fully portable from one job to another.
This option would address the two key issues in the pension system that are currently causing concern: the lack of coverage of workplace pension plans and the fact that individuals are not saving for their retirement by themselves. As well, an expanded CPP, of course, could reduce federal expenditures on GIS because more people would have adequate retirement incomes. It would also benefit employers because it would be a clear pension plan and they need not be concerned about a private plan. It is a public plan and it has a lot of true and clear benefits.
While the government says that CPP contribution rates cannot be increased when there is a fragile economy, it is worth noting that when the financing of CPP was changed at the end of the 1990s, combined employer-employee CPP contribution rates nearly doubled, from 5.6% of covered earnings to 9.9% over that five year period, but unemployment fell from 9.6% to 7.6%. So there are other side benefits.
It should also be noted that PRPPs will do nothing to help the baby boom generation now coming up to retirement. It seems that this lost generation will remain lost as far as pension reform is concerned. As I said previously, it has been estimated that roughly one-third of Canadians now in the age group of 45 to 64 are likely to end up with incomes that fall far short of adequate minimum incomes and the kind of income that would allow them to maintain their standard of living in retirement. The adequacy of CPP benefits has been an issue for more than 30 years. It is time now for federal and provincial governments to set aside ideology and work together to solve the problem.
The study by the pension expert for the Canadian Centre for Policy Alternatives, Monica Townson, provides a thorough analysis of the PRPP and argues that expanding the Canada pension plan would provide better retirement pensions for virtually all Canadians. Ms. Townsend found that the expansion of the CPP would provide a mandatory defined benefit pension to virtually all Canadians, giving them a basic retirement income that, for modest and middle-income earners, would preserve their standard of living in retirement.
The government's PRPP proposal does not do this, not at all. It does not guarantee a pension, the benefits would depend on selection of investment and stock market performance and participation would depend on the employer deciding to take part. As I indicated before, the stock market took an 11% hit in the most recent economic downturn. People cannot afford an 11% economic hit.
The pooled registered pension plan is basically a defined contribution pension plan. In defined contribution plans, there are no guarantees as to how much money will be left when people retire. The risks are borne entirely by the individual employees. In these types of plans, the amount of money available at retirement depends on the outcome of investment in the stock market and people cannot rely on it. I have indicated that very clearly. Defined contribution plans lack the security of defined benefit pension plans, like CPP and QPP, which pay guaranteed set amounts on retirement. This is important to remember.
Bill places no caps on administration fees. It merely assumes lower costs will emerge through competition. Financial institutions, like banks, insurance companies and trust companies, stand to profit substantially from these fees. If we look at all those recommending this pooled registered pension plan, it is those with a vested interest, like financial institutions.
However, expanding the CPP-QPP would not cost the government any more than its proposed PRPP. Most important, expanding CPP-QPP would not entail transferring huge management fees to private financial institutions.
How can I get through to the government that seniors need to be protected? The PRPP would not help families drowning in debt. It fails because it is a voluntary defined contribution plan run by wealthy institutions. With a tenuous economy and high rates of unemployment, families do not need more risk. They need the stability of the CPP and QPP. Economists and provincial leaders have said so for years, but the out of touch government has turned its back on families. We need effective and fair pension reform.
We have validators for this. An editorial in the Calgary Herald of November 2010 stated:
The CPP already covers almost all Canadian workers and thus spreads the risk and management fees. It is fully portable, offers guaranteed income to all retirees, and is the only risk-free investment broadly available to workers. Private RRSPs and employer pension plans have proven much riskier than initially billed. Those who are in company pension plans are likely in a defined contribution scheme, where the amount that goes in is predetermined, but the payout is based on how well the fund is invested and ultimately performs. Nortel workers know only too well how that worked.
We know that Nortel employees in Canada have taken a beating because of the bankruptcy of Nortel. Many of those retirees are receiving a pension that is 40% less than they planned on and believed would be available. Anyone who was a disabled Nortel worker has lost all benefits. It is interesting to note, and the House should note it, that in the United States and Great Britain, when Nortel sold off its assets, there were billions of dollars in liquid assets. The Americans and the British protected their Nortel workers but in Canada there was nothing. Our government did not see fit to protect those pensioners. That is why it is so very important that we come up with a remedy that works.
Seniors have worked hard all their lives and have played by the rules. Now they simply want access to programs and services that their hard-earned tax dollars helped to make. Every senior in Canada has the absolute right to pension and income security. This bill would not provide the pension security that seniors today want and need, nor would it help them in preparing for their retirement.
It is time for real pension reform, not this sham perpetrated by the government. Bill would not accomplish any kind of security. Canadians do not need any more private voluntary savings schemes. They want real action to ensure they can retire in dignity.
I will say this one last time. Expanding the CPP and QPP would not cost the government any more than its proposed pooled registered pension plan. It would simply mean that there would be real retirement security. People deserve that. They have earned it.
Mr. Speaker, I am pleased to have a chance to speak to Bill , its inadequacies and the concerns that many of us continue to have here on this side of the House.
I have often referred to Bill as being nothing more than bread crumbs to a starving person because in reality that is all it is. I doubt very much that it would help very many Canadians. From everything I am hearing from the provinces and from other people who have looked into the issue, there would be big management fees and little help for people when it comes to serious pension reform. It would simply be a mechanism for those who have money to save for their own retirement. The government tries to call that its answer to pension reform. I am sure we will hear its solution to pension reform was PRPPs for the next five years or so, until it realizes that as Australia's plan failed, so would this one. While I have no difficulties with creating savings vehicles for Canadians, we must also work to help those without the means to save. That is what pension reform is really all about. Bill C-25 is not pension reform. Anyone who makes that claim is misleading the public.
Two years ago, I asked the government what it planned to do to protect and preserve pensions for all Canadians. The minister responded in this House by saying that pensions were provincial and should be left to provincial legislatures to deal with. He said pensions were not a federal problem. However, Canadians rightly found that notion to be wrong, short-sighted and clearly unacceptable. The Conservatives produced Bill which is a copy of an Australian proposal that, after 12 years, has been declared a failure. The government was sent into a scramble. It had to find something to satisfy the accusations that it was not doing anything so it came up with this idea.
I will cast my vote, as will my party, with very deep concern and caution because it is nothing more than bread crumbs to a starving person. However, it is that small tool in a toolbox. It is not the answer but we will support it because it is one small step in the advancement of talking and recognizing the need for pension reform in Canada.
In 1998, when the current was campaigning, he announced that he wanted to privatize the Canada pension plan. That is right, the Conservatives proposed the elimination of the public Canada pension plan. Just imagine where we would be today. Not only is the government talking about moving from age 65 to 67 in this current budget bill, and is clearly moving in that direction, imagine where Canadians would find themselves if we did not have the Canada pension plan or it had been privatized. All of a sudden their retirement plans would severely change.
Who knows if that is not the next shoe to drop in the big plans that the government has? Will the Conservatives decide they are going to privatize the CPP? I am not fear mongering, but who knows what is going to be next on the agenda of the government?
At the time, the government suggested that the CPP should be replaced with a super savings account that would allow Canadians to put all of their extra money into investments for their retirement. The government did not talk about the fact that most Canadians are not up to speed on how to invest in the stock market, that they can make poor choices and that their alternative would be to pay high management fees to people who have that expertise. This would be another way of discouraging Canadians from what they are trying to do. Canadians would have to become market experts. Their employer would be playing no administrative role in PRPPs. Canadians would have to bear 100% of that investment risk. A single market stumble could spell the end of any retirement hopes. We all know what happened with the investments a few years ago when the stock market crashed, and what happened to thousands of Canadians whose retirement income was lost.
The Conservatives talk about people working later. They are going to have to work later because they lost a tremendous amount of their retirement income. They do not have the expertise needed. They would need the expertise with PRPPs, to be able to manage a certain degree of their investments. Employers would be forced to create administrative systems to enrol members. If the provinces made them mandatory, and that is highly unlikely, Ontario, the province I represent, has already indicated it is not going to have anything to do with PRPPs. It does not believe this is the answer to the pension issue.
The proposal for an enhancement of the Canada pension plan, which is what we have been proposing, along with the supplementary Canada pension plan, which I will talk about a little further, are much more reasonable methods for most Canadians out there.
This PRPP will be of no help to homemakers unless they are contributing to employment income. One of the challenges facing many women today is that, when they are at home caring for children or elderly relatives, parents and so on, they are out of the workforce. When they are out of the workforce, they have a much more difficult time thinking about their pension and what will be in it for them. That is why unless they are in the workforce for 35 or 40 years, most women at 65, or 67 as the government is going to, end up with minimal income. They are living on $11,000 or $12,000. That is not the Canada I want to live in, and I do not think it is the Canada most people want to live in. Changing that age to 67 years old will certainly hurt a tremendous amount of people.
I had a meeting in Kemptville last night. There were about 60 or 70 people. When I asked the people there, who were a non-partisan group, to raise their hand if they supported moving the age of retirement from 65 to 67, everyone in that room opposed the change, and there were many Conservatives in that room. They did not feel it was necessary, but that it was part of an ideology of the government or because the Conservatives are starving the government for revenue sources by removing the GST and lowering taxes. The government only has so much money. That is probably the real reason: they are starving the beast we call the government. They will not have the money to give people pensions at age 65, so they want to move it up and take $30,000 out of the pocket of every Canadian over that two-year period of time.
As I indicated, the management fees are a big problem on PRPPs. We know that Canada has an F rating, according to the OECD. It says Canadians already pay some of the highest management fees in the world on their mutual funds. That is exactly where we are going with PRPPs, creating more vehicles for people to be able to do this.
However, the government knows all of this. We raised all these issues at committee. Our Liberal finance critic moved a couple of amendments that would have strengthened and improved the PRPP, which went nowhere. The Conservative members put their heads in the sand and voted down the amendments rather than possibly thinking that maybe together, because we were prepared to work with the government on this, we could strengthen it and make it better, recognizing that we need some pension reform. However, the government members do not care what everybody else offers. If it is not their idea, it is not good enough.
It is the same if we talk about some of the things in the budget. Look at the changes to EI and what impact they will have on Canadians all across the land. Never mind talking about where they are putting money into pensions. Many of these people will be forced to move away from their families to go out west, which is clearly where the jobs will be, starving other parts of Canada. Again, that is not the way we are supposed to be going. Canada needs to be a land where everybody is treated fairly and with a bit of respect and understanding.
What happens to the seasonal workers who are being brought into the country? Many of those seasonal workers are the reason we have a thriving industry when it comes to fruits, vegetables and so on. Canadian employers need those temporary foreign workers to come over and be able to do those jobs. We should not kid ourselves. There are lots of Canadians who physically do not want to do those jobs. I think they are quite happy to see these temporary foreign workers come over and work for six months in the agriculture industry or other industries and then go back to their home countries with some very much needed money, because many of these people are coming from countries that are very poor. Will we deny them that opportunity, again with short-sightedness and some of those issues that are in the budget, in Bill , that we will continue to deal with over these next few days that will hurt many Canadians and employers? It will hurt Canadians if that is the only work they have. It is not as if they do not want to work 12 months or 10 months of the year. They are seasonal workers. Who will be working the fisheries?
I remember the amount of people who told me they would love to work longer but the season is only so long, when I visited the east coast last year with one of my colleagues. Where are they supposed to go at the end of that particular point? They have to collect EI because they have no other options.
Some of the changes at second reading, which the Liberal caucus said it would have liked to put forward, were raised by many witnesses as additional ideas. However, when it comes to voting at the committee level, government members vote down anything anybody else suggests, no matter how good it is. The Liberal finance critic put a very good amendment forward on the issue of controlling high management fees, because that is a major concern for Liberals, one that would cap the management fees. There was a bit of discussion with government members, but it did not matter. They voted it down as they do everything else because it was not their idea.
Reducing government spending is a laudable goal, as we hear from the government. However, financial players offering PRPPs will need to offer annuities so that members may convert their accumulated balances into a stream of pension payments. Once that occurs, insurers are required by law to price in a profit margin and keep regulatory capital aside to underwrite those contracts. In simple language, this means that investors, the average Canadians the government is talking about, are legally required to pay fees that would guarantee a profit for the banks and insurance companies. This is a very inefficient way of delivering pensions, and once Canadians find out about all the small print, fewer and fewer of them and businesses will be interested in getting involved in all of this.
Those requirements are the cornerstones of the PRPP we are talking about. With this in mind, I am left to wonder how the PRPPs could possibly yield any results for Canadian pensioners. The simple answer is that they are not going to help the average Canadian prepare for retirement, just as millions of Canadians have not been able to max out their RRSPs either. It is just a locked-in RRSP. That is what the PRPP is. Forcing seniors to work longer and harder to save for retirement on top of asking them to pay for $6 billion in giveaways to the largest corporations, $13 billion for new megaprisons and $40 billion for untendered stealth fighter jet deals is not a plan for pensions. However, the government is certainly spending a lot of money and clearly it is looking to pay for all of these on the backs of Canada's seniors.
PRPPs will not work for those who need them the most. Instead of copying the failed work of others, why did the not seek to lift seniors out of poverty? The supplemental Canada pension plan already proposed by the Liberals would provide the best of both worlds. It would create a new retirement savings vehicle for Canadians who need it, while delivering the low overhead cost structure of the Canada pension plan.
The supplementary Canada pension plan is a simple and cost-effective solution to the pension question. It is a defined benefit pension for everyone who has a social insurance number, even those who have left the workforce during their lives for child rearing, illness, seasonal employment and educational advancement. It would use proven and existing resources to give every Canadian man, woman and child a reliable and stable investment vehicle for the future.
The supplementary Canada pension plan is a plan for real pension reform, and I offer it to the government at any time because it would benefit Canadians all across the board, no matter what their occupation. Even if they are home and not able to work, they could still contribute to the Canada pension plan. I could contribute to the supplementary plan. However, by steadfastly following their PRPP plan, by ignoring Liberal calls to improve the CPP, moving to slash the old age pension, slashing EI, cutting people off, making it difficult for farmers to be able to employ temporary foreign workers and all that goes with it, the Conservatives are really showing their true colours. Balancing the budget on the backs of seniors is nothing short of waging a war on the poor. It is unacceptable, and the government should be ashamed of that direction.
The , who is the sixth highest paid political leader in the world, earning an annual salary of $296,000 U.S., is telling Canadians to put their extra money into the bank for their retirement, but he seems to forget that not everybody has extra money. What about the seniors who pay their taxes, raise their families and work hard but still do not have extra money to invest?
Let me tell members about a woman named Mary, whom I met last night. She is a single woman who talked to me about income splitting. Yes, the income splitting idea is a good idea for all those who have money and who have a partner, but for single men or women who do not have anyone to share their pension income with, what help is it to them? Mary has to take the hit for the taxes that others get to save. She asked me why the government would do that when it is clearly unfair. I said she would just have to look around and judge for herself. Government is all about choices.
As a government, one makes choices every day and decides what is important and what is not. Clearly, this government's choices are far more interested in helping the rich and much less interested in helping the low-income or middle class Canadians, or in helping to build the Canada, Mr. Speaker, that you and I believe in.
The Prime Minister is the same man who said that the Canada pension plan should be scrapped in 1998, which I referred to earlier, and that government involvement in the financial security of Canadians runs counter to the Conservative ideology of fending for oneself. If one cannot fend for oneself, there is no room in the Conservatives' Canada.
That is very different from the Canada I want to live in. I believe we have an opportunity for a hand up, not a hand out. We can create an atmosphere where Canadians can thrive and do well. Canadians are a very independent, tough bunch of people. We are used to standing on our own feet, and we take great pride in that. I do not believe there are a whole lot of Canadians who are interested in living off the purse of the government.
Given the fact that the Prime Minister has made the kind of comments he has made, I have to wonder if these changes are not the first bricks in the long-desired firewall that the Prime Minister indicated he wanted to create.
I am very glad to have had the opportunity to speak for a bit today. The changes that are coming forward, both in Bill , the PRPP legislation, and in Bill , and all the things the government is moving are going in this direction, which is not an area to which I think we should be going.
We need to be making some changes as well to the Bankruptcy Act. We all know about Nortel and what happened to the thousands of people who were working for Nortel and in other companies that go bankrupt where individuals lose their pension funds.
There is no change. With all of the multitude of things in the omnibus Bill , there is nothing in there about how to protect people's pensions when it comes to bankruptcy, how to better protect Canadians. It is all about creating crisis management and making people think that the country is in a major crisis situation when it is not, whether or not we are talking about immigration issues and creating a crisis, in order to justify the means at the end.
It is unacceptable for us and it is unacceptable for Canadians.
Mr. Speaker, I am pleased to have this opportunity to speak to some of the key measures in Bill .
I will splitting my time with the member for .
First, I would like to thank the , the member of Parliament from the great riding of Macleod, for bringing forth this great legislation.
Our government understands that working Canadians and seniors want an effective and sustainable retirement income system that will help them achieve their retirement goals. Canadians who have worked hard, saved diligently and are relying on their pension and savings to support them once they retire should have full confidence that the system will serve them well when they need it.
Canadians can rest assured that our government stands with hard-working Canadians who are counting on their pension plan for a stable retirement. As part of this commitment, we continue to take the steps necessary to ensure that Canada's pension framework remains strong. In doing so, we are building on all that has been accomplished so far.
Let me offer a few examples of what we have achieved.
In particular, since 2006, our government has increased the age credit amount by $1,000 in 2006 and by another $1,000 in 2009. We have doubled the maximum amount of income eligible for the pension income credit to $2,000.
We have introduced pension income splitting. This single item was lobbied for very diligently for years by organizations like CARP and other organizations that represented seniors. It was well received when this came in.
We have increased the age limit for maturing pensions and registered retirement savings plans to 71 from 69 years of age.
Despite these advancements, there is always more to be done. That is why in December 2009, our government held a meeting with the provincial and territorial finance ministers in Whitehorse to discuss the retirement income system and, in going forward, how this system could be further improved.
In June 2010, federal, provincial and territorial governments reviewed options to improve Canada's retirement income system after extensive consultations with Canadians. Many of the members of the opposition will be interested to know that among these proposals was a modest expansion to the CPP, the Canada pension plan.
However, many employers, especially small and medium-sized businesses, something my riding has hundreds of, raised serious concerns about increasing the mandatory deductions that would come with an expanded CPP. Simply put, during these times of economic uncertainty and with Canada's economic recovery still fragile, it would have been reckless to impose a job-killing tax on job-creators.
While there were strong objections to expanding the CPP, there was unanimous agreement to moving forward with pooled registered pension plans. This led to priority being given to the PRPP framework, the announcement of the initiative at the subsequent finance ministers' meeting in December 2010 and the legislation that is before us today.
PRPPs mark a significant step forward in advancing our retirement income agenda by improving the range of retirement savings options available to Canadians. They will make well-regulated, low-cost private sector pension plans accessible to millions of Canadians who have up to now not had access to such plans. In fact, many employees of small and medium-sized businesses and self-employed workers will also now have access to a private pension plan for the very first time. This is groundbreaking. This will be a key improvement to Canada's retirement income system.
PRPPs will also complement and support our government's overarching objective of creating and sustaining jobs, growth and long-term prosperity. Quite simply, the PRPP framework is the most effective and targeted way to help these modest and middle-income individuals save for their retirement. These individuals consist of the 60% of Canadians who do not have access to employer-sponsored pension plans.
PRPPs address this gap in the retirement system by first providing a new, accessible, straightforward and administratively low-cost retirement option for employers to offer their employees. It would allow individuals who currently may not participate in a pension plan, such as the self-employed and employees of companies that do not offer a pension plan, to make use of this new option. It would enable more people to benefit from the lower investment management costs that result from membership in a large pooled pension plan. It would allow for the portability of benefits and facilitate an easy transfer between plans, and it would ensure that funds are invested in the best interests of plan members.
These are all important areas where the retirement income system can be improved. However, members need not take my word for it. Let us hear what others have to say.
According to the Canadian Bankers Association:
PRPPs will provide a new, accessible, large-scale and low-cost pension option to employers, employees and the self-employed. PRPPs will give all working Canadians the benefit of professionally-managed pension plans, and will be particularly beneficial to the self-employed and employees of small businesses.
I can speak to that as someone who was a self-employed farmer before I came to this House. My only pension at that time was my land, or whatever I could accumulate over the years. It was the same with my parents. There are hundreds of thousands of Canadians in the same boat, and they are going to get a chance to benefit from this great initiative.
The Canadian Federation of Independent Business says:
PRPPs can give many businesses, individuals and the self-employed additional retirement options, and many millions of Canadians who currently lack adequate retirement savings will benefit.
That is why our government, in coordination with the provincial and territorial governments, is working to implement PRPPs as soon as possible. These plans would help Canadians, including the self-employed, meet their retirement objectives by providing access to a new low-cost accessible pension option.
I am sure that all the provinces will take the advice of the CFIB, the Canadian Chamber of Commerce and the CBA when they jointly said that the longer governments take to establish a system of PRPPs, the less time those employees will have to use this vehicle to save for their retirement. Simply put, we need to act now.
Bringing the federal PRPP framework into force means Canadians can be confident about the long-term viability of their retirement system. We are listening, and we will continue to listen to their views on how we can strengthen the security of pension plan benefits and ensure that the framework is balanced and appropriate for the long term.
Canada's retirement income system is recognized around the world by such experts as the Organisation for Economic Co-operation and Development, or OECD, as a model that succeeds in reducing poverty among Canadian seniors. With Bill , we are making it better by working toward a permanent long-term solution to encourage greater pension coverage among Canadians.
I know that members on this side of the House will support Bill and vote to establish a pension plan that would help millions of Canadians save for their retirement. I encourage all the members of the opposition to support this very important bill and to vote to help the seniors of tomorrow provide for their retirement today.
I remind all members that a lot of legislation, whether government legislation or private members' bills, comes before this House. Not all of us in this place like every aspect of every bill, but the potential of Bill to help people plan their retirement is something that is certainly needed and has been wanted for a long time. I think that all members in this House should look at the quality parts of the bill. It is an improvement to what we have today, and I think it will be very well received out there among seniors.
Mr. Speaker, let me just take a moment to thank the hon. member for for sharing his time with me. The good people of Bruce—Grey—Owen Sound are fortunate to have such a passionate and hard-working member of Parliament speaking here in the House on their behalf.
I am pleased to have this opportunity to highlight some of the key measures in Bill , an act that implements the federal framework for pooled registered pension plans, or PRPPs, as I will refer to them.
Our Conservative government understands that hard-working Canadians want an effective and sustainable retirement income system in place to help them achieve their retirement goals. On this side of the House, we believe that Canadian seniors, after working hard, contributing to society and saving diligently, deserve nothing less. Members can rest assured that our Conservative government stands with these hard-working Canadians and that it will continue to take action to ensure that Canada's retirement income system remains among the strongest in the world. This is where pooled registered pension plans fit in.
The PRPP will mark a significant step forward in advancing our retirement income system by improving the range of retirement savings options available to Canadians. It will make low-cost, broad-based private sector pension plans accessible to the millions of Canadians who up to now have not had access to such plans. In fact, it is important to note that currently 60% of Canadians do not have access to a workplace pension plan. Self-employed individuals do not have access to workplace pension plans at all. Introducing pooled registered pension plans means that many employees of small and medium-sized businesses, as well as self-employed workers, will finally have access to a workplace pension plan for the very first time in their lives.
Let us take a look and see what features of the PRPPs might be found attractive by employees of small and medium-sized businesses and by the self-employed.
A key feature of PRPPs is auto-enrolment. This means that if an employer offers a PRPP, employees will be automatically enrolled in a pension plan. This feature is expected to increase participation in PRPPs by promoting retirement savings specifically targeting those disengaged savers.
Once plan members begin contributing to their PRPP, it is important that they use this money for what it was intended: their retirement. After all, the goal of the pooled registered pension plan is to help Canadians save for their own retirement. Unlike the funds in RRSPs, which can be accessed at any time, the funds in a PRPP would be locked in. This provision will help to ensure that plan members will in fact have savings when they retire.
Another key feature is portability. Many employees will appreciate the ability to transfer funds between administrators when they change jobs. Not only will portability benefit employees of the plan; it will also increase competition among PRPP administrators, thereby encouraging lower costs.
This leads me to my next point, and it is a very important one. One of the key benefits of PRPPs is that they will be low cost. By achieving lower costs, pooled registered pension plans will leave more money in the pockets of Canadians when they retire.
Members might ask how this will work. Pooling pension savings means that the costs of administering the pension funds will be spread over a larger group of people. This will enable plan members to benefit from the lower investment management costs that are typically associated with an average mutual fund.
Stakeholders across our nation are excited about the pooled registered pension plans and the prospect that millions of Canadians will now have access to a workplace pension for the very first time.
However, let us not just take my word for it. Let us hear what others have to say.
Dan Kelly, Vice-President of the Canadian Federation of Independent Business, stated, “A new voluntary, low-cost and administratively simple retirement savings mechanism will allow more employers, employees, and the self-employed to participate in a pension plan”.
If we are not satisfied with that, let us hear what the Ontario Medical Association had to say. It stated, “The creation of pooled registered pension plans...levels the playing field by providing the self-employed, including physicians, with better access to additional savings opportunities that have up until now been unavailable”.
The pool registered pension plan is not some patchwork scheme. It is an important program that would benefit millions of Canadians. Whether people work for or own small businesses, the pooled registered pension plan would be available to them.
What are the next steps? The bill before us today, Bill , the pooled registered pension plans act, represents the federal portion of the PRPP framework, which is a major step forward in making these available to Canadians. Our government has been collaborating closely with the provinces to implement pooled registered pension plans across our country. Once the provinces put in place their PRPP legislation, the legislative and regulatory framework for PRPPs would be up and running, allowing pooled registered pension plan administrators to develop and offer plans to Canadians and their employers.
Canadians want their governments to act on their priorities and deliver results on a timely basis. The PRPP should be no exception. For this reason, I urge all of the provinces to follow the wise advice of the Canadian Chamber of Commerce, the Canadian Federation of Independent Business, and the Canadian Life and Health Insurance Association when they collectively said that the longer governments take to establish a system of pooled registered pension plans, the less time those employees will have to use this vehicle to save for their retirements.
Our government is confident that the provincial side of the framework will soon be in place so that millions of Canadians can reach their retirement objectives. We urge our provincial counterparts to take action and follow the lead of our Conservative government. By bringing the PRPP framework into force, Canadians can be confident about the long-term viability of their retirement system. We are listening and we will continue to listen to their views on how we can strengthen the security of pension plan benefits and ensure the framework is balanced and appropriate for the long term.
Canada's retirement income system is recognized around the world by such experts as the Organisation for Economic Co-operation and Development as a model that succeeds in reducing poverty among Canadian seniors. Our system is the envy of the world. With Bill , we would be making it even better by working toward a permanent, long-term solution to encourage greater pension coverage among Canadians.
Let me summarize this new defined pension plan. It would be available to employers, employees and the self-employed. The PRPP would improve the range of retirement savings options to Canadians in a number of ways. It would provide access to a straightforward retirement savings option for employees at administratively low cost and it would provide people who currently do not participate in a pension plan a retirement savings option. More people would benefit from the lower investment management costs that result from the economies of scale of membership in large pooled pension plans, employees would be able to move their accumulated benefits from job to job and the PRPP would ascertain that funds are invested in the best interests of the plan members.
I urge all members of the House to support this very important bill. At this time, I move:
That this question be now put.
Mr. Speaker, like the other hon. members, I am going to give a speech on the pooled registered pension plans act. I am going to share my time with the member for .
First, I would like extend my thanks to the member for , the NDP critic on this bill. Second, I would like to thank all the hon. members for their various comments on the government bill that we are debating today at third reading. This is a very important topic, one that Canadians are really concerned about.
As we heard earlier, according to the Conference Board of Canada, 1.6 million seniors live in poverty in Canada, and, according to the Canadian Labour Congress, 12 million Canadians lack a workplace pension plan. This is food for thought.
It is amazing to see how two events can be interrelated. Today we are going to debate a special bill tabled in this House by the less than 24 hours ago. According to the representatives from Teamsters Canada, this special legislation infringes on the freedom to negotiate working conditions. You may wonder how this legislation is related to pooled registered pension plans. Well, the Canadian Pacific conflict basically has to do with pensions and management's wish to revise the system in order to keep up with its competitors.
The vice-president of the Teamsters Canada Rail Conference said the company “wants to take the money from our pension plan and give it to the shareholders”. In a democratic country like Canada, the right to retire in dignity after working your whole life is absolutely non-negotiable. So, yes, that is what we are talking about today.
Since 2006, the Conservative government has been introducing measures to amend Canadians' retirement security; these measures have been highly criticized. Just look at the retirement age, which will go from 65 to 67 in 13 years, when people who are 54 now will be 67. Why introduce this measure when in 13 years there will be less demand? Fewer people will be taking their retirement in 13 years than now. The baby boomers will have already retired by then.
Another measure they implemented was the tax-free savings account. The TFSA may be a good option for those who have the money to contribute to it. There is some debate as to whether the contribution limits should be increased from $5,000 to $10,000. Nonetheless, what is the purpose of this vehicle? According to a recent report by the Canadian Centre for Policy Alternatives, an ING Direct survey found that only 41% of Canadians have a TFSA. Nearly half of them earn $100,000 or more a year and only 24% of those surveyed said that they were using their TFSA to save for their retirement.
I have a TFSA. I was contributing to it bit by bit and it currently has $1,700. In fact, it is money I was saving for a rainy day: in case my washing machine or refrigerator broke down or something. I never considered using the TFSA for my retirement. I was earning a modest income and I never thought that $1,700 would go very far in providing me with a comfortable retirement.
We cannot rely on such savings to provide a decent retirement. I often wondered why the government developed such a measure. The government collects less tax, which leaves less money for investing in repairing bridges, ports and airports, in research and development or even in transfers to the provinces in their areas of jurisdiction. After I thought about it, I remembered that, previously, taxing the savings of the rich and the not so rich resulted in the flight of capital and the use of tax havens. That is quite likely why TFSAs exist: to keep our currency in our banks.
It is time for this government to take some real action to improve retirement security for the 12 million Canadians who do not currently have pension plans through their employers. Bill will not accomplish that goal. Canadians do not need another voluntary private savings plan. They need real measures that will ensure that they can retire with enough savings to live through their old age with the money they need to be able to dress, house and feed themselves. These are basic needs.
Canadians are wary, and rightly so. Pooled registered pension plans are risky. With this kind of plan, employees set aside funds throughout their entire working lives, and those funds are invested in stocks, bonds, mutual funds and so on. Investment income depends entirely on market fluctuations. Thus, employees are the ones who absorb all of the financial risk associated with stock market ups and downs.
In addition, clause 30 of the bill states:
30. An employer is not liable for the acts and omissions of the administrator.
So, can someone tell me who is liable?
On the one hand, workers are obliged to contribute, while employers, on the other hand, are not, and the funds are subject to stock market fluctuations.
Can someone tell me who assumes the risk, if not the worker?
Quebeckers remember all too well certain recent predators, the kind we call white collar criminals. Some institutions get bad press because they are making huge profits, which they give out as bonuses at the end of the fiscal year.
The NDP wants to increase CPP contributions. We support a pension fund for all Canadians. It is time to get to work on that. However, we do not want a pension fund that fluctuates with the stock market and where workers' savings will diminish when it is time for them to retire.
We are asking that the government secure Canadians' pension funds.
Why does the government not want to study this solution even though seven provinces have agreed to expand the Canada pension plan?
The NDP is being proactive and working on job creation so that Canadians can save. The more workers earn, the more they can save.
The PRPP bill does not provide a fixed benefit, could run out of money if we live longer than expected and is not indexed. Employers and employees can withdraw from the plan, but companies are not required to contribute.
Mr. Speaker, I am proud to stand here, along with members of my party, to express our opposition to Bill and speak to how this is a hasty attempt by the government to cobble together what the Conservatives say is an effort toward establishing retirement security.
However, we see it as just that, a hasty attempt and one that deviates from the real issue here and the kind of lack of retirement security that Canadians are facing and the way in which the government is weakening the foundations of our retirement system in Canada. I will say a few words specifically on this bill today and get more into that later.
The legislation would not guarantee an actual pension. We would like to refer to it more as a savings scheme. Among other things, the bill would create a type of savings scheme that would pool the funds in members' accounts to achieve lower costs in relation to investment management and plan administration. As we know, these savings schemes are being called pooled registered pension plans.
The bill is designed to appeal to the self-employed and workers at small and mid-sized firms and also companies that often lack the means by which to administer a private sector plan. All of the things that have been said as being key goals of the government, we find the bill misses the mark.
Our position is that Bill fails to protect retirement security because it encourages families to gamble even more of their retirement savings on failing stock markets. People who have watched their RRSPs plummet over the past year know how risky savings tied to the stock market can be. Telling families to double down on the same system that is already failing them shows how out of touch the government is.
We know the Conservatives are not fond of learning from history, facts, science, et cetera, but we can simply look at the most recent history. We know that this attempt to establish retirement security would make Canadians and their savings more vulnerable. In today's global markets, that is an unacceptable proposition. We would like to see the government say no to encouraging greater vulnerability and yes to more stability when it comes to retirement savings.
For the past three years, our party has championed a suite of retirement income security proposals. We have proposed doubling guaranteed Canada and Quebec pension plan benefits to a maximum of $1,920 each month. Growing the CPP and QPP is simply the best and lowest cost pension reform option available. Research has indicated that and advocacy groups that speak on behalf of seniors have indicated that. We have suggested that working with the provinces to build in the flexibility for individuals and their employers to make voluntary contributions to individual public pension accounts is also critical. The provinces have explicitly stated that they want to come to the table and work with the federal government in order to establish greater retirement security for Canadians.
We have proposed amending the federal bankruptcy legislation to move pensioners and long-term disability recipients to the front of the line of creditors when their employers enter court protection or declare bankruptcy. Numerous times a year, we are seeing large employers just pick up and leave. It is all the workers, particularly the more vulnerable workers, who are ultimately paying the price by losing the investments they made into their pension system and facing a very challenging future.
We have proposed increasing the annual guaranteed income supplement to a sufficient level to lift every senior in Canada out of poverty immediately.
All of those measures have received incredible accolades from various organizations, from stakeholders, from seniors and from people who are looking ahead at their retirement prospects. They have said that they want to see these kinds of proposals put into action by the government.
I will read some of what has been said. Ms. Susan Eng, the vice president for advocacy at CARP, an organization that is outspoken when it comes to retirees in Canada, said:
CARP remains committed to improving retirement benefits for the current crop of seniors, including increasing CPP, OAS and GIS payments, getting a moratorium on RRIF withdrawals, making access to Tax-Free Savings Accounts retroactive and lobbying to remove the HST on seniors’ energy bills.
These are a number of very progressive measures. We have not seen the government take leadership when it comes to a variety of these measures.
If we turn to what we are looking at more broadly, it is the way in which the government is weakening the foundations of our pension system. We do not have to look much further than the budget the government tabled some short weeks ago. In fact, the changes to OAS will have a direct impact on seniors, many of whom are already struggling.
As the status of women critic, I know particularly the devastating impact that the changes to OAS will have on many women, for whom OAS is an income they are dependent on at a time when many of them face a situation of poverty. We are looking at that and the way in which the government is standing by and allowing corporations to pull out of Canada, pulling away from agreements they have made with Canadians.
I think of Vale in my hometown of Thompson. It committed to the federal government to increase employment. However, instead of creating jobs, it is pulling out the value-added jobs in our community, and the government has done nothing to stop it.
I think of Hamilton where the workers at Stelco, now U.S. Steel, were dealt the blow when their jobs were shipped away from Canada. The government went as far as to take U.S. Steel to court and then withdrew the case even though it had grounds to keep going.
That is the way the government treats Canadians who are simply contributing to our economy, raising families and building communities. Many of them are investing in a pension system that the government is seeking to take away.
On a host of measures, the government has stood by while jobs have been shipped out. It has taken direct action to attack our pension systems. It has gone so far as to say, actually a misnomer, that somehow our pension system, whether it is CPP or OAS, suffers from instability. This is something that researcher after researcher has indicated is simply not the case. In fact, the Parliamentary Budget Officer stated the very same thing on numerous occasions. Yet the government fails to accept the research, fails to accept the proof and instead further exposes Canadians to greater vulnerability, to a future where poverty and impoverishment at a senior age is a reality.
Perhaps the saddest of impacts will be on my generation, a generation that is just a few years into the workplace, if people have been able to find a decent job, many of whom are unable to invest in a proper pension system and simply do not have the supports to do so.
Instead of having a government that will stand by and seek to strengthen our public pension system, a universal pension system that supports all Canadians, it is standing by and making life more difficult for future generations, for seniors of today, for people who are looking at their retirement and hoping to see a government that is going to stand up for them. Unfortunately, that is not what we have in the Conservative government.
I am proud to be part of a party, the NDP, that has always been at the forefront of fighting for true retirement security and dignity for all Canadians.