The House resumed consideration of the motion that Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act, be read the second time and referred to a committee.
Mr. Scott Duvall (Hamilton Mountain, NDP):
Madam Speaker, it is my privilege to rise today to speak to Bill C-26, an act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act. Bill C-26 would amend the Canada Pension Plan Act to incorporate the recent agreement reached between the provinces to enhance CPP benefits.
While better was possible, and the full effect of the changes will not be felt for another 49 years, this CPP expansion is an important first step in improving retirement security for young Canadians, and we congratulate everyone, especially labour, who worked so hard to lay the groundwork for this agreement.
We must now see immediate action to help those seniors and Canadians on the cusp of retirement who will not benefit from these changes. Government must build on the momentum of this agreement and take steps to improve long-term retirement security for today's workers.
Retirement insecurity is reaching a crisis level in Canada, as many Canadians do not have adequate savings to maintain their lifestyle upon retirement. A large part of this problem is fuelled by the erosion of workplace pension plans, to the point that six in 10 working Canadians have no workplace pension.
During election 2015, the Liberals promised to enhance the CPP. Once elected, the Minister of Finance was directed in his mandate letter to:
|| Meet with your provincial and territorial colleagues at your earliest opportunity to begin a process to enhance the Canada Pension Plan to provide more income security to Canadians when they retire.
The Minister of Finance met with his provincial and territorial counterparts in June 2016 and on June 20 announced an agreement in principle on CPP enhancements.
On October 4, 2016, British Columbia was the final province, besides Quebec, to officially endorse this agreement. Bill C-26 was introduced on October 6. Quebec did not sign the agreement but promised to apply some of the changes to the Quebec pension plan, which is similar to the CPP but is managed independently.
The NDP will support the bill at this time, but we feel that the bill does not live up to the expectations Canadians had for CPP reform.
Changes to the plan have been a long time in the making. The last time the CPP was altered was in 1997, although those changes were largely administrative. The most significant change in the 1997 amendments was to move the plan from a pay-as-you-go system to fully funded. This change was done to help protect the financial viability of the plan, and a recent report by the Chief Actuary of Canada shows a healthy fund that will be solvent for at least the next 75 years.
However, during a time when workplace pensions cover fewer and fewer Canadians, when Canadians have been finding it harder and harder to put away money for retirement, and when the rates of seniors living in poverty have steadily increased, there have been no increases in benefits under the Canada pension plan.
Many Canadians held out great hope that the government would make substantial changes to the CPP. Sadly, as with many Liberal promises, we are offered a loaf of bread but receive only half a loaf.
Ken Neumann, national director of the Canadian Steelworkers, summed it up very well when he said that the Liberal government's plan for a modest CPP expansion falls well short of the doubling of CPP benefits advocated for by the United Steelworkers and the Canadian labour movement. The USW is nonetheless pleased that the provinces and the federal government have agreed to a universal expansion of the CPP that will help all workers, and it will continue to push for full doubling of CPP benefits.
New Democrats, along with many in the labour movement and groups working for the rights of seniors and retirees, have long advocated that benefits be increased from replacing 25% of a worker's pre-retirement income to 50% of pre-retirement income, but no, this legislation has offered up a very modest increase, from 25% to 33% of pre-retirement income.
Although we like to see an increase, we feel that the amount is wholly inadequate, especially in terms of ensuring that our seniors do not have to live in poverty and can retire with the dignity and quality of life they deserve.
While many would be happy to finally see some changes to the plan and some increases in benefits, there are many who will be very unhappy. Those are the people who will see very little or no benefit from the changes presented in this bill.
More and more, I am hearing a lot of confusion and misunderstanding concerning who would benefit from the changes being proposed. A recent Ipsos poll found that over 25% of those who are already retired believe they would see bigger CPP cheques as a result of the deal, and more than 70% of Canadians do not realize that current retirees get nothing from this CPP expansion. These findings are totally consistent with what I have been hearing. Many retirees in my riding have asked me when they will be receiving their increased benefits. I have to break the bad news to them that this new legislation will do nothing for current or soon-to-be retirees.
The enhanced expanded CPP is a plan that would benefit a new generation of workers entering the workforce, but does little to alleviate the retirement income crisis for those approaching retirement. Those who would be the first to benefit from the fully enhanced benefits under this plan are now 16 years old. It will take 49 years for this plan to fully kick in. After the increase in premiums are fully phased in, in 2025, a person would have to pay the increased premiums for 40 more years to be fully eligible for the new maximum benefits. Increased benefits will be prorated for those 40 years as people pay the increased premium, but any significant increase for retirees is years away.
Let me take some time to talk a bit more about the specifics of the plan. Currently, the CPP covers earnings up to a cap of $54,900. For earnings up to the cap, the CPP aims to replace about 25% of that income. The maximum pension comes in at about $1,092 a month, or $13,100 per year. Contributions are 4.9% each for the employer and employee, up to the same cap.
The expanded CPP is a new separate tier. This new tier is added on top of the existing CPP. The new CPP tier does two things, phased in over the next nine years to 2025. First, it takes the replacement rate of up to 33.3% from the current 25%; and, second, it expands the upper earnings cap from today's $54,900 up to $82,700.
When the plan is fully phased in, in 2065, a worker who earns $54,900 would receive a maximum annual pension of about $18,117 by the time he or she retires. For a worker at an $82,700 income level, CPP benefits would rise to a maximum of $20,352 a year. Once the phase-in period is reached in 2025, it would take 40 years for a person to receive the fully enhanced benefit. Therefore, the first worker who will be eligible for full benefits is currently 16 years old. A person who is 59 in 2019, pays six years of the enhanced premiums, and retires in 2025 at the age of 65, would receive no additional benefit, or maybe a dollar or two.
It is important to note that much of the discussion about pension benefits relates to maximum benefits, yet only 11.4% will actually receive the maximum CPP benefits. The average benefit announced as of July 2016 was $550. In order to pay for the increase in benefits, contributions from employees and employers will increase. This increase would be phased in between 2019 and 2025. There will be two tiers to the increase. Between 2019 and 2025, those earnings which are less than the yearly pensionable maximum earnings, currently $54,900, would see their premiums slowly rise to an additional 1%. Those workers and employers would then be paying at a rate of 5.9%, up from 4.9%. In real numbers, this means that a person whose rate is set at the maximum would pay an additional $43 per month, as would his or her employer.
The second tier increase would be phased in over two years, starting in 2024. For anyone earning above the yearly pensionable maximum, theirs and their employer's contributions will rise by 4% above the current.
I know this is all very confusing, and it is going to take some time for Canadians to understand the complexities.
The bill also would make some changes to the Income Tax Act, which is supposed to help minimize the impact of the premium increases on Canadians. The CPP premiums that a worker currently pays are treated as a tax credit. An individual is able to claim a percentage of premiums paid as a non-refundable tax, which is then deducted from total federal tax payable. This would not change. These contributions would now be considered as base contributions but will still be treated the same for income tax purposes.
The increased benefits that a worker would be paying in 2019 and thereafter will be considered as additional contributions and will be treated differently for tax purposes. A worker will be able to deduct the amount of the additional contribution directly off their taxable income instead of applying for it as a credit.
The government has also included changes to the Income Tax Act in the bill that would increase the working tax benefit by 14%. The intention is to minimize the impact of increased CPP premiums on low income workers. Employers would be able to write off the increases on the CPP as a business expense, as they do now with the base contributions.
Now I would like to talk briefly about Canada's retirement income system, which is based on three pillars. These pillars are also supposed to interact or work together and are intended to enable seniors to maintain a reasonable standard of living in retirement. The first pillar includes standardized and universal public benefits, such as old age security and the guaranteed income supplement.
The second pillar includes mandatory public workplace coverage, the Canada pension plan and the Quebec pension plan. Almost all working Canadians over the age of 18, earning more than the minimum amount of $3,500 per year, must pay into this. It is mandatory for employees and employers, as deemed by legislation. Contributions are split evenly between the employee and the employer, or borne fully by someone who is self-employed. The amount depends on a person's income.
The third pillar consists of an employer or a union-sponsored plan, known as the registered retirement plan. They are registered with the Canadian Revenue Agency and one of the pension's regulatory authorities, because they are subject to government support in the form of special tax measures and regulatory oversight. This pillar also includes registered retirement savings plans and other personal savings.
The problem for today's seniors is that these pillars are falling behind in terms of enabling seniors to maintain an adequate standard of living. Dramatic increases in the costs of things like electricity and housing are causing great strain on seniors' fixed incomes. Failing to take action now will have a great social cost, forcing many seniors into poverty. The number of seniors being forced to use food banks will rise dramatically.
Studies point to a looming crisis in the retirement income security of Canadians. A recent study by Richard Shillington, done for the Broadbent Institute, shows a large percentage of older working Canadians are heading into retirement without adequate savings to keep them out of poverty. The report goes on to say that half of Canadian couples between 55 and 64 have no employer pension plan between them. Of those, less than 20% of middle-income families have saved enough to adequately supplement government benefits and the Canada or Quebec pension plan. Income trends suggest that the percentage of Canadian seniors living in poverty will increase in the coming years, especially for single women who already face a higher than average rate. The poverty rate for seniors will climb at the same time as a sharply rising number of Canadians hit retirement in the next two decades. More than 20% of the population will be older than 65 within 10 years.
When releasing the report for the Broadbent Institute, Rick Smith, executive director said, “This new data on retirement savings and gaps in support makes one thing perfectly clear - we have a retirement income crisis on our hands that requires requires urgent government action now..”.
Increases in the guaranteed income supplement and these eventual increases in CPP benefits will certainly help, but much more needs to be done to help our seniors live with the dignity they deserve.
The high cost of housing and drugs, the clawback of the GIS, and the indexing of pensions are just a few immediate issues. The government needs to keep its promise to introduce a new seniors price index to make sure that the old age security and the guaranteed income supplement keep up with rising costs.
The NDP will fight for further increases to the GIS and the OAS, a national pharmacare program, and, as well, programs to enhance home care and palliative care. Much work needs to be done to ensure that workers can retire with adequate incomes and access to the services they need to meet their quality of life.
The NDP will continue to work with our labour allies, and others, to improve the lives of Canadian seniors and retirees.
Mr. Kevin Lamoureux (Parliamentary Secretary to the Leader of the Government in the House of Commons, Lib.):
Madam Speaker, I want to indicate what a privilege it is to be able to stand in my place and talk about one of those fundamental issues that I believe Canadians as a whole are very supportive of. If we look at what would ultimately happen through Bill C-26, I would encourage all members of all political parties to recognize the historic agreement that was achieved by the Minister of Finance and the government, and to recognize that by voting in favour of Bill C-26.
The previous Conservative member posed a question in regard to the Minister of Finance by saying that the Minister of Finance wrote a book and in that book he said that raising CPP is not going to get rid of poverty for seniors. What the member does not make reference to is that the very same Minister of Finance brought forward a 10% increase to those poorest seniors in Canada by increasing the guaranteed income supplement. That will have a profound positive impact for seniors in the most significant way.
In fact, I would challenge future Conservative speakers on this issue to give me an example of a Conservative policy where they have seen such a substantial increase to Canada's poorest seniors. They would be challenged to find that. That is one of the reasons why, when we look at a policy announcement such as what we are seeing today in a very formal way in the House of Commons, we should always look at it as just one component in terms of dealing with seniors.
Let me now start with something that needs to be said. We campaigned about real change, primarily because one of the things we realized with the former Harper government was that it had lost touch with Canadians. The Conservatives in that government did not understand what Canadians wanted and expected of the government. There are a number of things that we could talk about. I could talk about the outstanding performance by our Minister of Health fighting for health care here in Canada, something which the former government did not do. Canadians see that as a positive. The Conservatives did not understand that. They did not understand what Canadians wanted.
The same principle applies here, where I can clearly demonstrate that of the Conservative Party, not only of the past but of what appears today. Now I will wait to see what happens when the vote actually takes place, but if the Conservatives want to demonstrate that they are listening to Canadians, I would suggest that they really need to support the bill.
Bill C-26 is something that is of a historic nature. It is not easy to get all the different stakeholders together and get an agreement of this nature that would see more money going into the pockets of seniors when they retire. Once implemented, it would be a significant amount of money.
Decisions of this nature do not happen overnight. I was pleased that my New Democratic colleague made reference to others, and how they actually participated in achieving what we have achieved. This is not solely a Liberal initiative. We know different stakeholders not only from labour but also from business have presented and commented on the importance of a Canada pension program. It actually reaches out to the individual, to the corporate body, to our union body, to political entities, and to many different stakeholders.
I said in the past how much I appreciate the fine work that many unions do in terms of advocating far beyond what their core responsibilities are. They think ahead not only for the individuals they represent within the unions, but often way beyond those individuals by talking about the importance of increasing CPP. I have heard presentations of that nature from members of union executives for many years. That is why when I stand up today I say that this is really good stuff.
Our Prime Minister mandated our members of Parliament on this side, even when he was leader of the third party in opposition, to represent their constituencies here in Ottawa, and it was a change. It was part of that real change, because under the Harper government, more often than not, what we saw was Ottawa being represented inside the constituencies. However, we want to see MPs representing the interests and thoughts of their constituents in this chamber, in the committee rooms, in subcommittees, when talking within caucus walls, and so forth. Bill C-26 is a reflection of that.
In essence, Bill C-26 is saying that we believe the workforce in Canada today is going to require additional money when it comes time for pensions. It is no surprise to me, personally, and I suspect that the vast majority of members of Parliament will not be surprised by that.
I remember sitting on the opposition bench arguing that we needed to do more with regard to supporting our seniors. I introduced petition after petition on this very issue, that Canadians expected us to do more. Many, if not most, probably even all of those petitions on the issue of CPP, GIS, and OAS came from residents that I represent in Winnipeg North. They wanted to see a government take action, support those pensions, and expand those pension programs where we could.
The Prime Minister gave a clear indication to the Minister of Finance that we wanted to achieve an agreement on expanding the CPP. I am forever grateful that our Minister of Finance was so successful at achieving that agreement, because it is something the government alone cannot do. We needed the co-operation and the understanding of provinces in order to make that happen.
I remember sitting on the opposition bench and feeling somewhat frustrated, because I would hear, for example, the Province of Ontario saying that it wanted CPP to be increased, but the feds were not interested. The feds at that time, with Prime Minister Stephen Harper, said that they were not interested. The former prime minister had no interest in increasing the CPP. In fact, he was quite prepared to see individual provinces go alone on that.
Members will remember that I said “losing touch with Canadians”. Had the then-prime minister, Stephen Harper, listened to what Canadians wanted on the CPP file, he would have found that Canadians were concerned about their ability to be able to retire and the earnings that they were going to be receiving, and that they supported en masse the need for that increase. However, the then-prime minister did not recognize that.
At the end of day, this is why I talked about the issue of real change at the beginning of my speech. It is because that is what we are seeing in the legislation before us, and members have the opportunity to participate in that real change,
There was a different attitude with the former Conservative government with regard to the CPP. We have taken a complete 180°. The Government of Canada is now saying that it wants to increase CPP and we have taken the necessary action by presenting the bill today.
I have provided some comment in terms of the number of consultations just the Department of Finance alone had. However, individual members of Parliament have also listened to many stakeholders, whether from labour, business, or indigenous people. Some individuals have taken the time to write or correspond through the Internet, or had face-to-face discussions at free meetings throughout this country on important taxation and policy ideas. I suspect members will find that many of those discussions were about the CPP, as I know that I have had many discussions on that particular issue.
Those discussions were then presented to the provinces in Vancouver on June 20, where the agreement was actually accepted. Because of that agreement, we now have Bill C-26.
In the bill's summary, we find that it would do the following:
||(a) increase the amount of the retirement pension, as well as the survivor’s and disability pensions and the post-retirement benefit, subject to the amount of additional contributions made and the number of years over which those contributions are made;
||(b) increase the maximum level of pensionable earnings by 14% as of 2025;
That is a significant increase.
||(c) provide for the making of additional contributions, beginning in 2019;
That was accepted primarily because there needs to be an adjustment period so that businesses and other stakeholders are able to adjust.
||(d) provide for the creation of the Additional Canada Pension Plan Account and the accounting of funds in relation to it; and
||(e) include the additional contributions and increased benefits in the financial review provisions of the Act and authorize the Governor in Council to make regulations in relation to those provisions.
Why is it such an important issue for all of us to address? I would like to reflect on some issues from my constituency, and I believe that those issues can be mirrored across Canada.
In my constituency are a healthy number of seniors. It is debatable at what age being a senior begins. I was told, as I am approaching age 55 in January, that I will be eligible for some store discounts.
I have had the privilege of knocking on thousands and thousands of doors. I can think of one 94-year-old who one would think was in her sixties. She was very spry and active. Age in good part is how one feels. There are many seniors in Winnipeg North who still feel great and want to have a decent standard of living.
One of the saddest things I often run into when knocking on doors is meeting seniors who talk about having such a difficult time making ends meet. Often they will say that they have an issue of medication versus food. Their budget does not allow them to afford both. This is not just a comment I heard at one or two doors. I have heard it at numerous doors. Seniors in many ways are challenged and have to make difficult decisions related to affordability for basic needs.
We have far too many seniors who opt for buying medication, and as a result, they go hungry, which is not good for their health, or they end up going to food banks. Thank God for the food banks and the huge number of volunteers who make them happen and especially those who contribute to them. They are helping many seniors who are living in poverty. That is a real issue that we hear at the door.
I can recall one incident when knocking on doors with my daughter, Cindy. One lady answered who was virtually in tears, because she had just been hit with an ambulance bill of more than $500. She had no idea how she was going to pay that bill.
I am glad that my daughter went on to ultimately become a local MLA and has raised this issue in the Manitoba legislature.
If someone has a heart attack at home and has to get to a hospital, the person does not have much choice. That is why we need to advocate for our seniors. Situations like this are taking place every day throughout our country.
When we have the opportunity to look at the issue of pensions, we should be supportive. Constituents tell us that they have a great desire that we support our three pension programs and feel that where we can, we should expand them. An increase to the GIS will help them immensely. Some of those single seniors will receive $900 plus more a month than they received last year. That will go a long way for seniors living in poverty in getting some of the things they need.
We are talking about Bill C-26 today, but it is about the social safety net that Canadians truly believe in. If we ask our constituents what makes them feel good about being a Canadian, some common responses are related to our social safety net. What is that social safety net? It is our CPP, which is what we are voting on today. It is also our OAS, our GIS, our health care system, and our employment insurance system. These programs provide peace of mind and comfort to Canadians. These are the things we should be speaking about more, and not just inside the chamber. We should be speaking more about them within our caucuses and within our committees.
We have fantastic standing committees that have the ability to set an agenda to look at progressive and positive social ideas. We could better utilize those committees. I have argued in the past that they are the backbone of our parliamentary process.
I realize that my time is quickly running out, but I want to emphasize how important Bill C-26 is. This is a piece of legislation that should be supported by all members. If we reflect on past debates in the House on this important issue, if one believed in expanding CPP, one would have been disappointed. However, with the change in government and the commitment from the current Prime Minister, we now have a change in attitude, and the CPP will be increased. This will prevent many seniors in the future from having to make difficult decisions. It will even prevent some seniors from going into poverty.
I highly recommend that all members of the House support this legislation.
Mr. John Barlow (Foothills, CPC):
Madam Speaker, I appreciate the opportunity to speak today on bill C-26. We are seeing the frightening trend of the Liberal government's imposition of punitive taxes without consultation, with very little feedback from stakeholders, and with very little knowledge of the economic impact these decisions and policies are going to have on Canadian families, and Canadian small businesses specifically.
First, it started with the carbon tax, which is going to increase the cost of pretty much everything. The government has also changed the mortgage rules, which will make it that much more difficult for young Canadians to buy their first home. Now it is talking about a hike to the CPP, which is really going to hamper growth in the small business sector. These are all policy decisions that have been imposed by the Liberal government with absolutely no consultation or study of their ramifications for Canadian families, small businesses, and the provinces.
I am the vice-chair of the Standing Committee on Natural Resources, which has been hearing from stakeholders over the last couple of weeks since the carbon tax was announced. All of these stakeholders have said that no one spoke to them about it, that this is going to make the difference between their putting shovels in the ground in some projects, or walking away entirely. What are the ramifications and implications going to be for our energy industry, which is already struggling, if a punitive carbon tax is imposed without any data to back up the economic impacts of that decision?
Yesterday, a motion was put forward in the natural resources committee that the committee do an emergency study of the economic impacts of the carbon tax on the natural resources sector. If Liberals were that confident that the carbon tax and the CPP tax hike were going to have beneficial and positive ramifications for Canadians across the country, then, in my estimation, they would have agreed to go ahead with that study, but they did not. They unanimously voted it down, because they do not know the ramifications of policies like this for hard-working Canadian families.
They are plowing ahead with these kinds of decisions because they think these make great politics for the very vocal minority of union bosses and big companies. Those are the ones driving these decisions. They are not talking to middle-class Canadians, the ones whose pocketbooks are going to be impacted by these decisions. That is what makes these types of decisions so frustrating.
A couple of weeks ago I had an opportunity to speak at a summit in Calgary, which was titled, unfortunately, “The Employment Crisis for Canada’s Energy Professionals—A Lost Opportunity for Canada”. There were more than 200 professionals at that meeting. They were not rig workers or welders, not the people we typically associate with feeling the impact of the downturn in the energy sector. They were petroleum engineers, geophysicists, and geologists. Many of them have not had a job in more than two years.
I asked them if they or their associations were consulted about the carbon tax or the tax increase via the Canada pension plan. I asked if the Liberal government talked to their associations, which include thousands of Canadian professionals across the country. Every single one of them said no, that these things were a complete shock to them. I said there had been ups and downs and booms and busts in the energy sector for decades, and they agreed that these, absolutely, had happened many times but this was the worst they had ever seen.
We heard in question period today and many times over the last week that Alberta has been hit hard by the downturn because of low oil prices. A barrel of oil is now more than $50. A low oil price is not the only reason that Alberta is struggling right now. It is bad policy, it is inaction, it is tax increases on businesses and employers. The professionals said they do not see a light at the end of this tunnel because of the policies being put forward, like a carbon tax that is increasing indecision in the industry, driving away investment, and taking their jobs with them.
They said that intellectual capital is going to be lost because of these decisions and that they are uncompetitive globally in energy, manufacturing, and agriculture, thanks to the decision of the government to put forward a carbon tax, and now a CPP tax hike, not to mention the changes to the mortgage rules that are making it more difficult for young families to buy their first home.
My colleague from Winnipeg North was saying that when he was door-knocking in his community, he was overwhelmed by Canadians asking for these changes. I had zero. Not once did I go to a door and somebody said, “Boy, I am really looking forward to a carbon tax. I am really looking forward to a hike in my CPP taxes, and do you know what? I really hope that you make it more difficult for me to buy my first home.”
Maybe residents of southern Alberta are much more savvy, I am not sure. These issues were never raised in that campaign, so for the Liberals to say that they have this incredible mandate because of what happened a year ago, I think it is disingenuous. I think they are putting through decisions that appeal to a very vocal minority of Canadians but are not in the best interests of hard-working Canadian families.
I would like to talk about some of the things that have been said so far today about how this would help Canadians in their retirement. Having an increase in CPP is great if I have a job, but now there are more than 200,000 Canadians who do not have jobs. I have not heard any decisions or any policies brought forward by the government that would help change that.
We have vehicles in place that will help Canadians save. What I think is most important with those things, including the tax-free savings account, which the government has clawed back, is that, again, in contrast to what my hon. colleague has been saying, that is something I definitely heard at doors. Canadians liked the opportunity to save on their own terms. It is absolutely their money. They want to make the decisions on what they do and how they save with their own money.
It is definitely a step backward to look at government as being the answer to everything. If people do not know how to save, the government will take care of that for them. Canadians are much more savvy than the Liberals are giving them credit for.
We also heard, when the Liberals made the decision to claw back the tax-free savings account, that this is just a vehicle for the wealthy. Only wealthy Canadians have the opportunity to invest in the tax-free savings account. Of those Canadians who have maxed out their tax-free savings account, 60% were making $60,000 or less. Those are not wealthy Canadians. Those are hard-working Canadian families who are making very tough choices for their future.
They are putting money aside to buy their first home, which now, unfortunately, is even more difficult to buy. I would ask where the government got the information that this was a good decision. Maybe it is for Vancouver or Toronto, but it certainly is not for Calgary or rural Alberta. I certainly have not had anybody come to me and say that this is a good decision. I have had the exact opposite. Realtors, mortgagers, credit unions, young families, come to me and say that this is devastating. Now it will take them another decade to save up for that first home, which we know is one of the largest investments they will have in their lifetimes.
When I was going door to door last October, I had so many Canadians, so many residents in my riding of Foothills, talk to me about the importance of the tax-free savings account and how welcoming they were that they would have an opportunity to invest further in a tax-free savings account. As I said, these were Canadians who were making very difficult choices for their families, whether it was a first home, their child's education, or saving for their own retirement.
The key to that is that Canadians had the opportunity to make their own decisions on what they felt was best for them and best for their families and their children's futures. This is a decision, once again, where government is imposing its will on Canadians, and Canadians have not said in any way, shape, or form that this is what they want, whether it is a carbon tax, mortgage rule changes, tax-free savings accounts, or electoral reform.
I do not understand why the government feels that it should be governing with an iron fist, a sledgehammer, and imposing its will on the provinces and Canadians. This is certainly not what I heard from hard-working Canadian families or certainly folks in my riding throughout the election campaign, and even before that.
But what has really been overlooked here is the impact this would have on small businesses. It is ironic that we are having this discussion during Small Business Week here in Canada. I am hearing daily from small business owners in my riding in southern Alberta and across the province that they are struggling. I do not think it is any mystery. The Liberal government will not do anything about it except to say that it has compassion and sympathy for what is going on in Alberta. I say in response, well, do something about it and give us a hand.
Imposing a carbon tax, and now a CPP hike on small business owners, is certainly not the way to do it. We have a very fragile economy right now in Alberta, and to impose these types of decisions when we are struggling does not make any sense. Alberta was the economic engine of this country for decades and, unfortunately, that engine has stalled. Rather than giving us a lifeline, the Liberals are throwing us an anchor. This would push those small business owners off the edge.
Right now in Calgary the unemployment rate is in the double digits. The vacancy rate in downtown Calgary is at 30%. It is unbelievable to me that in a province I have raised my family in and have worked in, I can go to downtown Calgary and see 8th Avenue deserted and entire floors of business buildings and office towers deserted. There is nothing but empty desks and empty offices. Yet our top priority is to impose a Canada pension plan tax hike, which would cost business owners more than $1,000 a year per employee.
Dan Kelly, president and CEO of the Canadian Federation of Independent Business notes that “Two thirds of small firms say they will have to freeze or cut salaries and over a third say they will have to reduce hours or jobs in their business in response to a CPP/QPP hike.”
When we are already struggling with an unemployment rate in Alberta close to double digits, and in some communities well over double digits, and 200,000 direct and indirect energy jobs that have been lost, we would further stress the employment numbers with these decisions. It will be more difficult for a small business owner to hire because of the increased costs from this CPP tax hike, which I do not think anyone was really asking for.
Indeed, Hendrik Brakel, a senior director at the Canadian Chamber of Commerce, has said:
||...we’re worried a big tax increase is headed for the middle class like an elbow to the chest....
|| This comes at the worst possible time—an economy reeling from weak commodity prices and slower consumer spending will be lucky to eke out growth of 1.5% next year. It’s difficult to stimulate the economy while pulling money out of the pockets of Canadians.
The Chamber of Commerce represents businesses across the country, as does the Canadian Federation of Independent Business. These people are raising the alarm about the impact of the CPP tax hike on small businesses at the worst possible time.
I know we talk a lot about Alberta, but the energy downturn has impacted Canadians across the country. I was in Nova Scotia a couple of weeks ago, and it was amazing how many people came up to me to say, “I was working in Alberta in the oil sands, but I had to come home, obviously, because there are no jobs. But there are no jobs for me here either”. We need Energy east. We need policies in place that will kick-start our energy industry. But instead, when it is down, we kick it with a carbon tax and now a CPP tax hike. Where does this make sense?
I am going to conclude with this. This has been my question all along: if the Liberals are so confident that these types of policies will bring a great positive change to our economy, with all these great jobs for Canadians they talk about, can they prove it? Can they show me the data? Can they show me an economic impact study they did before they announced the carbon tax and the CPP tax hike? I have not seen it. If they are so confident this is the best thing for Canadians, I ask them to show it to me.