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Supporting Vulnerable Seniors and Strengthening Canada's Economy Bill - Third Reading

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Statement made on 23 June 2011 by Senator Joseph Day

Hon. Joseph A. Day:

Honourable senators, I compliment the Deputy Chair of the Standing Senate Committee on National Finance, Senator Gerstein, on his presentation in relation to Bill C-3. {...}

Honourable senators, Senator Gerstein has outlined correctly what is in Bill C-3, the first budget implementation bill. I expect that the Senate will receive other budget implementation bills — at least one more — later in the year as the government looks at its budget and determines what other enabling legislation will be necessary to achieve some of the initiatives therein.

Honourable senators, Bill C-3 contains 12 Parts. The Finance Committee met for four hours last night and for one and a half hours or so today. Approximately 35 government officials appeared before the committee to explain the 12 Parts of the bill.

Honourable senators, I refer to the short title of the bill and my comments on the recently adopted practice of attempting to make political statements in short titles of proposed legislation, which I do not believe to be a desirable practice. The short title is Supporting Vulnerable Seniors and Strengthening Canada's Economy Act, but perhaps the title Budget Implementation Bill No. 1 would have been fine.

Honourable senators, in respect of the words "Supporting Vulnerable Seniors," no one in this chamber would object to any initiative to help Canada's seniors. However, we must analyze whether this title is meaningful or whether there is something simple in the bill to support these words in the short title. Only Part 3 of the bill deals with seniors and vulnerable seniors. It provides that certain seniors will be entitled to $50 more per month. I repeat: $50 more per month. Is that enough to warrant a title that includes "Supporting Vulnerable Seniors. I ask honourable senators to reflect on that question.

Worse than the fact that it is only $50 to help vulnerable seniors is the fact that we could provide more than that amount to our vulnerable seniors. I want honourable senators to read the fine print: These vulnerable seniors who will receive $50 will begin to lose it as soon as they earn $2,000 from any other source. It will be clawed back at $2,000 above the Old Age Pension amount that they receive. For someone who receives $4,000 above the Old Age Pension amount, it will be eliminated. There will be nothing left. That is how this government protects vulnerable seniors.

Senator Ringuette: Bye, bye, Charlie Brown.

Some Hon. Senators: Hear, hear!

Senator Day: Part 11 of the bill causes concern, honourable senators. It deals with changes that will allow government departments to provide services to other government departments and charge a fee for the service. The immediate thought is what impact this will have on the public service. For example, what happens when a department that does not have a sub-department to deal with accounting, goes to Treasury Board to have its accounting work done, for which it pays a fee. What impact will that have on the public service and the special skills developed within the various departments? Not all departments are the same. It is not a generic service that any department can do for another department. The committee did not have an opportunity to explore that issue but was assured that this would have nothing to do with either employment levels or the reduction in expenditures within government departments. Rather, it was felt that it would be a nice initiative to include in Bill C-3. That is as far as we were able to get with Part 11.

Three areas of the bill seemed familiar as being dealt with in the recent past. One area was the disability tax credit; a second was the shipping vessels registration; and the third was demutualization of insurance companies, which means moving from privately owned businesses to publicly traded companies. Each of those has been dealt with in legislation in the not too distant past. Honourable senators, we are seeing elements in this bill to correct oversights or sloppy drafting of previous legislation. We are dealing with the same concept simply to correct something that was done a year or so ago. In part, that highlights the important role that the Senate has to play in the legislative process of anticipating the unintended consequences of this proposed legislation that we are about to adopt. Three of these speak to subject matter dealt with before. Why did we not deal with all of it at the same time? That question remains to be answered.

Part 7 addresses residential mortgage insurance. Some concerns were not dealt with fully. The CMHC provides 100 per cent insurance to a mortgage loan. The insurance goes to the banks, who are the lenders. The banks ask the mortgagee to obtain CMHC mortgage default insurance. If the borrower defaults, then the government is on the hook, not the bank. The loan is backed 100 per cent by the government when the insurance is with CMHC and 90 per cent if it is with a private company. This bill provides that the amount of potential liability of the companies in CMHC be increased by $50 billion. I mentioned this last week. I repeat: $50 billion more. By passing this bill, honourable senators are exposing their children and grandchildren to an additional $50 billion worth of government responsibility and liability.

An Hon. Senator: That is a "b" for billion.

Senator Day: Yes, it is $50 billion.

Honourable senators, it is a concern when we give private companies and CMHC an incentive to approve and set up more mortgages. How much will this initiative affect the marketplace? Why is it necessary when they have not yet reached their limit? Why is it necessary to increase that limit by $50 billion? The committee was unable to get to the bottom of that. I pose the question so that I might come back to it at another time if we begin to see real estate mortgages running out of control. This part of the bill could have some impact.

Honourable senators, a number of other initiatives are good, for example, equalization. The government said a year ago, with their new formula that certain provinces would receive less than in the past. The government quickly said that for one time only it would ensure that no province would receive less than it received in the previous year.

We are now into the second year and there is legislation again allowing them to stay where they were two years ago.

It is one time only, and, for the second time, one time only. There is no explanation for this measure. It is good for the provinces. However, it is not good for a system that is supposed to work according to rules, as opposed to having these rules tinkered with on a regular basis through supplementary legislation. It is much better if we have the rules, if everyone understands the rules and if the rules apply as they were intended.

I mentioned the point about the small vessels and kayaks, and the Red Cross having to register their vessels. That point is an oversight. We did not think long enough about where that provision might take us.

Honourable senators, as to Genome Canada, how can we argue with that initiative? We do not take exception to much of this legislation. However, we want to know the impacts, and whether we could have improved the legislation.

Those are my comments with respect to this 12-part piece of legislation. I expect that we will receive another budget implementation act in the near future. However, this bill is the first one. A piece of legislation in Part 7 refers to exposure to risk and the $50 billion. That part is 22 pages of this particular bill. Why could we have not looked at and studied that piece of legislation in a separate bill, especially when neither the private companies providing mortgage insurance nor the Canada Mortgage and Housing Corporation are up to their limit?

We have a piece of legislation and a significant increase without any explanation as to why that legislation was included as part of a budget implementation bill.

Thank you, honourable senators.

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