Liberal Candidate for Whitby-Oshawa seeks information on the losses sustained by the Canada Pension Plan
as a result of Jim Flaherty's income trust betrayal
TORONTO, Sept. 11 /CNW/ - Today Liberal Candidate for Whitby-Oshawa, Brent Fullard delivered a letter to the CEO of the CPPIB seeking detailed information on the losses sustained by the Canada Pension Plan, and therefore all Canadians, as result of Jim Flaherty's income trust betrayal.
For further information or a copy of the letter please email:
brent.fullard@rogers.com
September 11, 2008
Canada Pension Plan Investment Board
One Queen Street East
Suite 2600, P.O. Box 101
Toronto, Ontario M5C 2W5
Canada
Dear Mr. Denison, President & CEO:
Re: The losses sustained by the Canada Pension Plan by Jim Flaherty’s Income Trust Tax
I am writing to you as the federal Liberal Candidate in the upcoming election for the riding of Whitby-Oshawa, the riding of Canada’s Minister of Finance, Jim Flaherty which as you know will be taking place on October 14, 2008.
It is important to voters in “Whitby-Oshawa” that their representative in Ottawa is acting in a responsible and prudent manner at all times. The same is true for all Canadians insofar as their Finance Minister is concerned. This inquiry concerns Mr Flaherty’s policy to tax an aribitrailiy selected subset flow through investment vehicles but not others, such as his law firm tax flow through vehicle Flaherty Dow Elliott & McCarthy, which pays no taxes.
In order to accurately inform Canadians of one of the many ways in which Mr. Flaherty’s policy to tax publicly traded income trusts, (and not all other firms of trusts, including REITs) negatively affects all Canadians, I am requesting from you detailed information on the “mark to market” impact of this tax on the public income trust portfolio holdings of the Canada Pension Plan.
I cite the following from your website:
“While the CPP Investment Board operates at arm’s length from governments, we are subject to very rigorous accountability requirements. Accountability is deeply ingrained in the CPP Investment Board's legislation, governance and in the policies and practices of the board, officers and employees.”
It is in this regard that I am writing to you, as Canadians are in need of accountability on the issue of the taxation of public income trusts and the impact it has had on their retirement assets within the Canada Pension Plan.
Unfortunately the level of portfolio disclosure afforded Canadians concerning the income trust holdings of the Canada Pension Plan and the timing of the tax announcement (October 31s, 2006) means that there is insufficient public information to make this calculation with absolute precision, due to timing differences and limited disclosure.
However a close approximation of the loss sustained by the Canada Pension Plan can be made, as follows.
On October 29, 2007 , the CPP income trust holdings (excluding REITs) held by CPP on March 31, 2007 had declined in value by $173,346,000 if those holdings had remained in place from the announcement date (October 31, 2006) onward.
On September 8, 2008 , the CPP income trust holdings (excluding REITs) held by CPP on March 31, 2007 had declined in value by $206,935,000 if those holdings had remained in place from the announcement date (October 31, 2006) onward.
We seek more detailed disclosure from you on the holdings of public income trusts by the Canada Pension Plan on October 31, 2006 and various points in time, specifically two weeks, six months, twelve months and eighteen months after the announcement as well as presently, in order to ascertain the absolute level of loss experienced by all Canadians and to demonstrate the fact that the loss incurred at the outset has been sustained over time, as is concluded from our analysis and as corroborated by the sustained loss in the broader income trust index.
In the event that the various investment positions held in the CPP have been sold at points during these various periods of time, please perform a “run down” analysis in which it is assumed that the monies received from the sale of public income trusts were not reinvested, but remained as cash at the time of sale to the end of the time period in question.
We request this information from you on a timely basis in order that your findings can be fully disseminated to the voting public. well in advance of the October 14, 2008 election date on this important policy matter affecting the retirement security of all Canadians, both inside and outside the CPP.
If you have any questions please call me at 647 505 2224 (cell)
Thank you in advance,
Yours truly
Brent Fullard
Liberal Candidate for Whitby–Oshawa
Campaign Headquarters
1540 Dundas St E.
Whitby ON
L1N 2K7
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