Finance Committee on May 29th, 2012

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I'll stop at this point.

[The Chair, Conservative, James Rajotte]

Okay, thank you, Mr. Marston.

Mr. Hoback, please.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair, and my thanks to you witnesses for coming out. I appreciate your accommodating the committee with the short notice. It's been one of those days where it's been hard to plan anything, and I think the chair must be pulling his hair out trying to schedule meetings and coordinate witnesses. I appreciate the work the clerk does in regard to that.

The testimony here I find amazing, because I come from Saskatchewan. I'll use an example in my riding. I have a local Canadian Tire, and they have been trying to get mechanics for quite a while.

A couple of years ago, there were layoffs in the auto sector in Ontario and Canadian Tire did their own job fair. The common answer they got from mechanics was that they'd think about it once their EI ran out, then maybe they'd give Canadian Tire a call.

That's been quite common talk at the different businesses in Saskatchewan. We're missing out on huge opportunities to develop more of our resource sector, more of our logistic sector, and more of the business sector. We're losing all the spin-off jobs, which would also create more jobs in Ontario and Quebec.

I find it really interesting. I'm trying to figure out what people are trying to say. Should we let people sit on unemployment insurance when there's a good job out there? If there's a good job there, some still choose to finish off their EI. They figure after their EI runs out maybe that job will still be there, maybe it won't, but it won't matter.

There has to be some sort of an incentive system to get them back to work. I think that's what we're doing. The goal is to make sure we see some productivity out of these folks.

Mr. Clemens, Mr. Marston had asked you a question about poverty lines, and I'm going to let you answer it.

[Jason Clemens]

I don't disagree with Andrew that there are some differences between the various lines, but they are important ones. More important is to recognize the different effect on different households. If you have two seniors who are both receiving GIS and OAS, it's a very different circumstance than if you have a single elderly person who's only receiving GIS. Those circumstances should be treated differently.

In addition, the data is clear that the cost of living varies considerably from city to city. If you're a low-income senior in Vancouver on GIS and OAS, it's a very different circumstance than if you're from my hometown of Windsor.

I would love to see a discussion about curtailing OAS—clawing it back more aggressively and freeing some of those resources to better target GIS. How do we do a better job? I'd be more than open to discussing augmenting the benefit for single elderly people. Given the demographic deficit we're facing, we have to use scarce resources better. My view is that having a full benefit of OAS on the individual level up to $70,000 is not a well-targeted program.

[Randy Hoback, Conservative, Prince Albert, SK]

That's a good point, and that's something we should be talking about in our prebudget talks for next year. I encourage the chair to consider that when we look for witnesses.

Going back to the unemployment insurance, when it comes to creating jobs this government's been fairly clear. Mr. Céré, you have to agree with us. In this budget, we're extending the hiring credit for small businesses in an effort to encourage over 50,000 small businesses to hire more workers. This has been well received. We're investing $50 million in youth employment strategies to help more young people to gain work experience and get into the workforce. We're improving economic opportunities for aboriginal youth, which I think is very important. We're increasing opportunities to fund and help Canadians with disabilities to get into the job market. We're improving job market information for Canadians looking for work. And we're assisting older workers who want to keep their skills and keep working.

There are lots of things in this budget, but these things are not east-west. They're right across Canada. I want to make that point. It is shameless when you start saying there's a west favouritism or an east favouritism. That's absolutely shameless. That plays right into the NDP politics of split and divide.

What do you say to that? These are programs that are good right across Canada so why would you say there's an east-west divide?

[The Chair, Conservative, James Rajotte]

Please be brief.

[Pierre Céré]

Let me ask you a question instead, sir. Do you know the average length of a claim for employment insurance benefits in Canada. On average. Do you know?

[The Chair, Conservative, James Rajotte]

All comments are made through the chair so the questions and the answers are through the chair.

[Pierre Céré]

Fine. Mr. Chair, I will make my comment through you, so that I can use a question of my own to reply to what was said. What is the average length of a claim for employment insurance benefits in Canada?

Let me give you the answer. It is 20 weeks.

[The Chair, Conservative, James Rajotte]

Mr. Hoback posed a question to you. Do you want to answer his question?

[Pierre Céré]

Of course I am going to answer. I assume that is why my microphone is now on.

In Canada, the average length of a claim for employment insurance benefits is 20 weeks, or four and a half months.

[Randy Hoback, Conservative, Prince Albert, SK]

That's not the question I asked.

[Pierre Céré]

In theory, a claim can last for 36 weeks. Under the eligibility rules, people can get up to 36 weeks of benefits. The average length is 20 weeks and 75% of claimants do not reach the end of their benefit period.

You don't want to listen to my answer, sir?

[Randy Hoback, Conservative, Prince Albert, SK]

He's playing cheap politics.

[Pierre Céré]

Seventy-five per cent of employment insurance claimants find a job. You are basing your reform on prejudice.

[The Chair, Conservative, James Rajotte]

Order, order.

[Pierre Céré]

When I hear statements being made based on prejudice, I want to reply with figures that are a little more scientific. This makes no sense.

[The Chair, Conservative, James Rajotte]

Mr. Hoback, your time is up anyway.

We'll move on to Mr. Brison.

Go ahead, Mr. Brison, please.

[Scott Brison, Liberal, Kings—Hants, NS]

Thank you very much. Can't we all just get along?

[Voices]

Oh, oh!

[Scott Brison, Liberal, Kings—Hants, NS]

I want to talk a little about the OAS, because I actually think there's some common ground between what Mr. Clemens and Mr. Jackson have said, and I have real concerns. We may disagree on whether or not OAS is sustainable, and there are arguments being put forth in that regard. The OECD and the Parliamentary Budget Officer have said that it's sustainable in its current form. I think it goes from 2.7% of GDP now to, I think, 3.1% in 2030, and drops down thereafter.

You've raised a good point. If it is not sustainable, there are more progressive ways to address its sustainability. First, I believe it's sustainable, so I don't think we have to make those changes, but it's a good idea to consider what we could do that would be less regressive than the approach being taken. The reality is that 40% of the people getting OAS are making less than $20,000, and 53% make less than $25,000.

It's fine to say you can work a couple of extra years if you're a politician, an economist, a journalist, or an accountant, but if you're a physical labourer or a woman working in a fish plant in Newfoundland in a cold, damp environment, the extra couple of years from 65 to 67 may be very difficult.

You suggested addressing this through the clawback approach. Should we, for instance, consider ideas that include taking a look at the type of labour? You also suggested looking at single seniors. Does that not take a more thorough analysis? Is that not one of the arguments why we should be dealing with this as a separate piece of legislation, so that we can really devote Parliament's time, efforts, and research to it?

Either of you can answer.

[The Chair, Conservative, James Rajotte]

Go ahead, Mr. Clemens.

[Jason Clemens]

I'll just quickly clarify the sustainability issue. The traditional definition of sustainability is that, given current policies, it can be funded without changes over time, and the OAS is going from being equivalent to $1 in $5 of total spending, to $1 in $4. So it either is going to be financed by more taxes or by crowding out other spending.

[Scott Brison, Liberal, Kings—Hants, NS]

Respectfully, we differ on that point. I'm trying to get to a point where we may agree, and that is the—

[Jason Clemens]

Sorry, I just wanted to clarify why I was saying that it was unsustainable.

I would be open to either of those suggestions. Again, part of the point I was trying to make post-budget, after the original announcement was made by the Prime Minister in Davos, is that there are a lot of moving parts to retirement income. If we only look at OAS and GIS, we're missing considerable parts.

So if we bring up the issue of the single elderly person, then we're definitely talking about GIS. Some of the other programs are moving parts—