Finance Committee on May 31st, 2012

[Diane Brisebois]

Absolutely.

[Mark Adler, Conservative, York Centre, ON]

Okay.

In terms of the price differences, historically they've always been there. The Minister of Finance has stated his opinion on the price discrepancies. Given the fact, now, that our dollars are virtually at par, why are there price discrepancies?

[The Chair, Conservative, James Rajotte]

That's a big question for 10 seconds.

[Voices]

Oh, oh!

[Diane Brisebois]

I think the chair would prefer I not go there.

[Mark Adler, Conservative, York Centre, ON]

I have seen items that are made in Canada that are cheaper in the United States than they are in Canada.

[Diane Brisebois]

Yes, and I would ask why the government, and in fact the Senate committee looking at this issue, are not calling multinational vendors to the table. There is such a thing as country pricing. There are Canadian manufacturers selling baggies and wrapping paper to U.S. retailers at 30% less than what they're charging their retailers in Canada. It's a huge issue. It's not one that can be addressed by government, but it's certainly one that needs to be understood.

[The Chair, Conservative, James Rajotte]

I implore members, if you're going to ask a very good, big question, to really give it time. I've said this a number of times. I'm trying to be fair in terms of time, but it really makes it challenging for the witnesses and for the chair.

Ms. Brisebois, perhaps what I can do is take your submission to the Senate committee and distribute it to all of our members.

[Diane Brisebois]

We have done so in both English and French.

[The Chair, Conservative, James Rajotte]

Thank you.

Mr. Caron, it is your turn.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you, Mr. Chair.

Mr. Stanford, if we compare the Statistics Canada figures from before the recession with the current figures, we see that wages have gone down by about $10,000. That would suggest that the jobs that have been created since the bottom of the recession are not as good. Those jobs pay less than the jobs that were lost because of the recession. Do you agree with that statement?

[Jim Stanford]

Thank you, sir.

I'm not familiar with that particular citation. It's certainly the case that by most of the measures of job quality—and that would include part-time versus full-time, permanent versus temporary, and measures of the utilization of your skills—the quality of work has deteriorated modestly since the recession. It isn't a night and day change. There are still some good jobs being created in the economy and some good jobs we have retained, but the average quality of work since the recession has certainly deteriorated.

That would be one of the factors behind the stagnation in real incomes that we certainly see in the data.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

With respect to employment insurance, if we believe what the Minister of Human Resources and Skills Development said, the reform, or the changes she announced last Thursday, are intended to match the jobs available with the workers who are looking for jobs.

I am finding it very hard to imagine the situation. I see people who are unemployed and looking for a job who quite often find one. Other people are looking for jobs in their field but cannot find one, obviously. How does dividing the unemployed into three categories and forcing them to accept a job after 7 weeks or 18 weeks of benefits, for which they will earn up to 70% of their previous wages, that is, 30% less, help to match jobs with people who are jobless? I am trying to see how this might work, and I am not succeeding. Could you shed some light on this for me?

[Jim Stanford]

At least in terms of how those changes were motivated and justified in the discourse that accompanied that announcement, they are very much rooted in the assumption that there is some kind of shortage...that jobs are going unfilled, and that some of the measures in the EI reforms, including some that I would say are based on compulsion of the workers to do other things, are aimed at allowing those unfilled jobs to be filled. Frankly, the empirical evidence for that is just not there. You can always find anecdotes from an employer who has a position that he or she is having a hard time filling, but in terms of the overall status of Canada's labour market, it is absolutely a question of excess supply, not excess demand.

I will point out that in the most recent month, only 48% of Canada's unemployed were receiving regular EI benefits at all. That means the majority of unemployed will be completely unaffected by any of these measures. So how they're going to help that majority of the unemployed suddenly find a work ethic or be willing to commute an hour or take a job at a lower wage.... They're not getting benefits anyway. Yet they're not being matched with the so-called vacancies that are there.

I find the starting assumption...the economic evidence to support the idea that we need to be pushing workers to take jobs that they are unwilling to take is not verified by the empirical data. It's all about measures either aimed at reducing the cost of the EI benefits, that is just cutting people off to save the government money, and/or perhaps it's part of a deliberate strategy to actually suppress wage increases in the future through measures like this, which I find very worrisome.

[The Chair, Conservative, James Rajotte]

You have 30 seconds.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you, that is all.

[The Chair, Conservative, James Rajotte]

We'll go to Mr. Watson, please.

[Jeff Watson, Conservative, Essex, ON]

Thank you, Mr. Chair. Thank you to our witnesses for appearing.

Ms. Brisebois, I'll start with you. I come from a cross-border community right on the border with Detroit. I live a little south of Windsor, actually. The issue of harmonizing duty exemptions with the United States is somewhat talked about in the community. I think it depends on which side of the transaction you are as to whether you feel good about it or don't feel good about it.

I can tell you on the consumer side there's a lot of support for the idea of a harmonizing measure. Folks who go on a business trip for two or three days, or go on a family vacation to the United States, I think, appreciate having some ability to bring back a bit more with them than they could previously. Retailers may not necessarily like the fact that people shop while they're on vacation, but I think that's neither here nor there.

I want to ask about your industry's profiling of who cross-border shoppers are. I think global information is somewhat useless in the sense that there are 50 million trips, but surely not every man, woman, and child is taking one and one-half trips.

Do you know who these travellers are? Has your group made any effort in trying to win their business in terms of shopping in Canada? What efforts are you undertaking?

[Diane Brisebois]

The profile, if we're looking at the $20 billion figure that we used earlier on—

[Jeff Watson, Conservative, Essex, ON]

That's not a verifiable number. Even Mr. Porter sort of hedged on that, so I think we should deal with realistic numbers.

[Diane Brisebois]

It's not, but I can assure you, sir, that he's not too far from the number, if you look at the increase in same-day cross-border shopping. We're not as concerned with vacation travel as we are with same day.

[Jeff Watson, Conservative, Essex, ON]

The government hasn't moved the duty exemptions with respect to same day.

[Diane Brisebois]

We understand that.

[Jeff Watson, Conservative, Essex, ON]

How does the Retail Council feel about that?

[Diane Brisebois]

The Retail Council was taken aback specifically because the Minister of Finance asked a Senate committee to look into the difference in pricing and cross-border shopping. We were expecting the Senate committee to present its final report and recommendations before anything would have been changed.