Human Resources Committee on May 12th, 2009

[The Chair, Conservative, Dean Allison]

Pursuant to Standing Order 108(2), our study of the federal contribution to reducing poverty in Canada will commence. Here we are at our twenty-fourth meeting, in Moncton, which is the first of many meetings today.

I would like to extend to our guests a warm welcome. Thank you very much for taking time out of your busy day to come to talk to us about this very pressing issue.

I would like to give you a bit of context on where we've been. We've been studying this in Ottawa and we are now travelling out east. We were in Halifax yesterday, we are in Moncton today, and we will be in Montreal tomorrow. We thought it was important to get out into the community, on the ground, and hear what's going on, so we appreciate your taking the time to let us know what's working, what's not working, and what can be done better.

We're going to start with Johanne Perron.

Thank you very much for being here. If your presentation doesn't cover what your organization is doing, could you talk a little bit about that? You may cover it in the presentation. It would be great if we could all get a flavour for that.

You all have five minutes. After your presentations, there will be a couple of rounds of questioning lasting seven minutes and then five minutes. That's how part of our session is going to work here.

We'll start with you, Johanne. Thank you once again for being here. I realize that you are with the New Brunswick Coalition for Pay Equity. The floor is yours. You have five minutes; if you're over a little bit, we'll let you finish your thought. Don't worry; we won't cut you off, but as soon as the timer goes off, you should finish up your thoughts.

[Johanne Perron, Executive Director, New Brunswick Coalition for Pay Equity]

Thank you.

The New Brunswick Coalition for Pay Equity is a non-profit organization. We're advocating for pay equity legislation in the public and private sectors. We are working mostly at the provincial level, but we are a member of the Pay Equity Network, which is a national organization. We represent over 600 New Brunswick individuals and 74 organizations.

First of all, I want to thank you for the opportunity to present our perspective on poverty issues. In this presentation, we want to make the connection between poverty reduction and the introduction of strong pay equity legislation for the public and private sectors, legislation that is proactive and rights-based.

Long-term solutions to poverty require a gender-based analysis and the removal of systemic barriers to women's equality. Pay equity legislation addresses one systemic barrier, and that's what I want to talk about. Pay equity is equal pay for work of equal value, and it's about recognizing the value of predominantly female work.

Now, a gender-based analysis of poverty would show that women are more likely to be poor. If they raise a family alone, their risk jumps. Other groups of women are disproportionately likely to experience poverty—unattached women under age 65, women with disabilities, and racialized and aboriginal women. In 2008, Canadian women earned 83.8% of men's hourly wages. For every dollar earned by an aboriginal woman, a non-aboriginal man earns about $2.34. So a key reason why women are more likely to be living in poverty is that they are overrepresented in lower-wage areas that have been traditionally considered women's work.

The Canadian Research Institute for the Advancement of Women, CRIAW, has estimated that 70% of women in paid employment are concentrated in a few female-dominated sectors, such as health, teaching, clerical, sales, and services. Pay equity would allow for an evaluation of predominantly female work in terms of skills, responsibilities, working conditions, and efforts. This would allow for a fair and objective process of comparison with jobs traditionally done by men, in order to adjust compensation rates equitably.

Studies have shown that pay equity tends to have its strongest impact on lower-paid work. As such, it's a policy initiative that plays an important role not just in eliminating discrimination but in reducing poverty, for if you put money into the pockets of working poor, they will spend it on their families.

A number of researchers have pointed out that moving out of income assistance into paid work is often not a route out of poverty for women because of the low pay that is attached to traditionally female occupations, which they typically enter. Pay equity would act like a magnet to attract single mothers and other women on income assistance who want to enter or re-enter the workforce.

Clearly, pay equity contributes to poverty reduction. But, people might ask, what about the cost of implementing pay equity?

It was estimated in a 2004 study that removing the discrimination component of the gender wage gap in New Brunswick would result in an 11% increase in personal income tax collection, amounting to $609 million for this province alone. Importantly, the federal Pay Equity Task Force, in 2004, drawing on available evidence from Ontario and Quebec, which have the equity legislation, concluded that most employers judge the effects of pay equity to be positive, providing them with an opportunity to strengthen their pay systems while also improving labour relations.

Canada is a signatory of the UN Convention on the Elimination of All Forms of Discrimination against Women, but we've been sharply criticized lately. Whereas Canada was ranked fourteenth in the world for equality between the sexes in 2004, the World Economic Forum dropped us to thirty-first place in its 2007 ranking of 130 countries.

So now we urge the federal government to remove one of the major systemic barriers to poverty reduction: wage discrimination.

That's the five minutes, is it? Okay.

Federal pay equity legislation would help to remove that systemic barrier. We totally support the task force that presented a report in 2004 on pay equity. They had a number of recommendations that I would like to highlight quickly.

We need to adopt a new pay equity law to extend the coverage to aboriginal people, people with disabilities, and visible minorities. We need to protect all employees, involve employees in pay equity plans, develop non-sexist evaluation methods, ensure that pay equity is not negotiable, sustain pay equity, and create a pay equity commission as well as a tribunal.

In conclusion, Canadian women represent about half of the paid labour force and receive 38% of the national income. The federal government can contribute to poverty reduction by using gender-based analysis and by reducing the systemic barriers to women's equality. One such way would be to adopt proactive pay equity legislation.

In closing, I want to say thanks to two of our volunteers who prepared these notes for the coalition, Gail Taylor and Lee Chalmers. They would have liked to be here, but they had engagements. They live outside Moncton, and I wanted to acknowledge their contribution.

[The Chair, Conservative, Dean Allison]

Thank you, Ms. Perron.

We're now going to move to Auréa Cormier, who is with the Common Front for Social Justice of New Brunswick.

Welcome. You have the floor for five minutes, please.

[Auréa Cormier, Member of the Provincial Council, Common Front for Social Justice of New Brunswick]

The Common Front for Social Justice is a coalition of about 30 organizations and has over 200 members.

I will present in French.

We applaud your committee's initiative because one of any government's important roles is to ensure the well-being of its population. During the last decade, Canada has had the largest increase in poverty among developed countries. In 1996, when the federal government cut transfers of funds to provinces for health and social services by close to 3 billion dollars, New Brunswick lost 115 million dollars annually. The federal government should restore the Canada Assistance Plan. New Brunswick would thus be reimbursed by the federal government for 50% of its social assistance costs.

Approximately 14% of New Brunswickers live below the poverty line. In May 2009, we had 33,274 social assistance recipients. Our social assistance rates are the lowest in the country. Furthermore, many of our workers are poor. Approximately 12% of them earn less than $8 per hour.

We would like to make six recommendations to you.

1) Minimum wage. A person working full time should not have to live below the poverty line. We recommend that the federal government establish, for all federal jurisprudence, a living wage, indexed to the cost of living.

2) Employment insurance. Thousands of New Brunswickers have lost their job. We recommend: that the federal government modify the Employment Insurance Program so that workers are able to receive regular benefits after 360 hours of work, no matter where they live or work in Canada; benefits are increased to 60% of income, based on the best 12 weeks of the worker; the period for receiving employment insurance is increased to 50 weeks; the 2-week waiting period is abolished; and a part of the employment insurance surplus is used for training and labour adjustment programs.

3) Child care. In 2007, our licensed child care facilities could only have accommodated 14% of children aged 12 years or under. For a lone parent wishing to return to work, it is practically impossible to pay child care costs. We recommend that the federal government invest funds towards creating and maintaining a national, universally acceptable, quality child care and early education system.

4) Support for seniors. Approximately 7% of seniors live in poverty. This proportion is even higher in the case of single women. The Canada Pension Plan is not sufficient. It was designed to replace 25% of the average industrial wage. Today, it ought to represent 50% of the average industrial salary. CPP contributions should be gradually increased. The Old Age Security pension should be increased by 15% in order to lift seniors above the low income cut-off. We recommend that the Canada Pension Plan be gradually increased until it reaches 50% of the average industrial salary. We also recommend that the Old Age Security pension be increased by 15%.

5) Housing. In 2008, there were 4,200 people on the provincial waiting list for subsidized housing. To bridge the gap between the supply and demand of affordable housing, the federal government should invest more. We recommend that the federal government transfer to the provinces the funds necessary to meet the needs in the area of affordable, adequate housing.

6) Pay equity. In 2008, in New Brunswick, the wage gap between men and women was $2.70 per hour, which feminizes poverty. We recommend the adoption of pay equity legislation for all sectors falling under federal jurisdiction.

In conclusion, I would like to quote Armine Yalnizyan, an economist, who stated that when public policy fails to balance the needs of the powerless against the appetite of the powerful, the promise of democracy is shaken. The ideal of a government of the people, by the people, for the people starts to look like government of the elite, by the elite, for the elite. Such a system may last for a time, but its days are numbered.

[The Chair, Conservative, Dean Allison]

That's perfect timing--very well done.

I'm going to move now to Steve Berubé.

You're with the United Church of Canada. Welcome. The floor is yours, sir.

[Steve Berubé, Reverend, Chignecto Presbytery of the United Church of Canada]

I want to thank the committee very much.

Looking at your biographies online, I can see that you folks represent a tremendous amount in terms of what you've done in the communities. Obviously, that's why you've been elected by people like me: to serve our nation.

As a United Church minister, I should probably begin by asking for a moment of silence for the Vancouver Canucks, but we'll move on from there.

There are a number of people, including people like Auréa and Johanne, who have far more insight, as do many people who staff the Hill, into the issues of poverty, but my concern is more to speak to the issues of broader concern in terms of what faces you folks.

Martin Luther King once said, “Our lives begin to end the day we become silent about things that matter.” What matters more in this country than those living in poverty? To me, one of the basic issues that this group needs to deal with is that the elimination or reduction of poverty in Canada will only be achieved if--and only if--there's the political will to make it happen.

One of the things we seem to have lost sight of is that budgets are moral documents. In the budget, we can truly understand what the priorities are for the government. Policies can be effective only if there are sufficient budget allocations in the short and the medium term; if sufficient funds are not allocated, it's evidence that the program is not truly a priority.

One of the things I believe needs to happen in order to reduce or eliminate poverty in Canada is that there needs to be a strong social vision, backed up by a variety of programs tackling a number of poverty issues.

If we look at this historically, we can see how FDR made such a tremendous impact during the Great Depression with his New Deal. We know the power of imagery and vision because of Churchill's leading of the world through the Second World War. Dwight Eisenhower had probably the greatest insight of any politician I've ever read, because of his experience both as supreme commander of allied forces in Europe and as president.

Competition for resources is an issue you folks have to deal with on a continuous basis. Eisenhower once said, “Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.” Lyndon Baines Johnson, of course, introduced the idea of the “Great Society”. Through that program--and there are many segments of it still in place--Americans were able to deal with issues of extreme poverty, as well as racial injustice.

But words in and of themselves are meaningless unless they're backed up by strong government programs. All we need to do to see what happens if programs are not in place is examine our failure to achieve the millennium development goals and the goals for child poverty reduction within this nation.

Part of the reason for that, I believe, is supply-side economics. In the 1980s, there was a dramatic sea change with the election of Ronald Reagan. His belief was that if the rich became richer, the benefits would trickle down to the poor, and everyone would be better off.

If we look at the situation in Canada, over the last 30 years we have reached the position where now the wealthiest 20% of Canadian families own more than 70% of the nation's wealth. Meanwhile, the poorest 20% own 2%. The gap between rich and poor has grown dramatically over the last 30 years. Supply-side economics has also led to the reality that 17% of Canadian children are living in poverty, with the Canadian rate worse than those of 18 other OECD nations.

To me, the problem with supply-side economics is what it's based on. It's founded in greed. The deregulation of the financial industry, tax cuts, and flat taxes are really based on what is known as one of the seven deadly sins--greed.

In spite of what is advocated by business leaders and a decreasing number of economists, greed is not a positive force in society. Ultimately, greed is something that is immoral and should never be the driving force in our economy. “I like paying taxes,” Oliver Wendell Holmes once said. “With them I buy civilization.”

Inherent within this issue comes the most pressing question for Canadians and for Canadian politicians: do Canadian politicians have the moral fortitude to look the wealthiest Canadians in the eyes and say that they believe in a fairer and more equitable distribution of the wealth of our nation? Do Canadian politicians have the courage to look at business leaders and say to them that they have a moral responsibility to carry their fair share of the tax burden for the nation? If the answer is no, then food banks and homeless shelters, the most visible signs of supply-side economics, will continue to be among our leading growth industries.

In conclusion, nations should not be judged on the size of their GDP or the number of millionaires who live there, nor should they be judged on military power. Rather, let our nation and every other nation be judged on how we treat the least and the last, the powerless and the voiceless, the homeless and the poor.

[The Chair, Conservative, Dean Allison]

Thank you very much, Steve.

We're going to start the first round now, with seven minutes for questions and answers. We're going to start with my colleague, Mr. Savage.

The floor is yours, sir.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Thank you very much.

Thanks to all of you for coming here today and for your presentations. They were very well done.

I am Mike Savage. I'm a Liberal member of Parliament from Nova Scotia, from the Halifax area, and I'm pleased, along with my colleagues, to be here in Moncton today.

I want to follow up on what Steve was saying. He quite correctly uses terms like moral fortitude, political will, courage, foresight, and competing interests, and this is really what it comes down to. I believe that Canada has in many ways abdicated its moral responsibility to assist those in need here in Canada and, for that matter, around the world. You mentioned the MDGs; I mean, we could do a lot more.

The bottom line is that we can do a lot of these things.

Auréa, your mentioned your recommendations. They're all very sensible. Each one of these things is something I can support. The issue for us is what to do if we're government. Imagine that you're the government. What do you prioritize? What do you do? Do you do them all?

Canada could do all of these things. I'm not sure what the cost would be to go to a minimum living wage, but on your recommendation 3, “investing funds into creating and maintaining a national universally accessible quality child care system”, I would say an early learning and child care system, or early education. I see Jody Dallaire here, who has been one of the champions of child care not only here, but in Canada, and now is a municipal councillor in Dieppe as well.

We can do those things.

On the EI side, going to 360 hours of work makes sense. It would probably cost anywhere from $500 million up, as the CCPA says. I think Caledon says $700 million. TD says a billion. To go to 60%, according to HRSDC numbers at last count, and according to Ms. Yalnizyan, whom you referenced, it's $1.8 billion and rising every year.

As for going to 50 weeks, I don't know the cost of that. For the two-week waiting period, it's estimated to be about $760 million, so you're looking at $3 billion to $4 billion. Now, keep in mind that it comes from the EI fund, and we've had surpluses for the last number of years.

My point is this: is Canada ready, in your view, to radically reform the way that we provide the social infrastructure of the country? A few weeks ago or a month ago, one of our political leaders mentioned in a forum that we may have to raise taxes at some point in time, and the outcry was immediate and consistent.

There's no question that we can afford these things. I'm going to ask you. Do you think there is political will in this country to do these things, knowing that it's going to mean, in all likelihood, that we will have to increase taxes?

[Steve Berubé]

I tend to side with Oliver Wendell Holmes: I don't mind paying taxes because with them “I buy civilization”.

The problem is that we've moved to a culture in which there is a focus just on tax cuts and the elimination of government services. Unless political leaders start talking about and bringing forward other voices, voices other than those interests that radically profess that the supply side is going to be the salvation for all of us, then no, there is no hope, not unless politicians do that.

All you have to do is look at the situation in the United States right now and listen to the leading economic voices. They no longer stand alongside supply-side economics. That's part of the reality we're facing. What has brought us here is the collapse of supply-side economics, which has led to a crash in the market that has cost something like $3 trillion and has brought us back how many years...I believe it's over a decade in terms of market value.

[Auréa Cormier]

I agree with Steve. I think it's a question of priorities.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Please use whatever language you like. Don't worry about us. We have the interpretation.

[Auréa Cormier]

That's okay. I'm comfortable in both.

I have listened to researchers who went to about 20 countries to ask consumers if they would be willing to pay more taxes. Surprisingly, the majority said yes, provided they knew that the money would be used to reduce poverty. If presented adequately and if managed adequately, I think taxes could be raised and used to bring more equality to income distribution.

As the Canadian Centre for Policy Alternatives said just a week or so ago, I think that maintaining income inequality is dangerous. It's not sustainable. I think long-range thinkers should really be aware of this.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Do you want to say anything, Madam Perron?

[Johanne Perron]

My colleagues provided a good explanation: it is about presenting a different message. If we ask people if they want their taxes to be reduced, they will obviously answer yes. However, if we talk about values that are more important for our society, for example equality and the elimination of discrimination, I believe we will get a different answer.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

I'm not sure if we are there; I certainly think that we need to get to a place where people are looking at poverty.

It is my view that people are looking at the cost of poverty as opposed to just the cost of fighting poverty and realizing that we're all in this together and more has to be done.

[Auréa Cormier]

Poverty has a tremendous economic cost. The major cost is health. People who are poor see the doctor maybe 40% more often, they are not as productive, and they are not bringing in as much earnings. Therefore, there is less tax revenue. To increase the budget for health and not do anything to relieve poverty is a very bad economic decision.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

New Brunswick is now undergoing some discussions for an anti-poverty strategy, as I understand it. Are any of you involved in that?

[Auréa Cormier]

Yes, very much so.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Thank you.

I may come back to that later.

[The Chair, Conservative, Dean Allison]

Thank you, Mr. Savage.

We're now going to move to the Bloc and Madam Beaudin.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Thank you very much, Mr. Chairman.

Thank you very much for being here.

Ms. Cormier, in your presentation, you talked about child care and pay equity. We see in the statistics for Moncton, for example, that there are many couples with two children, but also many single parents raising a child. Child care services are a problem for you.

Could you provide more information to us with regard to child care services in Moncton? What is the situation faced here by a parent or a couple wishing to access these services?

[Auréa Cormier]

My colleague, who is seated in the room, would be better able than me to answer your question.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Yes, that is true.

[Auréa Cormier]

What I can say is that there is a grave lack of child care services. Often, mothers who have a spouse tell me that as soon as they become pregnant, they put their child's name on a childcare waiting list, for fear of not being able to access quality service. Furthermore, the cost is relatively high: it is of around $35 per day. Low wage earners are unable to afford such an amount, which can cause delays in the child's development and socialization. All of this fosters an awful lot of poverty, in the long term.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

This leads me to my second question, which is probably more for Ms. Perron. Given that we are hoping for pay equity legislation, should we not start by creating spaces in daycare or early childhood centres, which would allow women to go to work?