Evidence of meeting #4 for Human Resources, Skills and Social Development and the Status of Persons with Disabilities in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was billion.
A recording is available from Parliament.
3:55 p.m.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Thank you, Madam Chair.
I'd like to thank my colleague Mr. Lessard for this bill on employment insurance. It has been before the House for a number of years. A great deal of work has been done in collaboration with a number of groups. Later on we will be hearing from the Conseil national des chômeurs et chômeuses and the Confédération des syndicats nationaux, the CSN. The CLC has appeared a number of times to discuss bills. Construction worker representatives, in fact all those who represent the labour movement support this bill. Would you agree with me on that?
3:55 p.m.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
It is as though the current government and the previous Liberal government believed that receiving employment insurance benefits was basically a sin. Today in the House of Commons, Ms. Beaudin asked a question and the Prime Minister responded by saying, in so many words, that all employment insurance recipients were paid to stay at home. That is basically what he meant. I do not know if you share his view, but I simply would like to know what you think about this matter.
Do workers throughout Canada and Quebec really want to stay at home, or do they have higher ambitions? Is it not rather that they want to work, but that there is a problem with the job situation? Under the plan, employers make contributions so that the needs of these workers' families are met.
3:55 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
At the beginning of my presentation, I said that the lack of access to benefits resulted not only in a greater rate of poverty for workers who lose their jobs, but also for their families, their region and their province. What is unfortunate, within the system, is that over time the original purpose of the plan has been hijacked, and as a result, today, a worker who loses his job and applies for benefits is considered as acting in bad faith. In fact, the legitimacy of the application is even questioned, and this happens in many ways. In my view, we are going through one of the worst periods ever. There are constraints in the regulations and there are restrictions in the application process.
Do people really want to be unemployed for a long period of time? No. They are entitled to 55% of their previous income which, in most cases, was already quite low. So if these people receive employment insurance benefits, they will be in a position to look for work. However, some of these workers do not even have enough money to take the bus.
4 p.m.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Have you come back with any studies or research on what other countries are doing, such as France, Germany or other developed countries? Are you familiar with their employment insurance programs?
4 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
It varies. In fact, we put this question to officials who appeared before the committee. They gave us a report which we could distribute.
Without going into detail, I just want to mention that the Special Committee of the UN Commission concluded that Canada was one of the countries which treated its unemployed workers the worst because of the constraints built into the system preventing people from accessing benefits. This appeared in a report three years ago.
4 p.m.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Madam Chair, I would like our analysts to find out how France and Germany are addressing this issue. What are their programs like, and how are other countries dealing with the matter? For example, in France, recipients of employment insurance benefits get 75% of their salary.
I put the question to elected representatives in France, when I visited the National Assembly in Paris. These were conservative members who probably felt that everybody would like to receive employment insurance benefits to avoid working. But the elected officials in France told me that French workers were very hard-working, that they wanted to work, that employees paid their own insurance, not the government. The system is based on the employer and employees. The officials added that when they invested in their community, it created jobs, since the money came from the community itself, that is, from small- and medium-sized businesses. It created jobs rather than eliminating them.
Do you agree with this?
4 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
During the 1980s, there was a period of economic growth. Benefits were much higher than they are now. I believe that they were 70% or even higher—we would have to check. Our system even worked well at times.
But things became complicated when the employment insurance fund was transferred to the consolidated revenue fund.
4 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
Indeed.
The Minister of Finance of the day, or rather, the two ministers who succeeded each other, the Conservative and the Liberal Paul Martin, began to take this money, which belongs in the consolidated revenue fund, and used it for other purposes. Once they devised the recipe, they began to reduce accessibility to benefits in order to generate surpluses on the backs of workers who lost their jobs. At a certain time, over 70% of workers who lost their jobs were eligible. Today, it's 46%. People deserve better. These people were targeted and their money was stolen.
I will not be budged from this position, because this is nothing short of an economic crime, and we have to tell it like it is. I am not accusing anyone personally of having stolen the money, but rather, it is because of the system.
4 p.m.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
I call this “the government cash cow”, because since 1986, the government realized that it could take the money out of the fund and move it to general revenues. In reality, workers were not the ones who depended on employment insurance anymore. Rather, it was the federal government, which used the money to pay down $57 billion from the $92 billion debt. Those $57 billion came from workers who lost their jobs. The debt was transferred to the provinces, because unemployed workers ultimately had to turn to welfare.
Do you agree with this?
4 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
It seems you are taking the words right out of my mouth. I could not agree with you more. We reached exactly the same conclusion. This is why the bill came about. I think that this bill is complete unto itself. If it is not, we will keep on putting bandages on a wound which will never heal. Those who are suffering are the workers from whom the money has been taken, money that is rightfully theirs.
4 p.m.
Conservative
Maurice Vellacott Conservative Saskatoon—Wanuskewin, SK
Thank you, Madam Chair.
I'll thank Mr. Godin and Mr. Lessard while they're here. They made the case very well. Mr. Godin could be a very good witness for our bill. This new, independent, arm's-length entity has been put in place so that those kinds of abuses of the past won't happen again, where the EI surplus money was taken by governments and there were issues of either having to raise taxes or EI premiums. That was a problem, and that's why our government has moved and changed that. I need to get that on the record right off the top.
Mr. Lessard also said something to the effect that they're going to be taking the surplus in the future. But in reality—I think you know this, and can check on this—in the future any surplus in that arm's-length body, in those accounts, cannot be used by the government. So that will not be happening in the future. I need to make that very plain.
I wasn't really clear on the good questions of Raymonde Folco about the cost of the bill and the precise breakdown here. HRSDC has costed the 360-hour, 45-day work year at $4 billion per year. You're saying this bill will come in at about $3 billion. Am I understanding that correctly?
Mr. Lessard, HRSDC's costing is $4 billion, and it seems to me that your bill here is significantly more than that. So I'm not clear on your math or how you arrived at that. Can you give me something more in the way of your costing and how you intend to pay for this bill?
4:05 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
As I indicated earlier, the amount is $3 billion. The costs are based on data we collected from two sources. The first source is Mr. Brown, who was the assistant deputy minister for Human Resources and Social Development Canada back in 2005 when the study was conducted. At that time, we recommended that the coverage rate be increased from 55% to 60%. Mr. Brown concluded that when the rate was applied to everyone, it would cost $1.2 billion. This has also been confirmed by the most recent data we have received. It is also the written response Ms. Folco requested, and which we will send her.
Let's now talk about the eligibility threshold. When it was established, the purpose was to cover 90,000 unemployed workers. That represented an additional $390 million. But now, it's less than that, because more people have access to benefits under temporary programs. However, let's suppose the amount was still $390 million. Based on our evaluation, which is the same one carried out by Mr. Malcom Brown, who was the assistant deputy minister of Human Resources and Social Development Canada at the time, for the 12 best weeks, the amount is $320 million. Where we didn't agree—we will have to examine this a little more closely—was regarding the maximum amount when the number of weeks was increased from 45 to 50. We arrived at approximately $200 million, whereas his total at the time was $11 million. However, there are unknown variables which should be taken into account.
We also have to take into account the cost effectiveness of your approach. When the eligibility threshold rose from $39,000 to $43,000, it cost the system $245 million in additional administration costs for the first two tiers of $1,000. However, revenues totaled $420 million. Your government raised the maximum insurable amount to $43,000. In other words, given today's salaries, the amount must, at the very least, be doubled. So it's a greater amount. This brings us to at least $250 million in additional revenues per year.
4:05 p.m.
Conservative
Maurice Vellacott Conservative Saskatoon—Wanuskewin, SK
I'll have to examine that again. Maybe it's because some of those figures are outdated. I'm not sure what your response would be, but HRSDC costed it at $4 billion. Your proposal seems to be a little more expansive than theirs. I'm still not clear how you conclude it will be $3 billion, but I'll look over your remarks in testimony today.
How much time do I have left here?
4:05 p.m.
Conservative
Maurice Vellacott Conservative Saskatoon—Wanuskewin, SK
Then I'll just pass it on to Mr. Cannan, because he has some good questions, and I want to share my time.
March 17th, 2010 / 4:05 p.m.
Conservative
Ron Cannan Conservative Kelowna—Lake Country, BC
Thank you for your generosity, my colleague.
I have a couple of quick comments. I appreciate that you are representing your constituents. What do you think of the work-share program? I know that it's been valuable for my constituents. Has it been successful in your community?
4:10 p.m.
Bloc
Yves Lessard Bloc Chambly—Borduas, QC
Shared work is something which already existed in the past; it's nothing new. It is something which almost all members of Parliament have worked on at one moment or another by proposing formulas, with the purpose of helping employees and employers keep a business open for as long as possible. It is a good program which was adjusted over the course of the year, to the credit of all those who contributed. Therefore, we believe that the program should be extended. I am wondering whether, depending on the state of the economy, we could not take a second look at it. I have to say that it's a good program, which is why our party and the other opposition parties did not want to bring it up.
4:10 p.m.
Conservative
