Evidence of meeting #4 for Status of Women in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was jobs.
A recording is available from Parliament.
11:10 a.m.
Liberal
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
I wonder if I could just put forward an inquiry before we begin today.
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
When the minister was here, she indicated that she would be happy to come back to talk about performance review either today or Thursday. Will she be coming Thursday?
11:10 a.m.
Liberal
11:10 a.m.
Liberal
The Chair Liberal Hedy Fry
The response was that she couldn't make it at that particular time, and we would hear back further when she can attend.
11:10 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Could we follow up? Because she indicated that she would come any time.
Thank you.
11:10 a.m.
Liberal
The Chair Liberal Hedy Fry
We will. We intend to.
Can we leave this to deal with under future business in camera?
Our orders of the day are pursuant to Standing Order 108(2), a study of the consequences and effects the current Employment insurance, EI, programs have on women in Canada.
We have two witnesses today, and we will begin. As you know, the witnesses will have ten minutes to speak, and then, as you know, we will go in the order with regard to the length of time for the first questions, etc.
I shall begin by asking Ms. Yalnizyan if she's ready to begin.
Are you, Armine?
11:10 a.m.
Armine Yalnizyan Senior Economist, Canadian Centre for Policy Alternatives
Madam Chair, thank you very much.
11:10 a.m.
Liberal
11:10 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
Good morning, ladies. I am very pleased to be here, to see you again and to be at this meeting. I am going to speak in English. I have no notes to circulate, but I can send you some afterwards, depending on the questions that interest you.
I want to make five points today, very briefly.
I thank you for holding this meeting in times that are so unusual in our economic history and so important to both men and women.
First of all, I want to make the point about labour force rates and how when times get tough women come to the fore. They come to the fore, of course, in unpaid ways, but importantly and historically, women have moved ahead in tough times to help support their families. I want to make a point about historic unemployment rates and how and why women are now less unemployed than men. I want to make a point about who gets access to unemployment insurance and under what conditions. I want to make a point about how women's pay affects that access. And I want to make a small cluster of points about what we can do about it.
Historically, labour force rates of women have gone from 22% of the labour force in the immediate post-war period, 1946, to about 30% in 1960 and about 35% in 1975. It has kept climbing and climbing. The story of Canadian economic history is that women have taken more and more of an active role in the economy.
Today, and since about the mid 1990s, Canadian women make up about 47% of the labour market. So we're about equal partners with men. Roughly speaking, that's the same when it comes to unemployment as well. About 44% of the unemployed today are women.
That has gone up and down in time. I was just looking at the numbers. In fact in the two biggest recessions we have had in the post-war period--the 1981-82 recession and the 1990-91 recession--women's unemployment rates went down. They moved forward as their men lost jobs and their families fell apart. Their unemployment rates actually fell. What is fascinating is that since the 1990 recession women have sustained that lower rate of unemployment even though they make up a significant proportion of the unemployed.
Women have picked up the pieces for families for a very long time. In fact since the mid-1980s it has taken two income earners to get into the middle class and to stay in the middle class. That has huge consequences for what we're facing in the road ahead. There is no reserve army of labour now to pick up the pieces with part-time work, to make sure that family incomes are sustained. Families are peddling as fast as they can. It has a huge consequence for what happens when one person loses a job. We have today's release of unemployment insurance rates, and the increase in the number of unemployed men has grown fairly remarkably.
I'm working on a piece that takes a look at what has happened with respect to recessions, unemployment, and unemployment insurance benefits from the 1920s on. For the first time in our history we have a recession that has been propelled by forces outside of our border; exports have driven it. We haven't begun to see the domestic fallout from this contraction of the economy in the official numbers that are coming through. We know that for the next three to six months--perhaps much longer--we're going to see very difficult numbers through Statistics Canada that document the way the domestic economy is contracting.
You see bits and pieces of it. You're seeing the effects of men losing their jobs first because they're primarily being thrown out of commodity-producing jobs and manufacturing jobs. But we know that the next wave of job loss will be among women.
Though women make up 47% of the labour market, generally speaking they are paid much less than men. Canada has been a job creation juggernaut over the last 10 years. Between 1997 and 2007, Canada was the premier nation for job creation in the G-7. But not all of those jobs were well paid. In fact in the last few years we've seen the proportion of minimum-wage jobs grow in many jurisdictions. Those jurisdictions include Prince Edward Island, Nova Scotia, Quebec, Ontario, and Manitoba, all of which saw an increase in the proportion of minimum-wage jobs. Women take up 60% of those jobs. More than a third of those jobs are for prime-age workers, those 25 years and older, with an increasing proportion of those who are over 65 years of age taking up minimum-wage jobs.
So we have a problem on our hands in terms of the growth of minimum-wage jobs. There are 750,000 people working in minimum-wage jobs, and a lot of them are in the service sector, which is going to be hit. It is all that peripheral stuff you don't necessarily need to do when you're hunkering down. And we know that 60% of women are in those jobs.
That brings me to my next point about unemployment insurance benefits and the receipt of those benefits. In the high unemployment period of the 1970s, about 85% of the unemployed were covered and received benefits when they were unemployed. In the 1981-82 recession, that dropped to 76%. By 1990, when we were looking at the massive continental restructuring of our industrial capacity and people were losing their jobs in manufacturing and some commodity-producing industries, that number had gone back up to 83%. So 83% of the unemployed in the last recession were covered by unemployment insurance benefits. Between 1989 and 1997, that dropped precipitously from that proportion to 44%. That's basically cleaving it in half. So we are walking into this recession with 43% of the unemployed covered by unemployment insurance benefits.
There is another troubling trend, which is that we have rules in the unemployment insurance system that permit people to pick up some earnings and not be completely penalized. The proportion of people who are picking up jobs on the side, a little bit of work on the side, while being covered by unemployment, has also grown. That is more the case for women than it is for men, because you cannot live on 55% of low wages. So they are able to top up their wages by a certain amount. But that means that instead of unemployment insurance becoming a social insurance program to protect the unemployed, work has become a top-up to unemployment insurance. And when the jobs disappear, it will be exceedingly difficult for people to live on these forms of income support.
This leads me to my last point, which is that there are things we can do. The unemployment insurance system was scaled back dramatically between 1990 and 1996, but it can be expanded. We had massive expansions of unemployment insurance coverage in the 1950s and again in 1971. If this government and all parliamentarians were interested, with or without budgetary changes, you could make those changes right now by ensuring that more people are covered by the rules of entry; by expanding, actually, the shelter of some form of income support; and by improving income levels. If you won't improve the income replacement rate from 55% to 60%, you could be doing other things to ensure, for example, that the self-employed have coverage. You could, for example, double the refundable GST credit.
There are measures you can take to protect people against the storm. This is not just specific to women; it's for everybody, because women cannot support families on their own any more. It is going to take government intervention, and significant intervention, to prevent what is already a bad recession from developing into something far, far worse and that is utterly preventable. It would do our nation a great disservice if we didn't take this story very seriously.
Thank you very much for the opportunity to work with you today.
11:20 a.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much. That was excellent timing. You actually have about another minute and three-quarters to go.
Now we will have Ms. Lahey, who will present for 10 minutes. Ms. Lahey has given everyone a document that she will refer to. For those of you who want to find it, it's called “Budget 2009: Designed to Leave Women Behind--Again”.
11:20 a.m.
Professor Kathleen Lahey Professor, Faculty of Law, Queen's University
Thank you, Madam Chair.
Thank you to the members of the committee who are attending to discuss this extremely important issue.
I was surprised that apparently no other element of the federal government had taken these issues so seriously and relieved to see that this committee has begun at the place where I think everything should have begun when the discussions about how to adjust federal policy to the new economic realities began several months ago.
I'd like to make a series of points, all of which lead to my desire to convince you that although ten years ago Canada was rated number one in the world amongst all countries on the UN human development index, which measures key elements of social and economic development, and number one in the UN's gender development index for a period of four years, Canada has, for the last several years, been repeatedly singled out, studied, written about, and chastised by the Organisation for Economic Co-operation and Development, the OECD, which consists of 30 plus an extra couple of the most industrially developed countries in the world, by the International Monetary Fund, and by various agencies of the United Nations, including the Committee on the Elimination of Discrimination against Women.
Canada has come so far in moving away from the things that, as my colleague has just pointed out, had brought it both to a high level of economic development and also to a high level of equality between women and men on a number of other fronts, I think people still don't see the reality. I'll just give you one figure that stunned me a couple of weeks ago when I found it.
I was looking at the United Nations development program page that gives country updates. It was doing a 2008 update in order to bring the current economic situation into the frame. I was shocked to discover that as the UN statisticians developed a new index called the gender disparity index, which measures the sort of factual difference between the economic and social development that women enjoy as compared to that of men, Canada was ranked number 83 out of 157 countries. This is a long way from number one. It's a serious problem.
The problem arises very fundamentally from the way in which the employment insurance rules operate at the present time. The problem is not going to be solved by the strategies being proposed by the current government to deal with the issues. Until bold steps are taken to treat women as if they were full citizens and members of the human race in Canada, right along with men, and are equally as important, it's going to remain a very serious situation. I'll go through this as succinctly as I can to make this point.
In the handout that I've distributed, I've included a little graph on page 6 that shows the reality of income distribution in Canada. This is based on 2004 statistics. It could be updated for 2005; the picture won't look any different. If anything, it'll look a little bit worse. This represents the shares of cash money that flow through male versus female hands in Canada. This is the starting point of the problem, because women and men can come up with a thousand reasons why this is, or why it should be so, but the fact of the matter is that it hasn't always been like this in Canada. It doesn't have to be. It isn't in other countries. In fact, a very few social policy decisions would dramatically change this picture.
But the reality within which the employment insurance rules operate is shaped by the existing access that women and men have to money. The employment insurance rules are constructed within the existing reality and they simply recreate and reflect back the status quo; they can't change it. Except, as my colleague outlined, it did manage to happen in stages, beginning with the changes in the 1980s and the 1990s to the employment insurance system.
The key thing that has changed is that over the years the employment insurance system in Canada has been increasingly restricted to what we could call the standard employment model. It presupposes that everybody who works for money works in standard employment--a full-time permanent job with full benefits, 12 months a year, going on forever into the future or until something better comes along.
But a closer look at what has been happening to women as they have entered the workforce in staggering numbers over the last 30 years shows that we actually have two workforces. We have the standard employment workforce, which is substantially male dominated, however you look at the numbers. Here, men receive 60% of the cash money to be earned and women are left with 40%, and men hold over 60% of the full-time jobs and women have fewer than 40% of the full-time jobs. It's a segregated economy in which women have 69% of the part-time jobs and men have a very small share. So it's a very lopsided economy, and it explains why, if you look at the three main indicators of the status of women, women cannot work their way out of the spot they're in. Women already have to earn their 40% share of income by working part-time, sometimes in multiple jobs, sometimes in not-so-secure full-time jobs, and in addition they have to continue doing two-thirds of all of the unpaid work that gets done in Canada. That's a long work day, and they're poorly paid or not paid at all. And it's a work day that leaves the person who's worked the hardest with the least money in their hands.
What does the employment insurance system do to meet the needs of this extremely vulnerable group? At this point, based on the sequential changes that have taken place over the last 20 years, women have to approximate full-time employment to be able to receive maximum benefit from the employment insurance system. But even if they do that, because their own earnings will determine how much of an employment benefit they will get, they will only get employment insurance benefits that are approximately two-thirds or three-quarters of the amount that men will get. Men's maximum weekly benefit would be $413 a week. Women's would be approximately $312 a week, and that would be for a woman who is in a good situation. All the rest of the women are not getting employment insurance benefits. Women started out with coverage figures that were described by my colleague as more than 70 or 80%, but now some statisticians have calculated that only 32% of women who used to be covered by employment insurance would be now.
Those are the main points I wanted to make. As soon as you take the larger context of recent social policy and fiscal policy changes into consideration, and as soon as you start looking at the impact on women with multiple disadvantages, you begin to see that in fact the average woman that I've been talking about is a lucky woman.
Thank you.
11:30 a.m.
Liberal
11:30 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Thank you.
There are so many questions and so many challenges here. Professor Lahey, you just concluded your comment by referencing the multiply disadvantaged woman. I wonder if you would expand on that and what this means to various groups, what the EI means, and whether you've done a study or dug down deeper.
11:30 a.m.
Prof. Kathleen Lahey
I can't say I've studied every group, but I have looked intensively at the situations of a number of them. The ones who stand out in my mind as needing some serious, focused attention are, first of all, new entrants into the workforce. Those workers include both immigrant workers—people who are new to Canada—and people who have just finished their education and are coming out of university with huge debt, if they've been so fortunate to attend. These workers have to establish 910 hours of eligibility before they qualify for establishing the minimum employment insurance benefits. So there is the whole question of the new entrants.
Secondly, I would say single parents are in a particularly invidious situation because the working income tax credit is constructed, just like everything else, around the image of the standard sort of male-breadwinner model, so there's no child care built into the working income tax credit to help people get in the door.
Aboriginal women have much higher, more intractable, lifelong levels of unemployment for a wide variety of reasons. The latest government allocation that was made to solve that problem was to give them a dedicated fund of 1.1% of the $600-plus million that were given to aboriginal groups that have been funded to run job training programs.
So there are huge disparities in different places, and the Canadian government has a history of just never doing anything about those particular situations.
11:35 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
Could you speak to the issue of self-employed or contract workers, not many of whom get EI, to the best of my knowledge?
Could you also speak to the issue of older workers? I have run into a situation where older workers continue to pay EI but can't claim it if they're already drawing benefits, like old age security or whatever.
Could you speak to those?
11:35 a.m.
Prof. Kathleen Lahey
Self-employed workers are an area of very great need, and in a way their needs—and particularly women who are self-employed, because they will earn less than self-employed men—particularly need consideration, because when they're unemployed or on maternity leave they have to replace themselves, where the entire business disappears and has to go into some form of liquidation.
People who are of retirement age are in a policy trap that has been constructed over the last several years. It works like this. If an older person is in a position to retire, the current economic situation is such that their financial adviser—their union or whatever—will recommend they see if they can keep working for another two, three, four years, to increase their contribution base so they will have a little bit higher income, as every pension fund goes through an asset valuation and commitment restructuring process.
This is all well and good for male workers who historically and statistically have higher incomes in the first place, but women who are in that situation are caught, because if they were to retire, they could instantly turn their spouses' income into a much larger income through the tax benefits of retirement income splitting, which at moderate- to high-income levels will give thousands of dollars of tax benefits to people in that situation.
So there are sort of second-level forces that are actually going to push certain women out the door. They won't get employment insurance and will become a tax shelter for their spouse.
11:35 a.m.
Prof. Kathleen Lahey
If they have a spouse. If they don't, then they fall into another category that is even closer to the edge. And although the amount that a person with a low income can earn without losing their guaranteed income supplement and old age security has gone up a little bit, it's not very much money. So there are serious problems in that area as well.
11:35 a.m.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
The government has recommended the extension of the EI benefits by five weeks. I wonder if you can comment as to whether that is the appropriate way to go to meet the needs of women, or whether there are other approaches that might have been taken.
11:35 a.m.
Prof. Kathleen Lahey
I would say that it is something that definitely should happen. Canada does not have a long enough benefit period. But for women who are now disproportionately excluded from the employment insurance system, even though they may pay into it for much of their working lives, it's still excluding them. Five extra weeks that will not go to someone does not help the person it doesn't go to.
What's so interesting is that there is also a rider that says that people who would have been out of the paid workforce for a very long time—for example, someone who has been staying home and taking care of children for more than a year, for maybe two years or three years—that will be treated as a special situation that needs particular help, but not for the average woman who is excluded systemically year after year.
11:40 a.m.
Bloc
Johanne Deschamps Bloc Laurentides—Labelle, QC
Ladies, first allow me to greet you and thank you once more. You are practically turning into regulars at our committee. It is our great pleasure to welcome you because we are the richer for the work, the research, the insight and the data that you bring us. It is our hope, of course, that it can all lead to something. We have looked into a number of matters, including women's economic security. You have been of great help to us because of your documentation and your contribution as witnesses.
You were telling us about social development again. You said that Canada has dropped a lot in the last ten years. Canada is no longer in first place in social development and in gender equality. What place was it? Thirty-third?
11:40 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
She is saying 83rd in some.... I think it's about 33, isn't it? Thirty-third place in—
11:40 a.m.
Prof. Kathleen Lahey
In the HDI?
11:40 a.m.
Prof. Kathleen Lahey
I think it might be a bit higher.
11:40 a.m.
Bloc
Johanne Deschamps Bloc Laurentides—Labelle, QC
Thirty-third. Whatever; Canada at that level is a dramatic drop.
You do not have to convince me; I am already convinced. My colleague and I are working hard to criticize the program, which is an obstacle preventing women from achieving equality. I did the rounds introducing a bill that was rejected because they said it needed royal recommendation. I find that response discriminatory too because the bill reflected a reality, an even greater inequality between men and women in terms of accessibility to Employment Insurance. Once more, for financial reasons, there is a refusal to improve the situation and the lot of women. In a society like ours, I find that an outrage. We are going to reapply and introduce a similar bill again.
I have just come back from a parliamentary visit to Algeria and Tunisia. I was very impressed, especially in Tunisia, to see the advances that women have made in only a few years. The governments recognize gender equality and have written it into their constitutions. Perhaps the reality is somewhat different, but the fact of recognizing the principle in itself is a greater beginning than we have here.
People talk a lot about how reprehensible this program is because women are at a disadvantage compared to men. One question about pay equity concerns me greatly and I really want to ask you about it. Statistics prove that, in general, women in Canada are already at a disadvantage and earn less. They want this principle left to collective bargaining. I would very much like to know your position.
11:40 a.m.
Prof. Kathleen Lahey
I think it is one of several key pieces that are all going in the same direction: watering down or eliminating pay equity at the same time as changes to employment insurance and adequate child care are introduced. All these things need to be changed. It's almost as if there's a list of things that have been accomplished for women in Canada and somebody is working down that list.
The pay equity provision is heartbreaking, and it should be taken out. Pay equity should be made a very high priority. That's my considered opinion.
11:45 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
We're here to discuss employment insurance today, but it is very challenging to ignore the tone that has been set in this response, and I say this with due respect. There has been a response from government to the economic stimulus that is required by the nation at this time, and abolishing pay equity had no place in that package. It was a non sequitur that should not have featured in this budget, and I would argue that it should never have featured as a government initiative implying that government believes that any strength comes purely from bargaining. We know that government has to be an arbiter of unequal bargaining strength and that women have fought for decades to guarantee a legislated level playing field.
But quite apart from the pay equity question is what we can do right now, outside of a legislative context, to improve access to a system that women and men and families and individuals have desperate need of. We are going to face a deluge of job losses in the next few months and the system is not prepared for this, and there is due blame to go around this room as to why the system is this way. It was both Conservative and Liberal cuts in the early 1990s that shrank access to the point where.... In the 1970s, when somebody was unemployed and the unemployment rate was 8% to 9%, the entrance requirements, if you were to convert them into hours, were 100-and-some hours. By the recession in the 1980s, it was 200-and-some hours, and now it's over 500. We know how to change it so that people can have some degree of protection.
May I just say, this is not just about justice and equity and all of those laudable things; it's about economics, because if you continue to let purchasing power go into a free fall at this point, if you just stand back and say, well, we'll do a little bit of infrastructure here and we'll do a little bit of this and that there—which is necessary—it will not be sufficient to fill the breach of what is going to be happening with the contraction of the private sector. If you look at recessions over the last seven decades, the scale of what is about to hit us requires massive offsetting momentum, and when you do things like pay equity and ignoring the changes that have happened to EI, there's no offset to the system, there's no way of preventing the free fall of purchasing power in too many households. This is not about fair mindedness; this is about preventing the recession from getting deeper and longer than it needs to be, which will bring in its sweep millions of households. I'm not overstating this.
11:45 a.m.
Conservative
Candice Bergen Conservative Portage—Lisgar, MB
Thank you, Madam Chair.
I just want to take this opportunity to thank all of our witnesses for coming today. As a new member of Parliament, I appreciate that you took the time. As a new member of this committee, I realize that many of the issues that we're talking about have been studied previously, but there's always more work to do. With the economic hardships that we are experiencing, it is very important to look at all the issues.
Today, we have been mandated to deal specifically with the EI program. You did refer to the pay equity issue, and I accept your comments, but I respectfully disagree with you. I do believe that unions have a responsibility, and as a woman, I truly want to be treated equally. I want to make sure that if I was part of a union or part of a bargaining group that I would have the same treatment as my male counterpart in making sure that pay equity was achieved. That's just a side note.
I think as a government--and some of my honourable colleagues have been on the government side before--we definitely have a responsibility to balance programs and to assist individuals who are in need, both men and women, with responsible government. We have a responsibility to the taxpayer and to the private sector, which also bears a large burden for the general programs the government implements. We're also in an economic recession that is not of our doing, and you've referred to that as well, Madam. This is something that's hit us. I think we need to be responsible as a government so that we are not penalizing the private sector for something that is beyond their control. So as a government, as parliamentarians, and as advocates for women, how do we balance what we're doing as a government with helping people? I think that's what we truly want to find out and what we truly want to discover. Life is always about a balance, isn't it? That's our goal.
Ms. Lahey, one of your concerns is that the $2 billion this government announced in the budget for EI benefits tends to exclude women. That was your term, which is not too flattering, and it's not something that we really want to encourage. You specifically referred to the fact that, and I'll just read this:
New women workers who might qualify under these enhancements are those who have been staying at home for long periods of time with their children, not women who have merely taken maternity leave and then returned to non-qualifying work.
That struck me because many of the women in my riding are wives of producers and farmers who are going through very difficult times. Specifically, the livestock sector has been going through very difficult times over the last five years, even before the economic crisis hit. Many of these rural women--and I think I do speak on behalf of many rural women--focus on their family farm or their home, but they have to change focus and have to go back to work and get a job. Many times, though, they really want a job that is not overly demanding. They want to go to a job where they can put in their hours, but get back home and focus on what is most important to them. I see those new workers as being very different from, for example, a woman who has taken a full maternity benefit and then wants to go back to work. Do you see the difference between both of these workers, and do you acknowledge that we have provided...? You mentioned the 910.... We have reduced the amount of time that new workers have to put in before they collect EI, but I see a difference between new workers versus women who have taken maternity benefits and are entering the workforce. That's one of my first questions.
11:50 a.m.
Liberal
11:50 a.m.
Prof. Kathleen Lahey
I'll reply briefly to that. My colleague has some comments that she will also make in relation to this.
The workforce is highly diverse. Family forms are so numerous that they can't possibly be identified, and new ones are emerging all the time. The employment insurance system itself has a number of subprograms and seeks to fairly address the contingencies that arise in all of these different sectors.
But one of the hallmarks of responsible government action in this kind of situation is to focus on the most vulnerable. The most vulnerable are the people who have been so poor that they haven't been able to afford to take their full maternity leave, who have not been able to live in a family where, even together, the family has been able to take the full maternity leave, and whose incomes are so low that they don't qualify for any employment insurance at all.
So certainly there are specific situations where it might be nice to add a new fund to the employment insurance system to deal with situations such as those you describe, but the problem is that there's no systemic analysis that has preceded this kind of cherry-picking of groups in solutions. That's the problem.
11:50 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
I'd just like to say that while maternity issues are important, and while there is a whole host of different ways for the labour market to respond, we are facing an economic meltdown. So the farmers' wives you're talking about who are going to look for jobs may be bumped out of their jobs very quickly without sufficient hours, and people who are losing their jobs are not going to find other jobs.
The only way we are going to prevent this meltdown from pulling businesses down further with it and entering this downward spiral of insufficient aggregate demand because people don't have incomes, and the only way we're going to prevent people from saying they can't sell at these prices, shutting down their shops, and saying they can't produce at these prices and having to stop, is if you maintain purchasing power.
That is a downward spiral that can be avoided if you maintain purchasing power. Open up the door to EI now for everybody, for every circumstance, so that you can maintain a certain level of purchasing power in the system. That is my only comment.
When Henry Ford wanted to expand his market, he raised the wages of his workers so that they would buy stuff and grow the market. We can't raise wages now, but we can certainly prevent economic free fall in households.
11:55 a.m.
Liberal
The Chair Liberal Hedy Fry
No, I'm sorry.
Ms. Mathyssen.
I'm sorry. I'm giving you guys a little bit of leeway, but I think you should remember that seven minutes is not a long time. If you could try to cut to the chase, we can get far more of your questions answered, because in the five-minute slot, you're not going to be doing very well.
I haven't started you yet, Irene. Go right ahead now.
11:55 a.m.
NDP
Irene Mathyssen NDP London—Fanshawe, ON
Thank you, Madam Chair.
Thank you, Ms. Lahey and Ms. Yalnizyan. I appreciate your expertise.
As you've pointed out, we're at a crisis in terms of our economy. Things are bad now and they're going to get much, much worse.
This is an important study. What we're looking at, I think, is absolutely critical in terms of what's happening to people and to women.
What do you think we should include? What is absolutely essential as we go through this study in terms of what we need to look at?
11:55 a.m.
Senior Economist, Canadian Centre for Policy Alternatives
You need to reduce the hours that trigger the entrance, make it uniform across the country, and let people in, even if it's only for two years as you've expanded the five weeks at the back end. Even if it's just for two years, do it now. Do it as fast as you can. Forget about the budget being passed. Start a whole other bill and start right now, because we don't have time to wait.
When you look at the statistics on how quickly unemployment jumps on top of a GDP decline, and when you look at the history of the last two or three recessions, this is coming at us like a freight train. We know what is about to happen and we are not prepared for the economic free fall.
Please work together to open up access. If that's all you do, it is something. In addition to that, a lot of people will not be able to survive on 55% of minimum wages of a part-time job. So expanding income support like the refundable GST tax credit is a remarkable way of making sure purchasing power goes to the people who spend all of it.
The IMF has said, if you are going to do economic stimulus in the form of income supports, any kind of tax reforms, any kind of new incomes, give it to the people at the bottom. Why? They spend it all. We have, starting in January 2009, a brand-new tax reform, the tax-free savings account. The benefits are going to accrue to people who are saving. Ladies, we have a crisis. We need people to spend, not save. Though it is prudent to save if you can, taxpayers should not be subsidizing the people who can afford to save at this moment, when we desperately need more purchasing power, more aggregate demand. It is an inappropriate way of distributing the scarce resources that we have at our disposal. That same amount of money devoted to increasing the incomes of people at the bottom means you get more purchasing power and in the local economy.
So there are lots of things that can be done, that can be done very quickly, but if you do not move with haste and with certitude that this is something that is going to actually support and stimulate the economy, we are going to be prolonging and deepening this recession far more than we need to. It's utterly preventable. That's the crazy part about this moment.
11:55 a.m.
NDP
Irene Mathyssen NDP London—Fanshawe, ON
First of all, Ms. Yalnizyan, I want to come back to the chart you provided. There was a concern expressed with the delivery of Budget 2009 that $6 billion was set aside for tax cuts, and I think $1.2 billion was set aside to extend the EI period by five weeks. Your chart indicates that we could make significant reforms—a uniformed entrance, basing benefits on best 12 weeks, increased to 60%, etc.—and the cost would be $3.381 billion.
There will be those out there who say, “We can't afford this. We're in a recession. This is too great an expenditure.” Can you comment on your analysis and this chart and respond to that sentiment that this is too expensive in a time of recession?
Noon
Senior Economist, Canadian Centre for Policy Alternatives
I think we should remember that until 2008 the unemployment insurance account had nominally, notionally, a $54 billion surplus in it. When it was turned into a crown corporation, $2 billion of that amount was put in a reserve account, and we know that the official actuarials--I can't remember the title, but it's the same as the Auditor General--are indicating that in a downturn of the scale that we think we're facing, we're going to probably run a $10 billion to $15 billion deficit in that fund.
In truth, that $54 billion is not there. It has been given to tax cuts already and to other purposes of expenditures. So there's an opportunity to actually do something. There have been opportunity costs all along the line for the last decade to restore the cuts that were made in the early 1990s to the mid-1990s. Many people on this committee will have heard myself and others talking about how in the bad times the deficit was wrestled to the ground on the backs of the poor, particularly women, and in the good times that funding was never restored to the same program. So I don't need to say that again. But I will simply say that there have been choices made all along the line as to how to spend public resources and there are arguments to be made for tax cuts, debt reduction, and spending enhancements. Every government will choose its priorities in that way, but the truth is the money is there when you need it.
If you take a look at our economic history, as a nation we have decided what was needed to be done and we've done it, and then we've figured out how to pay for it--until we hit the 1990s, where the number one priority was to balance books. Since the early to mid-1990s, governments have been very much into accounting and accountability to not use more money than we have, but in fact we can raise money to do things that we think are a priority. We created unemployment insurance out of nothing because it needed to be there. We expanded it in the fifties; we expanded it again in the seventies. When we need it to be there we can do it, if that's our collective will. But it does require all of Parliament. It requires all of government to say, yes, we are going to move forward to protect people. I think that's the conversation we're at, Madame Mathyssen.
The alternative federal budget documents from which you're quoting are from a coalition of groups that are asking what it would take to stimulate, what it would take to actually bring us out of it. We started from a different starting point in saying we have a budget of x amount, so how would you do it? We started with the 2% of GDP stimulus that the IMF, the OECD, and everybody else around the world were saying we needed to have in concert, and that it was every bit as important to synchronize our stimulus as it was to sustain the financial system. This government moved very rapidly to work in concert with other partners to stabilize the financial system--and kudos--but when it came to the stimulus there was a good deal of hesitation all over the world; it isn't just Canada. There's been a good deal of “How should we do this?” What is true is that we all know the government must act, because the contraction of the private sector--households, banks, and businesses--is such that the only agent left to fill in that breach is government. If government does not act, and act strongly, we are just going to go into a protracted downward spell.
So we took the 2% that the IMF was saying we needed and we said, how many jobs can you create, what are the biggest multipliers for that package? Tax cuts did not feature because they don't create enough jobs. So we allocated it mostly in infrastructure, both green and looking forward, and in training and income supports. All of this not only sustains this period, but prepares us for the next phase of expansion, which is inevitable. We will come out of this period, and we are ill-prepared for the labour force problems we are facing in the next five to ten years, as my age group and others like me start to retire. We will not have enough teachers, doctors, and nurses, and we are not using this moment, which would be perfect to train them for that next step.
Noon
Liberal
The Chair Liberal Hedy Fry
Thank you. Your passion is remarkable indeed.
Now I would like to go to the second round, and it's five minutes. Please remember that I allowed a lot of leeway here, and I will try to do it again. Try to fit it in, please.
Lise Zarac.
Noon
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
Thank you very much.
The figures provided today prove that it is both relevant and important to study the impact of Employment Insurance on women. The figures prove that women are more vulnerable; we really must spend some time on this.
Women earn lower salaries than men. Is there a study showing that women on maternity leave return to work quicker because they cannot afford to be on maternity leave for all the time to which they are entitled?
Will the five weeks that the government is now providing be used by women? Is there a study showing that they return to work quicker?
12:05 p.m.
Prof. Kathleen Lahey
Yes, Statistics Canada has been publishing those studies for years. The most recent one I've seen is dated 2005, I think. It's something they document very closely.
12:05 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
What is the percentage of women who go back to work more quickly and who do not take their full leave?
12:05 p.m.
Prof. Kathleen Lahey
Approximately 25% of women are not able to take their full maternity leave period, even though technically it's been expanded to a year. Those are women who, on average, have incomes of $16,000. The whole group of the 25% earn $20,000 or less, or if they are not single parents, they, with their partner or husband together, earn no more than $40,000 per year. So it's clearly the financially stressed group. There are also figures that show that if a woman has a permanent, full-time job she will almost certainly take the full one-year maternity leave--98% do so. It's well documented.
12:05 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
We provide training for women who want to improve their standard of living. Do they make use of that training to improve their lives? They have children and need day care, and that means more money from their pockets.
Is there a study that mentions the percentage of women who make use of those programs?
12:05 p.m.
Prof. Kathleen Lahey
Well, there are figures showing that child care is an absolute pre-condition to access, and that is one of the points on which the OECD has roundly criticized Canada. Canada provides less child care than any of the 30 OECD industrialized countries, and it also has the worst record in terms of trying to keep the rates affordable. It has the highest cost of child care as well. Training programs almost never have supplementary child care built into them as a matter of right, and even in some areas where you would expect it to be openly available to everyone, it seems to be very selectively allocated.
12:05 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
May I also add, Madam Zarac, that it was very welcome to see the expansion of access to EI training in this budget. The fact is, it is desperately needed, so it needed to be expanded. But the truth is, given that we've just seen a 16% increase in the number of EI beneficiaries who are male, the men are going to come into the system first, and access to EI spots is going to be taken up by those who came in through the door first and those who get most access. So the types of training spots that are there are going to be, just by virtue of who's getting in through the door and when, taken up more by men than by women--assuming that women were even getting into the system at the same rate, which they're not.
12:05 p.m.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
Yes, but we'd like it to be available to them because there's a need for them. They're making--
12:05 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
But it shouldn't be just EI triggered, because we have these enormous labour market shortages.
12:05 p.m.
Liberal
12:05 p.m.
Conservative
Tilly O'Neill-Gordon Conservative Miramichi, NB
Thank you, Madam Chair, and thank you for joining us today. I too am a newcomer and am interested in this.
Through the strategic training and transition fund, the government is increasing funding to provinces and territories for training and support measures that help individuals who do not qualify for EI training, including the self-employed. As we know, the self-employed are not all alike. Their needs vary and are more complex. This is a particularly important consideration when assessing the applicability of EI benefits for self-employed.
Under the labour market agreements signed with the provinces and territories, unemployed individuals who were previously self-employed are now eligible for support. Under the labour management agreement, Canada's government will invest $500 million annually over the next six years to increase the quantity and enhance the quality of Canada's labour force. These resources will be allocated to the provinces and the territories on an equal per capita basis. These investments will focus on supporting skills development for unemployed and low-skilled employed individuals who are not eligible for training assistance under the employment insurance program.
Because women make up a large percentage of self-employed workers, as we all know, can you explain some of the advantages of this program that are outlined just for women?
12:10 p.m.
Prof. Kathleen Lahey
There are a couple of things I would point out. The first is that the figure of $500 million is, in this context, extremely small. When the federal government was very serious about improving employment among aboriginal people, something like $636 million was aimed just at aboriginal groups. That's a large amount of money for such a small population. That $500 million spread across a population that is admittedly large and growing is really a drop in the bucket. It's certainly a step in the right direction, but it would need to be increased tremendously, perhaps by scaling back some of the corporate income tax cuts, which, by next year, will cost Canada $10.3 billion per year in lost revenue.
The second thing is that a number of job training programs that will inevitably be put in place, I believe, will take the form of focusing on the trades and apprenticeships. And although some provinces have established programs to try to gain equity in those areas of employment, the document I circulated indicates on page 1 that only 7% of those people in the trades, transportation, and construction are women. So it's still not going to get at the problem this committee is predominantly concerned with.
12:10 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
Thank you very much for your question, Madam O'Neill-Gordon.
I don't know if you remember this, but in the 1984 election that was won by Brian Mulroney, the campaign focused on “jobs, jobs, jobs”, and by 1985 and 1986, his campaign had turned into “training, training, training”. I have to say that, unfortunately, I was around in those days, watching the training money being flowed through.
You can put a lot of people through training as a kind of stop-gap measure to say that you're doing something. Now, the money you're talking about is actually going towards opening up more training spaces. That is very welcome, but training does not necessarily create jobs. This is not Field of Dreams: train them and the jobs will come. We need job creation mechanisms in place, because we know that the self-employed rise as a proportion of the labour market when there aren't any jobs.
More training is great. That's terrific. But we actually have a strategic problem going forward. It isn't just training as a counter-cyclical measure that is required but training that is preparing our labour market to fill the breach and replace all those people who are going to be leaving the labour market. They may have to delay their retirement for a few years because their retirement savings have just dried up. But we know that in the next 10 years there is going to be a labour shortage. You think you have a labour shortage now in health care? Wait five or 10 years. We have no strategic plan. Where are we putting our training money? Are we going to make sure that those services that Canadians have a statutory right to receive--health and education--are serviced in the public sector? Will we have enough bodies to provide the health and education services that Canadians expect as a right of citizenship, and should expect in a country as advantaged as ours?
It's very important to have a counter-cyclical stimulus, and training is always welcome. It's always better to be smarter than to be stupider. If you think training isn't an answer, don't try ignorance. But the truth is that we need a strategic plan that uses those dollars, that magnificent amount of dollars that is there, that says we are laying in place a plan with our partners at the provincial level because we know what is coming down the road and we are preparing for it.
That is absent.
12:15 p.m.
Bloc
Nicole Demers Bloc Laval, QC
Thank you, Madam Chair.
Good morning, Ms. Lahey and Ms. Yalnizyan. I have to tell you that I am having a hard time right now. I am passionate myself, but I do not like being angry.
I will shortly have been on the Committee on the Status of Women for three years. For three years, we have had in-depth discussions about all kinds of problems that affect women and we have tabled reports. But we have not been listened to. It is as if our committee means nothing, is not important and, most of all, has no influence.
Rather than trying to understand and find solutions to the current economic crisis, which affects women more than anyone else, they try to justify their position by saying that their side is stronger than the other and that their side is right.
I like to hear all the witnesses who come here with an open mind. But rather than listening to what you have to tell us with an open mind, we get party lines read to us. If I want to see the party lines, I will read the budget. I am sick of it!
We brought you here to suggest ways to get women out of the misery in which they find themselves. Fifty-four billion dollars has been stolen from the unemployed. That money could have been given back to the unemployed. I pay insurance premiums on my house, and, if there is a fire, I will be reimbursed. I started working when I was 13 years old. I have paid into Employment Insurance all my life and I have received Employment Insurance benefits for about five weeks. I do not consider that I stole from the government. I did not sit at home collecting Employment Insurance benefits and telling myself that I was better off like that.
I am sorry, ladies. Last year, you gave us advice about gender-specific budgeting. You explained that all departments are supposed to be aware of gender-specific budgeting, and that they must not accept any project that is not specifically gender-based. They have not considered it in the budget at all. There are no advantages for women anywhere. What do you think has happened?
12:15 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
I have to say that I understand your rage, having been a feminist economist for a very long time and getting nowhere—in fact, losing ground—for a very long time. It is challenging.
But can I just say that we are now in a new moment? The crisis does permit us to talk as reasonable partners in this. There are things that have occurred in this budget that perhaps should not have occurred, in my view, but we have to move forward on what we can do to best stabilize the situation. It will have a gender lens to it, but it is by no means specific to women. This is a problem, and once you resolve it, more women will be helped. But it is not specific to women. I sincerely hope we can have a genuine discussion on how.
The Conservative Party also would like to reform things to prevent further economic free fall and see how the employment insurance system can be a part of the solution.
I understand very much where your rage comes from. I don't know what else to say.
12:15 p.m.
Liberal
The Chair Liberal Hedy Fry
Does anyone want to continue?
Continue Madame Demers. You have about 40 seconds.
12:15 p.m.
Bloc
Nicole Demers Bloc Laval, QC
Thank you very much.
Madam Chair, as Ms. Yalnizyan has said, I hope that we are going to be able to hold our discussions with openness and common sense. No matter what we say, we are here to advance the cause of women. This must be our common objective, whatever our political views, whether we are on the left, the right or in the centre. Our meetings should be held with openness and common sense, recognizing everyone's experiences and not just what is written down.
I have aunts and uncles who have farms in the West. That is good, but if there are no jobs, however much training they have received, they will not be able to work any more. That is what has to be said.
Thank you, Madam Chair.
12:20 p.m.
NDP
Irene Mathyssen NDP London—Fanshawe, ON
Thank you, Madam Chair.
I blush at not having exhibited the passion of Madame Demers. I must say I admire it very much because ultimately we are here to look after the people of this country, the men, women, and their children, and I fear that we haven't done that.
One of the hallmarks of this government is accountability. Should the government be required to report annually the eligibility and ineligibility of EI recipients by gender, by region, to Parliament so that we can get a handle on this? Would that be effective, or is it sort of sidestepping?
12:20 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
As you and many of the members of your committee probably know, all of the EI information is available in an administrative format. In the United States, they produce weekly bulletins on what is happening with EI. There might be an argument, actually, to work with the department that is in charge of producing the administrative information to produce it more regularly.
I don't think you need to table it in Parliament. I think the thing is there and it is up to parliamentarians and people who are in the extra-parliamentary process to bring to light the information that is there in an administrative database, and to make sure it is free and openly available to the public along the parameters that you believe are the most important and significant in this period of economic downturn. A lot of that data is already there; you can just speed up the rate at which it gets delivered. StatsCan, of course, released this morning the EI beneficiaries. That's based on the administrative data. You won't see that again until the end of next month.
I'd like to just piggyback, though, on your question by saying that not in this last budget—Budget 2009—but in Budget 2008, the Conservative government did say explicitly in its documentation that it was going to have, within a year, a plan for women. I don't see much evidence of that. I really hope the Conservative members of this group and other members of the women's caucus, if there is one in the Conservative Party, can influence what the nature of a plan might look like. They might also request more fulsome gender budgeting analysis.
I understand the Department of Finance does produce every year a gender budget analysis. When I was in the budget lock-up this year, I asked the woman who is the gender champion, whom you heard from last year, Louise Levonian, whether that gender budget analysis had been done. She said, yes, it had been. I asked if it was public, and she said, no, it wasn't. I asked on what parameters the gender budget had been done, and of course it was done yet again on tax cuts. Tax cuts are part of it, but what are the spending changes that are going to help women?
We are in a crisis situation. We're not going to waste a lot of money on dickering around with what these reports look like, but what we have should be public, because it is a matter of public record that this government and the previous governments said that gender budgeting analysis is important to assure that governments are working for all Canadians, men and women, and in equal measure. There should be nothing to hide there.
Just in keeping with what you were asking, Madame Mathyssen, it's just more public information so we can assess together where we can make improvements at this stage. Are the scarce public resources being allocated in an effective and gender-neutral way at a time when women will be picking up the slack, as they have in every recession?
There is no more slack; there is no more fat in the system. People are running as flat out as they can. If jobs dry out, I'm not clear what people are going to have to do. So let's use our public resources really well.
12:20 p.m.
Prof. Kathleen Lahey
I'd like to just make two comments following on that.
If it is possible for this committee or Parliament to take the kind of responsible action that really does need to be taken, then simply publishing data more frequently is not going to do the job. Status of Women Canada has over the decades produced hundreds of detailed expert reports, has collected a huge database of gender-based analysis tools of every possible kind, as well as comparative literature, etc., which has been the mainstay of academic and social policy research on the part of people working in this area all across this country and around the globe. Sometime between December 10 and about a month ago, it was all removed from the Status of Women Canada's web page. It took myself and our reference librarian a good hour and a half before we could find it in an obscure, unindexed, inaccessible, non-usable, unfriendly government archive some place off in a corner. The human technical capacity to solve the problems that need to be solved has been removed from the reach of not just the public but also the academic and technical sphere as well.
12:25 p.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much, Ms. Lahey.
Now we have Ms. McLeod, and that will bring us to 12:30. We do have some in camera future business to do, so I would suggest we end with Ms. McLeod, if possible. That would give us two full rounds.
Ms. McLeod.
12:25 p.m.
Conservative
Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC
Thank you, Madam Chair. We have deviated perhaps a little bit within this discussion today from what we're really trying to accomplish, so maybe I'll try to bring some of that focus back.
I do represent one of these communities we're talking about. I have six aboriginal communities. I live in the pine beetle forestry area, so we have been particularly devastated by what's been happening around us.
Now, I was back in my constituency last week, and I need to bring forward a few of the comments I was hearing from the men and women in my constituency. First of all, they don't have their heads in the sand, but they say we need to have an optimistic approach. So to suggest we are heading down a spiral of doom and gloom they suggest creates a spiral of doom and gloom. Perhaps we need to temper how we present things. Indeed, we have challenging times, but....
To be quite frank, they wanted the resources of the government focused on opportunities for jobs. They are incredibly enthusiastic about ideas around innovation. Yes, employment insurance is important, but you can help our communities move forward to a long-term future. So we can't lose sight of that within this.
The small businesses did talk about tax cuts in that they help them keep people employed, and that is making a difference.
We have an opportunity around the commitment to move towards maternity benefits, EI maternity and parental benefits. Right now I understand there's pretty good access—600 hours and you have 91% qualification—and we're moving forward to that expert panel being developed to look at self-employed Canadians. Being as I actually think I had about 12 weeks when I had my children many years ago, I would really like to spend at least a minute or two focused on comments from our panel in terms of self-employed access to maternity and parental benefits.
12:25 p.m.
Prof. Kathleen Lahey
I'll just make one quick point, and it is that it certainly would have to be structured with some sense that people can't decide two or three months after they've discovered they're pregnant that they can get a job for the six months that it takes. It could probably be designed a bit better.
12:25 p.m.
Senior Economist, Canadian Centre for Policy Alternatives
I'd actually like to echo what you were saying, Madam McLeod, about depressions begetting depressions. It is important not to overstate things, in a doom and gloom way, because it will beget a bad psychology. That's why the Great Depression was called the Great Depression. It was psychology actually trumping economic fundamentals in a prolonged way and feeding on itself. We may face exactly the same thing. But the truth is that without a government that restores confidence and says this can be done and we will create jobs, there's nothing on which to anchor.
Everything else in the private sector is about hunkering down. We are not talking about a cyclical downturn now. We're talking about a structural de-leveraging. Banks are over-leveraged. Businesses are over-leveraged. Households are over-leveraged. People are looking at what's going on and saying that if they lose their jobs, the whole house of cards will fall down, and people are pulling back. When you get all of the sectors of the private sector contracting, including exports, then there is nothing to fill the breach, other than someone who can say with confidence this is how we're going to actually use this moment to create the platform for the next phase of growth.
It is quintessentially a government's job. I understand how difficult that is. We've had 30 years of hearing that governments are the problem and markets are the solution. You don't turn a mindset like that around in a matter of weeks. But governments are indeed not the problem. Governments are the solution at this moment to be able to create the long-term opportunities that you're talking about.
Given the fact that we are off topic and we need to talk about EI, with the very small part about the self-employed coming into maternity benefits, anything that expands the ability of people to raise their kids and not worry about where the food is going to come from is helpful. You have an opt-in plan that is terrific for people who can afford to opt in.
But may I just say this, as a feminist and as an economist? Maternity and parental benefits should not be part of the social insurance program for the jobless. You want to support people who are raising their kids in the few months after the adoption or the birth of a child. Create a program that does that, which includes everyone who has a child and not only those who are eligible for EI. Surely we want people to be able to stay at home in the first few months of that new child joining the family. I welcome anything that improves support for young families, but it's going to help those who can most afford it. People who are very poor won't be able to opt in and they won't get much out of the system. Let's actually redesign this to help young families in a meaningful way.
Quite apart from that, I agree that you need to look at the long-term options in jobs and not EI. But the purpose of this discussion is the question of what we can do about EI. The answer is to make it easier to get into it.
12:30 p.m.
Liberal
The Chair Liberal Hedy Fry
Thank you very much.
I would like to thank Ms. Lahey.
How do you pronounce your name, Armine?
12:30 p.m.
Liberal
The Chair Liberal Hedy Fry
Ms. Yalnizyan, thank you very much.
I will now give you a three-minute break to get some food. We'll then proceed in camera, because we have a bit of work to do.
Thank you.
Proceedings continue in camera