Bill C-265 (Historical)

An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits)

Bill C-243--Employment Insurance Act

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Speaker, I rise today to contribute arguments as to why my private member's bill, Bill C-243, would not infringe upon the financial initiative of the crown and therefore would not require a royal recommendation.

I appreciate the time of this House to present these arguments. As you know, Mr. Speaker, this is the only opportunity I have to do it, and I have to do it orally to get it on the record, so I apologize in advance for the time it will take to do that.

I want to begin by outlining exactly what my bill would do.

The first part would provide for the development of a national maternity assistance program, and the second part would amend section 22 of the Employment Insurance Act to expand the window of time in which existing maternity benefits could be taken if a woman worked in a hazardous job that posed a risk to her maternal health. Specifically, it would allow women to begin taking their 15 weeks of maternity benefits 15 weeks prior to the due date, rather than just eight weeks prior, as the current rules allow.

The argument I am putting forward today will focus on addressing the amendments to the Employment Insurance Act under part 2 of the bill. I will show that Bill C-243 would not increase or change the total benefits an individual is entitled to and therefore would not constitute a new and distinct expenditure.

My argument has two parts, and I will be citing both academic literature, in particular by Lukyniuk and Keyes in the Canadian Parliamentary Review, as well as relevant parliamentary precedent.

First, I will briefly show that Bill C-243 would not increase or change the total benefits an individual is entitled to and therefore would not constitute a new and distinct expenditure.

Second, I will show that these changes would not substantively alter the objects or purposes of maternity benefits. In other words, I will be arguing that it would not create or envision a new function.

The first thing to note is that there is a general authorization for EI expenditures that is sufficiently broad to encompass the provisions of the bill. To illustrate this, consider the comment on royal recommendations from Keyes, 1999, on page 19:

...an amending bill that merely re-enacts or consolidates existing expenditure provisions does not require the recommendation.

The provisions contained in Bill C-243 would simply reallocate or shift existing maternity benefits, which are already authorized under the Employment Insurance Act. As such, the changes would fall within the purview of a royal recommendation, which provides for the general authorization of EI expenditures.

Allow me to further explain, with reference to specific examples, why this modest shifting of benefits would not introduce new and distinct expenditures. There are four elements that must be considered to substantiate this claim.

The first obvious point is that the bill would not increase the amount of benefits paid to an individual. Since the amount an individual is entitled to per week would not change, there is no concern that it would affect estimates or payments from the consolidated revenue fund.

This differentiates Bill C-243 from other private members' bills that were deemed to require a royal recommendation, such as past bills C-278 and C-279.

Second, Bill C-243 would not increase the benefit period or the number of weeks an individual is entitled to claim. Eligible recipients would still only be entitled to 15 weeks of maternity benefits. The only difference would relate to the window of time in which these benefits could be taken. I want to be very clear that this would be the only change.

In this way, Bill C-243 could be differentiated from several other bills, such as Bill C-278, which sought to increase EI sickness benefits from 15 to 50 weeks.

Third, Bill C-243 would not change the eligibility requirements such that more individuals would become eligible for EI.

Whereas bills C-279, C-265, and C-280 would have changed the qualification requirements, and thus expanded how many people could access benefits, Bill C-243 would not do this.

For example, in the case of Bill C-279, the Speaker explained that:

...more individuals would be eligible to receive EI benefits and those currently eligible would receive increased benefits.

Fourth, since Bill C-243 would simply shift existing entitlements, the only costs associated with this legislation would be administrative, and it has been well established in previous rulings that these administrative costs would not require spending for a new function. Instead, they would be operational costs that are part of the department's ongoing mandate. As such, they have constantly been ruled as not requiring a new royal recommendation.

To summarize my argument that spending under this bill is not new and distinct, I want to quote Keyes, 1997, who argued on page 20 that royal recommendation is not for “Provisions authorizing charges that are already or were previously authorized by Parliament, for example, a bill consolidating or revising existing legislation or authorizing spending for a particular group of people already covered under general legislation”.

In fact, that is exactly what this bill does. It authorizes spending for a particular group of people, women working in hazardous jobs, who are already covered under general legislation, in this case, the Employment Insurance Act. While Bill C-243 does shift the window of time for when an individual can receive maternity benefits, it must be understood that these are benefits that many women are already entitled to. They are not new and distinct.

I will now concentrate on the second reason why my bill might require royal recommendation, which is whether or not it fundamentally changes the objects or purposes of the spending. In other words, does the bill envision a new function for maternity benefits? The central question on which you will have to rule, Mr. Speaker, is whether El maternity benefits are currently intended to protect the health of the mother and her unborn child. If this function exists under the current spending regime, my bill would not require royal recommendation, as it simply shifts existing benefits in a manner consistent with the existing purpose.

I will present several arguments to show that maternal health is one of the functions, if not the primary function, of maternity benefits. I will begin by noting that while we are tasked with determining the purpose of El maternity benefits, the actual enabling legislation, the Employment Insurance Act, says nothing explicitly on this issue. As such, to make this determination we will be required to make reasonable inferences based on other factors, including the eligibility criteria, their practical usage, and indeed a common sense understanding.

Let us consider the purpose and eligibility criteria of maternity benefits, according to the departmental website. It states, “A maximum of 15 weeks of El maternity benefits is available. The 15 weeks can start as early as eight weeks before the expected date of birth, and can end as late as 17 weeks after the actual date of birth.”

My central argument is that protecting maternal health is a function of maternity benefits under the existing legislation and usage. That is why my bill, which touches directly on this function through existing entitlements, cannot be considered to be creating a new function. The function already exists.

The fact that applicants are already permitted to take benefits during their pregnancy, up to eight weeks prior to their due date, is strong evidence that maternal health and maintaining a safe pregnancy are existing purposes of maternity benefits. The legislation may not explicitly recognize this, or any purposes of maternity benefits, but I believe the interpretation and the spirit of the law confirm this understanding.

Legal analysis of the existing provisions is valuable, but should be complemented by a practical understanding of the benefits. In other words, it is not just my opinion that maternity benefits can be interpreted as having a maternal health function, but this is exactly how the benefits are being used.

Melodie Ballard, a constituent from my riding, is one of the many Canadians who chose to access their maternity benefits early because their job posed a risk to their health and that of their unborn child. This is not only allowed under the current rules, but in fact, it is one of the main reasons why benefits can be taken eight weeks before the birth. All Bill C-243 does is emphasize one of the existing purposes and practical usages of maternity benefits. That is it.

To be clear, I do not mean to suggest that this is the only function of maternity benefits, or the only reason that the legislation permits pre-confinement access. Indeed, maternity benefits can be taken after the birth, and in that sense they are also intended to provide a recovery period for the mother after childbirth. The key point is that maternity benefits should not be so narrowly interpreted as to exclude the function of maternal health, given the structure of the benefits and how they are practically used.

I will now present statements as to why my argument that employment insurance, and in particular maternity benefits, do serve the purpose of supporting a healthy pregnancy. To begin, consider this statement from the director general of El who, when she appeared before the HUMA committee on May 8, 2014 said, “Maternity benefits provide income support for a 15-week period surrounding childbirth to allow recovery from physical or emotional effects of the pregnancy and childbirth.”

It is clear from this statement that maternity benefits are used to support maternal health during pregnancy. Perhaps more specifically, Mr. Speaker, you will have to answer whether maternity benefits serve the purpose of protecting the mother when her job poses a risk to her health, or to that of her unborn child.

In other words, do El maternity benefits serve a similar purpose to the preventative withdrawal program that exists in Quebec? This is a topic that has actually been discussed during debates in this House, in particular on past private members' bills, Bill C-380 and Bill C-307.

I would refer to a contribution from the member for Coast of Bays—Central—Notre Dame on May 3, 2012, “provinces outside of Quebec have been relying for numerous years on the Employment Insurance Act for compensation for pregnant and nursing women in the circumstances of a preventive withdrawal from work.”

That sort of statement makes my argument quite succinctly and coherently.

A similar explanation for how employment insurance benefits are used for the purpose of protecting the mother and unborn child were put forward in this House on October 17, 2005, by the parliamentary secretary to the Minister of Labour and Housing at the time, “women under federal jurisdiction, if they must take leave, have access to employment insurance”.

The understanding that maternity benefits are an income support during a period of preventative withdrawal was corroborated by multiple members during debate proceedings on both Bill C-307 and Bill C-380.

In addition to members of Parliament, this understanding of El has been affirmed by departmental officials as well. When asked during the HUMA committee on October 22, 2003, about whether Canada had a system of preventative withdrawal, the Director of Labour Standards and Workplace Equity responded:

Where the job has been determined to be dangerous, the employer has an obligation to attempt to reassign her to work that is not unsafe for either the unborn child or the nursing child. If it's not possible or not reasonably practicable for the employer to reassign that individual, then she is entitled to leave without pay. What would happen under those circumstances is that she would take advantage of the employment insurance program...

It is clear that the employment insurance system, in particular the eight weeks of pre-birth maternity benefits, are an integral part to supporting women who choose to leave their job due to hazardous conditions.

Even though some statements do not mention maternity benefits explicitly, it is clear that this is the main form of El that would apply in these cases.

The final point I will make is to clarify that this bill does not affect any other type of El benefits, in particular parental or sickness benefits. Parental benefits would still only be able to be taken after confinement, which is in keeping with their purpose.

One might also think that protection of the expectant mother better falls under the category of sickness benefits. In fact, this is a very common misconception of sickness benefits. The reality is that sickness benefits can only be accessed if the individual is sick, not if there is a risk to their maternal health. Unlike maternity benefits, they cannot be taken for the purpose of protecting the health of the mother and the unborn child from the risks of a hazardous work environment.

Let me be clear, eight of the 15 weeks of maternity benefits can and are frequently being used for that purpose. As this function and purpose is well-established, my bill cannot be said to be creating a new function.

To conclude, the intent of my bill is simply to emphasize an existing function of maternity benefits, maternal health, for those who need it most, women working in hazardous jobs.

There is a royal recommendation that exists for spending on maternity benefits. There is no doubt that this bill would affect the manner in which that spending is done.

The central question is, does my bill shift spending in a manner that departs from the original purpose of maternity benefits? Put another way, does protection of the women's maternal health fall outside of the purpose of maternity benefits? I submit to you that it does not.

In closing, I will draw your attention to Keyes 1997 who argued on page 20 that royal recommendation is not required for cases where the bill authorizes spending for similar functions where “Provisions imposing additional functions on publicly funded bodies if the functions are of the same nature as their existing functions or are conferred for similar purposes.”

Second Reading

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

Mr. Speaker, once again, I am pleased to speak to Bill C-395, the proposed changes to the Employment Insurance Act with respect to labour disputes.

This legislation addresses what I think is a bit of a gap in the EI system right now and in the Employment Insurance Act. The question is: what should be done if the qualifying period for somebody who has lost his or her job includes work lost because of a labour disruption? This bill is a reasonable attempt to address the gap. At the very least, it is worthy of further study at committee, so we can identify whether or not there is more that needs to be done. Also, to some extent, we could perhaps address the issue of what the cost might be. I see that the Speaker has ruled that a royal recommendation will be required.

Let me speak to the issue this bill addresses and how it proposes to solve it. Right now, somebody's qualification for employment insurance is determined by the qualifying period that precedes the loss of employment, and that is 52 weeks. There are allowances for certain instances such as sickness, but not for work time lost due to a labour disruption.

During a labour dispute, employees cannot draw EI. They can, in some cases, receive strike pay. Or they could, conceivably, go out and get another job, although it is a very difficult circumstance in which to look for a job when one is hoping to go back to a job that one currently holds. If one gets strike pay, of course, it is different from having insurable earnings for EI.

It is always difficult to determine costs when we are looking at employment insurance. It involves very complex calculations. This year, we had the issue of what it actually costs in another area of qualification, the 360-hour national qualifying standard. Just over a year ago, last spring, because of a request from the committee looking at a private member's bill, the HRSDC department had estimated that cost at somewhere around $600 million or $700 million. The exact figure does not come to me, but it was in that range.

Other people have estimated it will cost $1 billion to $1.5 billion a year. That would make sense, because there are more people unemployed now than there were last spring, and there has been a slight escalation in cost. As a result of a request from the employment insurance working group established by the Prime Minister and the Leader of the Opposition, we had the outrageous guesstimate, we might call it, of over $4 billion. They came back and said this would cost over $4 billion.

That did not make any sense. Everybody knew that was nuts. In fact, the government itself came back a little bit later and said the cost was actually about $2.5 billion. We asked the Parliamentary Budget Officer and he came in with a cost of about $1.1 billion, which notionally makes sense and obviously was statistically backed up. But that is why we have issues with costs when we start looking at employment insurance.

We have the same thing when we look at two-week waiting periods. What is the cost of a two-week waiting period? It is not really a waiting period; it is an out-of-luck period for a person who loses his or her job. What is the cost of that? The estimates have varied a bit on that, as is the case with this bill.

This bill does indicate that if a job is lost following a labour disruption, allowances can be made. It is very difficult for people and families who are already suffering from being unemployed because of a labour disruption when, all of a sudden, they come back and within a short period of time they are laid off completely and find out that their qualification for EI has been affected.

In essence, this bill will simply extend the qualifying period by the length of time of the labour dispute. As I have indicated before, qualifying is a huge problem in this country. It has been identified as the number one problem with the EI system. Many solutions have been proposed over the last number of years, and specifically in the last year.

We have had private member's Bill C-269 and private member's Bill C-265 from the member for Acadie—Bathurst and the member for Chambly—Borduas. In this session, we have looked at Bill C-241, Bill C-280 and Bill C-304. These are serious attempts to have a look at what the gaps are in the EI system, particularly at a time of economic difficulty.

We are still in this; we are still seeing job losses. We saw the numbers that came out the other day. There are still people in Canada who are losing their jobs. The economy needs a little bit of help. Everybody talks about stimulus. From any reports I have seen, the best stimulus is to invest in people who have lost their jobs or are in economic difficulty, because they will in fact put the money back into the economy, which is what stimulus is supposed to be all about.

We have heard from many people, including all the premiers from Ontario to the west, who normally have not spoken out much on employment insurance. All of the premiers of varying political stripes have said that we need to look at the issue of accessibility. We need to have a look at these variable entrance requirements, particularly at a time of economic difficulty, to see if they still make sense, because they are hurting the provinces. We heard that from the Minister of Finance's wife, when she was running for the leadership of her party in Ontario. We heard it from Premier Stelmach and Premier Campbell, and every premier, including Premier Brad Wall in Saskatchewan.

We have heard it from social policy groups. We have heard it from economists. We have even heard it from organizations that one might not normally think would call for such a thing. TD Economics has called for it. The Chamber of Commerce urged that we have a look at a couple of things in its prebudget submission this year, including entrance rates, but also at the two-week waiting period. These are all things that can be done to improve the system right away.

We have to have a look at what has the government done for employment insurance, recognizing finally that we are in a period of economic distress. As the House will recall, last November when the United States was already looking at proposals to assist people who were unemployed, we had an economic update that offered nothing.

In January, when we came back after Parliament was prorogued, EI was addressed in a specific way by adding five weeks of eligibility, which was a step forward in my view. If we look at the private members' bills that we have seen in the House over the past few years, the extra five weeks was always a small piece of it.

Of course, there was nothing on the two-week waiting period, nothing on accessibility, and nothing on increasing the rate of payment from 55% to 60%, which is called for a lot. But the five weeks were helpful and they were particularly helpful because they affected all Canadian workers; they did not pick winners and losers.

That is why the five weeks was a good piece of public policy at the time, but they are nowhere near to being enough and did not address the issue of accessibility that the 360-hour national standard would address. But the five weeks were something for all workers in Canada.

This fall we had a couple of pieces of legislation, one of them being Bill C-50, which would extend benefits from 5 to 20 weeks, but only for a select few, the fortunate few, in this country.

In the spring the government was saying that it was going to offer extra benefits to everyone, and then in the fall it said it was going to go back to a small percentage of the unemployed. One may qualify for between 5 and 20 weeks, but if one has drawn on EI before, too bad. If one happened to be a seasonal worker in northern New Brunswick, or in the fishing industry or the tourism industry, or others like that, one did not qualify for the extra 5 weeks.

That kind of discriminatory approach flies in the face of what the government was proposing to do at the beginning of the year, which was to provide equality in the employment insurance system, at least on the extension of benefits, if not in actually going to the number one source of irritation for Canadians, for workers, public sector unions, social policy groups, economists, think tanks, premiers and the wife of the finance minister. They were all saying that the system is not fair and that we have to fix it.

The reason it is not fair is that accessibility requirements range too much. At a time of economic difficulty, we need to do something to assist all Canadians and we need to make sure that people who lose their jobs do not feel like the government has forgotten them.

I would remind members that earlier this year the Minister of Human Resources and Skills Development was quoted as saying she did not want to make EI too lucrative. I remind the House and the millions who are watching at home that average employment insurance benefits are somewhere in the range of $330 a week. There are not that many people in the House who would want to work for $330 a week, or would feel very excited about losing their job so they could get $330 a week. I think the maximum is $440 a week.

EI is far from being a lucrative proposal for anyone. We have to keep in mind as well that people cannot draw EI in Canada if they voluntarily quit their jobs. If they quit their jobs, they do not get EI. They are told that they do not qualify. They can appeal it and they might be able to make their case, but they cannot quit their jobs and get EI.

Therefore, for an individual to suggest that EI is lucrative and that anyone would deliberately try to qualify for it, the individual would have to suggest that the person find a way to lose his or her job without quitting it. That person would have to get the employer to let him or her go so he or she could make 55% of his or her previous earnings.

Bill C-395 is worthy of consideration. I congratulate my colleague who brought it forward. We think it addresses a gap in the system. We think that at a time of economic difficulty, this is when we need to invest in employment insurance, because employment insurance assists Canadians when they need it the most, through no fault of their own from a work stoppage. It should not be made harder because of a labour disruption in the previous qualifying period.

Speaker's Ruling

[The Acting Speaker, Conservative, Barry Devolin]

The Chair is now prepared to rule on the point of order raised by the hon. parliamentary secretary to the government House leader on October 7, 2009 concerning the requirement for a royal recommendation for Bill C-395, An Act to amend the Employment Insurance Act (labour dispute) standing in the name of the hon. member for Berthier—Maskinongé.

I would like to thank the parliamentary secretary for having raised this important matter, as well as the hon. member for Berthier—Maskinongé for his remarks concerning the bill.

In presenting his concerns with respect to Bill C-395, the parliamentary secretary stated that in his view the bill infringes upon the financial initiative of the crown. Specifically, he pointed out that the bill seeks to change the purposes of the Employment Insurance Act by adding a new provision that would extend the qualifying period for an undefined period in case of a work stoppage caused by a labour dispute. He also argued that by altering the calculation of the qualifying period, the bill would result in increased government spending on employment insurance.

In support of his contention that the bill requires a royal recommendation, the parliamentary secretary made reference to a Speaker's ruling on Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits) on March 23, 2007 and a ruling by the Speaker of the Senate in Bill S-207, an Act to Amend the Employment Insurance Act (foreign postings) on January 29, 2009.

Both bills were similar to the present bill in that they sought to modify the employment insurance qualifying period, and both were found to require royal recommendation.

In his intervention, the hon. member for Berthier—Maskinongé argued that a royal recommendation is not required since the funds in the employment insurance account are paid by workers and employers and do not constitute government funds.

The Chair has examined the bill carefully and, it is clear beyond all doubt that Bill C-395 alters the terms and conditions of the existing program under the Employment Insurance Act. The argument put forth by the hon. member for Berthier--Maskinongé regarding whether or not funds contributed to the employment insurance fund constitute public revenue is a recurring argument. It has been brought forward during similar discussions on Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system) as well as Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system) from the previous Parliament. In essence, all monies received by the government, regardless of source, are deposited in the consolidated revenue fund and become public funds, that is, funds of the Crown. The Constitution Act of 1867 and Standing Order 79 apply to these funds. Thus, a bill proposing a new or increased expenditure of public funds, that is, an appropriation, requires a royal recommendation.

The employment insurance program operates under this framework. The funds in question are public funds and their management is subject to the financial initiative of the Crown.

By extending the qualifying period for employment insurance benefits by the amount of time a person was unemployed due to a work stoppage resulting from a labour dispute, Bill C-395 is increasing the expenditures under the act. These expenditures would be paid out of the consolidated revenue fund. As the House is aware, such provisions can only be put to the House for a final decision if they are accompanied by a royal recommendation as set out in Standing Order 79(1). Consequently, the Chair will decline to put the question on third reading of the bill in its present form unless a royal recommendation is received.

Today's debate, however, is on the motion for second reading, and this motion shall be put to a vote at the close of the current debate.

Employment Insurance Act

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

Mr. Speaker, I am pleased to have this opportunity again to speak to Bill C-50 in the House. We spoke to it when it was introduced and we have dealt with it in committee.

We had a vote on an amendment yesterday that Liberals supported. One of our key concerns about this bill, shared even by those who have agreed to go along with this bill, is that it already disenfranchises so many workers. We did not want to see further workers disenfranchised because this bill has to work its way through Parliament.

It is impossible to look at Bill C-50 without considering the context, the situation that this country is in, what we have gone through in the last year and a half in Canada, and the economic crisis that the bill is supposed to address. The background, as we know, is that the crisis started last year. Questions were raised as far back as last spring in the House and outside the House about the potential for Canada facing some economic difficulties. Of course, the Minister of Finance, the Prime Minister and everybody else told us not to worry, but to be happy. They told us that the sky was not falling and that Canada was not in any kind of trouble.

I have an article here from the National Post, a great Liberal institution, dated May 30. The headline is “[Finance minister] denies Canada headed for recession”. He goes into his thing about the economic fundamentals being strong. He said that we should not worry and that Canada was not heading into a recession. He also told us not to worry and that Canada would never go into a deficit. We were doing great, living off the strong fiscal management of the Liberal Party. The finance minister told us that we did not have to worry and that we could not mess it up that badly.

On September 27, in the middle of a federal election, when Canadians were worried about what was happening with the economy in Canada, we already had action in the United States from then-President Bush and incoming, soon-to-be-elected President Barack Obama, who said that we needed some stimulus and activity.

On September 27, the headline in the paper said “[Prime Minister] says Canada not in deficit, despite opposition claims”. The Prime Minister said:

The opposition tries to tell people that we’re in deficit when we’re in surplus. Tries to tell people we’re in recession when our economy is still growing. Tries to tell people we are losing jobs when actually more people are working.

That was only a year ago. The Prime Minister assured the people of this country that they should not worry, that people were working, that we were not in deficit, that we were not going to go into deficit, that we were not in recession, and that we were just fine. Then, we came back after the election.

The Prime Minister used a strategy to address this issue with Canadians. First, it was to tell them that it was a buying opportunity when their stocks went down. Second, it was to bring in an economic update that did nothing except throw political tricks into an economic update. Third, it was to prorogue Parliament. Fourth, it was to conjure up separatist-socialist coalitions. Finally, in January, prodding by the Liberal Party made the government say that it will try to have a look at this. It finally brought forward the budget in January of this year.

There were some things in there. Nobody would suggest it was enough. In fact, if one were to look at the reports that came out from the Caledon Institute, the CCPA, Canadian Centre for Policy Alternatives, labour union groups and other social policy networks, they said that this would not be enough to help Canadians. However, at least there was that five extra weeks.

Everybody who was unemployed and had a claim was eligible. It did nothing to increase eligibility, which was and continues to be the number one issue with employment insurance, but at least it offered five weeks. It offered those five weeks to everybody. I have asked two members of the Conservative Party if they could explain the juxtaposition of the Minister of Human Resources who, in talking about those extra five weeks in her own estimates tabled here, said:

--including extending five extra weeks of benefits, which is now only available in some regions, to all Canadians.

That was one of the boasting factors that the Minister of Human Resources talked about from the January budget. She said that Canada has projects where people get an extra five weeks and that five extra weeks of benefits is something that was always part of private members' bills, initiatives and proposals put forward by other people. That is not a panacea, but she is saying that the government has taken it and given it to all Canadians. One would assume that she said that because she felt proud of it.

It is almost as if she believed in equality. It is almost as if she felt that everybody was equally deserving of assistance. Now, we are debating a bill that goes in exactly the opposite direction. It divides Canadians into those who are deserving and those who are not deserving. That is a very significant contradiction in view, expressed over a period of a few months.

We have had employment insurance bills in the House for some time that talked about reforming EI. In the last Parliament they were Bills C-265 and C-269. We looked at those bills. What did they ask for? They consistently asked for the elimination of the two week waiting period. As people know, when they get their employment insurance, it is not really a waiting period. My colleague from Bonavista—Gander—Grand Falls—Windsor would agree with me that people who lose their job do not wait two weeks; they wait a lot longer than two weeks. In some cases they wait two months. The standard for Service Canada is that 80% of people get their claim processed in 28 days. We brought that to this House of Commons 12 months ago and the minister denied there was a problem. Then in the spring, she admitted there was a problem and she spent $60 million hiring people, but eliminating the two week waiting period is a possibility.

Increasing the rate of benefits is a possibility. It is now 55%. A number of private members' motions, opposition motions, social policy groups have indicated that should be 60%. The way we calculate benefits, perhaps going to the best 12 weeks is another way of looking at this; increasing the maximum insurable earnings. If somebody is making $70,000 and loses their job and they qualify for EI, they do not get 55% of their salary of $70,000, they get 55% of the maximum insurable earnings, which is in the low forties.

There are a number of ways we can change EI if we are serious about reform. Who else was talking about that back in the spring, and what were they talking about? “To be locked into a system which has 58 separate employment insurance regions, where one Canadian gets treated dramatically different than another Canadian, it doesn't seem right to me”. That was British Columbia Premier Gordon Campbell, who supported the call of the Leader of the Opposition for a national 360 hour standard of eligibility during the period of the recession.

Saskatchewan Premier Brad Wall said, “Here is an example where the recession's impact in Canada has moved from east to west, and we are feeling the effects”. Brad Wall supported the call of Mr. Campbell for some kind of national standard for employment insurance eligibility.

Again, Premier Gordon Campbell on May 29 called on the federal government to have one employment insurance standard throughout Canada. The Premier of Ontario had a position that said we should have one national standard across Canada, and 360 hours made sense. That is what people called for. Maybe it is 420 hours, which is the lowest eligibility, but the point is, we should have some equality in the system.

Premier Campbell is quoted in the Globe and Mail as saying, “The federal government needs to overhaul a clearly discriminatory employment insurance system to help the swelling ranks of the jobless in western Canada”.

The Premier of Ontario called for a national standard of employment insurance. It was not just the premier. Christine Elliott, who was at the time I believe running to be the leader of the Ontario Progressive Conservative Party, had some pretty sharp words for the Minister of Finance, with whom she enjoys a particularly close relationship, saying, “Ideally, the federal government will quickly reform EI to better meet Ontario's needs. The federal EI program is unfair to Ontario”.

Premier Stelmach said, “Alberta has complained about varying eligibility rules”. Premier Stelmach weighed in as well, so every western province has indicated that there was a problem. This was not the Liberals, the NDP or the Bloc saying that there was a problem. These were Canadians from coast to coast to coast suggesting that there was a problem.

We had an opposition day motion on March 5 brought forward by the New Democrats which called for a number of changes: eliminating the two week waiting period; reducing the qualifying period to 360 hours; allowing self-employed workers to participate, and we will have a look at that in the next few days as the government unveils its plan; and raising the rate of benefits to 60% and basing those benefits on best 12 weeks. Those were all things that were mentioned.

I mentioned Bills C-265 and C-269 in the last Parliament. There is Bill C-280, which we have debated in this Parliament and which we will be looking at today or Thursday in the human resources committee. It calls for 360 hours, increasing the weekly benefit, and reducing the qualifying period.

The member for Brome—Missisquoi brought forward Bill C-241 that we looked at in committee last Thursday. It will be coming back to the House. It calls for the elimination of the two week waiting period. There was another bill brought forward by the NDP member for Welland, which referred to severance payments and how they are treated in EI.

There were a number of changes across the board, some of which are very standard, that people were calling for. Primarily, they wanted a national standard of 360 hours for EI eligibility and a two-week waiting period. They wanted to take a look at the rate of benefits, the maximum insurable earnings and how benefits are calculated. Those are all things we have talked about. I have not seen any academic, social policy expert, anybody, suggest that the answer to the crisis was to further provide benefits and then to limit those benefits to only a few people.

In the spring the leader of the Liberal Party made his point clear, that we would call for a national standard of 360 hours for employment insurance eligibility. That was the call of the Leader of the Opposition, supported by many people across the country.

Our proposal was that it would be temporary in nature during a difficult period of time. One thing that often gets lost in this debate is the importance of EI as a stimulative measure to the economy. Those people who get EI need EI. Those people who get EI spend that money on food and shelter, things that they need for themselves and their families. That money goes back into the economy. This is a country that went crazy for stimulus back in January and February. Everybody was calling for stimulus. Those who evaluate stimulus said that the best stimulus is to invest in social infrastructure, particularly EI because that means the money will go into the economy. The second best stimulus was in infrastructure. The third best stimulus was tax cuts, particularly tax cuts that do not disproportionately put money into the hands of those who need it the most, low-income and middle-income Canadians. It is a very important stimulative effect.

What was the government saying to all this at that point in time? It was discouraging.

The Minister of Human Resources was quoted as saying, at the end of January, after the Conservatives brought forward the budget and were being criticized for not having addressed the key issues of EI:

Our goal is to help people get back to work, and get back to work quickly in jobs that will last. We do not want to make it lucrative for them to stay home and get paid for it--

That quotation was never retracted. It raised the hackles of people across the country, particularly those who are on EI, not because they want to be on EI but because they have to be on EI.

There was a running smear campaign against people on EI, that it was a nine-week work year, as if people would find a way to get fired from their jobs. Members must keep in mind that people cannot collect EI if they quit their jobs. That is a change that was made. The minister's suggestion was that people would be rushing out, trying to find a way to get fired so that they could go on EI for a maximum of 55% of what they were earning in their job for a maximum of anywhere from 19 to 45 weeks, or 50 weeks with the extension, most of them at the low end of that. It does not make any sense. Who would do that? It is an insult to Canadians who lose their jobs.

She changed her tune a bit in June. The minister was quoted as saying, “There is no need to change the threshold for employment insurance eligibility because as the economy worsens, more and more Canadians will find it easier to qualify”. She also said, “If the unemployment rate goes up in a given region, then it gets easier for people there to access EI for a longer period of time, and most of the regions around Canada now have become easier to access”.

Let us think about that. The United States has Barack Obama's version of hope: equality for all; benefits for those who need them. Canada has the Conservative government's version of hope: “Don't worry. Things are getting worse. We are not doing anything to help you. But you will find it easier to get EI because more of your friends and neighbours will be unemployed and then the unemployment rate will go up in the region and it will be easier to qualify”. That is what passes for hope from the Conservative government, “Wait. Don't worry. Things are getting worse. It is good news for you, but bad news for your neighbours, bad news for your friends, bad news for Canadians”. That is what we heard from the government.

A very important report was released in June by the Standing Committee on the Status of Women. The committee held hearings specifically about how EI affects women. I do not think it is much of a secret that with the system as it currently exists fewer women qualify for EI benefits and they get less payments. That is an inherent problem with EI that needs to be fixed. It is a problem which the Leader of the Opposition addressed when he called for a 360-hour national standard. That would have helped women and part-time workers.

He also called for an overhaul of the EI system. That is what is needed. We cannot do it piecemeal. There are things that we should do in the time of a recession. We do need an overhaul of the employment insurance system.

Changes came in. People were hurt. The economy was different. We were coming out of a time of recession and into a period of a long sustained recovery under Liberal governments. We are now back into a Conservative recession. Things have changed. That is just a fact of life. The circumstances are different now than they were in the 1990s. I could debate with colleagues in this House about what happened in the 1990s to no effect, but what we can do is impact people today who need help at a difficult time.

The status of women committee heard from a number of people. Richard Shillington testified at the committee hearings. He said:

Think of EI as a series of hurdles. To be eligible for your benefit, you first of all have to have had paid employment.... You have to have a certain number of hours. You have to have left your job for the right reason--you can't be fired; it has to be a lay-off.

We heard in the spring that 80% of people who were eligible were getting EI. That is incorrect. There was testimony from another witness who indicated:

The government likes to argue that 80% of all currently employed workers would qualify for regular EI benefits if they were to lose their jobs. However, this ignores the fact that job loss particularly affects those with unstable patterns of work, such as workers on reduced hours before a layoff as well as part-time, temporary, and contract workers. It also ignores the fact that many unemployed workers qualify for EI for a shorter period of time but quickly exhaust their benefits.

Those people would not be helped by Bill C-50 in the least.

There were a number of recommendations, a whole host of them which I will not read but I recommend this to all members for their consideration. One of the recommendations is that Human Resources and Skills Development Canada implement a uniform 360-hour qualification requirement. There is another about increasing the maximum benefit entitlement. There is one about the two-week waiting period. There are some recommendations about self-employment which I think we will be looking at in the next few days to see if they meet the needs of those who are most in need.

We had the EI working group over the summer, in which I took part. I have talked about that in this House on many occasions. I do not want to belabour people with that process, or how I spent my summer vacation. It was a discouraging time.

The government came up with numbers that were patently false, indicating that a 360-hour national standard would cost $4.4 billion. A week later the government said that it had made a bit of a mistake, that it would cost $2.5 billion. The actual cost as verified by the Parliamentary Budget Officer was $1.2 billion, but there still are government members, including the Prime Minister, who stand in the House and use the $4.4 billion figure. Unbelievable. There was documentation given to the committee that was marked “not for distribution” which had already been given to the media. That documentation showed those false numbers.

That is what we dealt with over the summer. I have talked about that before. It was a frustrating time.

I believe Parliament can work. I believe Canadians want Parliament to work. I had hopes that if we got together away from question period and used the strong resources of the human resources department that we could have effected some change. We could have all taken a little bit of water in our wine and come up with something that would have helped Canadian workers, but that was not to be, which is too bad.

The government came back in the fall and introduced Bill C-50. That is the bill we are talking about today. The fundamental problem with Bill C-50 is that it is discriminatory. Even the government would have to acknowledge that it picks winners and losers. It determines who is deserving of benefits. The minister has used this terminology herself, even at committee, “helping the most deserved workers”.

It is a discriminatory bill. Imagine a government coming forward with a health care system and saying, “We have a great new health care system. The only hitch is that if you have ever used the health care system, you do not get that health care. It is only for the deserving ones who have never used health care in Canada”. What would the outcry be to that? The outcry would be that that is clearly unacceptable. That is not what governments do. Governments do not pick winners and losers. Governments are governments for all the people.

Bill C-50 does not meet the needs of most Canadians. It does not meet the needs of most unemployed Canadians. It does not even meet the needs of most characterized long-term unemployed Canadians. It is a bill that is flawed. It is a bill that does nothing to address the number one concern of Canadians, which is to increase access to employment insurance for those who need it.

The bill does nothing to help seasonal workers who through no fault of their own work in the fishery, the forestry industry, or the tourism business. It does nothing for part-time workers. It is not a bill that we can support.

[The Deputy Speaker, Conservative, Andrew Scheer]

Before resuming debate on this bill, I would like to issue a ruling.

On May 7, prior to the second reading debate on Bill C-280, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits) standing in the name of the hon. member for Algoma—Manitoulin—Kapuskasing, a point of order was raised by the hon. Parliamentary Secretary to the Leader of the Government in the House of Commons to the effect that this bill requires a royal recommendation.

The parliamentary secretary argued that Bill C-280 would result in significant new expenditures by lowering the threshold for eligibility for some claimants and changing the formula for the calculation of benefits.

He further noted that Bill C-280 was virtually identical to another private member's bill introduced in the last Parliament, Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), which had been found to require a royal recommendation.

In replying to the parliamentary secretary's point of order, the member for Windsor—Tecumseh expressed the opinion that a royal recommendation was not required since any new expenditure would be covered by contributions from workers and employers and not by the government.

I have examined the bills carefully and found that as the parliamentary secretary noted, Bill C-280 and Bill C-265 are indeed virtually identical. They both contain proposed changes to the employment insurance program that include lowering the threshold for becoming a major attachment claimant to 360 hours, setting benefits payable to 55% of the average weekly insurable earnings during the highest paid 12 weeks in the 12 month period preceding the interruption of earnings, and reducing the qualifying period before receiving benefits and removing the distinctions made in the qualifying period on the basis of the regional unemployment rate.

On March 23, 2007, in a ruling on Bill C-265, on page 7845 of the Debates, the Chair had concluded that:

It is abundantly clear to the Chair that such changes to the employment insurance program, notwithstanding the fact that workers and employers contribute to it, would have the effect of authorizing increased expenditures from the Consolidated Revenue Fund in a manner and for purposes not currently authorized.

Therefore, it appears to the Chair that those provisions of the bill which relate to increasing Employment Insurance benefits and easing the qualifications required to obtain them would require a royal recommendation.

Having heard no new compelling argument to reach a conclusion that is different than the one concerning Bill C-265, I will decline to put the question on third reading of Bill C-280 in its present form unless a royal recommendation is received.

However, today the debate is on the motion for second reading, and this motion shall be put to a vote at the close of the second reading debate.

Resuming debate. The hon. member for Niagara West—Glanbrook has seven minutes remaining in his time slot.

Private Members' Business--Bill C-280

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, on February 25 you made a statement with respect to the management of private members' business. In particular, you raised concerns about five bills that, in your view, appeared to impinge on the financial prerogative of the Crown. One of the bills you mentioned was Bill C-280.

I am, therefore, rising on a point of order regarding Bill C-280, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits).

Without commenting on the merits of the bill, I submit that Bill C-280 contains provisions that would change the purposes of the Employment Insurance Act, which would require new spending and, therefore, would require a royal recommendation.

Bill C-280 would lower the threshold for becoming eligible for employment insurance benefits. The bill would introduce a new benefit rate calculation method of the best 12 weeks in the past 12 months, reduce the qualifying period before receiving benefits and remove the distinctions made in the qualifying period on the basis of the regional unemployment rate.

The Department of Human Resources and Skills Development estimates that the measures contained in Bill C-280 would cost a minimum of $2.3 billion per year.

Precedents demonstrate that the proposed changes in Bill C-280 would require new spending for employment insurance benefits not currently authorized under the Employment Insurance Act.

On March 23, 2007, the Speaker ruled, in the case of Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), which is identical to Bill C-280:

...the changes...envisioned by this bill include lowering the threshold for becoming a major attachment claimant to 360 hours, setting benefits payable to 55% of the average weekly insurable earnings during the highest paid 12 weeks of the 12 month period preceding the interruption of earnings, and removing the distinctions made to the qualifying period on the basis of the regional unemployment rate. ...would have the effect of authorizing increased expenditures...in a manner and for purposes not currently authorized.

In the same ruling, the Speaker concluded:

...those provisions of the bill which relate to increasing employment insurance benefits and easing the qualifications required to obtain them would require a royal recommendation.

Bill C-280 is identical to Bill C-265 from the 39th Parliament, which was found to require a royal recommendation. Therefore, I submit that Bill C-280 must also be accompanied by a royal recommendation.

Bill C-279

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, on February 25, you made a statement with respect to the management of private members' business. In particular, you raised concerns about five bills, which, in your view, appeared to impinge on the financial prerogative of the Crown. One of the bills you mentioned was Bill C-279.

I am therefore rising, Mr. Speaker, on a point of order regarding Bill C-279, An Act to amend the Employment Insurance Act (amounts not included in earnings).

Without commenting on the merits of the bill, I submit that Bill C-279 contains provisions that would change the purposes of the Employment Insurance Act that would result in new spending and therefore would require a royal recommendation.

Bill C-279 would remove pension benefits, vacation pay and severance payments from the amounts that may be deducted from benefits payable under the Employment Insurance Act. The changes would allow individuals to receive employment insurance benefits when they otherwise would not have been eligible because pension, vacation or severance pay would have reduced their benefits or made them ineligible to receive employment insurance benefits.

The Department of Human Resources and Social Development Canada estimates that the changes proposed in Bill C-279 could cost as much as $130 million per year.

Precedents demonstrate the new spending for employment insurance benefits not currently authorized under the Employment Insurance Act require a royal recommendation.

On November 6, 2006, the Speaker ruled in the case of Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), that:

Funds may only be appropriated by Parliament for purposes covered by a royal recommendation.... New purposes must be accompanied by a new royal recommendation.

On March 23, 2007, in the case of Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), the Speaker ruled that the changes envisioned in this bill “would have the effect of authorizing increased expenditures...in a manner and for purposes not currently authorized”.

The Speaker goes on to state:

Therefore, it appears to the Chair that those provisions of the bill which relate to increasing employment insurance benefits and easing the qualifications required to obtain them would require a royal recommendation.

Mr. Speaker, I submit that these precedents apply equally to the provisions of Bill C-279 which would change the purposes of the Employment Insurance Act resulting in new spending and, therefore, must be accompanied by a royal recommendation.

Opposition Motion -- Employment Insurance

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

Mr. Speaker, a number of parts of the motion make a lot of sense. I would not stand here today and tell the House which one of these things we will implement when we form a government, but I will say this. EI will be a central component of our campaign and of our government.

I remind my colleague, who is very passionate on this topic and I understand that, that every time in the last Parliament when a private member's bill or motion on EI came up, similar to the motion we are debating today, whether it was his Bill C-265 or Bill C-269 from my friend from the Bloc, Liberals voted for those. They did not vote because they were forced to do that. They voted because Liberals believe in employment insurance. We believe it is part of the social infrastructure of our country. Canadians will find out after the next election, if they choose, as I think they will, a Liberal government, that EI will be a central part of the reforms that we will bring to our country.

Motions in Amendment

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Speaker, I thank the hon. member for Acadie—Bathurst for this bill, which is another demonstration of those who have fought hardest against the deficit and have had no return on their investment.

I would remind the House that the government managed to build up a surplus of $54 billion in the employment insurance fund by tightening up the system, by requiring more hours to qualify and, in the end, paying fewer weeks of benefits. That is how they turned off the taps. As a result, those who are the worst off have made the greatest contribution to fighting the deficit.

When we hear that Canada is now in a better financial situation, the people who are primarily responsible for this are the unemployed workers, employers and workers who have contributed to the EI system, which has really been used as a cash cow.

Now, when we try to correct the situation, for instance with Bill C-265, by lowering the threshold for becoming a major attachment claimant to 360 hours, which would make special benefits available to those with that level of insurable employment, we are merely trying to restore its human side. That is how we must look at this bill.

We are also talking about weekly benefits representing 55% of the average weekly insurable earnings during the highest-paid 12 weeks in the 12-month period preceding the interruption of earnings. In other words, with an amendment like this to the legislation, someone who manages to qualify for employment insurance and loses his or her job will be given an income that is far from extravagant, but which represents a more reasonable minimum than under existing legislation, which, as everyone knows, is the result of these systematic restrictions under previous governments.

We now have the most appalling proof, that is, the $54 billion that the government would sooner forget. As though following this misappropriation of funds, in other words, after stealing this money, it was decided to record it, to put it down under lost accounts and stop worrying about it. However, the people who fought the fight and those living in this situation today still need some help, like the kind of help outlined in the bill before us.

The same is true for older workers. In my riding there have been some major closures. Unfortunately there was another one just last week. In a company with 50 or so employees, 5 to 10 are workers over 50 who cannot be retrained easily. I know there are some in the Quebec City area as well. I also know that some people have gone to their MPs and, facing this real-life situation, the latter have said, “We are going to change things”. But, today, the Conservative government is stepping back and not confirming the commitment it made to older workers.

Bill C-265 has to be seen as a heartfelt appeal for a modicum of fairness for people who have to live with the employment insurance system.

In the same vein, I would like to talk about one aspect in particular, that is not necessarily directly in the legislation, but is not unlike this situation. I am talking about all the pilot projects that are coming to an end in fall 2008. For example, there was the project that extended the unemployment rate, requiring fewer hours in order to be eligible and increasing the number of weeks of benefits. This project will end in October 2008 if the government does not extend it.

There is a pilot project for newcomers. Eligibility is based on 840 hours, instead of 910 hours under the regulations. This too will end on December 6, 2008. This helps keep young people in their regions and prevents us from losing them because, as everyone knows, there is an exodus of young people.

There is a project that allows all claimants to earn a minimum of $75 without any impact to their benefits or to earn 40% instead of 25% of their rate of benefit without being cut off. This encourages people to earn a little extra. This is another pilot project that will end in fall 2008.

There are two other projects: one that allows claimants to take the 14 best weeks and the other that grants five additional weeks of benefits in order to deal with the gap.

It is a series of measures. Under pressure from everyone who wanted the situation to be corrected, at least the government made adjustments by setting up pilot projects. These pilot projects have been in place for a number of years now and we now know they are necessary for ensuring minimum income for those who are affected by these pilot projects. We hope that the government will make these projects permanent and enact them in law, in the same spirit as Bill C-265.

The first few times the member for Acadie—Bathurst and I talked to each other, even before he became a member of Parliament, we agreed that the former government's cuts to employment insurance had to stop.

In our ridings, we saw how this negatively affected not only people's individual financial situations, but also the regional economy. The government's main message was that seasonal workers do not deserve reasonable support from the government; they should just move. We are still hearing this today: workers should move or go out west. I have nothing against the west. The government considers the law of the marketplace so important that it looks on people like cattle. It is time for a change.

We need to bring in measures that will restore some measure of dignity to the employment insurance system, measures like the proposals in Bill C-265 and the amendments the Bloc Québécois reintroduced in this House to ensure the debate took place. I appeal especially to the members from regions outside major centres, resource-based regions, regions with a major seasonal industry.

This is a private member's motion. Members must take this opportunity to exercise their rights as members and vote for this bill. This is a pivotal moment. This will not necessarily be the bill of the century that attracts the attention of the national media, but every member here in this House should look at the bill and ask himself or herself whether it would not benefit the people in his or her riding who are most in need and are experiencing financial difficulty. Would voting for Bill C-265 not be a great way to combat poverty?

All the efforts made by the members of this House to restore some measure of dignity to the employment insurance system deserve to be recognized. The effort that has been made to bring this bill before us deserves recognition. We need to put the $54 billion surplus and the money we want to provide for people into perspective. This bill will not make the system too broad, far from it.

For example, basing the benefit amount on the 12 best weeks will give people $320 instead of $300, or something like that. In a family, even if both parents are working, it can be very difficult to make ends meet during some winter months, especially on that much money.

In a society with such collective wealth, parliamentarians have the responsibility of ensuring that an adequate minimum amount of this wealth is distributed. We are more than happy to take advantage of the fruits of the labour of seasonal workers, who do not work full-time each year. Often more people are required to carry out this work. However, we need to ensure that they have decent minimum conditions. It is our responsibility to provide an employment insurance program that adequately responds to these conditions.

The fight for employment insurance has long been a defensive one. I hope that we are at the point of taking concrete action and that we will adopt legislation that will restore a minimum level of quality to the program and that will re-establish the balance between workers and employers. The 1994 changes have proven unduly harsh for those who lose or quit their job. The pendulum has swung too far, and the situation must be fixed.

In conclusion, I would ask the members in this House to consider, when they are voting, whether or not it is truly reasonable to accept what the bill is proposing, which is calculating EI benefits by allowing someone to qualify with 360 hours based on the best 12 weeks of earnings; by reducing the qualifying period before benefits are awarded; and by removing the distinctions made in the qualifying period on the basis of the regional unemployment rate. Are these proposals not simply a way of bringing the pendulum back to centre, of restoring a better balance?

We must always remember that by voting for this measures, we are not returning the $54 billion surplus that was siphoned off. Today we are very happy that the Canadian economy is in better shape. If we had a way to give back to those who made the biggest contribution in Quebec and in Canada and who brought about this state of affairs, why would we not do so by voting in favour of the bill before us?

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I hardly know where to begin after listening to my colleague from the Liberal Party. I did have some prepared comments, but he has actually knocked me right off my game with the outlandish remarks he made regarding EI reform and his efforts to convince Canadians that the Liberal Party sincerely would like to see the EI system reformed.

I would like the record to show that it was the Liberals who gutted the unemployment insurance program in 1996. It was the Liberals who paved the way in 1996 and showed the Conservative Party how to use the EI fund as a cash cow for everything except income maintenance for unemployed workers.

It was the Liberals who were punished resoundingly in the province of Nova Scotia by six seats because they had the audacity to undermine income maintenance for unemployed workers. They got slaughtered in the election in 1997 as a direct result of using the EI system to pay off their debt on the backs of the most vulnerable people in the country, unemployed workers.

Before I begin my remarks on the bill put forward by my colleague from Acadie—Bathurst, I must tell the House that the Liberals gave away $100 billion in tax cuts, which they are very proud of and crow about from the rooftops. Let me tell the House where they got that $100 billion to give away to their buddies.

The Liberals took $30 billion right out of the unemployment insurance program, whether we call it stealing or lifting or pilfering, and not one penny of that was their money. It was paid in by contributions from employees and employers, nobody else.

They took another $30 billion from the surplus of the public sector pension plan. Again, they had no proprietary right to the surplus in the pension plan without negotiating it with the beneficiaries. The Liberals took that $30 billion right out of there and used it to do whatever they wanted, from paying down debt to giving tax breaks to their buddies.

The last $40 billion they took was from direct social program cuts.

That is where the Liberals got the $100 billion that they gave away to their buddies.

I must not get completely knocked off my game. I will return to the issue at hand here, which is Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), introduced and sponsored by my colleague from Acadie—Bathurst.

Let me preface my remarks by saying that working people in Canada have no greater champion on this issue than my colleague from Acadie—Bathurst. He was elected on the basis of his advocacy on this subject and he has been a tireless champion.

Throughout 11 years this June 2, this man has stood up many times to try to drum some reason into the ruling party of the day. There have been nine years of Liberal leadership and two years of Conservative leadership. He has been trying to get it through their thick heads that income maintenance for unemployed workers is a good thing to bridge the gap of employment.

He has been trying to tell them that our system is dysfunctional and broken. No wonder it was showing a surplus of $750 million a month at its peak: nobody was qualifying any more. It is not hard to design a system that shows a surplus if benefits are denied to virtually everybody who applies. That happened for two reasons.

First, the Liberals introduced a system that went to an hours-based system of 920 hours, which made it very difficult for people to qualify for the first time. The bill put forward by my colleague from Acadie—Bathurst proposes to reduce the eligibility qualifying time and return it to 360 hours. The benefit would be based on an individual's best 12 weeks.

We know who undermined that at committee. The heart and soul of this legislation, in summary, is that it would reduce the eligibility time so more people would qualify, and it would increase the benefit per week that individuals would receive so they would get a reasonable benefit based on former income. That was undermined at committee by the Conservatives, backed up by the Liberals.

This is a minority Parliament. The opposition parties could in fact effect this change in this finite window of opportunity, but it was gutted, stripped and undermined by the Liberals at committee. Therefore, we are right back where we started. Again we have the same fight of nobody qualifying for eligibility for EI any more and successive ruling parties in government using this fund as a cash cow to pay for everything but income maintenance for unemployed workers.

In 1997 we did a calculation of the impact of the Liberal cuts. In my riding alone, just the riding of Winnipeg Centre, when the Liberals gutted the EI system, $20.9 million a year in federal money that was coming into the riding of Winnipeg Centre was ripped out. It was like losing the payrolls of two huge pulp mills or auto plants. Federal payroll money of $20.9 million a year that was coming into the riding no longer did. It was stopped.

That was true in every riding across the country. There were some ridings in Newfoundland and Labrador and Quebec where the impact was in terms of $50 million a year of federal money that used to come into those ridings. In the riding of Acadie--Bathurst, it was $81 million a year.

Do we wonder why the constituents were up in arms and sent the bums running by voting them out of office en masse in those Atlantic Canada ridings? That was the real impact of the changes to EI. Yes, the Liberals might have balanced the books, but they balanced the books on the backs of the people least able to afford it.

I am a journeyman carpenter. I have been on probably 10 different EI claims in my life, which is just a fact of life as an employee in the blue collar industries, but let me tell members about one thing that always bugged me, which neither the Liberals nor the Conservatives ever fixed.

When I was going through my four year apprenticeship, there was a two week waiting period even when I was going to trade school, as if I had been laid off. But apprentices are not laid off: the beauty of apprenticeship is that people earn while they learn. The employers give them six weeks off to go to the trade school and study for those six weeks.

It used to be that we could go right onto EI. That was part of the deal. Then the Liberals introduced a two week waiting period for apprentices, who had to starve and somehow borrow money to bridge that gap. That cost $11 million a year. A lousy $11 million a year would have made people whole for the two week waiting period, at least among the carpenters. I guess we have to extrapolate that to other trades.

That is how nickel and dime they were as they were trying to squeeze every ounce of juice out of the EI system. I will never forgive them for the inconvenience that it caused me and people I know.

Now that the Liberals think they are poised to form a government again someday, they are unwilling to fix the EI system, which they broke. In spite of all their rhetoric and being sympathetic to the issues, they are unwilling to fix it. I listened to that guy from Dartmouth and I could not believe it as he fudged around all of the issues that he knows very well are true.

When we add up the numbers of opposition members in this House of Commons, we see that we can do anything. United, we could bring this government down. United, we could fix the EI system. United, we could have a national pharmaceutical health care plan. United, we could have a national child care program.

We could do anything, but those members have squandered this finite window of opportunity.

I am running out of time, but I want to do justice to the bill that my colleague has introduced and has fought so valiantly for. It must make his blood boil to sit here in the House of Commons today and watch the other parties, the ruling party and its dancing partner, the Liberal Party, once again strip, undermine and destroy his efforts to fix the EI system.

I know that people in his riding had some optimism that perhaps this was the window of opportunity we needed, that surely Parliament would listen to them now that working people are represented in the House of Commons, and now that the three centre-left parties, so to speak, are united in opposition, but no, one of those parties went south on us. The official opposition went south on us, and we lost this again because the Liberals still see the unemployment insurance fund as a cash cow they can milk.

That $54 billion that we will vote on later today in Bill C-50 will be the end of that surplus money. Just let me state for the record one more time in case there is anybody who does not understand it: this is not the government's money. The entire EI fund since 1986 has been made up of contributions from employers and employees. Not one penny has come from the federal government.

When the fund dipped into deficit for a few years in the early 1990s, the total accumulated deficit was $11 billion. That was paid back, so as for the government taking $54 billion now and leaving only $2 billion in the kitty, the member for Dartmouth—Cole Harbour says we should not call it theft, but I am at a loss for words for what else we would call it. It is simply not the government's money to use as it sees fit.

It is not too late, I urge members, to support my colleague's amendments to reinstate these conditions to make the unemployment system work. I call on all members to vote in favour of the amendments he has put forward today.

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

Mr. Speaker, I am pleased to take part in the debate on Bill C-265 introduced by my colleague from Acadie—Bathurst.

Employment insurance is a very important part of the social infrastructure of Canada. That is a core belief. It has changed over the years. Today fewer Canadian workers have access to EI in general. Canadian employers and employees have seen a surplus of premiums over benefits paid in the last decade. I think it is time to make some changes to EI. We know that other people believe this. A number of private members' bills have been introduced in the House and have gone through committee, for example Bill C-269, this bill, Bill C-265 and Bill C-278 by the member for Sydney—Victoria, which is a very important bill that would have seen the EI sickness benefit period raised from 15 to 50 weeks. It is an active file. Also, the government recently introduced a proposal to set up an EI crown corporation.

Let us start with a few facts to set the context.

Between 1994 and today there has been a surplus each year in the EI account. From 1990 to 1994 there was a deficit each year, the last time the economy had a serious slowdown. We have seen over the past decade or so premium rates drop significantly. In 1993 employees paid $3 per $100 of insurable earnings and employers paid $4.20. Those have dropped on the employee side from $3 to $1.73 and on the employer side from $4.20 to $2.42.

We saw some changes as well in 2000 and 2004. In 2000 we saw the extension of parental benefits from six months to a year. In 2004 the compassionate care benefit was added. Several pilot projects were introduced in 2005 for things such as going to the best 14 weeks. There were some other changes that were very positive as well, including an additional five weeks for areas of high unemployment. These pilot projects were set up to provide more benefit coverage in areas that specifically needed that assistance. In 2005 a new process was introduced in the rate setting mechanism, whereby rate stability was to be achieved by restricting the rate change to .15, in other words 15¢ per $100 of insurable earnings.

In 2004 the House subcommittee on EI made recommendations, one of which was for a more independent EI board, a commission, with a fund that would operate outside the consolidated revenue fund. It did not recommend total independence but it recommended that step. Many workers and employees felt that would be a good idea.

The EI surplus is a very contentious issue. It is a surplus or a no show surplus, depending on to whom one talks. One thing we know is that it is not theft, as some people would characterize it. The money was kept track of and allocated every year. In fact, interest has been allocated. On the $54 billion, the EI alleged surplus, some $11 billion of that is in fact allocated interest.

It is a contentious issue and I understand that. The money went primarily to pay down debt and perhaps to other services as well but most of that money went to pay down debt. One can agree or disagree with that decision, but that was a policy decision that was made by the Government of Canada.

There are many aspects of EI that need to be addressed: those who are excluded, self-employed people, creators, part time workers who are often women. I believe there is a need to re-evaluate benefits paid to those who already qualify. What we need is a serious debate. We do not need allegations of theft.

We do not need the leader of the New Democratic Party going to a CLC meeting and saying that nobody in the Liberal Party or the Conservative Party cares because they only had five minutes at the finance committee hearing and totally neglected the fact that a Liberal-led motion in the human resources committee evaluated this new EI corporation. If it was not for that, there would be no discussion of this. The government's response was to set up a crown corporation, but how do we know if it is a solution when there is no information available? We have been provided nothing.

We introduced a motion at the human resources committee. We heard from employees, employers, actuaries, labour organizations and business groups, many of whom said that it might be a good idea, but they just do not know and they need more information. That report will be tabled in the House this week. I hope that the government looks at the recommendations of workers as well as employers.

These meetings were public. They asked questions about things such as the size of the reserve, the accountability and how this would affect benefits.

I, like almost all Liberals, feel that EI reform is necessary. We particularly need to look at it at a time when many Canadians are worried about the economy.

Liberals are part of a group which included the NDP member for Acadie—Bathurst, the Bloc and labour groups that looked at a previous bill, Bill C-269, and came to some common ground on it. The common ground was negotiated in good faith and every Liberal in this House supported Bill C-269 when it came for a vote. Bill C-265 shifts that ground considerably.

As an example of what it takes to reform EI, this is a serious business. One proposed amendment to increase the rate of benefit from 55% to 60% would cost $1.2 billion every year. That was an estimate done in 2004. Reform is costly but it must be done. It cannot be done on an ad hoc basis. It is simply too important for that. It must be done by a government that accepts the fact that EI is a fundamental part of the social fabric of Canada that strengthens our communities and our people.

Reform cannot be done by running around and making allegations. We all play the constituencies. That is why it is called politics: to tell disingenuous stories about what is happening in this place when we visit with labour organizations or business groups, or to make allegations of theft and other issues about what happened before.

Changes to EI are needed, but what are those changes and what is the cost? What about the two week waiting period? We think something should be done about that. There is the five week black hole. Should it be the 14 best weeks or the 12 best weeks? What is the solution? Do we go from 55% to 60%? How are part time workers and self-employed workers covered? How is sickness covered? People have said to me that we should extend maternity leave to two years. There is no shortage of ideas. Those ideas will only be turned into action by a government that is serious about EI reform.

The Conservative government is not serious about EI reform. Reform will only be done by a government that accepts EI as a key part of the social infrastructure of Canada that strengthens not only the people and our communities, but all of Canada. It is time for a proactive and positive change to EI for employers and particularly for hard-working Canadian employees.

[Daniel Petit, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Speaker, I am pleased to share with you our conclusions regarding Bill C-265, following its review by the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities.

The first version of Bill C-265 proposes substantial amendments to the Employment Insurance Act, resulting in less stringent eligibility criteria and increases benefit rates. These proposals would have quite an impact on the fund. Before further discussing the repercussions identified by the standing committee, I believe it is important to analyze the situation in the more general context of today's labour market.

We acknowledge that there has been an economic slowdown in some sectors and certain regions in the country recently. However, in general, Canada's labour market indicators remain robust.

According to Statistics Canada, the unemployment rate in Canada continues to be one of the lowest in decades and the proportion of the population that is working has reached almost record levels. The participation rate of working age Canadians is 77.9%, one of the highest in the world. In addition, a review of long-term unemployment indicates that the rate declined from 13.5% in 1996 to only 4.4% in 2006 and 2007, under our government.

In short, more Canadians are working and the labour demand is high. Employment opportunities are abundant because a number of sectors are facing labour shortages and the aging of the active population in the next few years will only increase labour demand. In this context, one of the important objectives, now and in future, is to encourage the full participation of Canadians in the labour market.

Of course we realize that even in periods of high employment, some individuals need the support of employment insurance. The facts indicate that the plan is meeting their needs. Statistics Canada's 2006 Employment Insurance Coverage Survey reports that almost 83% of individuals who pay into the plan and who lose their job or quit for allowable reasons are entitled to benefits. In regions where the unemployment rate is high, the proportion of eligible individuals has increased significantly.

Of course, the higher the unemployment rate in a given region, the harder it is to find a job there. That is why, in the employment insurance system, when the unemployment rate goes up, the number of hours required to be eligible for benefits goes down. Setting a fixed number of hours—360 hours in the first version of Bill C-265—works against the goal of achieving equal access to benefits across the country. In fact, the regions that would benefit the most are those that already have low unemployment rates. In such regions, eligibility requirements would be reduced by 50%, but regions with high unemployment would see only slight reductions.

When the standing committee reviewed Bill C-265, its members made it clear that a fixed rate, 360 hours, could have negative repercussions on the labour market and would be very expensive. By opposing that suggestion, the standing committee upheld the variable eligibility requirements and the provisions for people who are new entrants or re-entrants to the labour force, because it recognized that those requirements stimulate labour market activity.

With respect to benefit rates, following the standing committee's study, the bill still proposes increasing benefit rates by introducing a formula based on the 12 best weeks.

We believe that we need to find a happy medium between raising benefit rates and the possible factors associated with the notion of “best week” that could discourage people from working. It is important for members to keep in mind that we are currently conducting a pilot project in regions with high unemployment that calculates employment insurance benefits based on the 14 best weeks of income over the 52-week period preceding the claim.

This pilot project is designed to address the same issues as the best 12 weeks approach. It examines whether this way of calculating the benefit rates will encourage workers to accept jobs which, otherwise, would have lowered their weekly benefits.

Our government's approach is based on the certainty that Canada has to rely on the forces of the labour market and the economy. That is how we look at employment insurance. Based on the annual EI monitoring and assessment report, there is every reason to believe that Canadians are well served by the EI program.

At the same time, we have always sought to improve the program and bring in specific changes to address specific problems. For example, we have: relaxed the eligibility criteria for compassionate care benefits; launched a pilot project to examine the effects of providing additional weeks of benefits to those in high unemployment regions; extended transitional measures for two regions, in New Brunswick and Quebec, until the conclusion of the national review of EI boundaries; introduced just recently, in budget 2008, improvements to the management and governance of the EI account, against which the Bloc and the NDP voted.

As I said, our government believes it is important that the EI program strike a balance between providing temporary income support for Canadians while they find new employment and keeping individuals active in the workforce.

Given that it cannot be established that the fundamental changes put forward in Bill C-265 are absolutely necessary, two important factors have to be considered: the cost to Canadian workers and employers, and the potential negative impact on the labour market.

Bill C-265 is not the right approach in light of the current labour market conditions. The Government of Canada is committed to ensuring that all Canadians can participate and prosper in the Canadian economy. We believe that we can make the most progress and deliver the most results by investing in a variety of mechanisms, including the EI program.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

The Liberals did that in 1985, I agree. A Conservative colleague has just told me that the Liberals did that, and I agree with him, but nevertheless, they were supported by the Conservatives.

I am introducing Bill C-265, which would allow people who have worked 360 hours to qualify for employment insurance. But, in committee, the Conservatives and Liberals voted to delete this criterion of 360 hours. I hope that people are watching this debate today. I listen to the Liberals during debates or when they are on television. They say that they would like to be re-elected because they want to save employment insurance.

Yet, people often cannot receive benefits. We know that 68% of women in Canada do not qualify for employment insurance—even though they have contributed to the fund—and 62% of men who have paid into employment insurance cannot qualify because of the number of hours required. Quite often, women work part-time, 20 hours a week, and therefore cannot qualify.

That is what is currently happening in my region, and it is the same all across Canada, be it in Toronto or Vancouver. People would have us believe that it is only happening in the Atlantic provinces, but after the tour I did, I can say that it is happening everywhere.

As for the Bloc Québécois amendment, the consequences are too severe. The unemployed do not qualify with 420 hours, yet the Bloc Québécois wants to force them to have 700 and 875 hours.

With this bill, we can at least say that the two parties that are against employment insurance will have to take a position and indicate where they stand. I am anxious to hear the position of my hon. Liberal colleague who supported the Conservatives to remove the 360 hour requirement from my bill. I am anxious to hear my colleague from Nova Scotia, as though there were no problems in that province. I am anxious to hear from the Conservatives, who claim to be there for the workers, as though lowering premiums creates jobs.

We need only look at fish-processing plants in Atlantic Canada. Many are not operating at the moment; there is no work. We see this in the forestry sector, given all the closures. Now, we will also see it in the automotive sector. People have lost their jobs in Oshawa and they are leaving the factory. I hope they do not have to leave and that they win their fight. I wish them good luck and my thoughts are with them. Losing one's job is not easy. Furthermore, if they are given severance pay, they will not be eligible for EI benefits. It happened to workers at AbitibiBowater in Dalhousie and to workers at the Smurfit-Stone plant in Bathurst.

The employment insurance program is paid for by the workers, but under these types of formulas, they will not even be eligible, and this will leave them burdened with the biggest debts possible. Hopefully our amendment will be accepted and, in the end, the Conservatives and the Liberals will see a small light at the end of the tunnel, in favour of the workers, and give them a chance to survive.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I welcome this opportunity today to address Bill C-265, and the proposed amendments to it, which have now been grouped. I am glad the Speaker of the House found all three motions in amendment to be in order.

A number of years ago, in 1996, a change was made to employment insurance. This was the most significant change to EI and affected workers across the country. Some would have had us believe that the intention behind changes to unemployment insurance was to get people off employment insurance, to reduce their dependency on it. According to them, most people would rather receive EI than go to work. I can say that, everywhere we have gone, we have seen that this is not the case, and colleagues from across the country could say the same thing.

I would argue that the government is the one dependent on employment insurance. The surplus has been accumulating ever since the EI fund was created and now it totals $54 billion. Last week, theft from the employment insurance fund was made legal by a vote in the House of Commons. Ironically, when we finally vote on Bill C-50 tonight, that will seal the deal, and that will be that.

Bill C-265 seeks to re-establish the situation—I am not sure that that is the right word—in other words, it seeks to make employment insurance a little more humane.

People who receive employment insurance benefits get just 55% of their salary. Imagine what that means for people earning minimum wage. That is not at all uncommon in seasonal industries and tourism, for example. People working in the tourism industry earn little more than minimum wage, and most of those jobs are seasonal.

I have done the math, and it turns out that in most cases, 55% of minimum wage is much less than social assistance benefits. I should add that these employment insurance payments offer no benefits, such as a drug card—no benefits whatsoever. As such, that is a very low wage.

What does Bill C-265 seek to do? Employment insurance can be pretty complicated with all the formulas and so on. For example, some pilot projects use the 14 best weeks, but others do not even take that into account. That means the factor is 14. Consequently, for an individual who worked 12 weeks, the benefit calculation is still based on 14 weeks at 55%. That reduces the employment insurance benefit even more. This bill would see benefits calculated based on the 12 best weeks.

Some parts of the bill were not quite right, so that is why the amendments were made. When the committee members were studying Bill C-265 on employment insurance, they discussed the 12 best weeks and the 360-hour minimum for eligibility. The Conservatives proposed an amendment, and to everyone's surprise, the Liberals agreed to it. The Liberals refused to agree to Bill C-265 as written, including the 360-hour minimum for eligibility. They voted against this measure.

As it turns out, the Liberals have not changed their position on employment insurance since 1996. Let us not forget that that was when they were wiped out in the Atlantic region. They lost ground there because they brought in hours worked minimums for employment insurance eligibility, minimums that made people ineligible.

For example, a claimant needs to have worked 420 hours to qualify for employment insurance in areas where the unemployment rate is higher than 13%; 490 hours if the unemployment rate is 12% to 13%; and approximately 535 hours if the unemployment rate is under 12%. Those figures are approximate.

We thought things had changed since then. It has been nearly 12 years since the Liberals had their lesson and saw that changes needed to be made to EI, but they did not support us. I cannot wait to hear what the Liberal member has to say about that.

For years, I have seen Conservatives here in the House of Commons. Before they were Conservative Party members, they were members of the Canadian Alliance or the Reform Party. The only thing they said during debates was that we needed to decrease EI premiums, which would create jobs and ensure that more people were working.

How would lowering EI premiums solve the problem with fish processing plants in the Acadian peninsula, the Gaspé, Nova Scotia or Newfoundland and Labrador? At this very moment, crab fishing season is open, and workers in the fish processing plants are working only 20 hours a week. How can we solve the problem by lowering EI premiums when people have not accumulated the required number of hours to qualify?

Then, the Conservatives and the Liberals told us that we needed to change the employment insurance rules, because people depended on it. They took $54 billion from the employment insurance fund and put it in the general fund to pay down the debt and achieve a zero deficit. This was done at the expense of workers who lost their jobs.

Speaker's Ruling

[The Acting Speaker, Conservative, Royal Galipeau]

I will first make a ruling by the Speaker on Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits). There are three motions in amendment standing on the notice paper for the report stage of Bill C-265.

Motions Nos. 1 to 3 will be grouped for debate and voted upon according to the voting pattern available at the table.

I will now put Motions Nos. 1 to 3 to the House.

The House proceeded to the consideration of Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), as reported (with amendment) from the committee.

Opposition Motion--The Economy

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Mr. Speaker, the hon. member's party often talks about its commitment to working families. I would like to point out some of the things that the government has actually done for working families, important steps like cutting the GST, introducing the working income tax benefit, introducing the universal child care benefit, increasing the basic exemption, and lowering the lowest tax bracket. We have taken all of these important steps.

The NDP voted against these important steps but has introduced several private members' bills, one of which was Bill C-265 that was dealt with in the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities. Bill C-265 would have basically cost the average worker in Canada a little more than $100 per year.

My question to the hon. member is this. How can she justify to working families her opposition to the important steps that we have taken to put more money in their pockets and, as well, how can she justify to those same working families the NDP's proposal to add a little more than $100 to the EI bill that they pay through their hard work that comes off of their cheques?

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

Thank you, Chair.

This amendment we have put forward brings Mr. Godin's bill, Bill C-265, more in line, on the specific issue of regional rates of employment, with Bill C-269, the Bloc bill, which came about after a lot of discussion among opposition parties and some discussion with labour groups who feel we need to move forward on EI.

For a long time, the Bloc and the NDP have put forward bills on EI that haven't really gone anywhere. There's a recognition that we need to work together, and if there's going to be a change in government, it's going to be the Liberal Party that comes in and improves EI. And I believe we have to.

Throughout these hearings, the short hearings we've had, I've asked witnesses what their priorities are for EI, because there are so many. Every year we have a surplus. It wasn't always the case. There was a point in time, just over a decade ago, when we were spending $2 billion, I believe, more than was coming in. That's one of the reasons changes were made. Employment insurance has become a very important part of the social infrastructure of Canada. Some people don't like it. I suspect that there are many members on the government side who aren't keen on any changes to EI that would put money back into the families of workers who need it. But we have to prioritize what we're going to do.

There are a lot of ways we can improve EI. Some of the pilot projects have addressed this. We can look at the two-week waiting period and what they call the five-week black hole on the back side of employment insurance. We can reduce qualifying hours or increase benefits. What about Mark Eyking's bill, Bill C-278, which everybody who appeared before this committee said was entirely sensible and reflected the reality of health care at this point in time in Canadian history when people are living after having cancer interventions and after having strokes and heart attacks and need a longer period of time on EI? To me, that should be a priority for the employment insurance system. That's another cost of $600 million or $700 million. I can't remember exactly. I think it's a very valid cost.

How do we get to the part-time workers, largely women workers, who don't access EI as much as they should? What about self-employed people who don't have access to EI, and money for training under the program?

There are a lot of things we need to do with the employment insurance system. We believe it's time that some of the annual surplus be utilized to the benefit of workers.

We have a specific concern, though. As you can see, when you reduce to a flat rate of 360 hours, the cost is pretty significant. We propose, as a start, reducing by 70 hours across the board. But keep the regional rates. Mr. Godin and Mr. Lessard quite correctly have a concern about people in high unemployment areas. This is to protect those people. They are the people in the fish plant in Mr. Cuzner's riding or the people in the forestry industry who are out of work and simply don't have access to jobs without moving. And we don't want to force Canadians to move. Many of them will move to where the employment is better. But it's a real concern that if you get rid of the regional rates of unemployment, and cuts have to be made, it'll be those areas that are hurt disproportionately, and we need to be very concerned about that.

We've asked for priorities. We've identified ours. We want to make changes to EI that we think are reflective of the reality of the workplace today, including the fact that this country could be undergoing an economic recession, or certainly a slump in industries like forestry and manufacturing. We need to have that money.

Mr. Lessard mentioned that our leader didn't support Bill C-269. I think he was referring to the royal recommendation and appeal. That wouldn't have done anything, but I would remind him that every Liberal in the House of Commons voted for Bill C-269 at final reading. Every Liberal in the House of Commons voted to send Mr. Godin's bill to this committee so we could give it some prudent oversight.

We think it's time for employment insurance to reflect the fact that workers have not benefited. Employees have had a reduction in benefits over the last ten years, I think by almost half the premium rate. That's good. We want to be fair to both ends, but we haven't done very much for the workers who have been hurt and continue to be hurt as the economy of Canada continues to concern people more and more all the time.

So we support Mr. Godin's bill. But we think this is a prudent and sensible way to go about making changes in EI, keeping in mind that there are many other things we would want to do as a government to make EI more accessible and more reasonable and to enhance the productivity of Canadians, not to detract from it.

These recommendations, in our view, reflect that.

[The Chair, Conservative, Dean Allison]

Thank you, Mr. Godin.

We're taking a list here. I have Mr. Lessard, Mr. Savage, and Mr. Lake.

I just want to read this into the record so that people are aware.

As all members are aware, the Speaker was called upon to render a decision as to whether certain provisions of Bill C-265 would infringe on the financial initiative of the crown and consequently require a royal recommendation.

In his ruling on March 23, 2007, Speaker Milliken stated:

I have examined the bill carefully and find that the changes to the employment insurance program envisioned by this bill include lowering the threshold for becoming a major attachment claimant to 360 hours, setting benefits payable to 55% of the average weekly insurable earnings during the highest paid 12 weeks of the 12 month period preceding the interruption of earnings, and removing the distinctions made to the qualifying period on the basis of the regional unemployment rate.

It is abundantly clear to the Chair that such changes to the employment insurance program, notwithstanding the fact that workers and employers contribute to it, would have the effect of authorizing increased expenditures from the consolidated revenue fund in a manner and for purposes not currently authorized.

We have a proposed amendment before us that does not remove the requirement for the royal recommendation. The final decision, however, will rest with the Speaker of the House, so for the purposes of our meeting today, the amendment is admissible and will be put to the decision of the committee after debate.

I just wanted to get on the record again that we are talking about the amendment. It does not remove the royal recommendation, but we are going to discuss it and we will continue to move forward on that process today.

I will continue with the list. I have Mr. Lessard, Mr. Savage, and Mr. Lake.

Mr. Lessard, sir.

[The Chair, Conservative, Dean Allison]

I call the meeting to order. I'd like to welcome everyone back.

Pursuant to the order of reference of Tuesday, October 16, 2007, we are continuing with Bill C-265, An Act to amend the Employment Insurance Act.

A couple of weeks ago we started with the numbers and then we deferred. It's like Groundhog Day; we're starting all over again.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Chairman, if that's the case, then I suggest we suspend the meeting until we have the information we need. A bill is too important. Perhaps someone will say that we should have done this earlier, but we are here to work for the welfare of Canadians and it would be a shame not to have the right information. Moreover, Mr. James has information about both scenarios that he can convey to us, about the amendments that have been drafted and about the first bill. It would be important to have copies of this material in order to review it properly. Perhaps we should postpone the meeting until the House returns from its break. As soon as Mr. James has the information, he can forward it to our clerk, who can then pass it along to us. I suggest we adjourn this meeting on Bill C-265.

[Bill James]

It's $200 million per year, 25,000 claimants.

That part of Bill C-265 would be left standing.

[Bill James]

Sure. All I can mention is that the costs associated with the change to the program are very dependent on the specificity with which we're provided in terms of the change. So it's not to say the costs provided in 2004 were incorrect; they were the baseline preliminary estimates we could do in two days, based on the question we had from the committee. There's a lot more detail in the proposed changes in the context of Bill C-265. We've tried to cost it based on the way it's described in the bill.

If we go back to 2004, the question was quite a general one posed by the committee, and we did the best we could, I think, as Mr. Brown mentioned at the time, in the time we had. The cost estimate at that time, again, was a minimum cost and a preliminary estimate, and I believe it was indicated that with additional detail and more time we could improve on those estimates.

For the purposes of Bill C-265, we've taken the much more specific information provided in the proposed bill and we've costed those individual elements, and that's how we've arrived at a more accurate estimate.

[The Chair, Conservative, Dean Allison]

I call the meeting to order, pursuant to the order of reference of Tuesday, October 16, 2007, on Bill C-265, an act to amend the Employment Insurance Act.

We'll commence our hearings today on Bill C-265. We're going to go clause by clause. I believe you should have everything in front of you.

I do want to welcome Mr. James and Ms. McLean. Thank you very much for being here.

They will be here to answer any questions that you have. Mr. James is the director general of the EI policy, skills, and employment branch. Ms. McLean is the acting senior counsel of legal services.

As usual, we have our legislative clerk here, who will help us navigate through any and all clauses. I believe there are only two amendments. So as far as amendments go, there won't be a lot to deal with there.

Why don't we just get started with clause 1?

Go ahead, Mr. Savage.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Ms. Byers, in your introductory remarks, you explained how the plan could be improved, and you spoke of increasing the benefits. Currently, this would represent 55% of the claimant's income, and you suggested 60%. Generally speaking, people with the higher incomes are not the ones who draw the benefits. So that is a small income. I tabled before the committee an amendment to Bill C-265 in order to improve the plan and raise the benefit level to 60%. I believe that you would agree with me on that.

[Charles Cirtwill, Acting President, Atlantic Institute for Market Studies]

Well, I'll waste a few of my 10 minutes to point out to Yvon that since we both come from Atlantic Canada, if he's buying the beer, I'm his friend.

I appreciate the invitation to come today to comment on Bill C-265. As you say, I did just arrive from the airport. As proof of the wonders of the modern transportation age, it took just as much time to get here from the airport as it did to fly from Halifax to Ottawa.

For those of you who are unfamiliar with AIMS, we are an independent economic and social policy think tank. We are based in Halifax, Nova Scotia. Our chief objectives include initiating and conducting research, thus acting as a catalyst for informed debate on public policy matters, and communicating the conclusions of that research and the resultant policy prescriptions in a clear, non-partisan way via publications, conferences, seminars, and sessions like this one.

AIMS is a Canadian federally incorporated non-profit non-partisan organization with charitable status from the Canada Revenue Agency. We are financed by contributions from individuals, corporations, foundations, and other organizations, as well as by the sales of our publications. AIMS does not, to put a point on it, take any money from government.

I'd like to start my comments today with a couple of fairly straightforward points. Since the sponsor of this bill, as I understand it, is from New Brunswick, I thought I'd put those comments in the context of New Brunswick, but I want to emphasize that they do in fact apply nationwide.

If someone had asked me yesterday to come up with a list of the three or four things the federal government could do to put the biggest possible wrench in New Brunswick's plan to become self-sufficient, this suggestion, this bill, would have been in the list of the top three. Basically the reason is quite simple: if you pay people not to work, they will not work, and of course Bill C-265 does suggest that we get back to that very model.

AIMS has commented frequently on the problems with Canada's employment insurance system, and our key criticisms follow.

While the basic intention of EI should be to provide short-term assistance to those who find themselves temporarily unemployed due to the vicissitudes of life or a dynamic economy, the EI program has become instead a system that creates unemployment and provides disincentives to work. The Atlantic region is an example. Employers in large centres such as Halifax, Saint John, and Moncton are experiencing tremendous difficulties finding workers, while double-digit unemployment remains constant in other areas, such has northern New Brunswick and Cape Breton. For example, StatsCan just in January reported an unemployment rate for Halifax of 4.3%, while in Cape Breton that number is 13.8%. An overly lax and generous EI system deters unemployed people from moving from where the work is unavailable to where jobs are going unfilled. This problem is only going to get worse as our society ages and labour shortages become more severe.

The EI system also distorts wages upwards as firms are forced to compete not only with other employers, but with a system that allows workers to work for only a small portion of the year and then collect EI for the remainder. This distortion negatively affects firms' competitiveness and makes business investment less attractive in those regions where the effect is most prevalent, and that includes Atlantic Canada.

Further labour market distortions occur in that the value of work experience, training, and education—all of which lead to better long-term employment prospects—is diminished when the ability to live a state-subsidized life in exchange for only a few weeks of work each year remains available.

For these reasons, the general thrust of Bill C-265 to make access to EI easier is of clear concern, especially the question around the removal of the new entrant condition—the one that's meant to actually engage young Canadians' attachment to the workforce early on—and the dramatic change in eligibility requirements that would occur in areas of lower unemployment. Again, if we return to the Halifax example for a minute, which Mr. Savage might be relatively familiar with, and take a look at Halifax's vibrant labour marketplace, right now under this bill we would end up with the amount of work required to qualify for EI dropping from 17.5 weeks at 40 hours a week to only nine weeks. Now, is a nine-week qualification for employment insurance really necessary in a labour market with 4.3% unemployment?

The proposal to enrich EI benefits generally by basing the benefit on the calculation of the worker's best 12 weeks is also a disincentive, because it will again result in paying people more money not to work. Even worse, it increases the incentives to gain the system.

Now, with regard to the expansion of accessibility to special benefits, I don't think anyone should be opposed to the intention of this measure. Given the demographic challenges that we have and that the country faces in the years to come, measures of this type make it very much easier for parents to have children, for individuals to contribute to the care of family members. These kinds of proposals and services are absolutely critical in the future years in Canada, but I want to point out a couple of things around how we're funding it.

First, we have really done no significant research into the impact of these kinds of benefits on the employer side of the question, and certainly we haven't had a conversation yet about whether or not EI is truly the appropriate place to pay for these services. The benefits for these programs accrue to society as a whole, so we really need to question whether or not the burden for these services should be placed only on employers and employees by paying for them exclusively through EI.

Now, there is one point where the Atlantic Institute for Market Studies and this bill come to agreement on, and that is that Bill C-265does effectively remove regionally extended EI benefits, but it does it by basically giving extended benefits to everybody. We think the conversion should run in the opposite direction, that the objective should be to tighten the requirements in the areas where they're loose, not loosen them where they're currently tight.

Full-time jobs are going unfilled in Atlantic Canada because, among other reasons, the wages offered for them cannot compete with seasonal work and subsidized EI benefits. The balance needs to be changed decisively in favour of work, so that people see that they would be better off, not worse off, to accept the work that is available and to acquire the training and education needed to secure even greater opportunities.

Before I close by quoting a couple of other organizations, let me just say that AIMS does not think the EI system currently in place is perfect. Certainly it requires lots of tinkering around the edges, if not fundamental change.

We have just three quick suggestions for changes that you might want to consider, either attending to this bill or doing something else in its place.

First, the requirement for new entrants to access EI needs to be higher, not lower. We want people to engage in the employment field and stay there for a while, get used to the benefits of working, know what they are, and be able to appreciate them.

We need to take a serious look at experience rating. If in fact you spend a lot of time using unemployment insurance, perhaps your rates should be higher or your benefits should be lower, or both. That applies both to employers and to employees. We cannot afford a government system that encourages employers to set up a structure where they only employ people for 10 or 12 weeks, knowing that those people are going be taken care of until they need them again 12 months later.

The other thing we need to be thinking seriously about is, if we are carrying forward surplus after surplus in the EI account and we change the EI benefits to the point where we secure some savings, what do we do with those savings? Our suggestion is that the majority of those savings should be targeted at education and training of the workers, so that they in turn are better able to take advantage of opportunities as they come their way.

[Laurell Ritchie]

Lesson learned.

We're here to support Bill C-265, including the proposal for best 12 weeks, and at the same time acknowledge that a majority of members of Parliament have in fact supported other bills that have tried to address some of the difficulties with our current EI system.

Some of us live and breathe unemployment insurance. Earlier today I had to file an appeal for claims that had been presented out of a closure in Bracebridge. Certainly our industry and many others are reeling from closures and large-scale layoffs.

In our view, the employment insurance hours system was the main villain in the 1996 changes. Nothing of any real substance has been amended since what is now fully a decade ago except for two changes—not without importance to the people they affected but still in some ways tinkering on the edge of the system.

I'm referring first to the reduction of the 700 hours that were originally required for so-called special benefits—parental, sick benefits, those types of benefits. I think many of us can still remember the photograph on the front page of the The Globe and Mail of the woman with child in hand, just short of the 700 hours to qualify. It was amazing how quickly the political will was found to address that and to reduce it to 600. I never heard a very good, rational explanation for 600; it was simply that there were too many people who weren't being covered at 700, so it was reduced to 600.

The other change, though not to the legislation, was the introduction of pilot projects that extended, for 21 truly high-unemployment regions, an additional five weeks, still with the maximum of 45.

Those have been the only real changes. The fundamental structure of the EI grid has not been amended.

When you do get the document, I'd ask you to spend some time on the second page. I know it looks like you cannot fathom it, but what I had hoped to do—and perhaps someone can take the time to walk through that—is go through an example of what happens for people in sectors, in industries, and in regions where they do not have full-time, full-year work. This is not just a rural issue; this is an urban issue.

The example I want to give is of service workers; in particular, I use the example of a grocery store worker. Service workers are critical now in our economy. About 70% of all jobs are in the public or private service sector.

Under the old UI system...and we're not proposing to go back to that, but it's important to understand where some of the billions in the surplus have come from. I've provided Statistics Canada information that shows that the average service worker works 29 hours a week. On that basis, they would need, under the old system, 19 weeks of work prior to layoff in order to qualify in a 6% to 7% unemployment region; currently that would be like Toronto or Montreal. But under the EI system, the way the hours have been rejigged, the same service worker now needs 23 weeks of work prior to layoff to meet what is now a 665-hour minimum.

It is worse still for a grocery store worker, and I've picked that as one of the occupations where it's even lower than the average service sector worker. They average 24 hours weekly, and in their case, instead of needing 19 weeks of work prior to layoff to qualify, they now need 28 weeks of work.

There's a chart there that shows how the requirements have increased. This chart, which shows the old system alongside the new system—we've grafted them together—allows you to study and understand, in your own regions, how this system is functioning to the detriment of workers.

We have a changing job market out there. Many of us would argue that the architects of the 1996 changes had at least some sense that this was coming. Now, without a doubt, we know how many jobs are contract, temporary, and part time, and this applies mainly to women. It also applies to men.

One of the things we're finding with layoffs in auto and other manufacturing workplaces is that men and women are now having to look to a future with fewer options, and many of those options are those temporary, part-time jobs, certainly not full-year, full-time jobs. There are also serious economic impacts for the economy as a whole, serious negative impacts for EI's key role as an economic stabilizer.

The federal government last fall, in the economic and fiscal update that they provided, looked right through to year 2011-12 for risks to their fiscal projections, and they mentioned volatile commodity prices, weaker U.S. consumer spending—they didn't know the half of it—global current account imbalances, and a further appreciation of the Canadian dollar. This is not the end of history. We may well yet have another recession in this country. Certainly we have a downturn, and that, by all accounts, goes to explain the Bank of Canada rate drop, unusual as it was, this week. There is in some of the papers today the suggestion that the job numbers coming out tomorrow will have some grim information for all of us. We cannot sit easy.

Again, as part of the documents, we've compared the hours that were needed to qualify for employment insurance or unemployment insurance during economic downturns. We used a regional rate of 8% to 9% unemployment, which would not be unusual in a downturn. We've gone from a formula that would allow somebody at 165 hours to at least get a minimum entitlement; then, in the early 1990s, a formula that meant 255 hours; and now a formula in this same region that would require a minimum of 595, and that's just to get a bare minimum entitlement.

There is a very important study that was commissioned by Human Resources Development Canada—I can never remember its name in its various changes. This was a study of the UI system as an automatic stabilizer, identified as the single most important stabilizer, and to prevent downturns going much deeper.

Finally, this week is also the anniversary of the first death from the SARS epidemic. There was a great deal of puzzlement amongst the honchos within EI about why so few people were applying and getting EI. Those of us who know what has happened in the hospitality sector and in the health care sector and homes for seniors and the aged, what is happening in hotels and restaurants, understand very well why people could not apply or qualify.

Our system has been problematic since the beginning; it has gotten worse with recent developments in the labour market, and we urge you to fix it.

[Pierre Céré, Spokesperson, Comité Chômage de Montréal]

Thank you for having invited us, Mr. Chair, members of Parliament.

I represent Comité Chômage de Montréal, but more broadly, the Conseil national des chômeurs et chômeuses, the CNC, for which I am a spokesperson. The CNC is an umbrella organization comprised of groups from different regions throughout Quebec.

To begin with, I'd like to see if we can agree on three simple matters.

The first point is that the unemployed are not marginal. An unemployed person is not defined in society based on his or her social status. You're not defined as an unemployed person, you are defined first and foremost by your work, your profession, your roots, the places where you have ties, and your family. Unemployed people are workers. An unemployed person is someone who used to work and who will work again, but between jobs, such individuals are temporarily unemployed. And let me be clear: “are temporarily unemployed”.

In 1940, when you needed replacement income between jobs, it was called unemployment insurance. Since 1996, it has been called employment insurance. And it is also for a limited period of time. That's the first thing I'd like us to agree on.

The second thing—and it would seem more and more that this is true, according to the prognosis of a number of economists—is that we are heading into a period of labour shortage. So that raises the question: why do you need employment insurance and unemployment insurance if you are about to face a period of labour shortage?

We believe that even during a period of labour shortage, you never actually eliminate unemployment or the need for employment insurance. Now, why is this? Well, it is because of what has characterized the new jobs created in Canada over a good many years and the way in which work has been reorganized over the past 20 years. This has been documented by Statistics Canada, for example. Most jobs created in Canada for many years have been described by academics as atypical: part-time work, temporary or seasonal work. That's what jobs look like nowadays. Between two temporary jobs, obviously, people need a replacement income. And that's what employment insurance does.

Let's see if we can agree on a third point. We all know that the employment insurance system has been pruned over the past 20 years. This has been documented and publicized. It's now time to stop documenting these cutbacks because we are aware of them and have fought against them. We will continue to fight against them. But the time has come to find solutions.

We believe that Bill C-265 is part of this groundswell movement to find solutions to the problems which exist.

On behalf of our organization, I'd like to take this opportunity to commend the sponsor of this bill on his devotion and tireless hard work. He has fought hard for many years to find solutions to the problems faced by thousands of people throughout Canada who don't qualify for employment insurance benefits.

We believe that there is a political solution to these problems. There will not be a political solution without a political and social majority. The one and only eligibility criterion which features in Bill C-265 is the 360-hour minimum, and in our opinion, it is the way of the future. The CNC has been fighting for this for over 10 years.

The dialogue and exchange between a number of organizations and political parties over the past several years has not led to a majority of people being willing to find solutions to the problems which exist.

Last year, we brought together the three opposition parties: the Bloc Québécois, the NDP, and the Liberal Party of Canada. We got them to all sit around a table just like this one with representatives from Québécois and Canadian labour associations and groups of unemployed persons. We had a discussion and an exchange of points of view. Sometimes we agreed, sometimes we managed to find solutions, and to reach compromises. We agreed to a five-pronged agreement in order to improve the employment insurance system in the way that it needs to be improved.

Included in this five-pronged approach is the 12 best weeks benefit-setting formula. However, the single eligibility criteria was not included because we didn't manage to reach a consensus on this issue. We agreed on relaxing the eligibility criteria by 70 hours. There are two categories of beneficiaries: ordinary beneficiaries and new beneficiaries. The ordinary beneficiaries qualify based on a variable standard ranging between 420 and 700 hours; we would suggest that this range be lowered to 350 to 630 hours.

BillC-265 impacts on two areas: the eligibility criteria and the 12 best weeks benefit-setting calculation. Both here and in other areas, we find ourselves at a crossroads: either we get boxed in by the rationale for our demands—the fact is that we do not have a majority—or we look for a more appealing solution so that we can get a majority that will actually be able to impose a solution. This formula must be the result of a compromise and it will enable us to enhance the current level of protection provided to workers in Canada.

When Parliament debates this issue, it always says that it is going to cost the government money, and that it doesn't have this money. We asked an economist to calculate how much these two measures would cost, i.e. the 12 best weeks formula and relaxing eligibility criteria by 70 hours. A very serious individual who worked for a political party's research service and then at a union produced a document stating that relaxing the criteria by 70 hours would cost $400 million and that the 12 best weeks formula would cost $320 million, for a grand total of $720 million. Now you can play around for a long time with these figures, but that's the assessment that we made.

We know that the employment insurance fund is posting surpluses. On March 31, 2007, there was still an additional surplus of $3 billion, totalling $54 billion. We know that on March 31, 2008, or in a couple of weeks—the figures will be announced in a couple of months—there will once again be a surplus. So the money is there.

The creation of a crown corporation on unemployment insurance funding should help to strike a balance. A document submitted to the committee by the Conseil du patronat du Québec in 2003, in reference to comments made by the employment insurance chief actuary, stated that: “each 10 cent variation in the premium rate would affect revenue to the tune of [...] $840 million”.

In other words, we believe that the premium rate won't even need to be changed because the money is already there. But if necessary, there would be an increase in the premium of less than 10 cents which would enable more Canadians, in fact tens of thousands of people, to qualify for employment insurance. That's not a lot, considering that the premium rate was much higher in the past: it's previously been over $3.

I'd like to quote a line from the Conseil du patronat: “[...] the employment insurance system must rediscover its original mission which is to provide replacement income.”

It is our belief that we need a compromise formula that will help us garner this majority. It's time for solutions, and we need a majority so that we can impose these solutions. The debate has to take place above the partisan fray and it needs to focus on the welfare and betterment of our society. We need to find better ways of protecting our workers.

[Barbara Byers, Executive Vice-President, Canadian Labour Congress]

Thanks very much for the opportunity to be here. We won't be taking 10 minutes, because we want to get into the discussion as well.

The key reforms to the EI program that have been advocated by labour and anti-poverty groups are a reduction in the number of qualifying hours to 360 in all regions; a longer duration of up to 50 weeks of regular benefits; and an increase to at least 60% in the percentage of insured earnings replaced by EI benefits, based on the best 12 weeks of earnings.

We support Bill C-265, which would reduce the number of qualifying hours to 360 and base benefits on the best 12 weeks.

We are now sitting just two days before International Women's Day, so I want to speak today in particular about the importance of the EI program to working women and the need to make fundamental changes of the kind proposed in this bill.

The Canadian Labour Congress is going to be organizing, commencing Saturday, teach-ins all across this country on the question of women's economic equality, and these teach-ins will continue throughout the course of the year. The need for EI reform is very much on our agenda. I would refer you, beginning tomorrow, to our website, www.onceandforall.ca or www.unefoispourtoutes.ca, because you will see interesting fact sheets on the question of women's economic equality, and in particular on EI.

EI income support during periods of unemployment, maternity or parental leave, and periods of sickness is obviously important in terms of stabilizing and supporting family incomes. EI also supports the economic independence of women, since benefits are not based on family income, with the exception of a small supplement for low-income families. Rather, the benefits are based on insured individual earnings. However, key EI program rules exclude or unfairly penalize women workers, because they fail to take into proper account the different working patterns of women compared to men. While the great majority of adult women now engage in paid work, the hours they work exclude many from EI benefits, as do periods of time spent away from work caring for children or others.

We shouldn't just say that this is a particular kind of worker, because recently, at a meeting with some officials from Service Canada, it was pointed out by the representative of the Canadian Teachers Federation that there are a lot of young teachers who don't have full-time positions who are doing a lot of fill-in work, and a lot them don't quality for their EI. So we can't compartmentalize this and say it's one group of workers. In fact, it cuts across all groups, and in particular, again, it hits women in those groups particularly hard.

I'd like to suggest to the committee, if you haven't already reviewed it, that you look at a report done by Monica Townson and Kevin Hayes for Status of Women Canada. It's a recent report. They document that only 32% of unemployed women qualify for regular EI benefits compared to 40% of men who are unemployed. Over 70% of women and 80% of men qualified for benefits before there were major cuts imposed more than a decade ago. The key reason for the gender gap is that in order to qualify, a person must have worked in the previous year and must have put in between 420 and 700 hours of work, depending on the local unemployment rate. Workers in most large urban areas now have to put in 700 hours, roughly the equivalent of 20 weeks of full-time work.

Fewer unemployed women qualify than do men because many women take extended leaves from work to care for children and for others in their families. After a two-year absence from paid work, the entrance requirement jumps to 910 hours, or more than six months of full-time work. And when they work, women are much more likely than men to be employed in part-time and/or temporary jobs as opposed to full-time, permanent jobs providing steady hours. Because they lack enough qualifying hours, only about half of part-time workers who lose their jobs actually qualify for unemployment benefits.

Even when they finally do qualify, the lower pay of women, combined with more unstable work patterns, means that they usually qualify for lower benefits, an average of $291 per week compared to $351 for men in 2005-06. Only about one-third of the total dollar amount of regular EI unemployment benefits is paid to women, even though women now participate in the paid workforce at almost the same rate as men.

The EI program now provides for up to 15 weeks of maternity benefits and 35 weeks of parental benefits, 90% of which are taken by women. Expansion of maternity parental leave stands as a major gain for working women in recent years, especially the 2001 increase in parental benefits from 10 to 35 weeks.

To qualify, a woman must have worked 600 hours in the previous year. About three-quarters of all women giving birth to a child do qualify, and about 60% claim a benefit, but a full year leave of absence is much more likely to be taken by women who qualify for a reasonable benefit or whose employer supplements the EI benefit. Bill C-265 would increase the proportion of women eligible to take maternity or parental leaves and the proportion who could afford to do so.

In conclusion, the reduction of qualifying hours to 360 for regular and special benefits would result in a major gain for working women, who are unfairly treated by the current EI rules.

I would like to add here that when the change was proposed to move from a weeks calculation to an hours calculation and that everybody would be included, we actually embraced that in the labour movement. We thought that was good, that there would be people who could pay in and who could benefit from it. What we didn't know was that there was this vicious undertow that said, yes, you can pay in, but you're not going to qualify because the number of hours is too high.

I'll look forward to answering questions later on, and we've also provided to the committee an updated version of our policy paper, “Towards a Better Employment Insurance System for Workers in Today's Job Market”.

Thank you.

[The Chair, Conservative, Dean Allison]

Pursuant to the orders of reference on Tuesday, October 16, we're now going to look at Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits).

I want to welcome everyone here today, and certainly our witnesses. I realize that you've probably all come on fairly quick notice, so thank you very much for making your schedule available.

We're still waiting for one more witness, who was given about 24 hours' notice, just slightly less time than you guys were given. What we will do, though, is start the rounds anyway, and when the witness shows up we'll insert him into the lineup.

We have with us today three different groups that are here right now and one more that we're waiting on.

Why don't we start with Mr. Jackson and Ms. Byers from the Canadian Labour Congress. Welcome, again. I know you guys have been here before for various things.

I'm going to give each presenter 10 minutes, or less if they need that. I'll just give you a one-minute warning. Certainly if you're at less time than that, that's fine as well. Then what we'll do is start with a seven-minute round of questions and answers, and then we'll go with five minutes after that. I'll identify you, and the microphones will automatically turn on and off. I think most of you have been here before, but for those who haven't, that's the way it works.

We'll start with a round of Liberal, Bloc, NDP, and Conservative, and we'll proceed in that order.

Welcome, Mr. Jackson and Ms. Byers. We'll give you 10 minutes to get started.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Thank you, Mr. Chairman and committee members.

It's a pleasure for me to be here this morning to discuss Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits). I haven't prepared a brief because I feel I know the employment insurance question well enough to be able to discuss it for the next 10 minutes.

I would like to begin by saying that I'm proud that Parliament has voted to refer the bill I've introduced to our committee so that we can discuss it and see whether we can improve it.

In 1986, the Auditor General made some recommendations to Brian Mulroney's Conservative government. He recommended that the employment insurance funds be paid into the Consolidated Revenue Fund. In 1988, after the funds were paid into the Consolidated Revenue Fund, the government realized that the fund was becoming a cash cow. These funds had virtually become a tax. It saw the funds being paid into the Consolidated Revenue Fund and thought that, if it amended employment insurance and proceeded with cuts, it could make gains and apply those to the debt and balance the budget. That is precisely what occurred.

Mr. Chairman, I remember that, on July 31, 1989, L'Acadie Nouvelle reported that my predecessor, Doug Young, had asked all New Brunswickers to fight hard against the change made by the government because it would be a disaster for New Brunswick. At the time, he was speaking on behalf of New Brunswick, since he was only an ordinary opposition member. Around February 1993, when the opposition leader was the Honourable Jean Chrétien, a letter was sent to a group of women from Mouvement Action Chômage, in the Rivière-du-Loup region, stating that the government was punishing workers by making the cuts, that unemployment insurance was not the problem, but rather that the economic problem had to be solved.

Then, in the fall of 1993, the Liberals came to power and continued making changes to employment insurance. I'm not tossing balls around and making everyone angry. I don't want to prevent you from voting in favour of the bill. I'm setting out the actual facts that have been made public.

Once the changes were started, could we blame senior officials for getting it into their heads that unemployment insurance benefits had to be cut because giving people money made them indolent and lazy? After the Liberals came to power, an article in the Globe and Mail triggered comments in the Hamilton region. In that article, Doug Young was reported as saying that people from the Atlantic region were a lot of lazy and indolent people and that was why they wanted employment insurance benefits, but that he was going to change matters. He thought that the Globe and Mail wasn't distributed in the Atlantic region. It was in 1997—and Mr. Cuzner no doubt remembers this—that we realized that Atlantic workers had really reacted to those remarks.

People wonder why Yvon Godin wants to be so generous by lowering the number of hours required to 360, and think that makes no sense. You have to remember that, in those years, a person had to work 15 hours a week and accumulate 150 hours. You could say that unemployment insurance was generous, because it wasn't as hard to qualify: you had to work 15 hours a week and accumulate 150 hours. The 15 hours a week applied to male and female workers, especially female workers. A number of women worked 20 hours a week. Not everyone worked 40 hours a week. The 150 hours equalled about 10 weeks of work.

In the Atlantic provinces, we are lucky to live beside the Atlantic Ocean. We are lucky to live by the sea, which enables us to create a fishing economy. We also have forests. We could talk about this for a long time, since we're losing it as a result of the closure of the paper mills. I've said this many times in the House, colleagues: the Bay of Chaleur freezes along the coast in winter. In addition, the government imposes quotas.

It isn't employees who decide whether or not they can work year-round; it's government regulations. There are quotas.

For example, with regard to the crab industry, you can catch approximately 26,000 tonnes of crab. The fishery is over in less than six weeks. What do people do then? No one ever decides on Friday morning that he won't go to work on Monday and thus have his wages cut in half. I don't think so. I've never seen anyone from the Atlantic who is indolent, lazy and doesn't want to work.

You need only look at the number of people taking a plane and going to work for the oil industry in the west. These people like to work and work hard, but our industries are seasonal.

Statistics Canada has conducted some studies. The government argues that 85% of people eligible for employment insurance are receiving it. That's what the government says. The government today takes the same line as the previous Liberal government. It's senior official speak.

In the first report published following the major changes made to the employment insurance system in 1996, it was said that only 42% of people who contributed to employment insurance could receive benefits. Perhaps I'm mistaken, but I believe that's what was written in the first report. That hit hard, and everyone said it made no sense. So they took a different tack and said that 85% of people eligible for employment insurance were receiving it.

The question was asked here in committee meetings. I myself was present when questions were put to officials from Human Resources and Social Development Canada. The question was clear.

People are contributing to employment insurance, but don't qualify for it because they haven't managed to accumulate 910 hours of work, or 840 hours of work in certain regions. It takes 910 hours of work to qualify for employment insurance the first time. University students contribute to employment insurance, but don't qualify for it because they don't have enough hours of work. There are also all those people who work part time in Canada and who can't accumulate 910 hours of work during the year.

Here's another example. In 1999, Minister Pettigrew said that the problem only affected the Atlantic provinces, that it didn't affect the rest of Canada. I said to myself that I should go and visit the rest of Canada, and I did a national tour. I also sent out copies of my tour report. I visited all the provinces of Canada. I went to 22 regions, I attended some 53 public meetings, and I wrote a report.

I met one lady from Nanaimo who had been in a coma for 10 days. When she came out of the coma, she went home. She wanted to receive health insurance and employment insurance, but she was short two hours of work. In three years of work, she had never been able to accumulate the required 700 hours of work. She had accumulated 698 hours of work. So she was only two hours short of being eligible for employment insurance. The 420 hours required, or more depending on the region, represent a number that is too high for newcomers, because of the industry they work for, not because they leave their jobs in order to go home.

The act is clear: if a person voluntarily leaves his employment, he does not qualify for employment insurance. In that case, the person doesn't leave his job; it's the employer that says that it can't offer him employment because it has reached its crab and lobster quotas, that the lobster fishery is over, and so on. In Prince Edward Island last year and the year before, there weren't enough people to work in the fishing industry. Workers even came from Russia to work when the unemployment rate was 20%. People have gotten to the point where they prefer to live on welfare because, that way, they feel better treated. When you've gotten to that point, I think there's a real problem.

Here in Ottawa, when we talk to our colleagues about the employment insurance problem, some suggest that people affected should move out west, where there's enough work. Excuse me, but we don't want to move the entire Atlantic region and northern Ontario out west. There are major industries, including fishing and forestry, in Vancouver as well, where I went. Some employers in major industries should have a system that can help them.

The qualification requirement must be lowered to 360 hours to give everyone an equal opportunity. If someone loses his job, whether it be in Rivière-du-Loup, Timmins, Nanaimo or Fort McMurray, he's still an individual who has lost his job. Employment insurance should be used to compensate for that loss of employment by supporting the families of those individuals until they find another job. Everyone should have equal access to this system, which is funded by them, not by the government. It is employers and employees who contribute to the system. The system should therefore enable those individuals to access their own insurance system rather than make it so that the funds are diverted to pay down the debt and to achieve a zero deficit. We've seen that the $7 billion surpluses each year have been diverted from the Employment Insurance Fund for that purpose. It's really through this fund that the government has paid down its debt and balanced its budgets. The fund should enable the most vulnerable citizens to access this program, which they themselves fund.

In addition, we should focus on the best 12 weeks of the year. The employment insurance program already collects a percentage on these people's wages. If they work for minimum wage or $9 or $10 an hour, telling them that they will only receive 55% of their earnings if they don't look for a job is one way of urging them to look for one. I'd like the percentage to be 66%, but it's currently 55%. These people are doubly penalized under the divisor of 14 policy, which only applies to certain places. But, in reality, who are we punishing? We're punishing the family, man, woman and children. It's not for no reason that 1.4 million children are hungry in Canada. In my opinion, the changes made to the employment insurance system by successive governments have really caused this problem.

I still sincerely believe that all Canadians are stalwart individuals. If we attack the economic problems and create employment, people will be proud to get up on Monday morning to go to work. They will go home at night with a paycheque that they have honestly earned. It is the Government of Canada, not the workers, that has come to depend on the employment insurance system to pay down its debt. These are the two changes that I have requested in the context of this bill. I am prepared to answer your questions.

[The Chair, Conservative, Dean Allison]

We're still missing a few people, but we do have quorum, so we're going to start.

Pursuant to the order of reference of Tuesday, October 16, Bill C-265, An Act to amend the Employment Insurance Act in regard to qualification for and entitlement to benefits, I want to welcome today Mr. Godin, the sponsor of the bill.

Thank you, sir, for being here.

We're going to commit the first hour to this. So perhaps, Mr. Godin, you would like to go with your statement. We have members who are going to be coming in, and we're going to be pretty much filled up here, hopefully very shortly.

Before we get started, however, all the members will find in front of them a request for budget. This is some housekeeping we need to take care of. We need a motion to pass that. This is to deal with this particular private member's bill we have before us. You'll see in front of you the potential cost for witnesses. Keep in mind that whatever money is not used will be returned to the envelope, so this is just the highest-case scenario. Because we have some local witnesses, there may not be much cost at all, but we do need to present a budget.

If I could have someone move a motion for that, then we can have some consensus on the budget.

Canada-United States Tax Convention Act, 1984

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, I would like to ask the parliamentary secretary to be clear on this because we are getting mixed information from research. Is it the government's interpretation that this bill would eliminate all double taxation of U.S. social security recipients who are living in Canada but who have worked in the United States? Would this bill eliminate the double taxation that historically has taken place? Would it meet the provisions in Bill C-265, the private member's bill put forward by the member for Essex?

I want the parliamentary secretary to be on the record for the government . Would Bill S-2 achieve that goal?

[Lynne Yelich, Conservative, Blackstrap, SK]

I can't agree more with the speakers before me. Definitely, Mr. Martin has brought up several times, and the minister has said, that he really wants to have the poverty study go ahead, and I think he's waited patiently or long enough. So I think we should take his poverty study and definitely put it in the queue.

I think we should get on with the employability study. As Mr. Savage articulated so very well, we have to have Bill C-265 done before February 8, and then the poverty motion that Mr. Martin has called for.

So I'd like us somehow to stick to that. That's it, and nothing else; we should clear the agenda and do these four things. We should get the employability study done; we should leave some room for the minister, who has agreed to come here, to speak about the estimates, and I don't think there's a problem with that; we should do Bill C-265; and then we should go right into the poverty study.

Can we just stick to that? Is there a way we can confine this so that we don't have any more hijacking of this committee by anything else, but do the very important employability study first and foremost; have the minister here, which sounds like it's a good idea; and then do Bill C-265 and the poverty study.

Can we find a way to put that in stone?

Speaker's Ruling

[The Acting Speaker, Conservative, Royal Galipeau]

I am now prepared to rule on the point of order raised by the hon. Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform concerning the need for a royal recommendation for Bill C-362, An Act to amend the Old Age Security Act (residency requirement), standing in the name of the hon. member for Brampton West.

On October 18, the hon. Parliamentary Secretary to the Government House Leader and Minister for Democratic Reform drew attention to the fact that Bill C-362 would increase old age pension security and guaranteed income supplement benefits by lowering the threshold for residency requirement from the current 10 years to three years, thus resulting in significant new expenditures for the government.

The hon. parliamentary secretary argued that precedents clearly establish that bills which create new expenditures for benefits by modifying eligibility criteria or changing the terms of a program require a royal recommendation.

In support of this view, he cited rulings on Bills C-265, C-278, C-284 and C-269 from the previous session.

I would like to thank the hon. Parliamentary Secretary to the Government House Leader and Minister for Democratic Reform for having raised this issue.

The Chair has examined Bill C-362, An Act to amend the Old Age Security Act (residency requirement), to determine whether its provisions would require a royal recommendation and thus prevent the Chair from putting the question at third reading.

As has been pointed out, Bill C-362 amends the Old Age Security Act to reduce from 10 years to three years the residency requirement for entitlements to a monthly pension.

The parallel made by the hon. Parliamentary Secretary to the Government House Leader and Minister for Democratic Reform between Bills C-362 and Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), is a pertinent one.

Although Bill C-269 contains several elements that involve new expenditures, one particular element sought, much like the provisions of Bill C-362, to reduce the qualifying period for benefits.

As the Chair pointed out on November 6, 2006, in a ruling on Bill C-269, “...all of these elements [contained in the bill] would indeed require expenditures from the EI Account which are not currently authorized”.

It went on to say, “Such increased spending is not covered by the terms of any existing appropriation”.

By reducing from 10 years to three years the residency requirement for entitlements to a monthly pension under the old age security act, Bill C-362 would reduce the requirements currently authorized for payment of benefits. In doing so, the bill would authorize an inevitable increase in the amount of expenditure of public funds and therefore requires a royal recommendation.

Consequently, I will decline to put the question on third reading of this bill in its present form unless a royal recommendation is received; however, the debate is currently on the motion for second reading, and this motion shall be put to a vote at the close of the second reading debate.

Resuming debate, the hon. member for Laval.

Opposition Motion—Manufacturing and Forestry

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I would like to thank the hon. member for Chambly—Borduas for his very good question. The government has already taken $54 million from the employment insurance fund. In addition, from 2006 to 2007, the federal government announced a $3.3 billion surplus in the employment insurance fund, and from March to today, its surplus has been $1.7 billion. The reason why the government does not want to give this bill the royal recommendation is that it thinks all is well in Canada. It thinks unemployment is going down and, since there are no more problems, it can go on drawing from the employment insurance fund, just like the Liberals used to do.

We had agreed to say that Bill C-269 is similar to Bill C-265. Even the Liberals agreed, but now they have started to slip on the ice. Is it because winter has arrived that their skates have started slip? They do not want to support us on this bill now because they are afraid that, if they return to power some day, they will not be able to continue the cuts they began in 1996.

We need to remember that the employment insurance problem is the Liberals’ baby, even though the difficulty was created by the Conservatives before them under Brian Mulroney. The cuts started in the Brian Mulroney era and were continued by Jean Chrétien’s government and so, on and on.

This bill would help people who live in rural areas or have jobs in seasonal industries to qualify for employment insurance. The Bloc has often talked as well about the bill or motion to come to the aid of working people 55 years and older who lose their jobs. However, the government is still in neutral on this. It does not want to talk about it and has no intention of helping these people. But the government is there all right when it is time to help big business and the big banks by giving them big tax breaks. It is just too bad for working people, according to the government. They should just move to Alberta. But not everybody can move to Alberta.

Resumption of Debate on Address in Reply

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

Mr. Speaker, I am pleased to take the back end of the ship with my colleague from West Nova. His speech reminded me of a time when Nova Scotia had a regional minister who actually stood up for our interests and put Nova Scotia's interests ahead of Canadians' interests.

I want to talk about the Speech from the Throne. Some of the things that my colleague spoke about I may touch on, but for me it was a disappointing document, a leaflet really, more for what is not in it than for what is in it.

We just had a question from a western Canadian about the Atlantic accord saying that there was a lot of miscommunication. I remember when I was in the House back in the spring when it was apparent to most people in Canada, and certainly to all people in Nova Scotia, that the Atlantic accord was torched. A member from Ontario asked a question saying that it had not been torched and it was still there. That was obviously not the case. I pointed out to the member at the time that he would not know the difference between the Atlantic accord and a Honda Accord, and that is still the case. There is a lot of confusion.

The Atlantic accord is gone. If it were not gone, we would not have seen the scrambling to try to fix it. The fix is not a fix that Nova Scotians would stand up and give any resounding approval to. It is not a fix at all. If it were, the member for Cumberland—Colchester—Musquodoboit Valley would be back on that side of the House from where he was kicked out not too long ago.

It is one issue that all Nova Scotians, Newfoundlanders and Labradorians will stand up to be heard on.

Last week I had a public meeting in my community. I invited people to tell me as their member of Parliament what they wanted to see in the throne speech. The government had prorogued Parliament and would bring in a throne speech. Whether I agreed or disagreed, we discussed a number of things. We discussed poverty, Afghanistan, the Atlantic accord, as we might expect, students, seniors and veterans.

One issue that came forward, as one would expect, was the issue of crime. In my community of Dartmouth—Cole Harbour we have had more than our share of violent crime, which is a big concern.

At that meeting, two people whom I had not known before spoke at that meeting in a very personal way about their experiences with two sons from two different families. They had been beaten up and bullied and they did not feel safe in their community. They came with an open mind about what could be done, but they wanted to see changes in the Youth Criminal Justice Act to address their specific case.

When members of Parliament hear these stories, they want to do the right thing. In Nova Scotia last December Justice Merlin Nunn came forward with a report on youth crime in response to a specific incident in Nova Scotia, which was quite appalling. The report was long, detailed, well thought out, well argued and well presented.

When the Minister of Justice came to Halifax, he referenced the Nunn Commission report. All members should go to www.Nunncommission.ca and have a look at this report. In the report it refers to problems with the Youth Criminal Justice Act. It indicates particularly that repeat offenders are not dealt with effectively enough and makes recommendations. It also suggests that the Youth Criminal Justice Act is sound legislation and that we should not throw the baby out with the bathwater.

When the Minister of Justice refers to the Nunn Commission report, I hope he does not just take a little piece of it, on which I agree with him, but looks at the who report in context and adds into that the need for mental health services for kids in our community, boys and girls clubs, breakfast programs and stay in school programs as well, which will also do more to reduce crime.

Yesterday the Minister of Human Resources and Social Development spoke on the throne speech. He was one of the first government speakers. It was an amazing spectacle. He gave a 20 minute speech without talking about human resources. He talked about one specific issue, and that was the crime issue, which the government is pounding away trying to get people to believe that its members are the only people who want to act on it.

The Minister of Human Resources and Social Development stood in the House of Common, and he is a good guy, but he did not talk about human resources. Why? Because there is nothing in the throne speech on human resources of which to speak. We heard about employment insurance. It states:

Our Government will also take measures to improve the governance and management of the Employment Insurance Account.

There are people across Atlantic Canada whose knees are shaking when they read that piece. Does that mean the government will make it better, as my colleague from West Nova optimistically points out?

If the government wants to make it better, it could look at some private members' bills that have come from all parties in this Parliament: Bill C-269, Bill C-265 or Bill C-278 that my colleague from West Nova referenced, which would extend sick benefits under EI from 15 weeks to 50 weeks. Who could oppose that?

It is a reaction to a very significant issue in Canada, which is that people who used to die of heart attacks, strokes and cancer in a lot of cases now are surviving. That is good news. The bad news is they cannot go right back to work and the EI system is the perfect way to address that need.

I want to applaud the member for Sydney—Victoria, who brought forward Bill C-278, costed it and did a lot of work on it. He got the Heart and Stroke Foundation and the Cancer Society to say that it was the kind of legislation we needed, and the government refused a royal recommendation.

This document has one very brief mention about education, saying families worry about the rising costs of higher education. That is not a stunning revelation. They do. We all hear that as well. We need to help them. One does not tax cut one's way to a better education. One invests, particularly for low income Canadians, persons with disabilities and aboriginal Canadians. We should be investing.

In the late 1990s, when the government wrestled the deficit under control, we invested in things like the Millennium Scholarship Foundation, which is now at a precipice in terms of whether it can continue if it does not soon get a nod from the government that it will put money back into it, Canada access grants, learning bonds and a number of other things.

If we are to address productivity, there are a number of ways we should do it. We should be reducing taxes, not throwing $6 billion out the window on a GST cut, particularly for Canadians who need it the most. As a start, we should go back to the Liberal cut of the economic update of 2005, which the government reversed the following year. That is a start, raising the personal exemption.

I am fully in support of lowering corporate taxes. The countries in the OECD that have done that are doing very well. The lowest economic groups in those countries are doing very well also.

There are things that we can do, such as replenishing the Millennium Scholarship Foundation. The Canada summer jobs fiasco, which we dealt with last year, was pretty clear. It was a mistake by the government. It tried to rectify it. Some organizations, due to pressure from this side of the House, got their funding but many did not. There are things we can do now to ensure that fiasco does not happen again next year.

I want to talk about manufacturers and exporters. There is a crisis in manufacturing in Canada. We need to have mechanisms in the employment insurance system through Human Resources Canada to deal with that.

In my riding the Hershey Moirs plant announced in the spring that it would close in December. Six hundred people will be out of work. There is a program designed to help those people through Service Canada. I have been at transition team meetings with the union, which is working very hard. It is not happy about it at all, but realizes it has to now ask what it will do with the people. It is working with the plant and with Service Canada on a program that provides assistance to people who will lose their jobs.

Guess what? There is a limit of $100,000 per project. I asked Service Canada if it had implemented this project somewhere else and it said, yes, that it was great. I asked how many employees were affected and it said one. One person gets laid off and it can spend $100,000, 500 or 600 people get laid off and it can spend $100,000. Surely the funding should be by person, not by project.

I want to mention that I spoke directly to the minister about that. I appreciate the fact that he took the time to talk to me about this case. I am very hopeful he will intervene to make sure that what needs to be done gets done. However, there was no mention—

Bill C-357--Employment Insurance Act and Bill C-362--Old Age Security Act

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, I rise on a point of order with regard to two private members' bills, Bill C-357 and Bill C-362. Without commenting on their merits, I submit that these two bills require royal recommendations.

First, I want to explain why Bill C-357, An Act to amend the Employment Insurance Act (Employment Insurance Account and premium rate setting), requires a royal recommendation.

As the Chair ruled on May 9, 2005:

--bills which involve new or additional spending for a distinct purpose must be recommended by the Crown. The royal recommendation is also required where a bill alters the appropriation of public revenue “under the circumstances, in the manner and for the purposes set out” in the bill. What this means is that a royal recommendation is required not only in the case where more money is being appropriated, but also in the case where the authorization to spend for a specific purpose is being significantly altered.

I would note that Bill C-357 is nearly identical to Bill C-280 in the 38th Parliament which the Speaker ruled required a royal recommendation.

On June 13, 2005, the Speaker stated:

--Bill C-280 infringes on the financial initiative of the Crown for three reasons: first, clause 2 effects an appropriation of public funds by its transfer of these funds from the consolidated revenue fund to an independent employment insurance account established outside the consolidated revenue fund.

Second, clause 2 significantly alters the duties of the EI Commission to enable new or different spending of public funds by the commission for a new purpose namely, the investment of public funds.

Third, as indicated in my ruling of February 8, clause 5 increases the number of commissioners from four to seventeen.

All three of these conditions apply to Bill C-357.

Clause 2 would create an employment insurance account that is outside the consolidated revenue fund. The bill would transfer money out of the consolidated revenue fund to the employment insurance account and that money would no longer be available for any appropriations Parliament may make. This would be an appropriation of funds and, therefore, requires a royal recommendation.

However, worthy some aspects of the bill may be, and some aspects of it are, this does not alter the need for the royal recommendation.

Clause 2 would also change the duties of the Employment Insurance Commission, including new requirements for the commission to deposit assets with a financial institution and to invest assets to achieve a maximum rate of return.

These are new and distinct purposes which have not been authorized and are additional reasons why clause 2 requires a royal recommendation.

Clause 5 of Bill C-357 would increase the number of commissioners on the Employment Insurance Commission from its current four to seventeen.

On February 8, 2005, the Speaker ruled that the appointment of 13 new commissioners to the Employment Insurance Commission in Bill C-280 required a royal recommendation. This is consistent with other rulings where the Speaker found that adding remunerated members to commissions requires a royal recommendation. Given these precedents, I submit that clause 5 requires a royal recommendation.

To sum up, Bill C-357 would require an appropriation, it would alter the purpose of funds covered by the act, and it would require new spending for an expanded commission; therefore, it must accompanied by a royal recommendation.

The second bill I want to draw to your attention is Bill C-362, An Act to amend the Old Age Security Act.

This bill would increase old age security and guaranteed income supplement benefits by lowering the threshold for eligibility from the current 10 years to 3. This change would result in significant new expenditures.

Under the Old Age Security Act, applicants must have at least 10 years of residence in Canada after age 18 in order to qualify for benefits.

I would further note that partial benefits are paid to applicants who have less than 10 years of residence if the applicant has credits from a country with which Canada has a pension agreement. Residence has been an eligibility criteria since this program's inception in 1952. Reducing the residence requirement from 10 years to 3 years would have significant costs.

Since eligibility for old age security pensions also qualifies for low income recipients to receive the guaranteed income supplement, the Department of Human Resources and Skills Development estimates that the total cost of reducing the qualifying period would be over $700 million annually.

Precedents clearly establish that bills which create new expenditures for benefits by modifying eligibility criteria or changing the terms of a program require a royal recommendation.

On December 8, 2004, the Speaker ruled in the case of Bill C-278, which extended employment insurance benefits, that:

Inasmuch as section 54 of the Constitution, 1867, and Standing Order 79 prohibit the adoption of any bill appropriating public revenues without a royal recommendation, the same must apply to bills authorizing increased spending of public revenues. Bills mandating new or additional public spending must be seen as the equivalent of bills effecting an appropriation.

On November 6, 2006, the Speaker ruled with regard to Bill C-269, which extended employment insurance benefits, that:

Funds may only be appropriated by Parliament for purposes covered by a royal recommendation...New purposes must be accompanied by a new royal recommendation.

On November 9, 2006, the Speaker ruled in the case of Bill C-284, the bill that enlarged the scope of the student grants program beyond that originally authorized by Parliament, that:

Any extension of the terms of an existing program must be accompanied by a new royal recommendation.

On November 10, 2006, the Speaker ruled in the case of Bill C-278, dealing with employment insurance benefits, that:

--by amending the Employment Insurance Act to extend sickness benefits from 15 weeks to 50 weeks, the bill would require the expenditure of additional funds in a manner and for a purpose not currently authorized.

On March 23, 2007, the Speaker ruled in the case of Bill C-265, dealing with employment insurance benefits, that it was abundantly clear:

--those provisions of the bill which relate to increasing employment insurance benefits and easing the qualifications required to obtain them would require a royal recommendation.

I would also note that when Parliament adopted amendments to benefit criteria in the Old Age Security Act in Bill C-36 earlier this year, this legislation was accompanied by a royal recommendation.

In conclusion, Bill C-362 would increase expenditures for old age security and guaranteed income supplements in ways not already authorized and, therefore, should be accompanied by a royal recommendation.

Employment Insurance Act

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I am pleased to rise in the House to speak to Bill C-269. However, I would first like to welcome our new pages, who are here to assist us, to the Parliament of Canada, their Parliament.

It is fairly difficult to remain seated when listening to all that was said. However, that is part of our responsibilities. I do not wish to waste too much time speaking about the Liberals because I agree with what my colleague from Cape Breton—Canso just said. My only problem is that they were the ones, between 1993 and 2006 and especially in 1996, who made cuts. These draconian cuts to employment insurance led us to where we are today. Yet they had an opportunity to make changes. It was not until they were in opposition that they saw the light at the end of the tunnel. It is unfortunate that they did not see it when they were in power. In view of the $54 billion surplus, it is quite unreasonable.

What can we say about the member for Beauséjour and his support for the bills? Personally, I moved a motion with regard to the 12 best weeks and he voted against this motion, as did the member for Madawaska—Restigouche. The purpose of the motion was to provide citizens of northeast New Brunswick with the opportunity to use the 12 best weeks. They voted against it. I do not wish to waste too much time on this matter as I only have ten minutes. I would like to speak about the current government.

Earlier, I heard the Parliamentary Secretary to the Minister of Human Resources and Social Development say that the government had to be careful with public money. It is as if they had to use taxpayers' money, which they have a responsibility to take care of, to pay the national debt.

I believe they have forgotten the definition of employment insurance. It is not public money, but money that belongs to workers and employers. Unfortunately, employers have had to lay off workers, and people have lost their jobs. Employment insurance is special insurance that helps men and women who have lost their jobs.

When I hear the government say that people are dependent on employment insurance or are abusing the system and I see that the government took $54 billion from the employment insurance fund to pay the debt and wipe out the deficit, I wonder just who is dependent on employment insurance. Who is dependent on it? Who is suffering as a result?

Today, the government has nothing to be proud of. This week, for example, in Acadie—Bathurst, people from Tracadie-Sheila, Shippagan, Caraquet and Lamèque called me to say they had been waiting for 49 days for a decision about their employment insurance. They have been waiting for 49 days to find out whether or not they will get employment insurance.

What does Bill C-269 call for? I would have liked something better. I would have liked people to qualify for employment insurance after 350 or 360 hours. The three opposition parties agreed that each stage could be reduced by 70 hours. People who qualified for employment insurance after 420 hours could qualify after 350 hours, people who qualified after 910 hours could qualify after 840 and people who qualified after 700 could qualify after 630. We agreed to make a proposal to that effect.

The parliamentary secretary says that the bills are ridiculous, that the numbers are all wrong, that Canadians were not given the opportunity to come and express their views before Parliament. She forgot to say that nearly all the bills are similar.

If the government agrees to Bill C-269, there might be no need to introduce Bill C-265 because they are very similar.

When I introduced a bill in the House of Commons with 14 proposed changes to the employment insurance system, the Liberals and the Conservatives voted against it. I tried again with bills that would have cost a mere $350 million. Again they voted against them.

The Speech from the Throne scares me. Canada's Conservative government is telling us that it will take steps to improve the governance and management of the employment insurance fund. I am afraid because I think that the Conservatives will make yet more changes to employment insurance that will take even more away from families in need.

We have seen that the government is perfectly capable of depriving a family of two weeks' salary. The waiting period after losing a job is two weeks. How can they deprive people who work seasonally, who work in fishing, forestry, tourism and other industries, of two weeks' pay? How can they deprive these families of benefits that will help them pay for groceries or things their children need for school? How can the government say that it represents Canadians and workers and that it is acting in workers' best interest?

We have been told that 83% of workers can or do qualify for employment insurance. That is not true. We have checked. Only 38% of men in Canada qualify for employment insurance. Only 32% of women qualify.

Bill C-269 would also increase the benefit period by five weeks. What would the government rather do? It does not want people in Atlantic Canada, in Quebec or in northern Ontario who have seasonal jobs to qualify for employment insurance. It wants them to go work in Alberta where there are jobs for them. It is heartless. It makes families miserable.

Some people have to leave their family. A man who goes to Alberta gets a call from his wife who tells him if he does not come home, they are getting a divorce. He is forced to leave his job and return to his family. Even though the law is clear on the fact that one can leave employment for family reasons, the federal government turns around and cuts employment insurance. Is that the kind of system it wants? This is unacceptable.

Bill C-269 is a reasonable bill. It does not use public funds. These are funds that belong to the workers and not to the general funds the Conservative government uses to pay down the debt. Absolutely not.

The bill would eliminate the presumption that persons related to each other do not deal with each other at arm's length. How many times have we seen the example of a person who works for their brother-in-law, sister-in-law, sister or brother. When people apply for employment insurance, they are asked the following discriminatory question, among others: are you related to your employer? An investigation is automatically launched. People have to wait 40 or 50 days to find out whether they are entitled to employment insurance or not. This is totally discriminatory.

Furthermore, I am sure there is someone listening to me who lost their employment and received severance pay. Even if he gets employment insurance benefits, the government is still there to take away the severance pay. This causes the claimant more problems, instead of helping him find a new job or start a small business. Not once has the federal government, neither the Conservatives nor the Liberals, ever helped workers.

Now the Conservatives do not want to give the royal recommendation because they have dipped into the employment insurance fund and have become dependent on it. If they have not, then they should give it back to the people.

They say we have not studied Bill C-269. We have been studying this situation for 10 years and we know what Canadians want. It is a good bill. That is why the NDP will support it.

[Lynne Yelich, Conservative, Parliamentary Secretary to the Minister of Human Resources and Social Development]

Mr. Speaker, Bill C-269, a bill to amend the Employment Insurance Act, as put forward by my colleague from the Bloc, is a flawed bill and one that we cannot support.

As I followed the remarks of previous speakers, I have to say that I found it a little surprising to hear the Bloc asking us to support the bill. The evidence just does not support such a broadly expanded program.

What evidence shows is that the EI system is currently meeting the demands of the vast majority of Canadians. Eighty-three per cent of unemployed Canadians who have paid into the program qualify for benefits and this rises to more than 90% in areas of high unemployment.

The evidence also shows that even claimants in high unemployment regions rarely use more than 70% of the benefits. Where exactly is the evidence to suggest that the changes in the bill are warranted? It is not just that the bill is not supported by the evidence. We see the opposition asking for support of flawed bills with routine frequency.

What is so surprising is that my colleagues on the other side of the aisle are asking for support on a bill that the sponsor's own party and all opposition parties cared so little about that they refused to do their due diligence. They brought forth no accurate costing estimates, had no public hearings, had no consultation with major stakeholders and had no study on the bill's ramifications to Canadians or to the long term viability of the EI program itself.

Canadians sent this Conservative government to Ottawa to clean things up, to provide accountability, sound management and good public policy. The bill provides none of this but our government does.

We cannot support any bill that has been given so little oversight and so little consideration by Parliament, let alone a bill that proposes such drastic and costly changes to a program as important as this, especially when the changes are not backed by a shred of evidence.

Routine motions and decisions about what to have for lunch are given more serious analysis and debate than the one hour and fifteen minutes Bill C-269 was given by the opposition at committee stage. It is even more puzzling to be asked to support the bill when the Bloc and the opposition parties have been heaping one EI related bill after another onto the order paper asking for implementation of all but prioritizing on none.

The implementation of this bill would cost $3.7 billion, $1.1 billion for Bill C-278 and $1.4 billion for C-265. There are 16 more EI bills to come, 9 of which are too complicated to cost but it is fair to say that they will not be free. It would cost $4.7 billion for the remaining seven bills. The cost of these bills is astronomical and the opposition has supported them all without giving them any careful study.

These bills represent more than $11 billion in new annual spending for the EI account. This would put the program into a deficit within a year and bankrupt the program. Canadians are looking to the government to act responsibly and carefully. They want a government that will ensure the long term viability of the EI system and protect it from a patchwork of proposals made by the opposition, and that is exactly what we are doing.

Canadians expect that if the opposition is proposing to spend billions, it might also spend more than five minutes figuring out whether that much money is needed and where it will come from.

Listening to the public who are affected by these types of changes in policy seems so basic and yet Canadians have not been consulted. Employers who pay into the fund are concerned. Workers who see deductions on their paycheques are concerned and small business owners are concerned but the opposition did not want to hear from any of these groups.

Workers are left to wonder if Bill C-269 is better than the measures that this government introduced to extend compassionate care benefits. Is it better than our pilot projects extending benefits for best weeks and seasonal workers, which Canadians were looking for and this government provided?

The member talked about the forestry industry. We do care and that is why we improved and implemented targeted initiatives for older workers to help the vulnerable workers in certain industries that have been affected by layoff, such as the forestry industry.

All of those initiatives have been implemented since the previous Parliament, which was when the Bloc last proposed this bill and the Liberals last opposed it. Does the Bloc want to scrap all these initiatives in exchange for its bill?

Canadians appreciate that their new government is getting things done for them in a measured but meaningful way and they expect the same from all the parties in House. However, they are getting the same old, same old from the Bloc Québécois because the same old, same old is all it ever has to offer.

One does not have to look further than the recent byelection results in Quebec to know what Quebeckers think about the Bloc's proposals for this country. Canadians are shocked to see the Bloc propose the same types of changes it has been proposing for more than a decade. It is becoming increasingly clear to the people in Quebec that the Bloc has simply run out of things to say.

We know what Canadians have to say about the Liberal practice of spending public money with little or no oversight. One can imagine the reaction of all Canadians to find that the Bloc now wants to travel down that same road.

We are all tired of seeing public funds disappear into black holes, only to be explained as a mistake or worse, as the Auditor General described, “a rule-breaking sponsorship program, a scandal of major proportions”. Canadians want better oversight when it comes to their money and they want better long term planning. This bill goes against all of those principles.

We have all watched the cost of the Liberal programs balloon to billions of dollars. We must be very leery of the Bloc's untested assertion that Bill C-269 will cost just over $1 billion to implement when all outside estimates put the real cost at triple or even quadruple that amount.

Who is right in their figures? Is the sponsor of the bill correct when she says that it will cost $1.7 billion or is the Conseil du patronat du Québec and others right in pegging it at $3.7 billion? This would have been a prime question for the committee to have considered but unfortunately they did not bother seeking the input of witnesses like the Conseil du patronat, hard-working Canadians or even the Department of Human Resources and Social Development.

How can Canadians have confidence in this bill when they were completely cut out of the process by the opposition? A true and meaningful inquiry into Bill C-269 and the many unanswered questions around the bill would have gone a long way toward giving Canadians and this government confidence in a bill like this. Unfortunately, the opposition did not care enough to do its due diligence.

When the Canadian public went to the polls to choose a new government, they elected a Conservative government because they knew that we understood accountability. We know that accountability does not just mean explaining money that was spent last year. It means being able to plan expenditures before they go out of control.

We are asking the questions Canadians want asked because we know that the answers are important. However, without those answers and without the confidence of Canadians we cannot support this bill.

This government's record of measured improvements to the EI program proves that we have made EI a priority by our approach. However, our approach will not be piecemeal. We will look at the entirety of the EI program and not just one small aspect of it. Canadians expect more from this minister than that. They want him to properly manage a program that benefits the whole country.

Last night's Speech from the Throne outlined this government's priorities and reconfirmed our commitment to make the EI system responsive to Canadians' needs. We will continue to take measures to improve the governance and management of the employment insurance account and we will ensure that these changes are measured and responsible. I look forward to the minister's next steps in improving the EI program, which I am sure will be presented in the House in due course.

Business of the House

[The Deputy Speaker, NDP, Bill Blaikie]

Before we begin private members' business today, I would like to remind the House that yesterday the Speaker made a statement in which he reminded the House that all items of private members' business originating in the House of Commons that were listed on the order paper during the previous session are reinstated to the order paper and shall be deemed to have been considered and approved at all stages completed at the time of prorogation of the first session. This also means that those items on the order of precedence remain on the order of precedence or, as the case may be, are referred to committee or sent to the Senate.

Just as individual items of private members' business continue their legislative progress from session to session, the Chair's rulings on these same items likewise survive prorogation. Specifically, there are six bills on which the Chair either ruled or commented with regard to the issue of the royal recommendation. The purpose of this statement is to remind the House of those rulings or statements.

Members will recall that on May 4 the Speaker made a statement expressing concern regarding the spending provisions contemplated by two bills, namely: Bill C-357, An Act to amend the Employment Insurance Act (Employment Insurance Account and premium rate setting) and another Act in consequence, standing in the name of the member for Gaspésie—Îles-de-la-Madeleine and Bill C-362, An Act to amend the Old Age Security Act (residency requirement), standing in the name of the member for Brampton West.

Just as was done last May, the Chair invites members who would like to make arguments regarding the need for a royal recommendation for these two bills or any of the other bills on the order of precedence to do so at an early opportunity.

Members will also recall that during the last session some private members' bills were found by the Speaker to require a royal recommendation. At the time of prorogation, there were four such bills on the order of precedence or in committee. Let us review briefly the situation in each of these four cases.

Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits),standing in the name of the member for Acadie—Bathurst, was before the Standing Committee on Human Resources, Social Development and the Status of persons with disabilities. The Chair ruled, on March 23, 2007, that the bill, in its present form, needed to be accompanied by a royal recommendation.

Bill C-284, An Act to amend the Canada Student Financial Assistance Act (Canada access grants), standing in the name of the member for Halifax West, was awaiting debate at report stage. On November 9, 2006, the Chair had ruled that the bill, in its form at second reading, needed to be accompanied by a royal recommendation. In committee all clauses of the bill were deleted. In its present eviscerated form, Bill C-284 need no longer be accompanied by a royal recommendation.

Bill C-303, an act for early learning and child care, standing in the name of the member for Victoria, was awaiting debate at report stage in the House. The Chair ruled on November 6, 2006, that the bill, in its form at second reading, needed to be accompanied by a royal recommendation. The Chair finds that the amendments reported back from committee do not remove the requirement that the bill be accompanied by a royal recommendation.

Finally, Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), standing in the name of the member for Laurentides—Labelle, was at third reading in the House. The Chair ruled, also on November 6, 2006, that the bill, in its form at second reading, needed to be accompanied by a royal recommendation and reminded members, on April 18, 2007, that the amendments reported back from committee did not remove this requirement.

Consistent with past practice, although today's debate on Bill C-269 may proceed, the Chair wishes to remind members that the question on third reading of the bill in its present form will not be put unless a royal recommendation is received.

I thank hon. members for their attention.

[The Speaker, Liberal, Peter Milliken]

Order. It appears we have a few moments and to save time later I will inform members of something they are just aching to hear about now.

As hon. members know, our Standing Orders provide for the continuance of private members' business from session to session within a Parliament.

The list for the consideration of private members' business established on April 7, 2006, continues from the last session to this session notwithstanding prorogation.

As such, all items of private members' business originating in the House of Commons that were listed on the order paper during the previous session are reinstated to the order paper and shall be deemed to have been considered and approved at all stages completed at the time of prorogation of the first session.

Generally speaking, in practical terms, this also means that those items on the Order of Precedence remain on the Order of Precedence or, as the case may be, are referred to committee or sent to the Senate.

However, there is one item that cannot be left on the Order of Precedence. Pursuant to Standing Order 87(1), Parliamentary secretaries who are ineligible by virtue of their office to be put on the Order of Precedence will be dropped to the bottom of the list for the consideration of private members' business, where they will remain as long as they hold those offices.

Consequently, the item in the name of the member for Glengarry—Prescott—Russell, Motion M-302, is withdrawn from the Order of Precedence.

With regard to the remaining items on the order of precedence let me remind the House of the specifics since the House is scheduled to resume its daily private members' business hour starting tomorrow.

At prorogation, there were seven private members' bills originating in the House of Commons adopted at second reading and referred to committee. Therefore, pursuant to Standing Order 86.1:

Bill C-207, An Act to amend the Income Tax Act (tax credit for new graduates working in designated regions), is deemed referred to the Standing Committee on Finance;

Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), is deemed referred to the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities;

Bill C-305, An Act to amend the Income Tax Act (exemption from taxation of 50% of United States social security payments to Canadian residents), is deemed referred to the Standing Committee on Finance;

Bill C-327, An Act to amend the Broadcasting Act (reduction of violence in television broadcasts), is deemed referred to the Standing Committee on Canadian Heritage;

Bill C-343, An Act to amend the Criminal Code (motor vehicle theft), is deemed referred to the Standing Committee on Justice and Human Rights;

Bill C-377, An Act to ensure Canada assumes its responsibilities in preventing dangerous climate change, is deemed referred to the Standing Committee on Environment and Sustainable Development; and

Bill C-428, An Act to amend the Controlled Drugs and Substances Act (methamphetamine), is deemed referred to the Standing Committee on Justice and Human Rights.

(Bills deemed introduced, read the first time, read the second time and referred to a committee)

Furthermore, four Private Members' bills originating in the House of Commons had been read the third time and passed. Therefore, pursuant to Standing Order 86.1, the following bills are deemed adopted at all stages and passed by the House:

Bill C-280, An Act to Amend the Immigration and Refugee Protection Act (coming into force of sections 110, 111 and 171);

Bill C-292, An Act to implement the Kelowna Accord;

Bill C-293, An Act respecting the provision of official development assistance abroad; and

Bill C-299, An Act to amend the Criminal Code (identification information obtained by fraud or false pretence).

Accordingly, a message will be sent to inform the Senate that this House has adopted these four bills.

Hon. members will find at their desks an explanatory note recapitulating these remarks. The Table officers are available to answer any further questions that hon. members may have.

I trust that these measures will assist the House in understanding how private members' business will be conducted in this second session of the 39th Parliament.

(Bills deemed adopted at all stages and passed by the House)

Employment Insurance Act

[Mike Wallace, Conservative, Burlington, ON]

Mr. Speaker, I am pleased to join the debate on Bill C-357, a Bloc Québécois proposal to amend the Employment Insurance Act.

The part of the bill that interests me is the one that calls for a separate account for EI. Conservatives have long supported the principle of a separate account. In our policy declaration of the Conservative Party, we stated our commitment to:

...the establishment of an independent employment insurance system, with a self-accounting fund administered by employees and employers, the surplus of which being used to increase workers’ benefits or reduce contributions.

In this House, the Prime Minister has confirmed that our government is looking for solutions to meet those objectives.

I too support the principle of the creation of a separate EI account. I also support the tremendous new direction of this government in making changes to the EI system. Canadians are seeing their new government take a very different approach to the old Liberal one. The old Liberals resisted change and did not listen. They stood in the way of returning contributions to the pockets of employers and employees who pay into EI.

Canadians see that their new government is different from the Liberals. They chose a new government because Canadians are different from the Liberals. The Liberals simply would not listen to Canadians and what they wanted to see in a responsible and sustainable EI system.

The new government is listening and we are getting things done based on what we are hearing. In a little over one year since forming government, we have taken action by bringing in measured but meaningful changes. We have heard the concerns of older workers, particularly in Quebec and Atlantic Canada, who were struggling in the face of changes to the labour situations in their regions. They told us that they needed something to help them with retraining and taking their experiences to a new situation.

We listened to their concerns and we responded to their needs with the targeted initiative for older workers. The targeted initiative designs projects for older workers in communities facing ongoing high unemployment or a single industry dealing with downsizing and it helps them. We have also taken action for workers who face work disruptions in regions with high unemployment.

Canadians found that their fortunes in most areas of the country improved once the new government took over. They are enjoying one of the most prosperous periods of economic growth and record employment in Canadian history.

Many sweeping changes to the EI program at a time of unprecedented labour strength would, at best, be difficult to reconcile with the realities of our thriving national economy and, at worst, it would have a cooling effect. Therefore, a major change is not and was not called for.

However, Canada's new government recognizes that change is required. We appreciate that not all regions are seeing the same growth. We understand the need to make changes to meet these regional realities but we need a measured and effective change.

We introduced a pilot project to extend the coverage for five additional weeks in regions with high unemployment. We heard from seasonal workers and others who told us about the income gap. We wanted to maintain an incentive to work and yet recognize the labour market realities they face.

We have also moved to extend a pilot project that calculates benefits on the best 14 weeks of wages during the last 52. We heard from Canadians who had sporadic employment and were losing out on having their weeks of full time work benefit them. More than 200,000 people in regions of high unemployment benefit from us getting things done for them.

Listening to Canadians is what this new government does and what good government does.

When Canadians came forward with concerns about the limits of their compassionate care benefits, we listened. They told us that there were incidents where benefits ended before the needs they were meant to address were resolved.

Again, it was this government which showed Canadians that their government was listening and ready to make the changes to EI that were needed, for which they asked. Our record, the record of Canada's new government, is one of which Canadians can be proud. Why? Because the changes we are making come from them.

Finally, they have a government that is listening to them. Finally, they have a government that is here for them.

As I return my remarks to the bill, Canadians need only to look at their government's record to see the proof of our commitment to making changes to EI to improve the system for workers and all Canadians. As I said at the outset, I and the new government are firmly committed the principle of a separate EI account. Canadians are satisfied that their new government is interested in solutions, and we will achieve just that.

What Canadians are wondering, though, is where the opposition really sits on EI reform. With 19 EI bills in the works, the other opposition parties have been heaping one EI bill after another onto the order paper, voting for implementation of all, but not prioritizing one of them: $3.7 billion for Bill C-269; $1.1 billion for Bill C-278; $1.4 billion for Bill C-265. There are 16 more EI bills to come, nine of which, including this one, are too complicated to cost. It will cost $4.7 billion to implement the seven which we were able to cost. That is over $11 billion in new annual spending.

With all these proposals for one-off changes to EI, adding up to billions annually in new costs, Canadians are looking for someone to stand up for them and think about the EI as a system. Canadians do not believe a system should be stitched together in little bits and pieces. Canadians are looking to their new government to stand up for them. They are hoping to maintain the EI as a system and protect it from the patchwork proposals made by the opposition.

Canadians will be disappointed in their new government if it did not stand up for them and insist on accountability for the use of their money. They would be disappointed if it did not stand up for them and ensure that the policy for which they have asked, and we have committed to pursuing, is also put together not in a piecemeal fashion as we have in front of us today.

In comparison to our record of taking clear action to getting things done with EI reform for Canadians, the record of the opposition member has been all but clear. Canadians have no idea what its priorities really are. Opposition members have not made it clear when it comes to how they plan their legislation. More often than not, they have not made their intentions clear when one looks at the legislation they put forward.

I take my responsibility to my constituents and all Canadians seriously. I take our commitment to a separate account seriously. I will continue to work for that objective.

[The Acting Speaker, Conservative, Andrew Scheer]

The House will now proceed to the taking of the deferred recorded division on the motion at second reading stage of Bill C-265 under private members' business.

The House resumed from March 23, consideration of the motion that Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), be read the second time and referred to a committee.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

Mr. Speaker, I would like to thank the members who have spoken about Bill C-265, a bill that is very important to me.

I think this bill is even more important to workers. I am talking about the 800,000 workers who are not eligible for employment insurance, yet still contribute to it. This bill is also important to the 1.2 million Canadian children who are hungry. The cuts made to employment insurance have contributed to making these children poorer. When parents lose their jobs, the children and families suffer directly.

I would like to thank the Bloc Québécois member for Chambly—Borduas, the Conservative member for Haliburton—Kawartha Lakes—Brock, the Liberal member for Laval—Les Îles, the Conservative member for Wellington—Halton Hills, the Liberal member for Cape Breton—Canso, the Bloc Québécois member for Gatineau, the Liberal member for Thunder Bay—Rainy River, the Conservative member for Blackstrap, the NDP member for Surrey North, and the NDP member for Hamilton Centre, as well as all those who have spoken over the past 10 years, as long as I have sat here in the House of Commons.

It is false to say that 85% of workers are eligible for employment insurance, as the government claims. This was also the message the Liberals were sending when they were in power. The fact is that only 32% of women and 38% of men who contribute to the system receive employment insurance. This is not right.

EI belongs to men and women who lose their job. Just this morning, L'Acadie Nouvelle ran an article about a western company that came to Caraquet to meet workers. About 400 workers were at the meeting and were ready to move out west to work. Some would say that it is fine since they would find a job there. But what will be the results of EI cuts? We are destroying the seasonal fishing industry.

Last year, for the first time in its history, Prince Edward Island had to get workers from Russia because there were no more local people interested in participating in the fishing industry that is so dear to our heart in the Atlantic region.

The aim of the bill is not to steal the government's money. Quite the contrary, it says that the money belongs to the workers. If the government does not want people to benefit from EI, it only has to create jobs and stimulate economic development. Let us make people work but do not let them die from hunger.

We receive calls from people who tell us that they do not have money, they do not have benefits and they do not want to leave their family. They want to work in their community, in their own province. But see the situation the government has created.

This morning, I was disappointed that the Speaker of the House said we need a royal recommendation and that there will be no vote without a royal recommendation. That is why I am asking my Conservative colleagues to vote for this bill at second reading. We have to bring experts before the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities, the parliamentary committee responsible for employment insurance. We have to lay the cards on the table and stop saying that 85% of people who pay into the employment insurance fund are eligible for benefits, which is not true. They should stop saying things like that. The government must understand once and for all that only 32% of women and 38% of men are eligible for employment insurance. These statistics were provided by Human Resources and Social Development Canada and by experts.

What is the upshot of this? The best 12 weeks. It is shameful that under our employment insurance regime, workers receive only 55% of their salary. Moreover, to punish them further, there are 14-, 15- and 17-week categories. Workers are being punished twice over.

The government says that workers are dependent on employment insurance. That is not true. The government is dependent on employment insurance because it balances its budget and promises a zero deficit at the expense of men and women who have lost their jobs, at the expense of children who should be in school and at the expense of people who need that money to feed their families.

For all these reasons, I hope the government will change its mind. I would like to see the Liberals, Bloc members, Conservatives and NDPers set aside their partisanship. We must give back to our workers the program that belongs to them. If we do not want people on employment insurance, we must create jobs and stimulate economic development. Our citizens will have jobs and will not need this program.

I can assure you that people in Atlantic Canada, the Gaspé, northern Ontario are not lazy nor are those who have lost their jobs in British Columbia, Alberta, Saskatchewan, Manitoba or in the Northwest Territories. Canadians are a valiant people and they should be given back the program that belongs to them.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

Mr. Speaker, I welcome the opportunity to address Bill C-265, An Act to amend the Employment Insurance Act.

I would first like to commend the members of the New Democratic Party and the member for Acadie—Bathurst for their ongoing interest in enhancing Canada's employment insurance program, one of the key elements of our social safety net.

Our government is open to making improvements to the employment insurance program, but since this is such a very important program, we must be sure that any changes must truly be for the better.

This bill proposes dramatic changes to qualification for and entitlement to employment insurance benefits. While I do not doubt the sincerity and the intentions of the member who has proposed this bill, there is no evidence to suggest that these changes would improve employment insurance and every reason to believe that they would not.

One of the program's chief goals is to encourage attachment to the labour market. In other words, the program should encourage Canadians to seek and to retain employment.

To demonstrate the potential negative impact of this bill, I think it would be useful to examine just how well the program is currently working.

The system as it is currently structured is meeting claimants' needs. The Employment Insurance Commission produces an annual monitoring and assessment report to provide information on whether or not the program is working effectively. The 2005 report makes it clear that when Canadians need employment insurance, it is there for them both in terms of the amount they receive and how long their benefits last.

In fiscal 2004-05, for example, the program provided approximately $13 billion in income benefits to some two million Canadians. More than 83% of the unemployed who had paid into the program and had a recent job separation were eligible for benefits. Moreover, more than 90% of employees met the eligibility requirements for special benefits, such as sickness, maternity or parental benefits.

Ongoing analysis also indicates that the duration of benefits is also meeting the needs of Canadian workers. On average, regular beneficiaries collect less than two-thirds of their regular benefits. The number of beneficiaries who are exhausting their benefits is declining. In fact, the benefit exhaustion rate has been steadily declining since 1996.

All the evidence available suggests that the employment insurance program is meeting the needs of claimants. Any program can be improved, but before we make dramatic changes, we need to make sure that the outcomes will be positive.

This brings me back to the bill in front of the House today. Among its provisions, the proposed legislation seeks to introduce a flat 360 hour entrance requirement for regular and for special benefits. This would eliminate the variable entrance requirement, as well as provisions for new and returning entrants. The bill also seeks to introduce a best 12 weeks formula for calculating income benefits.

I believe, taken together, these proposed changes would undermine the program's focus on labour market attachment. To put it another way, the changes could reduce incentives to seek employment. As we all know, the Canadian economy is facing growing labour shortages and one of the government's policies is to promote participation in the workforce.

Let me specifically detail my concerns with the bill.

First, in a region with high unemployment, it can be more difficult to obtain work and to build up the necessary hours to qualify for employment insurance. That is why the program as it is currently structured has put in place variable entrance requirements. Through this policy, the program adjusts entrance requirements each month to reflect unemployment rates by region. As unemployment rates go up, entrance requirements go down and benefits are extended. This has proven to be a sensible approach to address regional disparities in economic opportunities.

The flat rate proposed by the bill would dismantle this system. It would essentially favour Canadians who live in regions with low unemployment, who would likely have an easier time meeting the lower entrance requirements. I am concerned about the fairness of this proposal in changing the variable entrance requirement. Reducing the entrance requirements would also have a very marginal impact on the number of people who would qualify for benefits.

There is no vast pool of applicants being turned down for benefits because of high entrance requirements. In fact, more than 83% of unemployed people who have paid into the program and who have become unemployed through no fault of their own are eligible to receive benefits.

Second, I am also concerned that the bill would eliminate the 910 hour entrance requirement for new entrants to the labour force and for those re-entering after an extended absence. The 910 hour entrance requirement strengthens the link between hours of work and entitlement to benefits. It helps present a cycle of reliance on employment insurance. Indeed, the last four monitoring and assessment reports suggest that the current entrance requirements encourage workforce attachment. This is not a provision we should idly discard. That is why the government launched a pilot project recently to test eligibility thresholds for new entrants and for re-entrants into the workforce.

The pilot project drops the entrance requirements from 910 hours to 840 hours, benefiting more than 16,000 individuals each year. However, before we embark on such significant changes to the entrance requirements, we should await the results of the pilot project.

Third, the bill also proposes to calculate and employment insurance benefits based on the best 12 weeks of earnings over a 52 week period preceding a claim. Again, it would be premature to accept this change without sound evidence.

To that end, the government is currently running a pilot project known as the “best 14 weeks”. It is testing the impact of the very same principle that the proposal in the bill seeks to address. This initiative will test labour market impacts of improving incentives for individuals to accept all available work, including weeks of work that are shorter than their normal full weeks. It will also test whether employers facing labour shortages will have access to additional workers. Consequently we should await the results of the pilot project and make a decision informed by logic, fairness and the evidence.

Fourth, the reason why I think we should also oppose the bill is that it extends benefits for employment insurance in a way that is not accessible to all Canadians. For example, the area that I represent, the greater Toronto area, has a much lower percentage of the workforce participating in the employment insurance program than other regions of the country. There is evidence to show that this is a result of the many new Canadians who have recently arrived in the country and who participate in the workforce but do not participate in employment insurance. They are in occupations that are often self-employed and are not eligible to participate in employment insurance programs. By extending the employment insurance program to greater entitlements than is presently the case, we are in effect not creating a greater benefit for those newer Canadians living in some of the country's larger cities like the greater Toronto area.

There is evidence to suggest that these new Canadians are some of the most disadvantaged in our society, that they are increasingly falling behind in their social outcomes, their poverty levels, their unemployment rates and the like. This is not something that is unbeknownst to public policy-makers. It is something that has been highlighted by many organizations, including the United Way of Greater Toronto. By extending benefits, especially benefits like caregiver benefits, we would not include this group, many of whom are disadvantaged.

For these four reasons, we should oppose the bill. I urge all members of the House to vote against the bill.

[David Christopherson, NDP, Hamilton Centre, ON]

Yes, and it was $20 billion 10 years ago and the alarm was raised by the member for Acadie—Bathurst, who said that Canada could do better. He said then that Canada had a bigger obligation than it was providing for people who find themselves without a job. Now, 10 years later, not nearly enough has happened.

As for this $50 billion, let us be clear about it right off the bat. Unlike most things that we deal with here, and notwithstanding the Speaker's ruling regarding whether this bill requires a royal recommendation or not, the fact remains that none of that $50 billion is what we would normally call taxpayers' money.

Let me say that again because it is really important: the $50 billion surplus that now exists in the EI fund is not taxpayers' money. That money is paid in premiums by workers and employers.

Obviously employees pay because they are the ones to benefit. They have an obligation to pay part of the premiums to support the fund. I have no problem with that.

Quite frankly, businesses are paying into the fund because they are in a society and an economy in Canada where they can make a lot of money. We have a great economy in this country, and if they are going to take some of that money by way of profit for their company, they have certain obligations to the rest of the country. One of those obligations is to put some money, by way of premiums, into a fund that helps deal with the catastrophe of what happens when a working family loses a job.

So what are we asking for today in Bill C-265? Is the member asking for such an enormous amount? Is this such an unreasonable, wild-eyed, lefty and kind of crazy idea? Is that what the member has in front of us? No, it is quite the contrary.

Bill C-265 seeks to do two main things. In doing these two things, the member for Acadie—Bathurst is trying to bring justice to this issue because there is a real and inherent unfairness in this chamber and, quite frankly, we have had enough of government members talking to us about the broader context, which is what I heard them talk about this morning.

They say the reason we cannot do this for workers is that we have to look at the broader context. Those members should not talk to us about the broader context when only 32% of the women who pay EI premiums qualify and when only 37% of men who pay EI premiums qualify.

Members of the government talk about 85%. Do not be snowed by them. If we look carefully, the 85% speaks to those who are eligible. We were sort of wondering where did the other 15% go because they are already eligible, but there are people who are eligible who get a job immediately, which is the usual case, or perhaps they do not apply because they know they are going to another job or are in the process of moving. There are reasons that that 15% exists. Do not for a moment let government members or Liberals who defend this also say that the 85% negates the earlier statistics. The 85% represents those who qualify. If people qualify, they are going to get it.

We are talking about people who do not qualify because the rules of eligibility are too narrow. That is why only 32% of women and only 37% of men now qualify.

Let us stand back and look at a different broader context. There is $50 billion in a fund that is there exclusively to help Canadians who, through no fault of their own, have lost their jobs. The rules, however, are set in such a way that only 32% of all the women and 37% of all the men who pay premiums actually qualify to get the benefit.

Let us think about that. Let us think about people and their family members and how many are making those payments. They look at their pay stubs and that money is coming off every week or every two weeks, but it is insurance. It is insurance against disaster.

When that job loss notice lands on the kitchen table, there are literally millions of families who immediately go into crisis. This money is there to help them through that. Where does the government or any other government get off saying they cannot have that money because somehow it is going to wreck the national economy? The money is already there. Businesses have done what they are supposed to do. Workers have done what they are supposed to do. Why is the government not doing what it is supposed to do and making sure that much needed money gets into the hands of the families that need it?

That is why we are so proud to stand here with our colleague, the hon. member for Acadie—Bathurst, in support of Bill C-265. It brings much needed justice to unemployed workers and their families who quite frankly are getting shafted, whether it is by the Conservatives or the Liberals, but it is time it stopped. It ought to stop with this bill. Let us bring some fairness to this place and give people what they are entitled to.

We are proud to stand united with the member. We urge everyone to please look at this. It is a minority government. We can do anything as individual parliamentarians. Members should ask themselves if it was their son or daughter, or mom or dad who was denied eligibility to a fund they paid into, how they would feel about that in terms of Canadian justice. This bill is about justice for workers. It deserves to pass.

[David Christopherson, NDP, Hamilton Centre, ON]

Mr. Speaker, I very much appreciate the opportunity to join in the debate on Bill C-265.

I would first like to join other colleagues from all parties who have acknowledged the work done by the member for Acadie—Bathurst and the commitment he has to this issue and to unemployed people.

As a relative newcomer to this place, I want to say that he sets a real example and is an excellent role model. A lot of the veteran members tell us, at least they did before the minority governments, to spend the first couple of years getting to know the ropes, how the place works and what our role is, and to get things settled in our ridings, but to eventually get to the point where we focus on an area that matters, an area that matters to us, matters to our constituents and makes a difference to the country.

The member for Acadie—Bathurst has done that and I think he has done it in an exemplary way, to the point that in 1998-99 he travelled across the entire country, visited every province and one of the territories, which at that time was 50%, and came up with a report that spoke to the inadequacies of EI, then called UI, at that time.

That is almost 10 years ago. As a footnote, let me tell members what I noticed as I was going through the report. The second sentence notes that in 1998 the accumulated UI surplus, as it was called then when it was unemployment insurance, reached $20 billion.

What an enormous number that is until we compare it to the number that exists today and that happens to be $50 billion in surplus.

[Richard Nadeau, Bloc, Gatineau, QC]

Mr. Speaker, it is a great pleasure for me to take part in this debate and to deliver a speech on Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), which aims at improving the employment insurance plan. I take the opportunity to salute my colleague from Acadie—Bathurst. I remember his early days in politics, which were very inspiring as a matter of fact. He used to put the Liberals in their place; they had been in power for a bit too long. He did the same for the Conservatives who, before them, were also not much help to the workers who had contributed and who are still contributing to the employment insurance plan. Just like the previous government, the present government continues not to give back to the workers the money they deserve and need when times get tough. The Bloc Québécois endorses the member's position. This is frankly an excellent initiative on the part of my NDP colleague from Acadie—Bathurst.

First and foremost, I would like to emphasize that this is a good bill. Here are three points showing this. First, by lowering the threshold for becoming a major attachment claimant to 360 hours, it makes special benefits available to those with that level of insurable employment. Second, the bill sets the benefit payable to 55% of the average weekly insurable earnings during the highest-paid 12 weeks in the 12-month period preceding the interruption of earnings. Third, the bill reduces the qualifying period before receiving benefits and removes the distinctions made in the qualifying period on the basis of the regional unemployment rate. This is very good.

This bill touches on a number of important points. First, employment insurance is no longer an assistance program. It has become a hidden tax because not all those who contribute have access to the program when they become unemployed. Under the Liberals, the employment insurance fund was used to balance the budget even though that is not at all the purpose of employment insurance. Although the Conservatives voted in favour of an independent employment insurance fund, the surpluses generated remain in the consolidated fund and are still being used for other purposes. That was the case last September 25 and with this budget as well. We do not have an independent employment insurance fund and this issue must remain in the forefront. This is a priority for the Bloc Québécois.

Another important point is the Auditor General's report of November 23, 2004, which reported at the time that the government continued—as she said—to loot the employment insurance fund despite the intentions of parliamentarians. Furthermore, the powers of the Employment Insurance Commission, whose membership includes contributors, will apparently be suspended for yet another year. That happened in 2004 and it has not changed. This situation is deplorable.

Conservatives voted against improvements to the employment insurance program in Bill C-278 and against the Bloc Québécois Bill C-269. It is about time that these individuals, who have been elected, respond to the needs of citizens, of the workers who need this fund—which is an insurance fund—when they lose their jobs.

As for the Bloc Québécois, it is still dead set against the looting of the employment insurance fund and proposes, among other things, that an independent fund and commission be established. The Bloc Québécois also demands that the federal government pay back misused money. That is very important. Money taken from the employment insurance fund must be returned to those who paid into it, the employers and employees, for when it is needed by workers who lose their jobs.

Improving the system for workers in a vulnerable situation is a matter of principle that should be defended. In the past two years, the Bloc Québécois has worked tirelessly on improving this system and we have another example of that today.

The Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities tabled or passed in its report of February 2005, no fewer than 28 very important recommendations that have to be considered and incorporated into the bill in order to respond to the needs of the workers. I will not read the 28 items, but I will cite a few to illustrate the importance and urgency of swiftly moving forward with the bill we are talking about today.

First, for example, the committee recommends a uniform 360 hour qualification requirement. This criterion, which was proposed by the committee at the time, is now in the bill. The committee also recommended a calculation based on the best 12 weeks of insurable employment; that is how benefits should be calculated for those who lose their jobs. The committee recommended increasing the benefit rate from 55% to 60% of average earnings before workers end up in a vulnerable situation. The committee also recommended that the government consider extending employment insurance coverage to self-employed workers. This is very important. This is a situation that did not exist before, or was quite rare at one time. Now it is a reality and these people should have the opportunity to receive employment insurance by contributing to it, of course, and being eligible for it.

The committee also recommended removing the arm's-length relationship clause within the employment insurance criteria, and eliminating the waiting period for those engaged in approved training. Furthermore, the committee recommended that individuals who take part in training to improve their status and perfect their skills should not be penalized, because they will be taking a course while receiving EI benefits, for instance. I could give countless other arguments, but let us move on.

The bill would reduce the minimum qualifying period to 360 hours of work for everyone—as we heard earlier—but the benefit period would vary with the region and the regional rate of unemployment. In comparison to the current figures, the new system would represent an average increase of five weeks in the benefit period and an increase in the maximum benefit period from 45 to 50 weeks. In regions with high unemployment—13% or more—it would provide between 30 and 50 weeks of benefits, depending on the hours worked and the unemployment rate.

For Quebec's high unemployment regions, however, it would substantially reduce what we call the spring gap or black hole. For example, in Gaspé, where the unemployment rate as of October 7, 2006, was 17.6%, a person who worked 360 hours would be eligible for 36 weeks of benefits.

I could go on. Nonetheless, we can clearly see the relevance of this bill, which is extremely important for all workers throughout Quebec and Canada.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Mr. Speaker, I rise today in support of Bill C-265, An Act to amend the Employment Insurance Act, which seeks to bring down to 360 hours the number of hours of work required to qualify for EI benefits. I have had the pleasure of working very closely with my NDP colleague from Acadie—Bathurst, who sponsored Bill C-265.

During the last Parliament, as the chair of the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities, I tabled a report on employment insurance funds in February 2005.

At the time, the subcommittee examined the use made of employment insurance funds and the surpluses that were accumulated, surpluses that continue to be accumulated and keep growing. The EI fund is one that is not benefiting those paying into it. Indeed, it is becoming increasingly difficult for workers to take advantage of a program they have been contributing to.

It has been pointed out by previous speakers that only 32% of women who contributed to the EI plan currently qualify for benefits and that only 37% of men who have employment qualify for employment insurance benefits even if they contributed to the plan.

What is the use of a fund, which now stands at close to $50 billion, if that fund is not doing what it is supposed to do, which is to help the very people that it was designed to help?

At this point, I want to congratulate my colleague, the member for Acadie—Bathurst, for his hard work on this file and for his single-minded determination.

Recommendation 10 of the standing committee's report states:

The Committee recommends that the government implement a uniform 360 hours qualification requirement, irrespective of regional unemployment rates or the type of benefit. This would establish a qualification requirement based on a 30-hour week over a 12-week period.

This was a key recommendation we made to the minister at the time, because it applies not only to workers in urban areas but also to those in the regions. Ours is a country with very clear-cut seasons. Our society relies heavily on seasonal workers, be it in the fisheries industry or in other industries where one can only work at certain times of the year.

In 2006, close to 15,123 foreign seasonal workers came to Ontario from Mexico and the Caribbean. Under the seasonal workers program, the SAWP, agricultural workers from Mexico and the Caribbean come here every year to help in harvesting our crops. For the past 10 years, workers coming to Canada under this program have been overwhelming male, accounting for 97% of the total in 2004.

Our country cannot function without this supplementary source of reliable and qualified seasonal labour to ensure our crops are planted and harvested before the winter. Canada has even moved to increase the number of workers from Guatemala over the past two or three years, even though they are not formally included in the program.

In the past 10 years, Mexico and Jamaica have become the two leading source countries for agricultural workers. These countries accounted for 53%, or 10,780 people, and 28%, or 5,736 people, in 2004. Mexico, however, has seen its participation rise from around 5,000 workers a year in the early 1990s to over 10,000 in each of the past four years, both on a stock and flow basis. Other notable source countries are Trinidad and Tobago and Barbados.

Hon. members probably wonder why I am referring to these workers in today's debate. While we depend on their work for food, while we require them to contribute to the employment insurance fund, these workers are another group that cannot benefit from the EI program, because they are temporary foreign workers. Our system is organized in such a way that they are forced to contribute to the employment insurance fund, but they cannot benefit from it.

Is it fair? Perhaps these people should be exempted from having to contribute to the program, or else their money should be used to set up training programs to allow them to develop their skills and their knowledge of the industry. This way, their country would benefit more from their experience, and not just from their financial contribution.

After a lot of pressure by the United Food and Commercial Workers International Union-Canada, the UFCW, these workers finally became eligible for family allowances, in 2001. The UFCW sees this progress as a first step in its fight for equality. In its June 2006 report, it reiterated that migrant workers should not be forced to make employment insurance contributions if they do not have full access to benefits.

This issue could be challenged in court under section 15 of the Charter, which provides that every individual has the right to the equal protection and equal benefit of the law without discrimination. If the union wins its case, foreign seasonal workers will have full access to employment insurance benefits.

We are talking about respect and dignity for our workers who pay into the employment insurance fund. I think all parties in this House, perhaps with the exception of the party across from me, agree on this.

I agree with some of the members who have spoken before me when they say that the entire EI system and the act need to be reviewed and overhauled to reflect the changing needs of our society and the Canadian workplace.

We, as leaders who were elected to govern, cannot afford to consistently ignore the needs of our electorate. Our population is aging. We will be even more dependent on all types of foreign workers and we will always be dependent on seasonal agricultural workers. Either that or we ourselves will need to help the farmers harvest our own food.

Our society is also moving toward increased part time work.

Are we going to continue to behave in this fashion with workers in our country, that is by ignoring their needs?

I hope that, regardless of the flaws that this bill may have, we will ignore them and we will adopt it at second reading, so that it can be referred to a standing committee for a more in-depth review.

Mr. Speaker, I thank you for giving me the opportunity to discuss this issue.

[Barry Devolin, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Mr. Speaker, it is a pleasure to join in the discussion today on Bill C-265. I would like to thank the hon. member for Acadie—Bathurst for raising the important issue of employment insurance.

On a small personal note, during the last Parliament I was a member of the House of Commons Standing Committee on Human Resources and Skills Development and, while the member was not the regular NDP member of our committee, whenever there was a discussion about employment insurance he was certainly there putting his views forward.

Bill C-265 puts forth proposals affecting two key elements of EI. The first of these is the hourly entrance requirement for regular and special benefits. The bill proposes a reduced flat 360 hour entrance requirement.

Second, concerning the way in which benefit rates are calculated, the bill proposes establishing an approach based on the 12 best weeks of work over the last 52.

These proposals would have a profound effect on the program and, in determining if they are justified, it is important to see them in the broader context of today's labour market.

The Canadian labour market is continuing to perform exceptionally well. Statistics Canada data shows unemployment rates at the lowest level in about three decades. In addition, the share of the population that is working is at near record high levels. However, we know that even in times of high employment there are those who occasionally need the assistance of EI. Evidence indicates that the program is meeting their needs.

More than 83% of those who pay into the program and have a qualified job separation are eligible for benefits. In areas of higher unemployment, such as Atlantic Canada, the percentage of those eligible for benefits increases to more than 90%.

It is important to note too that the present system is also working well for those who wish to avail themselves of maternity, parental and sickness benefits. Evidence shows that more than 90% of employees could meet eligibility requirements for those EI special benefits.

Evidence also shows that not only are the EI eligibility requirements meeting the needs of Canadians, but so too is the time period over which claimants can receive these benefits. On average, individuals use less than two-thirds of their EI entitlement before finding employment. Even in areas of high unemployment, claimants rarely use more than 70% of their allotment. That is good news.

With respect to the bill's proposed calculation of benefits based on the 12 best weeks of work, I should remind the House that we are currently testing a pilot project in regions of high unemployment based on the best 14 weeks of work over the past 52 weeks.

This approach maintains elements of the program that evidence indicates have been successful in encouraging workforce attachment. Our aim is to balance providing adequate EI coverage while still encouraging individuals to accept all available work.

Until this pilot project is complete, we believe it would be premature to endorse any changes to the benefit rate calculation.

EI is there for Canadians, both men and women. In fact, I would like to address the misconception that has been raised in the House that EI is not serving the needs of women.

Looking first at access to EI, women's coverage rate is high. This is true for both regular and special benefits. According to Statistics Canada, for those who paid premiums and were laid off or quit with cause, 87% of women were eligible for regular benefits in 2005.

In the same year, among women with children aged 12 months or younger, over 85% received maternity and/or parental benefits if they had insurable employment in the previous year.

If we look more closely at maternity and parental benefits, we see that contrary to opinions raised in the House, EI is actually serving women better through enhancements made to the EI benefits. These changes include: extending benefit duration from six months to one full year; lowering entrance requirements to 600 hours of insurable work; waiving the waiting period for a second parent claiming the benefit; and, the ability to work while receiving parental benefits.

Women have greater access and better benefits while increasing their ability to maintain their labour market attachment. In fact, women accounted for 85% of claimants benefiting from those enhancements in 2004-05.

Women are also the principal beneficiaries of the family supplement provision, representing 74% of claims. Those benefits enable individuals in low income households with children to receive up to 80% of their insured earnings.

Clearly, EI has a strong track record in serving Canadian women in an effective and timely manner. I would also like to add that the Employment Insurance Commission monitors, examines and assesses how well EI is serving all Canadians.

The commission's annual monitoring and assessment report is tabled in Parliament each year. It provides comprehensive information on the effectiveness of EI, including analysis on the adequacy of EI benefits for both men and women. The report provides sound, gender based analysis that informs decision making on any potential EI changes.

We will continue to draw upon extensive monitoring assessment and evaluation of the program in this regard.

Canada's new government is committed to building a strong, competitive economy and a dynamic and flexible labour market. We introduced new measures in budget 2007 to ensure Canadians can continue to succeed and enjoy a high standard of living. This is what Canadians want.

As I stated earlier, our labour market is performing well.

Our government believes it is important that the EI program strike a balance between providing temporary income support for Canadians while they find new employment and keeping individuals active in the workforce. EI is working well to achieve this goal and to maintain this balance.

We will continue to monitor and assess the EI program and make changes when we have demonstrable evidence that change is warranted.

The proposals contained in Bill C-265 do not meet this criteria and, as such, we cannot support the bill.

The House resumed from February 7 consideration of the motion that Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), be read the second time and referred to a committee.

Bill C-265—Employment Insurance Act—Speaker's Ruling

[The Speaker, Liberal, Peter Milliken]

On February 7, prior to the second reading debate on Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits) standing in the name of the hon. member for Acadie—Bathurst, a point of order was raised by the Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform to the effect that this bill would result in significant new expenditures by lowering the threshold for eligibility for some claimants and changing the formula for the calculation of benefits. The parliamentary secretary supported this interpretation by referring to three rulings where the Chair concluded that similar bills, which extended employment insurance benefits, required a royal recommendation.

Interventions on this matter were also made by the hon. members for Mississauga South and for Acadie—Bathurst. The Chair wishes to thank all hon. members for their comments on this issue.

In replying to the parliamentary secretary’s point of order, the member for Acadie—Bathurst expressed the opinion that a royal recommendation was not required since any new expenditure would be covered by contributions from workers and employers and not by the government.

I have examined the bill carefully and find that the changes to the employment insurance program envisioned by this bill include lowering the threshold for becoming a major attachment claimant to 360 hours, setting benefits payable to 55% of the average weekly insurable earnings during the highest paid 12 weeks of the 12 month period preceding the interruption of earnings, and removing the distinctions made to the qualifying period on the basis of the regional unemployment rate.

It is abundantly clear to the Chair that such changes to the employment insurance program, notwithstanding the fact that workers and employers contribute to it, would have the effect of authorizing increased expenditures from the consolidated revenue fund in a manner and for purposes not currently authorized.

Therefore, it appears to the Chair that those provisions of the bill which relate to increasing employment insurance benefits and easing the qualifications required to obtain them would require a royal recommendation.

In its present form I will decline to put the question on third reading of this bill unless a royal recommendation is received. Today, however, the debate is on the motion for second reading and this motion shall be put to a vote at the close of the second reading debate.

Employment Insurance Act

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, I am pleased to speak to Bill C-265 and to comment on the EI injustice in my community.

In the past, part time workers needed 910 hours to collect employment insurance. Under those circumstances, only 32% of women are eligible for employment insurance. In point of fact, only 37% of men are eligible for employment insurance. No matter what we do with the hours, the injustices in the EI system will continue as long as we continue to look at seasonal workers the way we do.

I represent Surrey and the lower Fraser Valley where about 8,000 to 10,000 farm workers are considered seasonal workers. They are primarily elders and almost 100% of them do not speak English. They depend entirely on the farm contractor or farmer to fill out their forms and then they sign them.

These people are trying to make a small amount of money to add to their family income. They are grandmothers and grandfathers living with their families. They are not used to being dependent upon someone and they want to make their own contribution. These people work many hours a day beyond what is acceptable. When harvest is in, picking hours are long.

These farm workers sign the forms that the farmers give them but they do not know what they are signing. No one is in the fields to tell them in their own language their rights but they do know that if they do not sign the form they will not get paid and will not be able to go back to work. They, therefore, sign the form even though they do not know what they are signing.

These elders, who do not speak English, did not have someone explain their rights, were used by farmers and farm contractors and are now being sued by the government. They really work piecemeal. A farmer or farm contractor divides the piecemeal work by the number of hours and tells the worker to sign the form. The government is now saying that they tried to defraud the EI system but they did nothing of the kind. They had no idea what was going on. The workers who worked in 1997 are currently before the courts, which means there are another four years yet to go.

It has been suggested that it will take about $6 million to try this case that will collect $600,000 for the government. Is that economic efficiency to spend $6 million to collect $600,000? This money is not being collected from large corporations that are not paying the taxes they should. This money is being collected from 80 year old people who have moved to this country because they believe in justice. They are trying to do the right thing but because they are frightened by their employers they sign the form. They did not know it was wrong but the government is taking them to court. What on earth would they pay us back with? They barely have enough money for the clothes on their back.

As I have not worked in the fields I would not suggest that I know what it is like. However, I have talked to some of these elders through translators and they have told me what it is like to be in the fields with the sun or the rain beating down on them for 14 to 16 hours a day picking fruit. It is outrageous for someone to tell them that if they do not sign a form they will not get paid and they will not be allowed back to work.

I have been told about a similar circumstance in New Brunswick involving fish plant workers and a former Liberal MP who found a particular way to deal with those seasonal workers.

I am not saying that is the same situation. What I am saying is that we need a different kind of EI structure for seasonal workers, such as those working on the farms in the lower Fraser Valley from which many of us across the country receive our fruit, particularly blueberries and cranberries.

The other people involved in part time work are in security, in construction work and so on.

These farmers are just trying to do their best. They have come to this country to be with their children and make a contribution to the household. Therefore, for the bill to be fair, it needs to look at B.C.'s seasonal workers. The act has an overall inherent flaw in how EI is granted to farm workers.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Mr. Speaker, first I want to thank and congratulate the NDP member for Acadie—Bathurst, for his perseverance in defending the unemployed for so many years, often in rather difficult situations, as the member for Cape Breton—Canso pointed out earlier. The situation in which he was put when the next to last budget was presented made things even tougher for him. The member for Cape Breton—Canso himself had probably not noticed, but $2.5 billion had been taken out of that budget. I think this was a deplorable misfortune about which the hon. member surely has regrets. It could even make him cry, but this is the past. Let us just say that such things should not happen again, because it does not help workers.

The bill before us is a positive measure that does two things. First, it reduces the number of hours required to qualify for employment insurance benefits to 360 hours, and bases benefits on the highest-paid 12 weeks. This means 12 weeks of 30 hours, thus making it easier for people to qualify.

As the hon. member for Acadie—Bathurst rightly pointed out, over 60% of workers are excluded from the employment insurance program when they lose their job, even though they have contributed to that program throughout their working life.

The parliamentary secretary and member for Blackstrap wondered whether these were good changes in this day and age. I find that question to be disconcerting. There is no specific era to determine whether we should help those in need or those who are not in need. There is no specific era for making such a distinction. There is no specific era for determining whether the government has a responsibility towards the unemployed. I think the answer is obviously yes. This bill provides proper solutions to the problems faced by the unemployed.

Ever since the Liberal Party reformed the EI program, the government no longer considers it to be an assistance program. It is a hidden tax that has particularly helped the Liberals achieve fiscal balance. However, the only ones contributing to the employment insurance account are the workers and the employers. As we are speaking, over $50 billion has been diverted from that account.

This is nothing new. Since 1998—when the incumbent was a man—and up to the most recent report, released on November 23, 2004, the Auditor General has reported that the government continues to loot the employment insurance fund, thus violating the rules that were set by the government itself.

As for the Bloc Québécois, of course we will vote in favour of this bill. It is a bill that addresses concerns that we raised with other bills. My colleague for Cape Breton—Canso said earlier that it is just one part of the measures that should be implemented. It is positive and it must be implemented.

It also reflects the will of the parliamentarians who sat on the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities, which made 28 recommendations. By mid-December, it had made 8 recommendations and added another 20 on February 15, 2005. The measures found in Bill C-265 are actually measures recommended by the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities.

This same committee had recommended that the misappropriated amounts be restored to the employment insurance fund. Guess what? Last year, the Bloc Québécois tabled a bill calling for the establishment of an independent fund, as recommended by the committee.

During parliamentary committee meetings on Bill C-280, it was the Conservatives themselves who suggested the rate at which the fund should be reimbursed.

Now that they are in power, they no longer hold the same positions they did when they were in opposition, back when they supported the Bloc's demands on this issue.

Let us review, in brief, the history of these bills. Last year, in the previous session, the Bloc introduced a bill that included these measures. Bill C-269, introduced by a Bloc Québécois member, is now in second reading in committee. It, too, contains these measures.

On November 8, the House of Commons voted to debate Bill C-269 in second reading.

This bill was drafted in response to the demands of major unions and groups of people who are unemployed. It acknowledges the real needs of unemployed people. These groups made statements to the parliamentary committee.

I would like to speak in detail about the costs of these two measures. In December 2004, Malcolm Brown, an assistant deputy minister at the Department of Human Resources and Social Development, stated that the Bloc's proposed measure concerning the 360 hours—12 30-hour weeks—would cost $390 million of a $16 billion budget. It would improve employment insurance and enable 90,000 more unemployed people to collect employment insurance. Furthermore, the assistant deputy minister calculated that the measure in this bill concerning the 12 best weeks would cost $320 billion. This measure alone would help 470,000 people in need. Those 470,000 would not have to collect social assistance from the provinces. Obviously, under the circumstances, they are currently exacerbating the fiscal imbalance.

Over the past 12 years in particular, the restrictions imposed by the Liberal Party on the employment insurance program have not only penalized people who lost their employment, but also the families of those people. They have also penalized the regions in terms of the regional economy. In your riding, Mr. Speaker, there is an annual shortfall of between $30 million and $40 million because the unemployed do not receive the EI benefits they are owed. It is scandalous. These people go on welfare, of course, which increases the burden on the provinces and Quebec, since they have to support these people.

In closing, the Bloc Québécois will support Bill C-265 in order to have it considered at second reading.

The Bloc Québécois sincerely hopes that the House of Commons passes this bill unanimously, or at least with a majority, refers it to second reading to deal with it quickly, receives it at third reading and that cabinet does not apply its royal recommendation to block this bill.

That would be the best thing that could happen for the unemployed. For once, the government—

[Lynne Yelich, Conservative, Blackstrap, SK]

I am trying to tell the member because he has been jiggling the figures. For example, individuals who have never worked, or those who are self-employed, have not paid into the program and are, therefore, not eligible to receive the benefits.

The B/U ratio also includes those who have paid EI premiums but are not eligible for benefits because they voluntarily quit, they were unemployed for two weeks or less, or they worked fewer than the required hours.

When we look at the access rates of those for whom the program is designed, we can see that the actual rate is quite high and again over 83%.

Nevertheless, the government recognizes that in regions where unemployment levels are high, it can sometimes be difficult to obtain enough work to meet the employment insurance qualification requirements. That is why the EI program includes a variable entrance requirement, something that the member did not allude to.

The variable entrance requirement is designed to provide for consistently high program access by making monthly adjustments to qualifying requirements that reflect the latest unemployment rates in each region across the country. Do members think the member understands that this is designed to provide for consistently high program access by making monthly adjustments to qualifying requirements that affect the latest unemployment rates in each region across the country? This is where he is being served well by this employment insurance program.

When a regional unemployment rate increases, the entrance requirement is relaxed and the benefit duration is extended to allow more time for a successful job match. On the other hand, if a regional unemployment rate goes down, the entrance requirement is raised and the benefit duration shortened, thus recognizing the greater opportunities that are available for employment.

It is worth noting that to assist those with significant labour market attachment provides a significant benefit. For example, workers in high unemployment areas can get up to 37 weeks of benefit for about 12 weeks of work. All programs must have entrance requirements.

Bill C-265 proposes we abolish the variable entrance requirement and adopt a reduced flat 360 hour entrance requirement that would be the same for every region regardless of the unemployment rate.

There are a number of problems with this proposal. It would disproportionately benefit those living in regions with low unemployment over those in high unemployment regions. Reduced entrance requirements could create disincentives to work since workers may choose not to work beyond the minimum entrance requirements, and it would have only a very marginal impact on the number of additional people who would qualify for benefits.

The evidence indicates that the variable entrance requirement has played an important role in equalizing the percentage of individuals who meet employment insurance entrance requirements across various regions. Further, this measure could reduce labour force participation at a time when Canadians are facing growing labour shortages.

The new government is not in favour of eliminating the variable entrance requirement as the bill proposes. Evidence does not support abolishing it. This does not mean that the government is opposed to making improvements to employment insurance. I too have a soft spot for those who are unemployed--

[Lynne Yelich, Conservative, Parliamentary Secretary to the Minister of Human Resources and Social Development]

Mr. Speaker, it never ceases to amaze me how dramatic the member who introduced this bill can be. He has to consider our position here. He went on about the Liberals and the Conservatives agreeing. What he has not realized is he is a member of the third party in the House and he probably will never be in the position to make this decision.

I am pleased to join this debate on behalf of the new government. Let me begin by saying that Canada's new government is committed to ensuring that the EI program continues to serve Canadians in an effective and timely manner. The government knows how important EI is to unemployed Canadians and we want to make sure the program continues to operate in a way that meets their needs in a prudent and responsible manner.

We are not only prudent, we are caring. That party, which claims to be everything to everyone, has forgotten that we do care, but we temper it and we balance it, and we balance it with prudence. That is why any proposals for a change to the program must be looked at in the context of the overall Canadian labour market, as well as be consistent with the fundamental objectives of the EI program, something that was missing from the member's speech. Most important, they need to be supported by evidence.

Bill C-265 is asking the government to amend the Employment Insurance Act in the following ways: to reduce the entrance level requirements for the employment insurance program benefits to a flat 360 hours; to eliminate the variable entrance requirement; and to introduce a new best 12 weeks approach for determining benefit rates. Those would be significant changes. The question is, are they the right changes for these times? To answer that question, let us look at the environment in which they are being proposed. Let us look first at the current state of the labour market.

Canada's labour market is strong. Canada's labour market is performing well. Some would say it is performing exceptionally well. According to Statistics Canada, the national unemployment rate, which currently is about 6.1%, is the lowest it has been in some three decades and the share of the population that is employed today is at near record levels. This is good news. It means more Canadians are working and the demand for labour is strong. It also means that the opportunities to find and keep work are many.

We also know that many sectors are experiencing labour market shortages and many are looking for more workers.

We also know that even in this strong labour market, many Canadians will go through transitions and will continue to look to the employment insurance program for support and the employment insurance program will continue to help Canadian workers.

Employment insurance provides financial support during periods of temporary unemployment. It can help balance work and life responsibilities. It can provide assistance as unemployed workers adjust to the market changes and seek help to re-enter the labour market. These are all important functions of the program. Anyone interested in how well the program is delivering on them can consult the latest monitoring and assessment report which is prepared by the Employment Insurance Commission.

The latest report, for example, analyzes the operations, the impacts and the effectiveness of the employment insurance program for 2005. It demonstrates that the program is clearly meeting its objectives. When it comes to access to employment insurance benefits, we know that over 83% of unemployed workers who had paid premiums into the program and who had recent job separation, who qualified, were eligible to receive benefits. In other words, despite the member's claims to the contrary, the evidence shows that access to the existing employment insurance program is actually quite high.

There are those who claim that the number of hours needed to qualify for EI benefits should be reduced because they say that too few unemployed persons receive employment insurance benefits in some parts of Canada. However, they are often quoting a statistic known as the B/U, or beneficiary to unemployment ratio. That is a misleading statistic. It is not an accurate indication of actual access to the EI program.

This is because the statistic includes those who have not contributed to the employment insurance program by paying premiums.

[Yvon Godin, NDP, Acadie—Bathurst, NB]

moved that Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits) be read the second time and referred to a committee.

Mr. Speaker, as always, it is an honour and a privilege to represent the people of Acadie—Bathurst in the House of Commons. It is also an honour to introduce Bill C-265.. I would like to thank as well the member for Sault Ste. Marie—that good northern Ontario city, as he said earlier—for supporting my bill.

Let me say at the outset, that we got off to a bad start because about 15 minutes before the bill was read in the House of Commons, I saw that the Conservatives were already calling for royal recommendation. I could see that the LIberals were going to support that and back what the Conservatives were saying.

In short, they are saying that the workers' money, the employment insurance premiums paid by workers and companies, does not belong to them. Those monies were seized by the federal government when the Liberals were in power, and were put into the government coffers, in the general revenue fund. Now, the government says that it wants to pay down the debt and balance the budget at the expense of workers.

From the start I said that was not right. In the past I have used the following example. The amount of tax paid is shown on an individual's pay stub. Usually, the tax is used to pay for things that the country has to fund, such as the health system, roads, pensions and all that. In addition, there is the Canada pension fund. What is the pension fund used for? It provides a pension to individuals when they are older. That is why these monies are withheld from workers' pay. The other deduction is for employment insurance. That is used to pay people when they lose their jobs. It is money that belongs entirely to the workers and the government is responsible for managing the employment insurance fund and making it available to them.

It is thus regrettable and shameful that this evening, in this House, the Conservatives have asked the Speaker for a royal recommendation for this bill, arguing that this money belongs to the Conservative government and that it will be used to pay down the debt and achieve a zero deficit at the expense of workers.

But coming back to my bill, which is an important one, when we ask that the threshold for becoming a claimant be lowered to 360 hours, this is like taking the EI fund and putting it back in the hands of the workers who have lost their jobs, to whom this fund belongs.

In Canada, only 32% of women who contributed to the EI plan currently qualify for benefits. Only 37% of men who had employment qualify for employment insurance benefits even if they contributed to the plan. This means that the vast majority of women with seasonal jobs or part-time jobs 20 hours per week will not be eligible for employment insurance initially, if they are required to accumulate 910 hours of work.

That is how the government came to play with the figures and with the formula to rob them of their EI. That is how it was done, and that was done under the Liberal government.

Today, we have a Conservative government. I cannot wait to hear the government line. I am sure that it will say that 85% of Canadians who are eligible for employment insurance do qualify for benefits. But if they are eligible, every one of them, not 85%, should qualify.

We in the NDP say that the money should go back to those who contributed. For example, students who pay EI premiums and attend university will never see a cent in EI benefits. Women who work but do not accumulate 910 hours and young people starting off on the labour market will never be eligible for employment insurance.

This is why the 360 hour level requested in this bill would help put the EI account back in the hands of those to whom the money belongs, and these people could finally qualify.

The National Council of Welfare has just released its latest report.

It indicates that reduced accessibility to employment insurance benefits is a cause of poverty among the various age groups, including children. In 1990, 80% of unemployed workers qualified for employment insurance benefits, compared to only 37% today.

How can the government say that 85% of workers qualify for employment insurance, when there is a $50 billion surplus in the employment insurance account? This is money that was taken by our governments, money that was taken from the country's poorest. Today, I would not want to find myself out of work. When a man or a woman loses his or her job, he or she goes back home and must tell the family that he or she will not be entitled to employment insurance benefits the next week. Imagine the impact on the family.

We are talking about poverty in Canada. The employment insurance program has generated poverty in this country. There are 800,000 Canadians who do not qualify for employment insurance. These are workers who lost their jobs. The Liberals and the Conservatives should be ashamed to have implemented such a system and to take workers' money. This is totally unacceptable and despicable.

I am also asking in the bill that we take the best 12 weeks, instead of the best 14 weeks. It is bad enough that workers only get 55% of their salary, up to a maximum salary of $740. Now, even though workers are only getting 55% of their salary, the government still feels it has not taken enough money from them. It will use 14 as a divisor, so that unemployed workers will barely get anything.

When the Conservatives were in opposition, they were interested in only one thing: lowering employment insurance premiums. There is not a single company in Canada that went belly up because of employment insurance premiums. However, I have seen families, women and children suffer because of the changes made to the employment insurance program.

This evening, I spoke to an employment insurance official. I am going to talk about a real case that I want the public to know about.

A woman in my riding decided to look after a senior who is over 80. The senior pays the woman $30 an evening, or $90 a week. The employment insurance service denied the woman employment insurance because this constitutes a work week. The woman stays 12 hours a night, because she spends the night at the senior's home. Her pay amounts to $3 an hour. This violates New Brunswick's and Canada's minimum wage legislation, but that is fine.

However, it is inconceivable that this woman, who looks after a senior, should be denied employment insurance. The government claims that this is a full-time job. The woman is paid $30 an evening for three days of work a week. Yet the Department of Human Resources claims she is not entitled to employment insurance. Do you think this is humane? The employment insurance system is in drastic need of reform.

When they were in opposition, the only thing the Conservatives did when recommendations were made was to call for lower premiums. Pity the poor companies. Their premiums are too high, they are going to starve, even though some are making billions of dollars.

In the nine and half years I have been a member of Parliament, I have never had a call from an employer in my riding complaining that its employment insurance premiums are too high. Never.

Where is our social conscience? Where is the wonderful country we like to boast about?

An employee does not decide one Friday not to come to work on Monday. What happens is that the employer has no more work for the employee. The employer asks the employee to stay home because of a lack of work. Why punish the employee? Why punish that person's family?

Why punish his or her children? In my riding, I receive cries from the heart from people who do not qualify for benefits because of the changes made to the plan in 1996. These are shameful changes, which are still in the statutes of Canada.

Yesterday, in the House of Commons, the Liberal leader said that the Conservative cuts were almost criminal. But these cuts were made by the Liberals, with the Conservatives' support, back in 1996. Earlier, when the Conservatives suggested that this bill would need a royal recommendation, the Liberal member rose and said that he was in agreement with that. That is what is making me say that there is no difference between the Liberals and the Conservatives. They are the same. It is shameful and monstrous to attack people who have lost their jobs and have been paying for a system that belongs to them, a system that they and their employers have paid into. Nowhere in Canada have I seen employers take to the streets because they were starving as a result of EI cuts or premium increases. I did, however, see families in that situation. I have seen thousands and thousands of them.

I want to commend two groups in Quebec: Mouvement Action Chômage and the Coalition des sans-chemise. People walked from Montreal to Ottawa and took to the streets in support of the workers, to defend their cause. I want to commend them. They have once again stood up and sought justice from our Parliament, from our governments. What a shame.

Allow me to come back to the divisor based on the best 12 weeks. In the fisheries sector, fishers can work between 70 and 80 hours per week for the first few weeks but that does not continue throughout the fishing season.

I have something to say to those in Ontario and the west who do not understand. At the end of the season, when fishermen work only 20 hours, that is considered a week. This is where the problem lies. This is a basic problem. One must accept that, in the fishing business, fish and cod cannot be caught on Yonge Street in Toronto. We cannot fish for lobster on St. Catherine Street in Montreal. Fish and lobster are caught in the ocean, and there comes a time when there are no more and when the work weeks are shorter. That is why it is shameful to set the divisor at 14, when these people have only 55% of their salary. Thus, they are punished twice.

For example, the greatest gift that could be offered to my riding of Acadie—Bathurst would be investments to ensure that everyone there has jobs. They would be happy to work 12 months of the year. Instead of constructing enormous buildings here in Ottawa and providing all services from Ottawa, why not invest in the regions where the unemployment rate is high?

Peter Mancini, former NDP member from Cape Breton, proposed creating new jobs in regions with high unemployment in order to help these people find work. We do not want to move the jobs. People back home do not want to leave the riding of Acadie—Bathurst, they do not want to leave Caraquet, they do not want to leave Shippagan, they do not all want to go out west to work for the big oil companies that the Prime Minister favours by decreasing their taxes and cutting benefits for workers who lose their employment. It is shameful. It is monstrous, shameful and unacceptable.

That is why I am calling on this House, on behalf of workers in Canada and in Quebec, to support the bill, to decrease the number of hours so that women in our country will be equally entitled and there is no discrimination. Let us stop abusing the women in our country.

We can also help people by lowering the divisor from 14 to 12. This would have an impact on the amount of money they receive. Given the number of hours they work in a week, this equals 12 weeks. That is why a divisor of 12, not 14, would be right.

Mr. Speaker, with that I want to thank you for giving me the opportunity to talk about Bill C-265.

Once again, I am asking for the House of Commons to support the workers. In the meantime, keep in mind that this money does not belong to the Government of Canada. It belongs to those who contributed, namely the workers.

Bill C-265--Employment Insurance Act

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, I rise on a point of order with regard to Bill C-265. Without commenting on the merits of the private member's bill, I would appreciate your consideration on whether the bill requires a royal recommendation under Standing Order 79.

Bill C-265 would increase employment insurance benefits by lowering the threshold for eligibility for some claimants in changing the formula for the calculation of benefits. Both of these changes would result in significant new expenditures under the Employment Insurance Act.

Precedence clearly establishes that bills that create new government expenditures for employment insurance benefits require a royal recommendation.

Mr. Speaker, on December 8, 2004, you ruled, in the case of the 38th Parliament's bill, Bill C-278, which extended employment insurance benefits, that:

Inasmuch as section 54 of the Constitution, 1867, and Standing Order 79 prohibit the adoption of any bill appropriating public revenues without a royal recommendation, the same must apply to bills authorizing increased spending of public revenues. Bills mandating new or additional public spending must be seen as the equivalent of bills effecting an appropriation.

On November 6, 2006, you ruled, in the case of Bill C-269, extending employment insurance benefits, that:

Funds may only be appropriated by Parliament for purposes covered by a royal recommendation, as explicitly stated in Standing Order 79(1). New purposes must be accompanied by a new royal recommendation.

Again, on November 10, 2006, you ruled, in the case of Bill C-278, extending benefits, that:

...would require the expenditure of additional funds in a manner and for a purpose not currently authorized. Although contributions to the employment insurance program are indeed made by employers and employees, appropriations for the program are taken from the consolidated revenue fund and any increase in such spending would require a royal recommendation.

These precedents apply equally to Bill C-265, which should be accompanied by a royal recommendation.

Bill C-265--Employment Insurance Act--Speaker's Ruling

[The Deputy Speaker, NDP, Bill Blaikie]

Order. At this time I would like to share with the House a ruling. The Chair would like to take a brief moment to provide some information to the House regarding the management of private members' business.

On May 31, 2006, after having reviewed all of the bills on the order of precedence which, at first glance, appeared to involve spending, I shared with the House a list of bills that caused the Chair some concern. Without making any decision on these bills at that moment, hon. members were invited to present arguments as to why, in their view, each of these bills did or did not require a royal recommendation. This practice of preliminary review is one that the Chair intends to continue.

Accordingly, following the replenishment of the order of precedence in November, I have reviewed the additional bills that have come forward for consideration. I can report that only one of these bills, Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits), standing in the name of the member for Acadie-Bathurst, gives the chair some concern, given the spending provisions it appears to contemplate.

The Chair would encourage hon. members who would like to make arguments regarding the need for a royal recommendation for this bill to do so at an early opportunity.

I thank the House for its indulgence in this matter.

Income Tax Act

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Mr. Speaker, I am happy to speak about this issue today. I also had the opportunity to talk about Bill C-265.

This is not the first time a bill on taxing social security payments has come before this House. In November 2004, my Conservative colleague was on this side of the House, and we shared his joy when his spouse gave birth to a child. Naturally, we congratulated him.

Today, I congratulate him on again raising this issue by introducing Bill C-305. The purpose of this bill is to reduce the tax rate from 85% to 50% for Canadians and Quebeckers who receive United States social security payments.

At first glance, this bill might not seem very important. But this issue affects thousands of Quebeckers and Canadians. For over 20 years, we have been looking for an equitable way to solve the legislative problem facing Quebeckers and Canadians.

Why could Canadian and Quebec citizens who receive payments from the American government not benefit from the same conditions as American citizens who receive a pension from the Canadian and Quebec governments?

To help members understand where we are at today, I will give some background on this issue. Four protocols have been negotiated between the United States and Canada. I want to talk about the fourth protocol, signed in July 1997 with a number of other countries, including the United States. Under this protocol, only the country of residence is able to tax social security benefits. Since then, Canada has been able to tax American benefits paid to residents of Canada and Quebec.

The problem is that the protocol gave Canada, under the U.S. Social Security Act, the right to increase the tax rate from 50% to 85%. Bill C-305, before us today, would correct this situation.

The Bloc Québécois supports the bill, because it rectifies an error the previous government made in 1997. Several thousands of Quebeckers left their families to go work in the United States, often for years, and have been punished by the provisions of this legislation. These are people who, in many cases, were close to their roots and did not want to leave their country for the United States.

The 1997 legislative amendment enabled the federal government to bring in a lot more revenue at the expense of a population that could be considered vulnerable and economically weak. It is important to understand why Bill C-305 is now before the House and how it corrects a past blunder.

As I mentioned, historically, four protocols have modified the Canada-United States tax convention. In 1980, the income tax convention provided that social security benefits are taxable only in the originating country. It was only sometime later that the benefits were initially taxed in the United States.

The portion of benefits deemed taxable rose from 0% to 50%, depending on the taxpayer's net revenue and when the benefits were paid.

Modest income families and individuals were generally exempt from paying taxes on their benefits. In March 1984, a second protocol modified the Canada-U.S. tax convention. This agreement made social security benefits taxable only in the taxpayer's country of residence. From then on, 50% of the benefit amount was exempt from taxation.

For example, an American citizen residing in Canada was taxed on 50% of the benefits received from the United States. Bill C-305 is designed to return to this situation.

A third protocol was signed in March 1995. It gave the country paying benefits under social security legislation the exclusive right to tax those benefits.

This means that the United States taxed social security benefits paid to Quebec and Canadian residents at a rate of 25.5%, while Canada did not tax benefits received by American taxpayers.

Finally, the fourth agreement to amend the tax treaty was signed in July 1997. It provided that benefits paid under U.S. social security legislation to a resident of Canada would be taxable only in Canada, as if they were benefits under the Canada Pension Plan, except that 15% of benefits were made tax exempt in Canada.

Under this agreement, the tax rate became 85% of the payments made to Canadian residents.

However, the last agreement provides that the benefits paid under Canada's social security legislation to a resident of the United States are taxable only in the United States.

Essentially, the purpose of Bill C-305 is to reduce from 85% to 50% the tax rate on United States social security payments received by Canadian taxpayers.

For over 20 years now we have been trying to find a fair and equitable solution for all Quebeckers and Canadians dealing with this problem.

Thousands of Quebeckers and Canadians live near the border and have been suffering the never-ending repercussions of these tax reforms over the past 20 years.

Of course, this measure does not come without a price, but it is a small price to pay considering the thousands of people who have sacrificed their lives and their families to work far from home and their loved ones. These people wanted to stay here and keep their identity.

We, the Bloc Québécois, support lowering the tax rate on benefits paid to taxpayers, from 85% to 50%, because it corrects certain injustices. For this reason, I would like to congratulate the hon. member for his bill, which we will support.

[Jeff Watson, Conservative, Essex, ON]

moved that Bill C-305, An Act to amend the Income Tax Act (exemption from taxation of 50% of United States social security payments to Canadian residents), be read the second time and referred to a committee.

Mr. Speaker, I am very pleased to rise today to speak to Bill C-305, an act that is designed to lower from 85% to 50% the inclusion rate for the amount of income taxable for Canadian seniors who collect the U.S. social security pension.

I spent a lot of this past weekend in reflection, thinking about things that are important. I thought back to about 10 years ago and how very different things were for me, when I was unmarried and worked at a job scrubbing giant inflatable balloons as they came back from parades. Ten years later, some things have changed in my personal life. I am now married with four kids. I am no longer scrubbing inflatable balloons but have the great privilege of being a member of Parliament representing the communities of Essex.

Sadly, 10 years later some things have not changed. Bill C-305 exists because an injustice was committed a little more than 10 years ago and still needs to be righted.

As I said earlier, Bill C-305 is about lowering the inclusion rate from 85% to 50% for retired Canadian seniors who collect a U.S. social security benefit. This follows on the heels of two previous private members' bills, one by the member for Calgary Southeast and my own private member's bill in the last Parliament, Bill C-265, which passed second reading, as members of the House may know, and went to the finance committee, where it died a very slow death.

There are a lot of new members in the House since the last election and there may be Canadians looking in on this debate this morning who may not know exactly where this particular bill fits in history, so I want to take a few moments to go back and look at how we got to where we are today.

A major change occurred on January 1, 1996, for about 85,000 Canadian seniors in Ontario, Manitoba, British Columbia, Quebec and New Brunswick, who lived in Canada but happened to work in the United States and upon retirement collected U.S. social security cheques. What happened on January 1, 1996, is that their entire retirement changed. They were given a pretty substantial tax increase that changed the economic presumptions for their retirement years.

Of course, that all started three weeks before January 1, a week before Christmas in 1995. When most kids were writing letters to Santa Claus about all the good things they would like, these seniors received letters from a government agency informing them that in three weeks the way they were taxed was going to change.

We have a Canada-U.S. tax treaty that exists for some very important reasons. The two countries came together and agreed, for example, on how a Canadian resident in the United States, or an American who collects CPP, the Quebec pension plan or old age security, was going to be taxed and treated. We had to define on this side how we were going to treat Canadians who collect U.S. social security pensions or Americans who happened to be resident here as well.

At one time, these seniors were not taxed at all but in 1984 two protocols to the Canada-U.S. tax treaty changed the way they would be taxed. They were taxed in the country of residence, not in the source country, where the benefit came from. The maximum inclusion rate was set at 50%, so half their income would be included for taxable purposes. That was the situation that existed from 1984 to 1996.

Then came the third protocol, in the dreaded Christmas letter that these seniors got. The change was that their taxation would be done in the source country, where the benefit came from. They would have 25.5% of their income withheld at source.

Let us imagine this change. There was literally no time for these seniors to respond. There was no ability to cushion against the shock of such a change. There was no control over the benefit they received because it was withheld at source, so what they would get is all they would get. It was a tremendous and very drastic change that happened over that Christmas season. Starting January 1, suddenly 25.5% of their income was withheld at source and they got a much smaller pension cheque.

At that time, a citizens' group mobilized in the region. Canadians Asking for Social Security Equality mobilized very quickly and in large numbers, because many seniors were affected. In our region, I think the member for Windsor—Tecumseh will recall some of the meetings at the time. They came out in the thousands and forced the government of the day to go back to the table and renegotiate with the United States.

In Canada at the time, the finance minister, the current member for LaSalle—Émard, was looking to balance his budget. In the United States, President Clinton was looking to balance his budget and saw an opportunity to tax the richest of the seniors in the United States. He saw this as his opportunity to do that.

Therefore, we had a fourth protocol negotiated between the two countries. It changed back to residence taxation instead of these seniors being taxed in the nation where the benefit came from. But something interesting happened. After these seniors were promised that this was going to be a revenue neutral change, many of them were expecting that we were going back to the 50% inclusion rate. They had a really nasty surprise. The inclusion rate was set at 85%. It did not go back to the way it way before January 1, 1996, so instead of the wrong being righted, it was compounded.

It would be nice to point out, of course, that the finance minister of the day left a convenient loophole for family ships not to be taxed. That was in the same piece of legislation, the same treaty whereby these poor seniors were getting a whopping 70% tax increase. What a cruel irony that the rule-maker got to make the rules in his favour while thousands of seniors, who do not have any ability to make or change rules but are affected by them, had a tax increase instead.

As for Canadians Asking for Social Security Equality, what an incredible group. They mobilized in four successive elections, in 1997, forcing the government of the day to go back and renegotiate, and in 2000, 2004 and 2006. I say this with some bittersweet feelings. This group is very successful at mobilizing and at keeping this issue before candidates, prospective members of Parliament and prospective governments. However, I was talking not long ago with some of the folks doing the phone calls. With every election and every phone call, the cold hard reality is that yet another member is deceased, and another and another, or the latest ailment or disease is afflicting the few who survive.

Of course, this news kept coming, election after election. I can tell members that CASSE does not want to mobilize for another election. Quite frankly, its members should not have to. In my opinion, it is time to pass this private member's bill and get on with this measure. Or also, I would be pleased if this wound up being a line item in a budget, something for which I am working hard.

These seniors have been waiting a long time. They are looking for justice. Who are these seniors? Let us go back and look at what that generation achieved. Certainly they worked in the United States, but they lived in our communities. They built our communities across Canada. Talk about great foreign investment: they went to the United States, brought back their wealth and invested it in our communities here.

Let us go back and imagine these seniors in their prime. World War II has ended. They set about growing families and building homes and barns, hospitals and fire halls in their communities, delivering the services that were necessary and starting the businesses that employed others. They built community centres and churches, improving the quality of life in their communities. They went to work in the auto factories, building the cars their generation would drive. They worked the fields, harvesting and sending product to market.

Former NBC news anchor Tom Brokaw called these seniors “the greatest generation”. I do not call them the greatest generation; I call them the selfless generation, a good example to my generation. They were the dreamers. They had a good vision for this country. They were the builders. With their bare hands and their hard work they built this country and made it what it is today.

Those people were selfless because they thought about the generations to come. They did not think about what they wanted or what they could get from everyone else. They thought about what they could save and invest in their children and grandchildren. That is the kind of thinking of this generation. They planned for their own self-sufficiency. They did not ask anybody else to do anything for them. They saved their pennies. They worked hard. They did not just suddenly get to retirement and wonder who would take care of them. They were thinking long before that. This is why this was such a cruel thing. They knew that if they lived to a certain age they would need to save enough to be fine when they retired.

They were the givers. They gave to others and to charities. They started community groups that worked hard to meet the needs of people in their community. They were fundraisers. They went out and raised money for all kinds of noble purposes in their community. They were the generation that never asked for anything in return.

What happened to these seniors? Many have been forced from their modest accommodations into nursing homes or forced to move in with siblings who were also senior citizens. However, this move was symbolic of something, I think, much deeper. They have been forced from independence to a situation of dependence, which is what this tax increase did.

Seniors have been forced into making choices that they never thought would happen. They do not know whether to pay for their prescription drugs this month or to pay the gas bill to keep the gas on in their homes. They do not know whether they should buy groceries or pay the electric bill? The wonder if they can buy a gift for their grandchild's birthday or if they can lend money to their son or daughter who is in a bit of financial difficulty. This is the generation that saved and planned so they could give to other generations but they cannot make those choices any more. That is what this tax increase did to them.

They are bitter. They were misled. They were told that things would go back to the way they were before. It never happened. Their esteem and their future plans for retirement have been shattered through no fault of their own.

There are several roots to bitterness but one of them is the feeling that we are owed something.

While tax relief for any senior is good thing, and I support those measures, for these seniors they are owed something. They are owed a change, a change that will help them heal and help them get to back on top of their lives.

I am calling on members of this House to come together and to find the will to act now so that these seniors get back on top. We owe it to them.

Employment Insurance Act

[Yvon Godin, NDP, Acadie—Bathurst, NB]

moved for leave to introduce Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits).

Mr. Speaker, I am pleased to introduce a bill concerning the best twelve weeks. The Liberal Party had a chance to pass a bill for workers who were short work weeks and found themselves falling into what is known as the seasonal gap.

The best twelve weeks will help seasonal workers. This bill also proposes 360 hours. I am pleased that the member for Vancouver East is seconding this bill. I hope that all members of the House of Commons will support it.

In Canada, only 33% of women who pay employment insurance premiums are eligible to receive benefits. The $49 billion that disappeared from employment insurance coffers were contributed by workers. In Canada, only 38% of working men are eligible for employment insurance.

This bill will bring justice to Canadian workers. The Liberals could not do it, but I hope that this Parliament and its minority government will succeed in passing this bill.

(Motions deemed adopted, bill read the first time and printed)