Bill C-308 (Historical)

An Act to amend the Employment Insurance Act (improvement of the employment insurance system)

This enactment makes a number of amendments to the Employment Insurance Act. Specifically, it
(a) reduces the qualifying period to a minimum of 360 hours of work, regardless of the regional rate of unemployment;
(b) increases the benefit period;
(c) increases the rate of weekly benefits to 60%;
(d) eliminates the distinctions between a new entrant and a re-entrant to the labour force;
(e) eliminates the presumption that persons related to each other do not deal with each other at arm’s length;
(f) increases the maximum yearly insurable earnings to $42,500 and introduces an indexing formula; and
(g) adds a new Part VIII.01 to the Act relating to self-employed persons.

Employment Insurance Act

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

moved that C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system) be read the second time and referred to a committee.

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

Mr. Speaker, I rise on a point of order. On June 2 you made a statement with respect to the management of private members' business. In particular, you raised concerns about three bills that appear to impinge upon the financial prerogative of the Crown and invited the comments of members of the House.

One of the three bills you mentioned was Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system). Without commenting on the merits of the bill, I submit that Bill C-308 contains provisions that would change the purposes of the Employment Insurance Act, would require new spending and would, therefore, require a royal recommendation.

Bill C-308 includes the following provisions that would require new government spending.

First, Bill C-308 would reduce the qualifying period for employment insurance to a minimum of 360 hours of work compared with the current variable interest requirement, which varies from 420 to 700 hours, depending upon the unemployment rate of the region.

Second, Bill C-308 would permanently increase the benefit period by five weeks.

Third, Bill C-308 would increase the benefit replacement rate to 60% of insured earnings from the current rate of 55%. The bill also proposes to change the benefit calculation from the best 14 weeks of a claimant's earnings during a 52-week period to the best 12 weeks of a claimant's earnings during a 52-week period.

Fourth, Bill C-308 would increase the level of maximum yearly insurable earnings from $39,000 to $42,500. It would also introduce an indexing formula that would further increase the level of maximum yearly insurable earnings every year.

Finally, Bill C-308 would add a new part to the Employment Insurance Act to expand benefits for self-employed persons.

The Department of Human Resources and Skills Development estimates that the measures contained in Bill C-308 would cost as much as $4.3 billion per year.

Mr. Speaker, in previous rulings, you have ruled that other private members' bills on employment insurance were out of order because they would increase government spending and therefore require a royal recommendation. In particular, I would draw the attention of members to a November 6, 2006 ruling on Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), where the Speaker stated that Bill C-269 would reduce

the qualifying period for benefits...increases the weekly benefit rate...repeals the waiting period for benefits...increases the yearly maximum insurable earnings and...extends coverage of the Employment Insurance Plan to the self-employed. ... I have concluded that all of these elements would indeed require expenditures from the EI Account which are not currently authorized. I note as well that the summary of the bill lists three further ends which, at first glance, appear to me to involve other increases to expenditures. Such increased spending is not covered by the terms of any existing appropriation.

I must rule that...Bill C-269 requires a royal recommendation.

Bill C-308 includes provisions similar to those in Bill C-269 from the 39th Parliament, which was found to require a royal recommendation. Therefore, Mr. Speaker, I submit that Bill C-308 must also be accompanied by a royal recommendation.

[The Deputy Speaker, Conservative, Andrew Scheer]

Does the hon. member for Chambly—Borduas wish to comment on that point of order?

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

No, Mr. Speaker, I do not. We will invoke our right of reply another time because this morning we are just getting started with the debate on Bill C-308.

If we may, we will address the government's claims later on.

What a happy coincidence that we are debating Bill C-308, employment insurance reform, as the session begins. As everyone knows, people have been talking about this issue all summer and even earlier this year.

Before I begin, I would like to salute the people of my riding, who are celebrating the 400th anniversary of Champlain's arrival in the Chambly-Borduas area via the Richelieu River. This summer was full of festivities marking the event.

I would also like to salute my House of Commons colleagues, and I hope that we can get off to a positive start this session.

This summer, people were talking about a 360-hour provision for employment insurance benefits. We believe that this is only part of the solution to the problems plaguing employment insurance. It is time for a comprehensive overhaul of the employment insurance system, and that is why we have tabled Bill C-308.

This bill includes a number of changes to the current system, including reducing the qualifying period to 360 hours—I will discuss costs related to these measures shortly; increasing the benefit period, which is currently 45 weeks but has been temporarily increased to 50 weeks—we believe that should be a permanent change; and increasing the weekly benefit rate to 60% from 55%.

For those who did not tune into this debate the first time around, I want to point out that this bill would eliminate the presumption that persons related to one other do not deal with each other at arm’s length. Right now, people working for an employer who is also a relative must prove that they have an arm's-length relationship with company administration.

I would also note that a temporary measure was recently brought in to increase the maximum insurable earnings to $41,500. We believe that this measure should be permanent. This bill would also enable self-employed workers to qualify for employment insurance benefits.

That is an overview of the measures in Bill C-308.

Some will focus on the other measures that are not in the bill. But we have planned separate initiatives, and we have not neglected these measures, such as the waiting period, the abolition of the two-week waiting period, which is being examined in Bill C-241, introduced by my colleague from Brome—Missisquoi.

In addition, regarding the increase in the number of weeks for individuals who are on extended leave because of a serious illness, epidemic or quarantine, we would like to increase the number of weeks from 15 to 50. This bill was introduced by my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, who has left this House, but the bill was saved by a motion from the House Leader of the Bloc Québécois, the member for Joliette, so that it can be put to a vote in the House.

Motion M-285, moved by my colleague from Bas-Richelieu—Nicolet—Bécancour, would reinstate a program for older worker adjustment, for which the provinces would provide 30% of the funding and the federal government would provide 70%. This would ensure that those aged 55 and up who are not able to find new jobs receive an income until they reach the official retirement age, when they will receive income security.

The fourth additional measure is addressed in Bill C-395, introduced by our colleague from Berthier—Maskinongé. This bill would protect workers who are affected by a prolonged labour dispute—more than 103 weeks—and would ensure that these workers, who have often been paying into employment insurance for 25, 30 or 40 years, are eligible for EI benefits when their employer shuts down the company after the 103 weeks. These are the other measures we have planned in addition to Bill C-308.

Since this time last year, we now have 500,000 more unemployed workers, including 70,000 in Quebec. Nothing has been done to help these people, although we are aware of all of the problems with the current system, which already excluded nearly 60% of unemployed workers from the possibility of receiving employment insurance benefits. We all saw the show put on by the Liberal-Conservative coalition this summer about the 360 hours. In a heartfelt speech, the member for Bourassa told us in June, here in this House, that if the Conservatives did nothing, it meant they were abandoning the workers and that these workers would starve. To ensure that this would happen, the coalition set up a bogus working group that has been recognized as such and that has produced bogus results.

Today, we need to debate this issue in this House. Are the parliamentarians here aware of the problems the crisis is causing for people who lose their jobs? These are problems faced by all the families who have seen their income drop because of job losses. The crisis also means a substantial shortfall for the regional economy. Many of these people will soon be dependent on provincial programs. Quebec, of course, has programs to help people in need.

The show we witnessed this summer is a non-starter. No one from the government or the official opposition is willing to say that they are going to stand up for the unemployed and correct the situation. The department's own figures show that in 1990, nearly 84%—83.82%—of people who lost their jobs could expect to receive employment insurance benefits. Today, 46% of people can expect to receive these benefits. This means that 50% of people have been deliberately excluded. The Liberals, followed by the Conservatives, created this economic tragedy for the unemployed, while managing to produce an EI surplus of between $3 billion and $7 billion year after year.

In the past 12 or 13 years, $57 billion has been diverted from the employment insurance fund.

Where will the money come from to pay for the improvements to the system? From worker and employer contributions. Instead of using this money for other purposes, the government should have put it toward the fund's stated objectives.

This opinion was shared by all the members of the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. I would remind this House that just four years ago, in February 2005, that committee made 28 recommendations to the House of Commons, in keeping with its terms of reference. The first eight of those 28 recommendations were unanimous. In other words, the four parties in the House of Commons represented on that committee had unanimously agreed to recommend that an independent employment insurance fund be created to prevent the government from dipping further into the fund. The committee recommended that the fund be used only to cover the costs of employment insurance. It also recommended that the money that had been diverted be transferred gradually to the employment insurance fund, as the Auditor General had called for. The committee further recommended creating a premium rate stabilization reserve, to provide for sudden increases in the number of unemployed workers; introducing a mechanism to stabilize premium rates; giving the government the power to set a statutory rate and implementing a $3,000 yearly basic insurable earnings exemption.

These recommendations were all unanimous. I would also remind the House that all three current opposition parties—the Liberal Party, the Bloc Québécois and the NDP—also unanimously recommended amendments that correspond exactly to Bill C-308. It will be interesting to see if the Liberals support that, if this time, they will remain true to the work they did with other members of the House, and if they will support their own recommendations in the House of Commons.

These amendments are: a permanent, rather than temporary, maximum duration of regular benefits of 50 weeks; that is, extending benefits by five weeks. We no longer hear the Liberals talking about that; now it is the Conservatives. At that time, the Conservatives also voted in favour of calculating benefits based on the 12 best weeks. The amendments also provided for an increase in the rate of benefits from 55% to 60% of earnings between periods. Once again, the Liberals agreed with us. The other measures included allowing self-employed workers access to the EI system, removing the arm's-length relationship—this is all included in Bill C-308—and eliminating the waiting period for those engaged in approved training.

We are very curious to see how our colleagues will vote. Of course, we encourage them to vote in favour of the bill as it was introduced, which would allow them to honour their commitment in this House. The Conservatives also voted for some of these measures back when they were in opposition.

As a final point, one might wonder whether the money is there. Yes, it is there. The cost is not as high as the Conservatives are claiming. We saw that in relation to the 360 hours. This measure will not cost $4.5 billion, as the Conservatives would have us believe.

The Parliamentary Budget Officer did an approximate calculation and estimated the cost at $1.2 billion.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I thank the member for introducing his bill, a bill which I think all three opposition parties have supported in whole or in part for a long time. It is the government that has been resistant, although it appears now that it is prepared to come forward with some relief, which I think is helpful.

In the last budget the government proposed to establish a new employment insurance commission, which would be funded with some seed money and established to follow certain rules to make sure there is balance. That balance obviously depends on some circumstances.

I wonder if the member has taken into account the rules established for this proposed commission, which I understand will not start until 2012, and whether he has done any estimates as to what he or his party believe will be the actual cost of implementation. The government has indicated it will be some $4.5 billion. I wonder if the member has an idea of how much these provisions would cost if implemented.

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

Mr. Speaker, I thank my hon. colleague for his excellent question.

Take for example the 360 hour threshold. The Parliamentary Budget Officer, Mr. Kevin Page, estimated the cost of that measure, if implemented, at $1.148 billion, which is well below the $4 billion suggested by the Conservatives.

Another cost, and the highest, would be associated with raising the benefit rate from 55% to 60%, as forecasted when the Liberal Party was in government and, later, under the Conservatives. This benefit rate increase from 55% to 60% would apply across the board. This cost, which is the highest, is $1.2 billion.

Is there money for that? When the cutbacks started, the premium rate was $2.20. Today, it is $1.76 per $100 of insurable earnings. Yet, surpluses continue to be accumulated. Both the Liberals and the Conservatives have pursued a conservative policy, maintaining premiums to a minimum, thereby limiting benefits.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, throughout the summer I came across a lot of people who said they were in a desperate situation. They have been laid off. Some of them have worked for many years in a job, they are in their fifties and they cannot find another job.

On top of that, they have to use up all their severance pay before they can get employment insurance. As the House knows, the New Democrats have said that should not be the case and that they should be able to get employment insurance immediately. I know the Bloc supported this. Unfortunately, many Liberal members did not.

In the case of extending employment insurance five to twenty weeks, I know the private member's bill supports that. Is that an area that the Bloc understands must happen? It is an area that many unemployed people desperately want, because they do not want to go on welfare and become destitute.

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

Mr. Speaker, the member raised an important issue and, in doing so, she is showing that, by making access to the EI fund difficult for those who are insured, the government is putting the burden back onto the provinces. These are individuals who have been paying premiums, whether they are regular employees or, as the hon. member said, people over 55 who lost their jobs and are unable to find another job because of their age or other adjustment factors.

Note that we agree to some extent with the measures in place with respect to retraining people to enable them to find a different job. Where we have a problem, and the two main federal parties will not listen to reason, is regarding those over 55 who cannot find another job. That is truly dramatic for them. They have nothing and are often forced to live off their savings or even to sell their homes to get money to live on.

[Ed Komarnicki, Conservative, Parliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour]

Mr. Speaker, it is good to be back in the House after spending the summer seeing our economic action plan create jobs.

With respect to this bill, to put it quite simply, and with deference to my colleague, the bill is not sound policy. It is therefore unsupportable. It proposes a significant number of changes to the EI system, a veritable laundry list of the oppositions' demands with respect to the system.

Among many other changes, this bill proposes a flat 360-hour national entrance requirement, and a permanent flat 360-hour requirement at that. Not only would this bill be unaffordable and irresponsible now and in the short term, but it would also be increasingly unaffordable, irresponsible and economically damaging over the long term.

As this proposal is a big ticket item in this bill, I would like to take time to discuss it in some detail. I know my colleague from Regina—Lumsden—Lake Centre noted the substantive cost to it. My learned colleague started in the low billions and then added to that list.

This bill would permanently reduce the EI entrance requirements to only 360 hours of work for regular benefits. Let us be perfectly clear about what this means. Three hundred and sixty hours is 45 days of work, just nine weeks. In reality this is a proposal for a two-month work year supported by the Liberal opposition, specifically the member for Dartmouth—Cole Harbour. This program's history shows us that the 360-hour idea is nothing more than a return to the failed Liberal policies of the 1970s.

On August 1, in The Canadian Press, referring to this time and these negative Liberal policy effects, University of Ottawa economist David Gray said, “What happened in '71 to my mind was a policy catastrophe”. To repeat it today, he said, “would just be catastrophic for the Canadian economy”.

Shortening the qualification period for EI would be tantamount to encouraging a higher turnover of workers. The result of that kind of misguided policy could be a permanent rise in the unemployment rate.

Others agree, and I will quote the Canadian Chamber of Commerce's July 23 press release. It said:

moving to a national standard of 360 or 420 hours of work as the basis for qualifying for EI would have substantial adverse impact on Canada’s labour market--it would discourage work, increase structural unemployment, exacerbate skills and labour shortages, and stifle productivity.

All those are not acceptable. Simply put, they are ill-advised. Those are the not the sorts of policy outcomes the House should be pursuing.

Allow me to quote a few others. On August 1, the president of the Canadian Federation of Independent Business said that the flat 360-hour proposal was “just ludicrous”. It really sums it up.

On June 3, in the National Post, Jack Mintz, now the Palmer Chair in Public Policy at the University of Calgary, said that the flat 360-hour proposal is “[one] of the worst ideas...getting serious attention”. He said that, “shortening drastically the qualification period [for EI] would encourage greater turnover of workers, result in a permanent rise in the unemployment rate and impose a high economic cost”. It becomes quite clear what sorts of problems this 360-hour proposal carries with it.

The Department of Human Resources and Skills Development calculated the cost of this sort of proposal, and to put it mildly, it is costly. A 360-hour national entrance requirement including new entrants and re-entrants to the workforce, which this bill would do, and including the costs incurred by making the 360-hour standard permanent, which this bill would do, and including the related behavioural or dynamic effects of this permanent change, brings the cost of this policy alone to $4 billion. My learned colleague speaks in billions of dollars as well.

In addition to that, we would have to provide for the costs of all other changes proposed in this bill. This could be in the tens or hundreds of millions of dollars. This would not be responsible at this time.

Where do these many billions of dollars come from? They come from Canadian workers and employers; eventually that is where they come from. But the immediate effect would be to further increase the federal deficit. I think it should be clear to everyone that this 360-hour, two-month work year proposal is a very costly and irresponsible policy.

The proposals put forward in the bill would truly hurt our ultimate goal of encouraging and supporting unemployed Canadians in their efforts to get back to work. The two-month work year proposal is unacceptable as policy and unacceptable to hard-working Canadians. It is a policy change this government will not be pursuing.

I know the opposition has been talking about access to EI. I would like to point out that EI access is high among those persons for whom the program is designed. According to Statistics Canada's 2008 employment insurance coverage survey, 82% of the unemployed who have paid into the program and have either lost their jobs or quit with just cause were eligible to receive benefits. In fact, fewer than 10% of those who have paid the premiums and then lost their jobs lack the required number of hours to qualify.

These high rates of access are due in large part to the variable entrance requirement. As of September 2009, 38 of the 58 EI regions have seen their entrance requirements decrease and their benefit durations increase. That is the way it was intended to work. During this same period, more than 82% of Canadian workers gained access to EI.

Right now, the duration of EI benefits is something very much worth addressing. Bill C-308 does propose a change of duration. It proposes to make permanent the temporary five extra weeks of EI benefits this government introduced as part of Canada's economic action plan. Our government implemented this measure because we recognize that during these challenging economic times people need more time to find employment. We also temporarily increased the maximum duration of benefits available from 45 to 50 weeks. As of August 30, close to 289,000 Canadians had already received additional benefits and both of these measures will be in place for new claimants until September 2010.

While our government firmly believes that these measures are providing immediate support to workers and their families right now, we anticipate that these measures will no longer be needed a year from now when they are scheduled to lapse. Making these additional weeks of benefits permanent, as this bill proposes, may hinder economic recovery by contributing to disincentives to work and labour shortages when the economy rebounds. We do not think this policy proposal is a responsible measure to take.

Of significance, the Minister of Human Resources and Skills Development has announced that she will be introducing more measures shortly to ensure that Canadians, who have paid into the EI system for years, are provided the help they need while they search for employment. This will be an important step for Canadian workers who have worked hard, paid their taxes their whole lives, and have found themselves in an economic hardship that they did not create.

Our government has already made a number of improvements to the EI program to support unemployed Canadians to help them get back into the workforce. We are providing five extra weeks of benefits. We made the EI application processes easier, faster and better for businesses and workers. We have increased opportunities for unemployed Canadians to upgrade their skills and get back to work. We are assisting businesses and their workers experiencing temporary slowdowns through improved and more accessible work sharing agreements. More than 160,000 Canadians are benefiting from work sharing agreements that are in place with almost 5,800 employers across Canada.

We believe it is important to ensure Canada's workforce is in a position to get good jobs and bounce back from the recession. Career transition assistance is a new initiative that will help an estimated 40,000 long-term workers, who need additional support for retraining, to find a new job. Through this initiative, we have extended the duration of EI regular income benefits for eligible workers, who choose to participate in long-term training, for up to two years. We are providing Canadians easier access and training that is tailored to the needs of workers in our country's different regions.

Our government is focused on what matters to Canadians: finding solutions to help long-term workers who have worked hard and paid into the system for years but are having trouble finding employment through no fault of their own; extending benefits to self-employed Canadians; and getting Canadians back to work through historic investments in infrastructure and skills training. The temporary measures under Canada's economic action plan are well suited to respond to the economic situation.

Our plan provides support to unemployed Canadians over the short-term. It is designated to meet the needs of the current economy and to help Canadians get the skills they need for the jobs of the future.

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

Mr. Speaker, here we are back in Parliament in the fall, again speaking about employment insurance. It is almost as if we never left.

Much has happened over the summer but little has changed. We still have a Conservative government that puts politics before people, that does not see EI as the fundamental and critical part of our social infrastructure that is so necessary at a time of difficulty, but rather a government that sees EI as a political tool, a blunt instrument to divide Canadians, to divide Parliament, as part of a strategic ploy hatched to distribute false and misleading information to Canadians.

This is a government that uses false statistics and never allows facts or truth to get in the way of its goal to divide this country. These are the traits, indeed, this is the character of the government. Employment insurance is but one example.

Today we look at the work of my colleague, the distinguished member for Chambly—Borduas in Bill C-308, who today introduced his bill in this Parliament and is worthy of consideration. One of the most important things in his bill is the issue of a 360-hour national standard for eligibility. This is something that has had a lot of attention, not just from members of the House but from people across the country.

Let me just give a couple of quotes from people who might be recognized across Canada.

B.C. Premier Gordon Campbell said in August, “What we’re really saying is Canadian workers, whether they live in the Maritimes, the West or North or Ontario, we should treat them the same way”.

Brad Wall, Premier of Saskatchewan, said “Instead of 50-plus different treatments for the number of qualifying hours, we need to dramatically reduce that”.

Alberta Premier Ed Stelmach said, “An unemployed family, whether they live in Nova Scotia, Quebec or Alberta, are equally unemployed”.

The TD Bank, in July, said, “The truth of the matter is that during an economic downturn, it is no easier to find a job in a region with lower prevailing unemployment than in one with a higher unemployment rate”.

Pierre Fortin, economics professor, said of the Leader of the Opposition that his proposal of 360 hours was not a problem. It was just and it was fair.

The Star Phoenix in Saskatoon said, “Clearly, EI services should be equally applied across the country. Isn't that what being a nation is all about”?

The Canadian Chamber of Commerce, who my colleague, the parliamentary secretary referred to, said:

A measure to improve the equity of the EI system that would be consistent with longer-term smart policy aimed at improving labour mobility and flexibility would be to immediately and permanently make the duration of, and access to, benefits equal--

How about this one: “An unemployed worker is an unemployed worker and deserves to be treated the same, regardless of region of residence. We will urge the immediate elimination of discriminatory EI elements such as regional entrance requirements”. This was said in the Reform Party of Canada platform statement authored by the now Prime Minister of this country. Let me repeat the last bit, “We will urge the immediate elimination of discriminatory EI elements such as regional entrance requirements”.

Here we are. We resume Parliament more or less where we left it off in June. As the session ended last spring, we all remember that we were on the verge of an election. It was averted when our leader and the Prime Minister agreed to a joint committee that would spend the summer looking at improvements to EI, specifically two things: regional fairness, which was our issue, and the Prime Minister added the issue of the self-employed. That was the proposal from the Conservatives, part of which they had promised in the last election but had not acted upon.

We had these meetings. I was there along with my colleague from Notre-Dame-de-Grâce—Lachine, Kevin Chan from our leader's office, and three members of the opposition. The meetings were difficulty but I do not suppose that this particularly relevant. People do not care how we spend our summer time.

The bottom line is that the Conservative members of this committee stalled, delayed and brought nothing to the table, absolutely nothing serious. I do not believe this was unintentional. The Conservative members broke confidential protocols. It had been decided that there would be certain protocols about confidentiality. At almost every turn the Conservative members prevented departmental officials from giving information that we had all agreed to, including the Conservative members. That is unbelievable.

The Conservative members leaked a document that they themselves indicated should not be leaked. I am looking at it. It says “Employment insurance working group--not for distribution”. The members brought that to a meeting. The only problem was, it was already given to the media. Why would the Conservative members do that?

Mr. Speaker, I can see you are shocked. The Conservative members did it because there was false and misleading information in that document. They increased the cost of the Liberal proposal for regional fairness by over 400%, not a little bit.

I took the decision to ask the Parliamentary Budget Officer, an independent officer of this House, to review the government numbers. We now know the result of that.

The PBO, appointed by the government, came back and said, yes, the government inflated the cost and, in fact, indicated that the actual cost of our 360-hour temporary proposal was slightly under the cost proposed by the Liberals.

This is some of what the Parliamentary Budget Officer said in his report:

The government's total cost estimate overstates the cost of the proposed 360-hour national standard. The Parliamentary Budget Officer believes that the government's dynamic cost estimate is flawed. More important, the PBO also believes that only the static costs should be considered in costing the proposal, given the structure of the program and that the proposed change to the EI system is in effect for one year only. This is the independent officer of this House and this is what he came back with.

The response from the government was that it did not change anything. The government first ignored it, then continued to mislead and still used, as recently as Friday, the $4 billion, even though everybody knows that it was discredited.

That is how the summer went.

I was asked many times by people across the country, including people in my own caucus and in my riding, “Why do you keep going to these meetings? You know that the Conservatives are not serious. They have not presented anything. Why would you keep going back?” We went to every scheduled meeting, to try to find a consensus.

Canadians have more important things on their minds than to follow what is happening with an employment insurance working group. However, to the extent that they paid attention, who could blame them for saying that that was just an extension of a dysfunctional Parliament? Who could blame them for saying, “You have just dragged question period throughout the summer. You guys can't get along in the House of Commons and you can't get along in the summer”? Who could blame them for saying, “He said this and she said that; you're all equally to blame”?

We tried to make it work. We went to those committees to try to make those committees work. Yes, we had an opening position, supported by many people across this country: economists, labour leaders, anti-poverty groups, even business people, and premiers of provinces who have many representatives on the other side of this House. We had that position, we presented it, and we all agreed that we would go away and get that costed. When the number came back, it was distorted.

However, beyond that, we also asked other questions. These are the questions we tabled to the group on July 23.

What is the current deficit in this year's EI account?

What are the components of that deficit? There was no answer.

How many Canadians have seen increased access to EI by region?

What would be the incremental cost of having a 360-hour national standard for eligibility?

We also asked, at that same meeting in July, what would be the cost of a 395-hour standard and a 420-hour standard?

We asked, how many Canadians draw benefits for the maximum duration?

What percentage of claimants are expected to draw the maximum weeks? Perhaps extending benefits further is a very sensible thing.

We did not get answers to all of those questions.

We also asked, in areas where the unemployment changes the eligibility criteria, how does the time lag between job loss of people becoming eligible for benefits go into the issue of a three-month average versus a one-month average to determine eligibility?

We asked all those questions.

We followed the protocols of the working group. We established the working group, we established protocols, we followed those protocols, and we expected answers. We were told we would get answers.

At the last meeting of the group, the minister told us that he told the department not to even bother with that, not to even bother with the stuff that we all agreed with.

Many of us in this House come from backgrounds in business or labour organizations or other non-for-profit organizations. We do negotiations as a way of doing business to make perfect not be the enemy of better. However, we all know, whether we are in labour or management or any other organization, it takes two to make something happen.

Employment insurance to the government is a ploy. It is part of the game of politics.

Here today, as Parliament resumes in the fall, we are where we left off in the spring, and for the government the games continue.

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

Mr. Speaker, I am pleased to speak today to Bill C-308 introduced by the member for Chambly—Borduas.

It is common knowledge that this bill is very important to me, just as it is to a great many workers throughout the country. This is a bill that the NDP has proposed quite a few times in the House of Commons.

Some people may not know or may have forgotten that in 1997, when I was elected, the same changes were being studied. Cuts to employment insurance were initiated by Brian Mulroney and continued through Jean Chrétien's tenure. In 1996, employment insurance cuts were disastrous for the country and for the workers.

I feel obliged to start off with a few comments. The member for Dartmouth—Cole Harbour is trying to tell us that the Liberal Party—I do not know if the members have seen the light at the end of the tunnel—wants to be the saviour of employment insurance.

At the same time, the Liberal Party is saying that this is temporary. That worries me. What does “temporary” mean? I heard the leader of the official opposition, the Liberal leader, say that temporary means “as long as there is an economic crisis”. As soon as the economic crisis is over, this temporary measure will be terminated. We are already hearing on the news that the crisis may soon be over. But we do not really know how long it will last.

The bill will set 360 hours as the number of hours required to qualify. I have a problem with the Conservatives' position on 360 hours. It is as though they have always said that it would cost $4 billion and that too many people would receive employment insurance. To hear them talk, only 15% of workers are not eligible for employment insurance. According to their data, 85% of workers pay premiums and are eligible for unemployment benefits and only 15% are not. It is as though all of Canada were applying for benefits. Come on. There are 33 million workers in Canada.

What an insult to the workers when we say to them that if we bring it down to 360 hours, they will all get on EI and they will be on EI instead of working. What an insult to working Canadian men and women and the people of Quebec. What an insult.

I was in France not too long ago, and I asked how much people were getting paid for employment insurance. It was 80% of their wages. I used the Conservative argument and asked whether they thought that at 80% of their wages, people would want to be on EI instead of working. The representative of the government said that their people love to work, that they want to go to work, but that in the meantime, they do not want to punish the family of the person who has lost his or her job, and that they invest the money in the community. That is good for the economic crisis.

When I went to France, I asked the question. People can check if they want. In France, employment insurance recipients receive 80% of their wages. I asked a question that could very well have been asked by the Conservatives or the Liberals: do you not think that people who get 80% of their wages in EI benefits would want to be on EI instead of working? The government representative said no, that people want to work and are eager to work. It is their own employment insurance system, paid for by employers and employees. He said that they are proud of the fact that they have a good income because they can spend that money within the community, which is good in tough economic times.

The government and the Liberals are saying that people are lazy, that they do not want to work. About the 360 hours, where is the government taking its figures when it says that it will cost $4 billion and that nearly everybody can get EI benefits already? This obviously makes no sense whatsoever.

I listened to what the government representative was saying earlier. The parliamentary secretary was saying that all the changes proposed by the Bloc Québécois would cost more than $4 billion. There are several changes: 360 hours; increasing the benefit period; increasing the rate of weekly benefits to 60%; eliminating the distinctions between a new entrant and a re-entrant to the labour force; eliminating the presumption that persons related to each other do not deal with each other at arm’s length; increasing the maximum yearly insurable earnings to $42,500 and introducing an indexing formula; and adding a new part VIII.01 to the act relating to self-employed persons.

Now they are changing their tune and saying that it will cost $4.1 or $4.2 billion. And they are also saying at the same time that reducing the number of hours to 360 will cost $4 billion. Which figure is the right one?

What is the right number? The 360 hours are supposed to cost some $4 million, and the parliamentary secretary of the Conservative government said that all the changes of the Bloc would cost $4 million. I would like to hear the right number.

The real figures indicate that it would cost $1.4 billion. That money belongs to workers in case they lose their jobs.

I heard the Liberals say that it was terrible. I read in BC newspapers that people in that province should be treated the same way as those in Atlantic Canada, in Regina and across Canada. The 360-hour rule should apply to everyone. It was the Liberals, supported by the Conservatives, who established the varying threshold, increasing the number of hours from 420 to 700 and then to 910. That is why we are saying that there is not much difference between the Grits and the Tories. They all take their orders from Bay Street. That is where the decisions are made.

However, for those workers who lose their jobs, the decision is made on Monday morning when they no longer have a job to go to and wonder how they will support they family. They wonder whether they should get EI benefits or welfare benefits. That is where it hurts.

When people say that the country will go into debt if changes are made to employment insurance, which debt are they talking about? The former Liberal government and the current Conservative government stole $47 billion from the EI fund that belonged to workers. So we should be able to say that there is a fund with surpluses and to use that money.

We must study the possibility of making changes to EI. It is a serious issue. We must ask ourselves what we can do to help workers. People must stop telling tales and giving false figures.

It has always been said—and experts said it—that only 38% or 42% of people who contribute to EI are eligible for benefits.

Therefore, since the Conservatives keep telling us that this is false and that 85% are eligible, why are they so afraid of the 360-hour rule and why do they think that the whole country will receive EI benefits? Why are the Conservatives so worried? A mere 15% is not that much, if I am to accept the government's arguments.

It is the same thing with the workers referred to in the bill put forward by the Bloc member, those who are related to the owner of the business. We want to have small and medium sized businesses and promote them. That is the right thing to do. To build a business, one starts by hiring family members, and then, as the business grows, they start hiring outside the family. It is discriminatory to deny benefits to contributing employees when they are laid off because they are related to the owner of a business who pays his or her taxes. It is discriminatory because the decision is simply based on the fact that a family relationship exists. They have to be treated like any other employee. If they did their job, worked the hours, paid their premiums and lost their job, that is what matters. The current approach is totally discriminatory. And there are such cases.

I am thinking of the Liberals, the so-called saviours of EI. I am sorry, but that makes me laugh. They are the ones who, in 2005, voted down a motion I had put before the House of Common, asking that the 12 best weeks be used in calculating benefits in order to help the workers. The Liberals did that. They also increased to 700 the number of hours of work required to qualify and established requirements that vary across the country. To listen to some people, 360 hours is the end of the world. One should remember that all that was required previously was 150 hours.

The myth about these 360 hours allowing individuals to receive benefits for one year is fallacious, because people are entitled to benefits for a given number of weeks.

Let me conclude by saying that we will certainly support the bill from the Bloc Québécois.

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

Mr. Speaker, I am especially happy, for at least two reasons, to have an opportunity today to rise on Bill C-308, introduced by my colleague from Chambly—Borduas. The first, of course, is that I am deeply concerned about the flaws in the current employment insurance system and the proposals for remedying them. The second is that the Conservatives and Liberals set up a phoney committee to discuss these issues behind closed doors and it is wonderful to finally have a chance to hear the positions of all the parties in the House.

There are many problems with the current system, but we are very familiar with them all because they have been pointed out repeatedly by the various stakeholders. As early as February 2005, the Standing Committee on Human Resources, Skills Development, Social Development and the Status of Persons with Disabilities produced an exhaustive report with no fewer than 28 recommendations to reform employment insurance from top to bottom.

But it remained largely a dead letter. Both the Liberals and Conservatives ignored its conclusions, even though they were very reasonable and appropriate. No one should be surprised, therefore, that we in the Bloc Québécois took a rather jaundiced view of the announcement that a secret committee on employment insurance would be quickly and quietly convened to save face in view of the thousands of unemployed people who would have been able to take immediate advantage of the measures in Bill C-308.

This bill does not reinvent the wheel. All it does is pull together the best proposals for finally improving the accessibility of an employment insurance system that has been strait-jacketed for far too long by the restrictive changes introduced by the same Liberals who say now in public that they are outraged but then vote in favour of a budget that does nothing.

The most shocking thing about this refusal to finally re-open the eligibility requirements is the ideologically driven insistence on seeing all unemployed people as potential cheats. The government’s way of thinking was on display as recently as last Friday in the report from the Office of the Parliamentary Budget Officer when it estimated the cost of a standard eligibility requirement of 360 hours.

The government assumes in its calculations that, in addition to the 166,000 existing unemployed, more than 180,000 people would qualify under the new standard and would try to take advantage of it by voluntarily quitting their jobs, with the connivance of their employers, after accumulating enough hours to qualify. As we know, voluntary departures have not been covered for a long time by the current system.

It is only in this way that the government is able to conclude that changing the minimum requirements would cost about $2.5 billion, or more than twice the estimate of the parliamentary budget officer. It is hard to imagine a government with more contempt for its own citizens. It is especially sad to think that this contempt and these suspicions are penalizing people who have had the misfortune of losing their jobs. The government is basically treating 180,000 Canadians, and therefore more than 40,000 Quebeckers, as potential liars and scam artists.

I have a question now for the government. If the intent to commit a crime is just as punishable as the crime itself—as it is in the Canadian Criminal code—perhaps the government thinks that it should rush out and arrest these people who might commit fraud? Let us make no mistake. This is the exact same logic behind the government's imposition of a two week waiting period. The same logic applies to people who do not deal at arm's length with the employer. It is up to them to prove beyond a doubt that they have no intention of defrauding the plan. This does not take into account the fact that the procedure can take a number of months, even a year, before the applicant is deemed to be acting in good faith. All this cynicism is extremely discouraging.

Perhaps we should remind the government of the principle underlying the seven measures proposed in Bill C-308—attempting to help the unemployed by increasing benefits and eligibility does not amount to promoting unemployment. On the contrary, these measures have a single aim—to enable the unemployed to retain some dignity despite the difficult times they face.

Let us review these measures here, one by one. The first, and perhaps one of the most important, is to introduce a standard qualifying period of 360 hours across the board. Despite the claims of the Conservatives, who clearly have not taken the trouble to study our proposal seriously, there is absolutely no question of granting the maximum number of weeks of benefits to anyone who has worked 360 hours. This is misinformation, as my colleague has just said.

One need only consult schedule I of the bill. An individual who has worked 360 hours would be entitled to between 14 and 36 weeks of benefits. Entitlement to 50 weeks, the maximum under this bill, would require over 1,115 hours of work and residence in a region with a level of unemployment over 16%.

If this measure were passed, it would substantially reduce the phenomenon known as the spring gap, the period in which many seasonal workers receive neither income nor benefits.

The second measure in Bill C-308 concerns the weekly benefit rate. At the moment, as everyone knows, the rate is set at 55% of insurable earnings, to a maximum of $41,300 a year. This bill proposes to increase it by 5% to set it at 60%.

Over 166,000 Quebeckers—nearly two thirds of whom are women—earn minimum wage, which is currently $9 an hour. This means that these workers can earn a maximum of $173.25 a week or $9,000 a year. Clearly that is far too little to live on decently.

The third measure in this bill, which perfectly complements the previous one, is to increase the maximum insurable earnings to $41,500 and introduce a guaranteed annual indexing formula. This increase would generate additional revenues and thus fund some of the improvements proposed by this bill. According to the figures of the human resources department, this increase would lead to additional revenues of $420 million and spending of $245 million resulting in a credit balance of $175 million.

Fourth, the bill also proposes finally eliminating the discrimination facing people who are entering or re-entering the workforce—the Liberals put forward that distinction in 1996. Those individuals are unfairly penalized, especially women who often leave the workforce to care for their children. That is why, according to a study by the Fédération des travailleurs du Québec, only 16% of young unemployed workers under 25 years old are receiving EI benefits, while in the early 1990s, that proportion was 52%.

The fifth measure aims to correct the problem I mentioned earlier, namely, the presumption that workers who do not have an arm's length relationship with their employers are basically guilty until proven innocent. Of course, this goes against the presumption of innocence that is pivotal in all modern judicial systems, and enshrined in the Quebec Charter of Human Rights and Freedoms and its Canadian equivalent.

Sixth, Bill C-308 amends the formula used to calculate insurable earnings; the calculation would be based on the 12 best weeks in the 52-week qualifying period.

Lastly, this bill opens the door to the possibility of self-employed workers taking part in the EI system on a voluntary basis. According to the most recent numbers, over 16% of Canadian workers are self-employed at this time, and that number has risen recently particularly because of the recession. It is high time we offered them the opportunity to enjoy some sort of income security.

These seven measures would undoubtedly correct many major deficiencies that exist in the current employment insurance system—first, by improving it, but also by removing certain provisions originally put in place to address the terrible suspicions that successive Liberal and Conservative governments have seemed to harbour against unemployed workers.

In closing, losing one's job is rarely a joyous occasion. Having to prove to the government that one is not trying to cheat the system is even more humiliating. Workers who find themselves in that situation are reduced to begging the government for assistance that they rightly deserve, assistance that they themselves have paid for, day after day, week after week.

That is why I invite all parliamentarians to look at this bill not simply as a way to improve the system, but as a way to correct certain glaring injustices.

[The Deputy Speaker, Conservative, Andrew Scheer]

The time provided for the consideration of private members' business has now expired and this item is dropped to the bottom of the order of precedence on the order paper.

The House resumed from September 14 consideration of the motion that Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), be read the second time and referred to a committee.

Speaker's Ruling

[The Deputy Speaker, Conservative, Andrew Scheer]

Before resuming debate on this bill, I am prepared to rule on the point of order raised by the Parliamentary Secretary to the Leader of the Government in the House of Commons on September 14 concerning the requirement for a royal recommendation for Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), standing in the name of the hon. member for Chambly—Borduas.

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

In presenting his concerns with respect to the bill, the parliamentary secretary noted a number of its provisions which, in his view, infringed upon the financial prerogative of the Crown. Specifically, the bill reduces the qualifying period for benefits, permanently increases the benefit period, increases the benefit replacement rate to 60%, alters the benefit calculation formula, and increases the level of maximum yearly insurable earnings as well as introducing an indexing formula that would further increase benefits.

Furthermore, he pointed out that the bill would expand the employment insurance system to provide benefits for the self-employed.

In support of his contention that the bill requires a royal recommendation, the parliamentary secretary made reference to a Speaker's ruling concerning Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), presented during the 39th Parliament, found at page 4719 of the Debates of November 6, 2006. That bill was found to require a royal recommendation.

In his intervention, the hon. member for Chambly—Borduas put forth arguments very similar to those put forth in the debate regarding Bill C-269, mainly that the funds in the employment insurance account are paid by workers and employers and therefore do not constitute government funds.

The Chair has carefully examined Bill C-308, and compared it with Bill C-269 from the 39th Parliament and has also reviewed the reasoning in the earlier Speaker’s ruling. The Chair notes that Bill C-269 contained a number of provisions either identical to or substantially the same as those in the bill in the present case.

In my view, it is clear that Bill C-308 alters the terms and conditions of the existing program under the Employment Insurance Act. As for whether the funds in question are government funds, I refer hon. members to the ruling of June 13, 2005 at page 6990 of the debates which stated that:

Sections 71 to 77 of the Employment Insurance Act establish the operation of the employment insurance account as part of the consolidated revenue fund. Amounts are paid out of the consolidated revenue fund and charged to the account--

It is evident that the bill seeks to increase employment insurance benefits, thus increasing the expenditures under that Act. 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.