Thank you, Mr. Chair.
Thank you for these great presentations. I am pleasantly surprised that the issue of the fiscal imbalance was among the concerns mentioned, in particular by the business people. I admit that in Ottawa, we do not hear much talk about the problem of the fiscal imbalance when we collect testimony.
Mr. O'Hara is completely correct when he mentions that when the Canada Assistance Program was transformed into the Canada Social Transfer, the less prosperous provinces lost a great deal. In fact, the transfers are now established based on the percentage of the population and not on needs. For example, Quebec has around 35% of Canada's social assistance population, but Quebec only receives 22% of the transfer for social programs and post-secondary education.
Messrs. Dennison and O'Hara, I would like to submit an idea the Fraser Institute proposed last week. It suggested that the federal government should withdraw from transfers, leave this tax field to the provinces and redistribute only through the employment insurance program. This would leave equalization. The Institute suggested that the employment insurance program would sufficiently redistribute throughout Canada to ensure a certain equity between the provinces.
I wanted to know what you thought. Do you think that the employment insurance program redistributes sufficiently so that it could replace all other forms of transfers, such as the equalization or the transfers we currently have?
Mr. Dennison?