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Evidence of meeting #66 for Finance in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was immigration.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Patrick Grady  Economist, Global Economics Ltd., As an Individual
Richard Kurland  Policy Analyst and Attorney, As an Individual
Ian Lee  Professor, Sprott School of Business, University Carleton, As an Individual
Lorne Waldman  As an Individual
Roxanne Dubois  National Chairperson, Canadian Federation of Students
Mark Fried  Policy Coordinator, Oxfam Canada
Jim Stanford  Economist, Canadian Auto Workers Union
Diane Brisebois  President and Chief Executive Officer, Retail Council of Canada
Marjorie Griffin Cohen  Professor, Simon Fraser University, As an Individual
Laurel Rothman  National Coordinator, Campaign 2000

11:20 a.m.

Laurel Rothman National Coordinator, Campaign 2000

Hello. Thanks for the opportunity to appear before you.

You're probably aware that Campaign 2000 is a network of organizations representing low-income people, affordable housing, child care and health care providers, food banks, labour organizations, and women's groups. We've been tracking progress, or lack thereof, on child and family poverty for at least 20 years.

We were quite disappointed not to see measures addressing poverty or inequality in Bill C-38, and I guess we were jarred again by the recent report from UNICEF measuring child poverty in the world's richest countries, which reminds us that even among our peers, the economically advanced nations, Canada ranks 24th out of 25. UNICEF also emphasizes that poverty is one of the most costly mistakes a society can make—and it is indeed one that we can ameliorate.

The most recent statistics show that 639,000 children, or about one in 10, are still living in poverty. That doesn't well reflect the numbers in first nations communities, where it's closer to one in four. It's important to remember that about one in three of those children in poverty has a parent already working full time. So the issues we've been talking about with regard to labour market and labour replacement income under EI are relevant to poverty reduction.

UNICEF also confirmed that public policies in the form of taxes and transfers make a big difference, which is why we had wanted to see some progress on that. Of course, in Canada we have strong evidence in the progress we've made to date, both from our programs assisting seniors—OAS, GIS—as well as with children. I don't know if you have in front of you a copy of the report card that was sent, but we have a good chart where we show the impact of taxes and transfers, including employment insurance, the Canada child tax benefit, the national child benefit supplement, and the GST credit. Before those were taken into account, we would have had 25% of children, one in four, in poverty, and after those taxes and transfers, the rate went down to 14%, preventing about 770,000 children from living in poverty.

The other important point is that the CCTB and the NCB address both poverty and inequality. The maximum benefit goes to families with net incomes under $24,000, but the progressive nature of the benefit trails out so that almost 90% of children receive something. Obviously, in families with more income they receive less.

So what we are suggesting is that to both prevent and strengthen child and family poverty we need to retain, if not enhance, those existing taxes and transfer measures, including EI, the national child benefit. I think we need a more updated look at the GST credit—or now we'd call it the HST credit in many places—and we need to focus on creating better jobs. Specifically, the child benefit needs to be increased to a maximum of $5,400, and even at that, our lone-parent mother would need to earn at least $12 an hour for at least 34 hours a week, plus the child benefit, to bring herself and her child out of poverty.

We believe that poverty reduction and eventual eradication is a key part of a prosperity agenda. Remember, these funds in families on tight incomes are all spent in local communities. They're not sent abroad. Unfortunately, people aren't able to save, but they desperately need that money for food and rent. So this direction will address some critical needs of our most vulnerable Canadians and will reduce intractable social and economic problems for years immediately ahead and to come.

Thank you.

11:25 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you very much for your presentation.

We'll begin members' questions with Mr. Marston, please.

May 31st, 2012 / 11:25 a.m.

NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

Thank you, Mr. Chair.

Once again, we have a wealth of expertise here in a lot of very important areas. I think I'm going to spend most of my time with Mr. Stanford.

Regularly, sir, we hear the government members here and in the House talk about net jobs—700,000 net jobs—and on face value it sounds really good. The materials you brought before us today counter that argument. Very clearly, you're saying that the jobs that have been created, first of all, are not necessarily that good, and there's a certain discounting that's been done with the number of people who have lost their jobs.

Would you like to comment further on that?

11:25 a.m.

Economist, Canadian Auto Workers Union

Jim Stanford

I wouldn't dispute the empirical accuracy of the claim that net new jobs have been created and net new jobs are an important variable to follow. The question is, how do you appropriately interpret that measure? In a country like Canada, whose population is growing relatively quickly...we have one of the fastest rates of population growth in the industrialized world. Our labour force, or working-age population, grows by between 1.3% and 1.5% per year.

We have to be creating hundreds of thousands of net new jobs year after year just to keep up with that normal course of population growth. It's particularly important when you're making international comparisons. Think of a country like Germany, which has virtually no population growth. Canada has created net new jobs; Germany hasn't. But Canada has to create hundreds of thousands to keep up with population growth; Germany doesn't.

By a more appropriate measure, which is the number of jobs relative to the size of the working-age population, Germany's labour market has been much stronger than Canada's through the recession and the subsequent recovery. Their employment rate is actually higher than it was before the recession, whereas the graph I showed you shows that Canada's is still substantially lower than before the recession.

There is also an issue about the quality of jobs that is not captured either in the net new job measure or, frankly, in my graph. My graph just asks whether you're working or not. There has been some growth in part-time work and precarious work through that period. But I think the bigger issue is the context in which you interpret a statement like the number of net new jobs. Canada's labour market relative to our population is still far weaker, near the worst conditions at the bottom of the recession.

11:30 a.m.

NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

One of the things that happened at our pre-budget hearings is we had a number of people talking to us about a figure that was thrown out. It was $500 billion of business capital that was sitting. Nothing was happening. Part of the pre-budget was whether we're going to have an austere budget or whether we're going to have an investment budget. With the bond rates as low as they are, would this not have been a good time for this government to use their borrowing power to start addressing the Federation of Canadian Municipalities' deficit in infrastructure, which is around $122 billion?

11:30 a.m.

Economist, Canadian Auto Workers Union

Jim Stanford

You mentioned the issue of cash and other short-term financial assets not being mobilized within the business community. I do think that is an important problem. Think of the economy as having four major players in it, if you like, who have to be spending, and in general borrowing and spending, in order to propel the economy forward and create jobs: consumers, government, foreigners—in the sense of our net exports—and then the business community.

Consumers and governments have both gone deeply into debt during the recession, and are concerned about the debt and are looking at curtailing their expenses. Our net exports to the rest of the world have declined significantly, partly because of economic weakness in the rest of the world, partly because of our overvalued exchange rate.

That means we're very dependent right now on business opening the taps of capital spending in order to balance out our recovery. As yet that hasn't really happened. In fact, business investment spending is still the only source of domestic spending in our economy that is lower in real terms than it was before the recession.

So I'm in favour of measures to try to stimulate more investment spending, both by businesses and by the public sector, and there are very important investment infrastructure programs that the government can and should be taking on in part to address the downturn in employment that I documented.

11:30 a.m.

NDP

Wayne Marston NDP Hamilton East—Stoney Creek, ON

I'd love to ask you several questions about OAS. I can't do it. I'm just about out of time.

There's been a particular interest by some government members in the operations of unions. The CAW, when they have their convention, puts a financial document before their members that shows their operating budget. Is that correct?

11:30 a.m.

Economist, Canadian Auto Workers Union

Jim Stanford

Yes, we release audited financial statements twice yearly. Those statements are public. In fact, in most jurisdictions we're required to file them with the labour board. So there's no issue about the transparency or public nature of our financial statements.

11:30 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you, Mr. Marston.

Ms. McLeod, please.

11:30 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Thank you, Mr. Chair, and I'd also like to thank the witnesses for coming and appearing on this very important budget.

I'd like to start with Ms. Rothman. Certainly child poverty is a concern. I think it's got to be a concern to everyone. I know that in regard to affordable housing, for example, with the economic action plan we actually managed to double housing throughout my riding. I think we have made significant strides, but I would never feel that the job is done for sure.

Could you help me in terms of Canada's numbers, because I think Canada does have some unique challenges in terms of rural, remote, urban? Does the study actually break things down at all in terms of where those challenges are?

11:30 a.m.

National Coordinator, Campaign 2000

Laurel Rothman

Are you referring to the UNICEF study?

11:30 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Yes. Looking at Canada and the challenges that we have, can you talk about the rural, remote, and urban variations?

11:30 a.m.

National Coordinator, Campaign 2000

Laurel Rothman

Absolutely.

First of all, we should also remember that of course some groups are at much greater risk of poverty than others. One in two children in recent immigrant families lives in poverty. Unfortunately, children of all immigrants, including those who may have been here for a couple of decades, still have a higher rate of poverty than others, as do children in lone-parent families, children of aboriginal identity, and of course children with disabilities.

It is important to look at a finer grain, if you will, to drill down to the details. Most low-income families want to work. There often are lots of reasons why many are not able to work. Health, family separation, divorce, lack of child care—they are often the reasons why people are not working at the moment.

By the same token, those who are working find that transition to be a very difficult one. In rural areas, for example, or areas where manufacturing has left.... For example, in the greater Toronto area, we have a much higher rate of child and family poverty, including the suburban ring around Toronto.

Obviously local conditions make a big, big difference.

Having said that, so do public policies.

11:35 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Thank you.

Certainly in terms of immigrants and the successful integration of immigrants, this budget actually looks at some significant changes in terms of ensuring that immigrants who come to Canada have matching jobs.

Representing and having worked in some rural and remote communities, including some aboriginal communities, I've seen many examples of where the aboriginal communities have partnered with the resource sectors in a very positive way, whether it be forestry or whether it be mining opportunities. Not all have been successful, but certainly moving forward, I think, changes....

I did note that you said that having opportunities for positive employment is critical. I think as we move forward in our rural and remote communities...and again, I can look at a number of examples of really positive...moving forward together. Having the changes we have had to protect the environment but also to allow these projects to move forward I think will be very important for some of our aboriginal communities.

I'll quickly shift to you, Ms. Brisebois, in terms of the issue I think you identified with eggs, poultry, and gas. I would think that those typically would be under 24 hours, which has not changed. Is that accurate?

11:35 a.m.

President and Chief Executive Officer, Retail Council of Canada

Diane Brisebois

Exemptions have not changed. We were just bringing it to...because those are the most popular items.

11:35 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Okay. So the budget has not actually changed that particular issue. It will be the same as it has been.

11:35 a.m.

President and Chief Executive Officer, Retail Council of Canada

Diane Brisebois

Well, the point is, does it really matter if the exemptions have changed if in fact consumers coming back into Canada are not declaring or being asked to declare the goods they buy? I think the question is how we monitor that and how we ensure that taxes are paid.

11:35 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Yes, and of course what we're trying to do—

11:35 a.m.

Conservative

The Chair Conservative James Rajotte

Can you wrap it up?

11:35 a.m.

Conservative

Cathy McLeod Conservative Kamloops—Thompson—Cariboo, BC

Okay.

If you don't have this, perhaps you could share it with us, but I've been wondering...because we're aligning with the United States. Obviously there are Americans who come up and spend money in Canada. How does the balance work?

Thank you.

11:35 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you.

We'll go to Mr. Brison, please.

11:35 a.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

Thank you very much.

Thanks to each of you.

Mr. Stanford, it's good to see you again. I have a question on the temporary foreign workers.

There is a fear...and I've heard people say that there's a threat to taking jobs from Canadians. Yet when I speak with companies, businesses, and farmers who use temporary foreign workers, they've been able to quantify that reducing access to temporary foreign workers could actually threaten Canadian jobs, because the Canadian jobs created as a result of temporary foreign workers are further up the value chain. In fact, temporary foreign workers are part of the global production chain in certain industries, particularly in agriculture, but increasingly in other industries as well. We're actually hearing evidence from employers that these are not taking jobs from Canadians; they're actually leading to higher-value jobs at other levels of production.

Just briefly, I'd like your thoughts on that.

11:35 a.m.

Economist, Canadian Auto Workers Union

Jim Stanford

Well, I certainly accept that temporary foreign workers seem to be part of an emerging global production chain; that is to say, it is a way for employers to—in a way—tap into very desperate, very low-wage pools of labour from other countries and to bring them to Canada.

11:35 a.m.

Liberal

Scott Brison Liberal Kings—Hants, NS

On that point, in my riding, I know that temporary foreign workers are costing about $14 to $15 per hour, compared with the minimum wage in Nova Scotia, which is significantly less than that.

11:35 a.m.

Economist, Canadian Auto Workers Union

Jim Stanford

I do think the claim that more Canadian jobs are created when you bring these workers in is not—