Evidence of meeting #28 for Finance in the 41st Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was work.
A recording is available from Parliament.
Conservative
National President, Canadian Union of Public Employees
A guaranteed annual income in retirement is worth talking about. It's not going to happen in the current realm.
My colleague talks about the PRPP option put forward by the federal government that kind of has been rejected by eight out of ten provinces, and the other two are sitting on the fence. There has been a kind of unilateralist approach to federalism recently: the Canada job grant and the saying no to CPP expansion. Canada can only work if government, employers, and trade unions actually sit around the same table.
You raise an interesting idea.
Conservative
Conservative
The Chair Conservative James Rajotte
Thank you, Mr. Van Kesteren.
Mr. Goldring, for your round, please....
Peter Goldring Edmonton East, CPC
Thank you very much, Mr. Chairman.
I'm very sorry I wasn't here for the first part of the presentation. It's absolutely fascinating.
I have to relate to you more of my own experiences, and the high school experience was one. I went to high school in Whitby. Henry Street High School was academia, and Anderson Collegiate was trades. There was a discrimination between the two.
First of all, I got my training through the military—from the RCAF—in electronics, but when I started my own company there was a difficulty. I needed people with technical experience, but you need them with tickets, too, in the fire alarm area, the suppression system area, and the extinguisher charging area. You need them with tickets.
They had a program then that worked well. I was able to hire five or six people, graduates from NAIT, who didn't have experience. They didn't have tickets. They just had that electronic background that I could use to mould them into these more complicated systems and train them on the job. It was the government system that paid, if my memory serves me, 50% of the wages for a three-to-six-month period of time.
What I would do in return for that was get them their fire alarm ticket. I would get them their extinguisher ticket. I would get them their suppression system ticket and training in some other areas too. These tickets were portable so they could take them with them. It wasn't on specific systems. They were generic tickets in those particular fields. Without them they were having a hard time getting employment, and I was having a hard time hiring these people with these tickets and experience, so it worked out very well.
I'm not sure if this program is headed in that direction.
Mr. Smillie, could you comment?
Senior Advisor, Government Relations and Public Affairs, Building and Construction Trades Department, AFL-CIO
You're talking about encouraging employers to hire apprentices. You missed it, I know, but what I said in my opening remarks is that's what we need to do more of. Be it a wage subsidy—it's a bad lingo in this town—be it some sort of incentive for the learner, we need to incent the system: trainers, employers, and the learners. I think it's close to 16% or 17% of Canadian employers who take on apprentices in the industries that have apprenticeable trades. At the end of the day, you're talking about a way to encourage employers to want to do it. So it sounded like you wanted to do it, there was something in it for you, and you had made the business decision that made sense for you.
That's what we need to communicate to the employer community. We have to have companies that want to do it. They can make a tonne more money. The margins are much better on people who don't have their full qualifications because those people aren't as marketable. You can take somebody as an apprentice and charge your client more for their...you make more on the spread than you would on a fully qualified person.
Edmonton East, CPC
It's not only that. I know the discussion was whether they're working with tools or not working with tools. I think perhaps I'm a bit of an example. My company eventually was up to 50 employees. I would also note that several of those employees are running their own companies now in Edmonton.
Senior Advisor, Government Relations and Public Affairs, Building and Construction Trades Department, AFL-CIO
If I may interject again, the gentleman from the CFIB came with us on the study tour and his pitch was that small employers can't afford to train. They're afraid to train because of poaching and that kind of thing. I think this is a perfect example of how that doesn't have to be the case.
Edmonton East, CPC
I could afford to keep them and train them because I was getting a small return on it that allowed me to spend the extra time with them that they needed, because they were green or right out of school in these specific areas. At the end of the day, they had tickets that were portable and that they probably still have to this day.
As I said, the other thing, too, is that there are three or four companies in Edmonton that were started by employees of mine who started in this fashion too, so they're doing well as well.
Conservative
Conservative
Conservative
Andrew Saxton Conservative North Vancouver, BC
The topic of our study is youth employment, yet at the same time retirement security was brought up by a number of people on the panel today. I can tell you that I think the biggest shock that a young person has when they get their first job and they get their first paycheque is to see all the deductions that are taken out of their paycheque. Those who are advocating for enhanced CPP are advocating for even more deductions to come from those paycheques.
The young people who I know, their priority is to save money for a down payment on a house. It's not to put more money into a pension plan that they're going to see 45 years down the road. So I just don't understand how people can justify increasing CPP, payroll tax, whatever you want to call it, for young people, because that's who we're really talking about today. We're talking about young people.
When we talk about retirement security, probably the biggest item on retirement security is home equity, and we haven't talked about that. Young people want to save for a down payment to buy a house, and the equity in that house will eventually become probably the biggest retirement security they have of all. In addition to that, we have the OAS, GIS, CPP, RRSP, TFSA, and PRPP. We have to look at the whole package and not just look at CPP and say, let's increase those deductions on young people. I don't think that's fair.
Mr. Moist, you seem to be thinking otherwise. What is your opinion?
National President, Canadian Union of Public Employees
I think you mentioned earlier empirical evidence that a hike in CPP might cost 70,000 jobs. I think it was Postmedia that recently got the background to that comment. That was if the hikes in premiums were imposed in one year. Nobody from the labour movement, nor the P.E.I. finance minister, not one single proponent of CPP expansion has talked about imposing hikes over one calendar year. There's no evidence that it would cause unemployment.
Secondly, in terms of home equity, this is not a deduction from a paycheque, and retirement security shouldn't be the focus of this panel. I would agree with you on that, but I want to say absolutely crystal clearly that all Canadians benefit from having one of the world's best pension systems. There is no private solution. There are no takers among the provinces for the PRPP solution. The Quebec government passed enabling legislation. They may be done as of Monday. There are no jurisdictions in Canada, so if federalism is going to work on any front in Canada surely to goodness there should be consent from the provinces for a Canada job grant program. It's been fixed up now by Minister Kenney and others, but there's been no consultation from day one.
National President, Canadian Union of Public Employees
On Canada pension plan, the advice from The Globe and Mail to the new finance minister, the Saturday after his appointment, was to “revisit the CPP, Government of Canada”. It's the Government of Canada that's an outlier on CPP right now; everybody else has come to a consensus point.
Conservative
The Chair Conservative James Rajotte
Okay, Mr. Saxton, you will have another round if you want to respond.
Mr. Caron, you have the floor.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
As Mr. Saxton mentioned, this isn't really the topic of our discussion. However, if the government agrees, it might be interesting for the Standing Committee on Finance to do an independent study on retirement income security. It would probably be very interesting to study. We could really focus on that.
In any event, today we are talking about youth employment. I would like to come back to the exchanges I had with Ms. Woloschuk, but turn to Mr. Smillie this time.
Ms. Woloschuk said earlier that 12- and 13-year-olds in Germany are encouraged to choose one path or another. She felt that it might be a little too early for these young people.
Do you agree with Ms. Woloschuk? Is that the impression people in Germany have?
Senior Advisor, Government Relations and Public Affairs, Building and Construction Trades Department, AFL-CIO
What they do to alleviate that concern or that stress on the system is that they have re-evaluations every couple of years. So if you're moving through and you find it's not of interest to you, you can switch to the other stream. So you can go from the vocational back to the academic, and your vocational experience—or your academic experience if you're on this side—works towards your certification on the other side. So there are various off-ramps after a number of years to alleviate that concern. So if you get partway down, and you're 15 or 16 and you're doing the HVAC stuff on the vocational side, and you decide to do the academic stream because you want to be a scientist or an engineer, because you believe you have the competencies to go beyond what you're doing on vocational, you can switch, and it counts.
Try doing that in Canada, right? When you're in a trades situation, can you switch to a university easily? No. Do your credits at a community college count towards a bachelor's degree? No. So there are various off-ramps.
It sounds like I drank the wine, but it's a flexible system. People say it's rigid and streaming, but there are lots of choices to be made by everybody: by the institutions, employers, students, and parents. Parents play an important role in this process. We haven't talked about that today and the education process around what parents need to be doing for their kids.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
We are hearing a lot about the advantages of the German system, but we live in Canada. Our political system is different, as is the culture of our economic system.
What do you think are the main obstacles to implementing a similar system in Canada?
Senior Advisor, Government Relations and Public Affairs, Building and Construction Trades Department, AFL-CIO
We have to have provincial governments that want to do it. They have to decide to do it and they have to execute it. They receive, through education transfers from the federal government, in the tens of billions of dollars, not only for post-secondary but also for primary education. There are billions of dollars at play. So you have to have provincial governments that want to do it, to have a dual system, and then I believe you have to have a federal government as the funder or the writer of cheques, that's saying, “These are the things we want you to do.”
Imagine giving your child a $10-billion cheque, sending them to the grocery store, and they come home with just Cheetos. You can't be mad at them because you didn't give them a list. So as the funder of education systems in Canada, the federal government has a right and a responsibility to direct how that money is spent in some way. I'm not talking about centralization of education policy; I'm talking about direction for federal funding. So if the provinces want results, and are serious about getting results, and the federal government is serious, they will say, “For your $4 billion that you get next year, you must institute a system that produces these results”, and if you do not get those results out of the system, perhaps the $4 billion is in question the next time. It has to be a results- and an outcome-based system.
Imagine a company that transfers money to subsidiaries but doesn't require any results at the end, or there's no policy prescriptions to that subsidiary. The provinces act at will, and I think maybe we need some nudges.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Would you also agree that this frame of mind, the way that we're thinking of approaches, is actually crucial? I'm just thinking about what I heard today, and I heard about what's going on in Germany, and I heard about the whole path and the whole.... They are really
…surrounded and supervised…
While on the other side, when we're looking at some other professions, we're talking about unpaid internships as being the way to get experience.
Do you see that emphasis in Europe or in Germany on unpaid internships that actually give the experience, rather than, I think, a well-designed system...? I don't see an emphasis here to go toward a well-designed system that will actually accompany our youth along that kind of path.
