Evidence of meeting #36 for Finance in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was employers.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Christopher Worswick  Professor, Department of Economics, Carleton University, As an Individual
Martin Lavoie  Director, Manufacturing Competitiveness and Innovation Policy, Canadian Manufacturers and Exporters
Matthew McGuire  Chair, Anti-Money Laundering Committee, Chartered Professional Accountants of Canada
Fred Webber  President and Chief Executive Officer, Fruit and Vegetable Dispute Resolution Corporation
Guy Parent  Veterans Ombudsman, Chief Warrant Officer (Retired), Office of the Veterans Ombudsman
Sandra Nelson  As an Individual
John McAvity  Executive Director, Canadian Museums Association
Gregory Thomas  Federal Director, Canadian Taxpayers Federation
Blair Campbell  General Counsel, Corporate Secretary, PEI Mutual Insurance Company
Sean Reid  Vice-President, Federal and Ontario, Progressive Contractors Association of Canada
Shaunna Jennison-Yung  As an Individual

6:05 p.m.

NDP

Murray Rankin NDP Victoria, BC

Thank you.

6:05 p.m.

Conservative

The Chair Conservative James Rajotte

Thank you, Mr. Rankin.

I have Mr. Allen on the list.

6:05 p.m.

Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

Thank you very much, Mr. Chair.

Thank you to all of our witnesses for being here today. I appreciate your taking the time.

Mr. Thomas, I'd like to start with you. I'd like to ask you a few questions with respect to EI.

Do you agree that in principle, in the long run, the EI system should be financed by the premiums of the people who will be recipients of it?

6:10 p.m.

Federal Director, Canadian Taxpayers Federation

Gregory Thomas

Yes. We believe that training should be part of the education system within K to 12 and in post-secondary education. We don't believe it's the obligation of a Canadian worker to fund training programs for others out of EI payroll taxes. We also believe that EI should be similar to the Canada pension plan, such that money comes off your cheque; it's invested for you in the event that you suffer a loss of employment; and if you manage to stay employed throughout your productive life, and your family, your spouse, and your dependants all manage to stay productively employed, then you get to keep those funds into your retirement.

6:10 p.m.

Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

So you disagree with the part II programs for labour training and labour market development agreements and that type of thing that we have with—

6:10 p.m.

Federal Director, Canadian Taxpayers Federation

Gregory Thomas

Yes. We believe that funding them out of a regressive payroll tax is bad public policy.

6:10 p.m.

Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

At the end of the day, if you look at the budget numbers—and granted, the Government of Canada did subsidize EI premiums over the downturn in the economy—it's going to be the end of 2015 before the EI operating account comes out of the negative position it's in. Then, budget 2014 says, “as a result, in September 2013 the EI premium rate for 2014 was frozen at the 2013 level of $1.88 per $100 of insurable earnings and it was announced that the rate will be set no higher than $1.88 for 2015 and 2016”, and the chart shows it's going down to $1.47. So, in fact, over the seven-year timeframe, it will actually start to go down again in the cumulative account.

Do you think it's a responsible position that we should be managing this over a period of years as opposed to just jumping the premium up and down?

6:10 p.m.

Federal Director, Canadian Taxpayers Federation

Gregory Thomas

I don't want to take too much of your time, but between the previous government and the current government, you had a $57 billion surplus in the EI account in the 2010 budget, which was liquidated into general revenue. So—

6:10 p.m.

Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

Actually it was the Liberals who did that.

6:10 p.m.

Federal Director, Canadian Taxpayers Federation

Gregory Thomas

—the economy could use a shot in the arm now. Canadians have paid through the nose for a recession they didn't create. If you want to see economic activity and consumer spending, you should get those rates down sooner rather than later.

You're taking in $5.5 billion more in revenue this current fiscal year, 2014-15, than you're paying out in benefits. For the next budget, in 2015, our strong advice would be to get that down. As far as the notional deficit in the EI operating account goes, that's all smoke and mirrors. That account was created to create a deficit.

6:10 p.m.

Conservative

Mike Allen Conservative Tobique—Mactaquac, NB

Well, part of it's in the $5 billion deficit right now anyway.

Mr. Reid, I'd like to go to you.

With respect to the apprentices, you said about 35% of your people are apprentices where possible. It struck me with some of the testimony that we've heard regarding youth employment and other types of situations about the trades that there are inconsistencies across provinces. I just wanted to know how you are partnering with community colleges and how you are working to try to frame your block release program so that there's consistency across the country in this. It seems to me that some of our students are getting hung up in block release, and it's taking them a long time to get out into the workforce.

6:10 p.m.

Vice-President, Federal and Ontario, Progressive Contractors Association of Canada

Sean Reid

Let me try to answer that as well as I can. I'm not sure we see a ton of issues with block release, per se. I think the biggest restrictions or challenges we face are actually regulatory at the provincial level. Frankly, to western Canada's benefit, Ontario is shutting out apprentices through its high apprenticeship ratios and compulsory trade certification. People are leaving to go to western Canada.

That, to us, is probably the strongest barrier we're seeing in that regard.

6:10 p.m.

Conservative

The Chair Conservative James Rajotte

Thank you, Mr. Allen.

I'll take the next Conservative round, if there's no objection.

Mr. Reid, at the end of your presentation you talked about a mobility grant. You said, “The funds advanced from EI payments would then be used to fund job search, training and relocation costs.”

Would this be a repayable loan? If the person is relocating, would they get an advance from EI and then, after they work in their position for perhaps a few months, pay that back? Is that how it would work?

6:15 p.m.

Vice-President, Federal and Ontario, Progressive Contractors Association of Canada

Sean Reid

No. It would be essentially reaching forward into your EI contributions and basically taking a lump sum instead of the regular contribution you get every two weeks, or whatever it is.

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

This is a person who is currently collecting EI payments, then.

6:15 p.m.

Vice-President, Federal and Ontario, Progressive Contractors Association of Canada

Sean Reid

They're currently collecting EI, yes.

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

That clarifies that. I appreciate that suggestion.

Ms. Jennison-Yung, on the situation that you and your colleague describe, I don't know the particulars. I don't know what particular restaurant that is, or what hotel. But this describes clear rule breaking. This describes someone, if this is all true, who clearly broke the rules of the program. They did not hire Canadians preferentially, when that is exactly what people are supposed to do under the current rules.

I guess what makes this doubly upsetting for me is that I come from an area—I represent Edmonton—Leduc—of very low unemployment; an area that is really searching for all types of people in all types of occupations; an area where some very decent employers are facing some really tough challenges. They have maybe 5% of their workforce as temporary foreign workers, and their concern is that they get tarred with the same brush that the employer you're describing gets tarred with.

Frankly, there's actually a fair amount of common ground between you, between those employers, and I think between the policies advanced by the government in the sense that those people who break the rules ought to be held to account. You've made those points here today. I fully support that, and I'll certainly follow up to ensure that this is done. It's certainly fair to ask for an investigation.

With respect to the blacklist, it's fair to ask that anyone who transgresses this program be put on a blacklist, absolutely. The good employers, frankly, support that 110% as well. There's a lot of common ground on that.

I just want to go back, though, to what was mentioned earlier by Mr. Saxton. To me, this bill seems to partially move in the direction of what you're recommending with respect to the fines. You're saying that employers who break the rules ought to be investigated, held accountable, put on a blacklist. What this legislation will enable the government to do is fine these companies. If these companies then break the rules, they ought to be held to account. The surest way of punishing a company like this is to fine them very quickly so that they see there is an immediate cost to this kind of activity, and it acts as a deterrent to any others who are thinking they should do this.

Perhaps you could comment on that, on the government imposing fines on those companies that do break these rules.

6:15 p.m.

As an Individual

Shaunna Jennison-Yung

I understand that they want to change and make the fines more, but in all the literature that we could find, that was something that was already in place. It stated that companies that were caught abusing the programs would be fined, and possibly do criminal time.

Our standpoint is that if this had already been done, and the rules had already been followed, then perhaps we wouldn't find ourselves in this situation. Just saying now that they're going to levy heavier fines, which would....

How many fines have been given out in the first place?

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

Just to clarify, the blacklist has been established.

6:15 p.m.

As an Individual

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

What this does, in part 6, is it enhances the monitoring and enforcement of this program and enables the minister, the government, to apply “administrative monetary penalties”, which is a technical way of saying fines.

6:15 p.m.

As an Individual

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

It will actually empower the government to levy fines, which I think you and I are in complete agreement on.

6:15 p.m.

As an Individual

Shaunna Jennison-Yung

Oh, and we absolutely agree with that as a point, but you have to move forward and take those steps to actually use that blacklist, which still only has four companies on it, and impose those fines.

6:15 p.m.

Conservative

The Chair Conservative James Rajotte

I appreciate that, and I look forward to seeing it. The vote on that division will be interesting.

I appreciate all of you being with us here this afternoon. Thank you so much for your testimony and for responding to our questions. If there is anything further you wish the committee to consider, please submit it to the clerk. We will ensure that all members get it.

Thank you so much.

Thank you, colleagues.

The meeting is adjourned.