Thank you, sir.
Chair and honourable members, good afternoon.
First, on behalf of the three million members of the Canadian Labour Congress, I want to thank the committee for the opportunity to present our views on Bill C-74.
We want to commend the government for two recent improvements to the working income tax benefit, WITB, now renamed the Canada workers benefit, CWB. The first of these improvements expanded WITB as part of the Canada pension plan enhancement. The second improvement is proposed in Bill C-74. In total, there will be nearly $1 billion of annual investment coming into effect in 2019 that will increase the maximum benefit and expand the number of workers who will receive these benefits. The government estimated that these enhancements will lift about 70,000 people out of poverty, and will encourage a greater labour market participation.
We're also pleased that the Canada Revenue Agency will automatically enrol low-income tax filers who are eligible for the benefit. This will improve access for low-paid workers. The government estimates that an additional 300,000 low-income workers will receive the CWB in the 2019 tax year.
We also have several recommendations to further improve the benefits.
First, receiving EI benefits should not cause the CWB to be reduced. Currently, the CWB is gradually phased out based on net income instead of on earnings. This means that EI beneficiaries can be eligible for the Canada workers benefit. Workers have earned these benefits by paying EI premiums, and their EI benefits should not reduce their CWB.
Second, low-income workers should be able to get the CWB more frequently through the year. Low-paid workers need the CWB in periods of low or no earnings. However, only half of the anticipated benefit can be paid in advance. In our view, the CWB should be changed so that 100% of the expected benefit can be paid quarterly, instead of having to wait for tax time. This would be similar to other transfers like the GST tax credit.
Third, it is important to keep in mind that this is still a very modest benefit. In 2015, 1.2 million working-age Canadians received the WITB, with an average annual benefit of only $807 per household. Many recipients of the benefit will continue to fall below the poverty line. More money should, therefore, be allocated to the Canada workers benefit to provide higher benefits and to phase it out more slowly. We believe that no worker in Canada should live in poverty. In particular—shamefully—full-time, full-year workers earning minimum wage in Canada could be earning at or near the poverty line. This leads to my final point.
The CWB alone is simply not enough. It must be part of a broader tool kit to eliminate working poverty in Canada.
As the 2018 budget noted, over the past four years, lower and middle-income workers have had their wage prospects stall while the CWB remains essential. Therefore, we must strike new wage and workplace standards and combat precarious work. This should take a three-prong approach.
First, we need to strengthen the labour standards of the Canada Labour Code, which we hope we will do this year. This will include the creation of a new federal minimum wage. A $15 federal minimum wage is long overdue. The federal government also should enact measures to ensure equal pay protection for part-time, temporary, and contract workers within the federal jurisdiction.
Second, there is still a gap between the number of Canadians who want to join a union and the number of Canadians who are actually represented by a union. The best and the most effective way to raise wages and fight precarity is by giving these workers a voice in the workplace. This means strengthening the labour laws to enable workers to join a union.
The third prong is simple. Attack the joblessness and unemployment by creating decent jobs. The CLC urges the government to invest in the bold economic transition to a low-carbon economy. We have an historic opportunity to respond to the climate crisis and generate decent jobs—green jobs—through the ambitious program of energy investment, public transit, and home and building retrofits. There are many job options here waiting to be tapped. If we reduce the labour market slack and address underemployment, wages will begin to rise.
Finally, I want to say something about the improvement to the Canada pension plan in part 6 of this bill. The CLC welcomes these enhancements to the survivors pension and other benefits. With respect to the child rearing and disability dropout, we believe the government hasn't properly researched the impact on women and workers with a disability. We therefore recommend the committee ask the Department of Finance to provide detailed modelling of the drop-in provision that's in the bill in regard to the CPP enhancement, for the committee members.
I want to thank the committee members for the opportunity to be here today. I will answer on behalf of the congress any questions the committee wishes to pose.
Thank you so much.