Lesson learned.
We're here to support Bill C-265, including the proposal for best 12 weeks, and at the same time acknowledge that a majority of members of Parliament have in fact supported other bills that have tried to address some of the difficulties with our current EI system.
Some of us live and breathe unemployment insurance. Earlier today I had to file an appeal for claims that had been presented out of a closure in Bracebridge. Certainly our industry and many others are reeling from closures and large-scale layoffs.
In our view, the employment insurance hours system was the main villain in the 1996 changes. Nothing of any real substance has been amended since what is now fully a decade ago except for two changes—not without importance to the people they affected but still in some ways tinkering on the edge of the system.
I'm referring first to the reduction of the 700 hours that were originally required for so-called special benefits—parental, sick benefits, those types of benefits. I think many of us can still remember the photograph on the front page of the The Globe and Mail of the woman with child in hand, just short of the 700 hours to qualify. It was amazing how quickly the political will was found to address that and to reduce it to 600. I never heard a very good, rational explanation for 600; it was simply that there were too many people who weren't being covered at 700, so it was reduced to 600.
The other change, though not to the legislation, was the introduction of pilot projects that extended, for 21 truly high-unemployment regions, an additional five weeks, still with the maximum of 45.
Those have been the only real changes. The fundamental structure of the EI grid has not been amended.
When you do get the document, I'd ask you to spend some time on the second page. I know it looks like you cannot fathom it, but what I had hoped to do—and perhaps someone can take the time to walk through that—is go through an example of what happens for people in sectors, in industries, and in regions where they do not have full-time, full-year work. This is not just a rural issue; this is an urban issue.
The example I want to give is of service workers; in particular, I use the example of a grocery store worker. Service workers are critical now in our economy. About 70% of all jobs are in the public or private service sector.
Under the old UI system...and we're not proposing to go back to that, but it's important to understand where some of the billions in the surplus have come from. I've provided Statistics Canada information that shows that the average service worker works 29 hours a week. On that basis, they would need, under the old system, 19 weeks of work prior to layoff in order to qualify in a 6% to 7% unemployment region; currently that would be like Toronto or Montreal. But under the EI system, the way the hours have been rejigged, the same service worker now needs 23 weeks of work prior to layoff to meet what is now a 665-hour minimum.
It is worse still for a grocery store worker, and I've picked that as one of the occupations where it's even lower than the average service sector worker. They average 24 hours weekly, and in their case, instead of needing 19 weeks of work prior to layoff to qualify, they now need 28 weeks of work.
There's a chart there that shows how the requirements have increased. This chart, which shows the old system alongside the new system—we've grafted them together—allows you to study and understand, in your own regions, how this system is functioning to the detriment of workers.
We have a changing job market out there. Many of us would argue that the architects of the 1996 changes had at least some sense that this was coming. Now, without a doubt, we know how many jobs are contract, temporary, and part time, and this applies mainly to women. It also applies to men.
One of the things we're finding with layoffs in auto and other manufacturing workplaces is that men and women are now having to look to a future with fewer options, and many of those options are those temporary, part-time jobs, certainly not full-year, full-time jobs. There are also serious economic impacts for the economy as a whole, serious negative impacts for EI's key role as an economic stabilizer.
The federal government last fall, in the economic and fiscal update that they provided, looked right through to year 2011-12 for risks to their fiscal projections, and they mentioned volatile commodity prices, weaker U.S. consumer spending—they didn't know the half of it—global current account imbalances, and a further appreciation of the Canadian dollar. This is not the end of history. We may well yet have another recession in this country. Certainly we have a downturn, and that, by all accounts, goes to explain the Bank of Canada rate drop, unusual as it was, this week. There is in some of the papers today the suggestion that the job numbers coming out tomorrow will have some grim information for all of us. We cannot sit easy.
Again, as part of the documents, we've compared the hours that were needed to qualify for employment insurance or unemployment insurance during economic downturns. We used a regional rate of 8% to 9% unemployment, which would not be unusual in a downturn. We've gone from a formula that would allow somebody at 165 hours to at least get a minimum entitlement; then, in the early 1990s, a formula that meant 255 hours; and now a formula in this same region that would require a minimum of 595, and that's just to get a bare minimum entitlement.
There is a very important study that was commissioned by Human Resources Development Canada—I can never remember its name in its various changes. This was a study of the UI system as an automatic stabilizer, identified as the single most important stabilizer, and to prevent downturns going much deeper.
Finally, this week is also the anniversary of the first death from the SARS epidemic. There was a great deal of puzzlement amongst the honchos within EI about why so few people were applying and getting EI. Those of us who know what has happened in the hospitality sector and in the health care sector and homes for seniors and the aged, what is happening in hotels and restaurants, understand very well why people could not apply or qualify.
Our system has been problematic since the beginning; it has gotten worse with recent developments in the labour market, and we urge you to fix it.