Human Resources Committee on Dec. 10th, 2009

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Okay. I have one other question. I'm not sure if you can answer this.

The government wants this in place. It wants it to go through both houses of Parliament and receive royal assent before January 1, which seems very unlikely. Is there any reason this couldn't be backdated if it got royal assent in February or some other time, in order to include people? Is there any reason that it couldn't be backdated to January 1 if it received royal assent later?

[Michel Bédard]

That's a technical matter, but to me it would seem feasible. Officials would have to implement some proper procedures. It doesn't seem to be--

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

On a point of order, Mr. Chair, as an actuary you deal with the numbers--

[A voice]

I know. They understand the procedures.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Mr. Chair, excuse me.

He worked for the EI Commission.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Let me have my point of order, Mr. Savage, and then you can speak your piece.

The point of order is that I think the question is not relevant to why we have the actuary here. It was so the committee could talk about specific costs, numbers, participants, and how he arrived at his numbers, but not about government policy, the government decision, or what process can be taken in terms of passing it or not passing it through the House in this session.

[The Chair, Conservative, Dean Allison]

Thank you.

Mr. Savage, you have about 15 seconds left. I put some extra time on because of the two points of order.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

I just want to thank him very much for coming back and providing us with this information. I appreciate that.

[Michel Bédard]

Thank you.

[The Chair, Conservative, Dean Allison]

Thank you.

Mr. Lessard.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Chair, I'm sorry, before we proceed, I want to clarify one question that Mr. Savage asked.

You're saying that you feel each year there should be a three-month window--

[The Chair, Conservative, Dean Allison]

When you guys have your turn, you can do that.

We have to have a little order here.

Mr. Lessard, the floor is yours.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Thank you, Mr. Chairman.

I would also like, at the outset, to thank Mr. Bédard for sharing his experience with us. Not only is he an independent actuary, given his retiree status, but he is one of the most relevant witnesses with regard to Bill C-56, because I know that he himself was chief actuary for 12 years.

Mr. Chairman, I would like to add that Mr. Bédard's appearance here required a lot of courage, given the climate of adversity that we sense within the committee, on the part of our colleagues. This is deplorable, and I say this to you as a friend. There is a minimum amount of courtesy and respect that we must show to those people who come here to appear before us, unselfishly and with no self-seeking interest.

Mr. Bédard, you say that the costs for Quebec are too high...

[The Chair, Conservative, Dean Allison]

Mr. Komarnicki, on a point of order.

Mr. Lessard, we have a point of order.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Just for the record, I don't think Mr. Lessard reads this quite right. I don't think because he says it's so it makes it so. And I take objection to his saying that we don't treat this witness with respect, because we absolutely do and we have respect for him, which means we're entitled to question him as well.

I don't agree with him, and I don't accept that on a matter of record.

[The Chair, Conservative, Dean Allison]

Thank you.

Mr. Lessard, the floor is back to you, sir.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Mr. Chairman, I would like Mr. Komarnicki to behave himself in the same way as his colleagues.

Mr. Bédard, let us come back to the questions.

You say that in fact, for Quebec, it is too costly and that, for the rest of Canada, there is a shortfall given the commitments, the real benefits. Could you remind us of the extent to which it is too costly for Quebec and of the extent to which the cost is not sufficient for the rest of Canada?

[Michel Bédard]

For Quebec, the surplus for 2014, with the premiums anticipated at that time, would be in the order of $20 million. The exact number that appears in my table is $18 million.

Outside of Quebec, with the contribution rates announced for 2014, there would be an overall deficit of $86 million, with a net deficit of $68 million. The Department has referred to a deficit of $78 million. I obviously do not have all of the detailed assumptions of the department, but it must be stated that the data supplied by the department is quite minimal and that one has to somewhat guess at what is hidden behind the few numbers that it has supplied.

I might also add that I found an error in one of its tables. This was as a matter of fact confirmed by the department.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

What would the equilibrium ratio be between Quebec and the rest of Canada? We for example know well that the benefits predicted for Quebec would be fewer, because Quebec funds its own program, its own parental and maternity leave program. Therefore, this coverage would apply only to sick and compassionate benefits. However, for the rest of Canada, the program covers all of the benefits. Therefore, there is a break-even rate that could or should normally apply to each group. In your opinion, what break-even rate should apply now and over time into 2014, or in 2014 — I do not know if you have done a progressive calculation of it —, in both cases, in other words for Quebec and for the rest of Canada?

[Michel Bédard]

This is provided in Table 1. For Quebec, the rate would be 0.9% of insurable earnings, and for the rest of Canada outside Quebec, it would be a rate of 3.40%. These are the rates which, according to the department's data, would provide for a break-even situation between the monies received and the monies paid out.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

When we saw the contribution rates as presently set out, in other words the contribution rates for the system as a whole, a question immediately came to our minds. We found it an odd coincidence that the rate was the same as the general contribution rate. We do see, upon further investigation, that there is a gap between the two. You have made comparisons with the implementation of the plan as such, and one of the examples you provided is that of California.

My question is somewhat in line with that of my colleague, who was asking what the disadvantages of this system are. Could the Californian scheme enlighten us with regard to a different implementation that might be useful to us with regard to what we are presented with here, and more particularly, relating to the eligibility waiting period, the duration of eligibility and the experience with the system there?

[Michel Bédard]

The Californian system is a system that is both similar and different. For salaried workers, the system provides 52 weeks of benefits at a rate that could reach as high as nearly 1,000 $ a week. For self-employed workers who chose to participate, 39 weeks of benefits are available at the same rate, after a one-week waiting period, following a six-month trial. People are free to withdraw from the system after two years if they so wish. In this scheme, there are also family benefits that are similar to our maternity and parental benefits, but their duration is of only six weeks. They are therefore less generous, and would probably not bring about the additional costs that we would have with our system, obviously, because our one year of benefits are much more generous than California's six weeks. Nevertheless, their scheme covers a series of benefits that are quite similar.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Just like you, we agree with the principle of the bill because it is the first time that these entitlements are being extended to the self-employed. I believe that you did underscore this fact. However, if the bill is adopted as is, there will be one difficulty for self-employed workers, independent workers. There are a lot of self-employed individuals who are rejoicing at present, but they do not know that if they benefit from a short period of compassionate or sick leave, they will be required to pay in for the rest of their lives.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I think Mr. Cannan had a point of order in relation to Ms. Folco and Ms. Minna making a conversation.

[Maria Minna, Liberal, Beaches—East York, ON]

I was asking my colleague for an opinion.