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Evidence of meeting #4 for Human Resources, Skills and Social Development and the Status of Persons with Disabilities in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was billion.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Pierre Céré  Spokesperson, Conseil national des chômeurs et chômeuses
François Lamoureux  Assistant to the Executive Committee, Confédération des syndicats nationaux (CSN)
Danie Harvey  Executive Member, Conseil national des chômeurs et chômeuses

3:30 p.m.

Conservative

The Chair (Ms. Candice Hoeppner (Portage—Lisgar, CPC)) Conservative Candice Bergen

Welcome, everyone. I'd like to call the meeting to order.

As per the orders of the day, today we'll begin with Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system). We'll have the sponsor of the bill, Monsieur Lessard, testifying for the first hour.

I suggest--and I already spoke with Monsieur Lessard about this--that because we have votes today, we'll have to complete the entire committee meeting today by 5:15 p.m. We do have a little bit of committee business to look at, which means we have to complete the witness portion by 5:00. Therefore, Monsieur Lessard has agreed that he will take 45 minutes for his introduction and the questions from us. That will give his witnesses a little more time, and we can also do the committee business. He's agreed, so we'll move forward with that.

Monsieur Lessard, welcome today as witness as opposed to someone asking the questions. We look forward to hearing from you. You will have 10 minutes to present, and then we will begin our first round of questions.

Monsieur Lessard, I turn the mike over to you.

3:30 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

I thought I was ready, Madam Chair, but I realized that I did not have the right file with me. That is what happens when you have to come here from the House of Commons in so little time.

Madam Chair, I would like to thank you for your welcome. Appearing as a witness before you is something quite new to me, as I was a witness on only one brief occasion in the past. I have been a member of this committee for the past six years and have considered all aspects and components of human resources and social development programs, and especially the issue of employment insurance.

This year, we have again tabled a bill intended to reform the employment insurance system. I believe this is the third bill, since we had previously introduced Bills C-280 and C-269. The latter is perhaps fresher in people's minds, because three opposition parties had agreed on a platform to move the planned reform as far forward as possible.

Madam Chair, you might wonder why we are so persistent in wanting to affect such far-reaching changes to the employment insurance system. The reason why is because the system is so terribly unfair to part of our society, i.e., the people who lose their jobs.

Before addressing the substance of the bill, I think that it is appropriate to remind ourselves of our shared motivation. I see colleagues here who, with myself and others, put forward changes to the employment insurance system in the past. That is extremely hard to achieve. Which brings us to the question: Why is it so hard to improve the lives of our country's most underprivileged people and yet so easy to feed or support the rich? We see that with the banks, the oil companies and the military industry. Madam Chair, $1.2 billion in funding was cut from social programs in September 2007, whereas close to $9 billion had been announced for the military sector in the summer, without any debate in the House of Commons. Why are things so easy for the rich and the military? We do not object to supporting the forces themselves, because they play a crucial role in our society, but the amounts that are committed to wage war, Madam Chair, are a matter of social choice—a choice that we do not share and call into question once again today.

Madam Chair, it is sometimes necessary to speak bluntly. I think that employment insurance represents a serious economic crime against workers, and particularly the unemployed, their families, regions and affected provinces. Why do I say that? I say that because money is being diverted from its stated purpose, i.e., to support the needs of people who have lost their income, people who have contributed to the fund along with their employers.That money is taken and used for other purposes. Over the past 14 years, $57 billion have been diverted.

Madam Chair, I am talking about an economic crime and asking my fellow parliamentarians whether we have not become white-collar criminals.

It is the same as when the people we entrust our money to to invest for our retirement use the funds for their personal benefit.

You might say that the difference here is that the government is doing so for collective purposes. That is the only difference because the harm is the same: it is attacking the less fortunate even though they had taken the precaution of contributing to an insurance fund in order to collect benefits in the event of job loss.

I wanted to begin by saying that because I believe that is something we need to think about each time we deal with this issue.

In 2004-2005, we produced the report I have here and completed it in February. Bill C-308 contains the thrust of the recommendations that we made.

Some of our recommendations are also contained in the committee's employability report that was presented in the House no later than April 2008. That report called on the government to take action in order to improve and broaden access to employment insurance.

I have these documents here. Is our work all done in vain? That would be most unfortunate because my colleagues and I believe in the work we do. We believe in restoring the important status of the EI system. How should we go about doing that? We must begin by putting forward a number of measures that I will set out. I will end with that in order to give my colleagues time to ask questions.

Needless to say, the bill includes a measure to improve accessibility through a reduction to a minimum of 360 hours of work, regardless of the regional rate of unemployment. We will see later how to calibrate access.

We now see that the government has tried to make some improvements to the system with partial measures, but they are temporary measures and have nothing to do with what is contained in Bill C-308.

We need to increase the benefit period from 45 to 50 weeks. The government has done so temporarily. In our view, that should be a permanent measure. By doing so temporarily, the government is confirming that there is a real need.

The rate of weekly benefits needs to be increased from 55% to 60% of insurable earnings. A 5% increase is not much, and I will show later that such an increase will not encourage people to remain unemployed.

We have to eliminate the distinctions between a new entrant and a re-entrant to the labour force. That is a measure that leads to some discrimination, which is also something I would like to touch on later.

We have to eliminate the presumption that persons related to each other do not form an employer-employee relationship. That concerns family situations where it is presumed that a person does not deal with a relative at arm's length. As a result, when that person claims employment insurance benefits, he or she is considered to be committing fraud. I would also like to come back to that issue.

I would like to welcome our colleague Diane Finley who has just joined us. Earlier, I spoke about those who contributed to reforming the system. Mr. Godin is one of them.

We also need to increase the maximum yearly insurable earnings to $42,500. We had debated that amount in 2005. We had agreed on setting that amount at $41,000, although we had considered a gradual increase. The government has taken the initiative of setting the amount at $43,200. We find that that is a suitable amount and would be willing to make a consequential amendment to Bill C-308.

3:40 p.m.

Conservative

The Chair Conservative Candice Bergen

Excuse me, Mr. Lessard. Your time is pretty well up. You have about 30 seconds to wrap up your initial statement.

Thank you.

3:40 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Madam Chair, the timing is just right, that is about how long I had expected to speak.

I would like to conclude with EI coverage for self-employed workers. We have seen that the government has put forward such a measure, but it is only partial; we want it to be broad, accessible and voluntary.

I am now ready to take your questions.

3:40 p.m.

Conservative

The Chair Conservative Candice Bergen

Thank you very much, Mr. Lessard; very good timing.

We'll probably have time for just one round of questions, because they're seven minutes each.

We'll begin with Madame Folco, please.

3:40 p.m.

Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Thank you, Madam Chair.

Mr. Lessard, it is a pleasure to see you in your new role before our committee. I have two questions. As I always tell the witnesses, I would like you to answer as briefly as possible so that I can ask a greater number of questions. You have heard me say that before.

First of all, back when I was Parliamentary Secretary to the Minister of Human Resources, I had been told that eligibility to regular employment insurance benefits varied depending on the number of hours worked as well as the regional rate of unemployment. At the time, I found that to be an excellent idea. I understood that there were regions in Canada where the unemployment rate was very high. Therefore, it made sense to require fewer hours of work from workers in those regions, so that they could access benefits. Your bill contains a rate of between 360 and 420 hours of insurable work, but that is invariable.

Could you explain why you are moving away from the former system, which seemed fair to me, and are considering a new one that is invariable?

3:40 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Yes, it is invariable, but it seems quite fair. There is a difference of 60 hours. We are talking about between 360 and 420 hours. It is the same range that exists at present.

Unfortunately, I did not make a copy of the range of variance. The bill maintains variances.

3:40 p.m.

Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

If you do intend to provide members with that information, it would also be useful to include a comparison between how unemployed workers would fare under your new system and how they have managed under the current system that has been in place for a number of years.

I would find it interesting to compare the benefits received by unemployed workers in regions with very high unemployment under the current system with those received under your system. I think that would allow us to compare apples with apples.

3:45 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

I can provide you with that. My assistant is taking good note of all the things I will be sending you. Explaining those things now will take a long time, and I would not be able to comply with your wishes.

3:45 p.m.

Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Furthermore, Mr. Lessard, what is your assessment of how much the bill will cost? According to the analyses, it would seem that your bill would lead to a sizable increase in the premium rate. Do you think that employers and employees would be willing to accept such an increase? Let me know what you think about that. As well, do you think that the bill would have an impact on job creation across Canada? Would there be a positive impact, negative impact or no impact at all?

3:45 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

You have asked a number of questions at once. You do realize how many answers I have to provide.

3:45 p.m.

Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

You know how it is.

3:45 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Madam Chair, we should start by saying that the government has frozen the premium rate until the fall. It will then be reassessed, but the chief actuary cannot have it vary by more than 15¢. This amount will determine, by 2012, the size of the deficit versus the EI fund's obligations. Well, at that rate, there will be a surplus in the fund again by 2012.

How will that happen? If the increase remains constant at 15¢ per year, the fund will have a balanced budget, and as of 2012, there will be a surplus because there will no longer be temporary measures in place. The current actuarial deficit calculations to determine the account fiscal balance point, which now stands at $2.43, will no longer exist. It will not be the same in 2012, so, based on the calculations in the most recent budget, the fund will be generating $19 billion in surplus between 2011 and 2015.

I will now get to our second question, in other words how much we anticipate this bill to cost. We believe it will cost a maximum of $3 billion per year. This amount is based on the government's own figures. We can include this information along with the notes we will be sending you.

In other words at this rate, if we were to implement Bill C-308 over the next five years, there would be $3 billion more per year, the fund would be nearing balance by 2012 and there would be a $4 billion surplus in 2015. This is not a result of casual calculations, it is based on the current budget. These $19 billion are not something the government is denying, because it will use them for other purposes, as was done in the past.

I do not know if this answers all of your questions.

3:45 p.m.

Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

What about job creation?

3:45 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

If we were to say that the premium rate has an influence on job creation, we would have to be concerned today. Indeed, the government is intending to increase the premium rate as of the fall. That will not slow down job creation. Either way, the increase is there. What we need to find out is how much of a surplus will be in this fund and for what purposes it will be used.

3:45 p.m.

Conservative

The Chair Conservative Candice Bergen

Merci beaucoup.

We'll now go to Madame Beaudin, please.

3:45 p.m.

Bloc

Josée Beaudin Bloc Saint-Lambert, QC

Thank you very much, Madam Chair.

Mr. Lessard, it is an honour for me to ask you questions on this bill today. My first question will be simple. I'd like to take this opportunity to clarify some comments we've been hearing over the last few weeks, or even months, before prorogation. We often hear this in the House during questions asked by our Conservative colleagues. They regularly say that a 360-hour qualifying period amounts to 52 weeks of employment insurance for recipients. I would like you to clarify this information.

3:50 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

I think the Conservatives should have verified this information for reasons of rigour and intellectual honesty. In response to questions asked by Liberal members, the Prime Minister on two occasions referred to different figures. First of all, he said that with respect to the 360-hour qualifying period, people would no longer need to have worked 45 days to receive 52 weeks of EI benefits. Later, he referred to 60 days in order to get the 52 weeks.

There is a serious lack of rigour here. The rigour that is being used to best determine how to help the affluent is not being used to help those that are less well-off.

One just needs to think of the unemployment rate rule, for instance, which would apply here. If there is an unemployment rate of 6% on the basis of 360 hours, that would give an individual in the region 14 weeks of employment insurance benefits. If there is an unemployment rate of 16% in another region, another person will be getting 36 weeks of benefits.

As a general rule, we can say that the number of weeks entitling unemployed people to benefits would fall within this bracket. If they go beyond 36 weeks, there would be specific measures for the regions, and those would be exceptions.

When people say so flippantly that working 360 hours entitles people to 52 weeks of employment insurance benefits, it is misleading and absolutely frivolous.

3:50 p.m.

Bloc

Josée Beaudin Bloc Saint-Lambert, QC

Let's get back to these 360 hours. Our committee is currently working on a poverty study. We know that a number of women work part-time. Seventy per cent of part-time workers are women, in fact.

Would this 360-hour qualifying period make EI more accessible... and help pull segments of the population out of poverty, including women? Could my colleague elaborate on how this employment insurance accessibility measure could help in the fight against poverty?

3:50 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

It is a powerful lever in the fight against poverty. We've seen that in the study we've been carrying out for the last two years. We have covered almost all regions of Canada. We know what the situation of women is in terms of employment. We have also examined it in the course of another study, one on employability, in fact. I have the document here. The committee recommended that the government revise the definition of “insured participant” that can be found in section 58 of the Employment Insurance Act, so as to broaden eligibility to employment insurance benefits and support measures. That is one of the sectors of employability which is affected and includes women in short-term employment. HRSDC indicates that 54% of the non-working population is not receiving employment insurance benefits. In other words 46% do receive them.

If we look at women, we see that 36% of them receive benefits. To get to 46%, the rate for men would have to be slightly higher, they are in their early fifties etc. So, under the plan, there is discrimination towards women and young people. These are the people that are holding precarious jobs. This is why, along with our colleagues, and I was referring earlier to Mr. Godin, Ms. Folco and Mr. Komarnicki who were there at the time, we made these recommendations in 2005 and we used them again in the report on employability. This is why we are preparing to reissue them in our poverty report.

3:55 p.m.

Bloc

Josée Beaudin Bloc Saint-Lambert, QC

Thank you very much.

Do I still have some time left?

3:55 p.m.

Conservative

The Chair Conservative Candice Bergen

You have one minute.

3:55 p.m.

Bloc

Josée Beaudin Bloc Saint-Lambert, QC

So much is being said about what is being done now. But these measures deal more with extending the duration of employment insurance benefits. Well, first, one would have to be eligible for these benefits to have access to these measures. You believe that these measures are bypassing an entire segment of the population, in other words women, students, workers who earn low wages, may lose their jobs and become unemployed again, part-time workers and seasonal workers. You believe Bill C-308 will have a major impact on all of these workers who paid employment insurance premiums when they were working.

March 17th, 2010 / 3:55 p.m.

Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Yes. Bill C-50, for instance, which has become law, provides for an additional benefit period for long-term workers. This legislation targets one or two areas of activity but also the regions, including Ontario, although that province is not satisfied with the situation. Yet, it is a temporary measure, which has no effect on women, for one. In fact, as of next year, it will no longer have any effect on anyone.

3:55 p.m.

Bloc

Josée Beaudin Bloc Saint-Lambert, QC

Thank you.