Evidence of meeting #20 for Human Resources, Skills and Social Development and the Status of Persons with Disabilities in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was study.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Paul Thompson  Assistant Deputy Minister, Processing and Payment Services Branch, Service Canada
Frank Vermaeten  Assistant Deputy Minister, Skills and Employment Branch, Department of Human Resources and Skills Development
Ian Shugart  Deputy Minister, Department of Employment and Social Development

8:45 a.m.

Conservative

The Chair Conservative Phil McColeman

Good morning, ladies and gentlemen. Welcome to meeting number 20 of the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. Today is Thursday, May 1, 2014.

I will quickly mention that we have set aside some time at the end of today's meeting to deal with some housekeeping issues.

Joining us for the first hour of our study on the main estates, we have the Honourable Jason Kenney, Minister of Employment and Social Development, along with the Honourable Candice Bergen, Minister of State for Social Development. Welcome. Thank you, ministers, for taking time to be with us today.

From the departmental side, the ministers are joined by Mr. Ian Shugart, deputy minister of the Department of Employment and Social Development, and Alain Séguin, chief financial officer.

From Service Canada we have Paul Thompson, assistant deputy minister from the processing and payment services branch. We also have Mr. Evan Siddall, president and CEO of Canada Mortgage and Housing Corporation.

Welcome to all of you. Members, since the meeting will be split into two one-hour sessions, we will go with five-minute rounds of questioning when we get to that point.

I'd now like to open it up to Minister Kenney to begin his remarks.

8:45 a.m.

Calgary Southeast Alberta

Conservative

Jason Kenney ConservativeMinister of Employment and Social Development

Thanks very much, Chairman, and good morning colleagues. I'm pleased to be here with the team that has been introduced. Particularly let me welcome Mr. Siddall, who has recently been appointed president of Canada Mortgage and Housing Corporation. They are very important responsibilities and he's off to a great start.

I'm pleased to be with you today to discuss the 2014-15 main estimates for Employment and Social Development Canada and to highlight some of our key areas of investment.

In this fiscal year, we are planning expenditures of $44.5 billion in income security. This amount includes payments through old age security, the guaranteed income supplement, the registered disability savings plan and the national child benefit.

Payments through old age security and the guaranteed income supplement are increasing by $1.6 billion, and of course, we can continue to expect to see that as our population ages and the number of retirees increases.

ESDC is planning expenditures of $3 billion in the social development program area. This includes the homelessness partnering strategy, for which Minister Bergen is responsible, the social development partnerships program, and the new horizons for seniors program, for which Minister Wong is responsible.

It also includes the recently created Federal Income Support for Parents of Murdered or Missing Children. This program is a new measure from our government to help families going through a very difficult period.

The social development program area also includes the Enabling Accessibility Fund, which is part of our government initiatives to help Canadians with disabilities. I would like to recognize the efforts of the committee chair for Canadians with disabilities. We recently created a workplace stream of this program to increase the ability of Canadians with disabilities to participate in our labour market.

Finally, the social development program area also includes payments directly to parents through the Universal Child Care Benefit—which our government is extremely proud of and which was one of our most important 2006 election campaign commitments.The increase in this area is because of an increased number of children entitled to this benefit. That is good news. By paying this benefit, the government recognizes that parents know best what child-care is best for their children. The Universal Child Care Benefit provides support to over 2 million children annually and has lifted 24,000 families out of poverty.

In the Learning Program area, the department plans budgetary expenditures of $2.3 billion. This program area includes the Canada Student Loans and Grants Program and the Canada Education Savings Program. The non-budgetary section of the 2014-2015 main estimates in this program area is the expenditures paid out in student loans, which are loans we expect to be repaid. Increases in this area are the result of more students receiving this support, more families saving for their children's post-secondary education and an increase in repayment assistance.

In the skills and employment program area, ESDC has planned expenditures of $1.1 billion in the main estimates before you. The main estimates before you show a $500 million decrease in this area from the year before. The reason for this is that the labour market agreements, which now include the Canada job fund and Canada job grant, were still being negotiated at the time the main estimates were tabled. We'll be bringing forward the $500 million in supplementary estimates as we have signed agreements in principle with all 13 jurisdictions for the delivery of the Canada job fund or grant and indeed final agreements with, I believe, five provinces. All this is to say there is not a $500 million cut. It just wasn't ready, frankly, to put in the estimates.

The skills and employment program area includes a number of our government's priority areas, including the aboriginal skills and employment training strategy, known as ASETS, which I think is a great program; the skills and partnership fund; the first nations job fund, a new initiative to try to get young aboriginal, able-bodied folks to move from welfare to work wherever possible; the Targeted initiative for older workers, which we've just renewed with a number of provinces; and the labour market agreements for persons with disabilities. The old agreements were sunsetted at the end of the last fiscal year, and we have been renewing them with provinces. There is also the opportunities fund for persons with disabilities; the Red Seal program, a very important part of our skills agenda; apprenticeship grants; and others.

Our ministry is planning expenditures of $168 million in the integrity and processing program area, which is obviously very important. This is responsible for ensuring that taxpayers' dollars are being disbursed correctly and only to those actually entitled to the benefits. This is particularly important in a department like ours, which is entrusted with a significant amount of taxpayers' dollars.

To provide you with a recent example, earlier this month a Toronto man was charged for allegedly collecting his mother's CPP and OAS benefits for 15 years after she died. Police alleged that this individual collected nearly $200,000 in fraudulent benefits. The reason this branch exists is to ensure that these funds are directed to those who paid into the system and truly qualify. This is also the program area responsible for processing specific benefits, including our very successful apprenticeship grants. ESDC is also planning expenditures of $118 million in the citizenship centre service program area.

ESDC is also planning expenditures of $118 million in the Citizen-Centered Service program area. This is the program area of the department responsible for ensuring that the department provides timely and quality service to Canadians. This is particularly important for a department like ESDC that deals directly with Canadians to deliver many programs.

One area here that I would like to highlight, on which we're particularly focused on improving the department's service delivery performance, is in employment insurance, EI, processing. Mr. Cuzner keeps offering constructive criticism in this respect.

When I was named Minister of Employment and Social Development, one of the early things I did was ask my parliamentary secretary, your colleague Mr. Armstrong, to conduct a review of EI processing.

He has been out meeting with Service Canada front-line staff and management across Canada to find ways to be more efficient and fix bottlenecks in the system. I look forward to hearing the results of his review and am hopeful that as a result we will be able to improve the department's service to Canadians in this area.

Finally, we are planning expenditures of $224 million in the internal services area, which is a reduction of about $54 million from the previous year as the department continues to look for ways to save taxpayers' money.

By reducing administration and back office expenses, we're able to provide more benefits to Canadians and more support for front-line service.

These are the summary highlights of our planned spending in the 2014-15 main estimates, Chairman, and I'm happy to take questions.

Minister Bergen, do you have an opening statement?

8:55 a.m.

Portage—Lisgar Manitoba

Conservative

Candice Bergen ConservativeMinister of State (Social Development)

I do.

8:55 a.m.

Conservative

The Chair Conservative Phil McColeman

Thank you, Minister.

Let's move to Minister Bergen's opening comments.

8:55 a.m.

Conservative

Candice Bergen Conservative Portage—Lisgar, MB

Mr. Chair, I'm very happy to be here today. The last time I was here at this committee, I was actually sitting in the chair's position, so it's interesting being across the way. It's a pleasure to be here. Thank you so much for inviting us.

As you know, I work very closely with Minister Kenney on the social development side of our portfolio, and I'm very proud of what we have accomplished so far. Today I want to focus my remarks on the considerable progress we've made when it comes to combatting homelessness and on the investments we've made.

First of all, however, I do want to take a couple of minutes to outline our investments when it comes to ensuring affordable housing for Canadians. These investments are made through the Canada Mortgage and Housing Corporation, CMHC. CMHC estimates budgetary expenditures of $2.1 billion in 2014-15 for housing-related initiatives. This funding supports close to 600,000 households living in existing social housing, as well as the investment in affordable housing initiative, also known as IAH, to help Canadians.

The IAH bilateral agreements with the provinces and territories recognize the diverse housing needs of Canadians while also recognizing jurisdictional issues. Provinces and territories are best positioned to allocate the investments, for example, these initiatives, to meet their local needs and priorities, and we've given them very broad parameters that include new construction, renovation, home ownership assistance, rent supplements, and shelter allowances.

Economic action plan 2013 announced our commitment to working with the provinces and territories by investing more than $1.5 billion nationally over five years to extend the IAH. From April 2011 to December 2013, the IAH helped more than 177,500 households across Canada.

As you can see, our investments are making a difference, and they continue to, which is why we renewed our investment. In fact, about a month ago, I was very pleased to be in British Columbia to sign the investment with Minister Coleman for $300 million. When I was in Prince Edward Island, we signed our agreement with P.E.I. for $14 million. We just recently announced in New Brunswick an additional $78 million. I'm leaving for Edmonton later on today, and I'm looking forward to making an announcement tomorrow.

We're making real progress in terms of the investment in affordable housing agreements with the provinces. We're seeing a very positive response from them. Each province has a very different way of addressing issues of affordable housing.

I want to turn my efforts now to talking about what we're doing to combat homelessness. Just over two weeks ago, I joined the Mental Health Commission of Canada for the official release of the final results of the At Home/Chez Soi project. This was the largest study of its kind, looking at how using a housing first approach can reduce homelessness. Many of you, I think, are probably familiar with the approach. I think you know that it represents a departure from more traditional approaches.

Up until this point, the most common way of dealing with homelessness has been through more of a crisis-based model, so it's been very reactive, not just in Canada but in many developed countries. This model involves relying heavily on shelters and other emergency-based interventions. Typically, these individuals must first participate in a series of treatments and demonstrate sobriety before they are offered housing. This approach has been costly and not effective for the long term. It's pretty easy to see how with that kind of instability it's much more difficult to participate in treatment programs and to manage mental and physical health issues. As you can imagine, for individuals who spend a night in a shelter and then leave that shelter but have to stay very close to it so they know they'll have a place to stay later on that night, it becomes virtually impossible to go out and try to get treatment for an addiction or a mental illness, or to try to look for a job or advance their lives in any way, because they are tied to that shelter. It's pretty much common sense, but now the evidence shows that the housing first approach works.

With regard to cost, homelessness takes a tremendous toll on our economy and social services in terms of emergency housing, hospitalization, shelters, prisons, and a host of other crisis services.

The housing first strategy, on the other hand, involves ensuring the individual has immediate housing before providing the necessary supports to help them stabilize their lives.

Back in 2008 we knew this approach showed great promise and we knew it was something worth looking into, so that year, under the leadership of Prime Minister Stephen Harper, we invested $110 million in the Mental Health Commission of Canada's landmark study on this issue.

We believe the evidence is overwhelming. We have heard some skepticism and opposition from the opposition, but I'm hoping, as they're looking at more and more of the evidence, we will all be able to come on board to support housing first.

We continue to invest in our HPS, homelessness partnering strategies, and we've renewed that investment. Thanks to the groundbreaking research from At Home/Chez Soi, we've been able to inform our policy direction moving forward. As policy direction, it's based on evidence. It's not a political decision. It's making smart investments so that we can see lasting results for probably the most vulnerable in our society. We're moving out of crisis mode in terms of managing homelessness and working towards eliminating it altogether.

As of April 1, we have officially begun the shift towards the housing first approach in our renewed homelessness partnering strategy. We have also built in flexibility so that smaller communities who may not have the resources don't have to move to a full housing first model. They can incorporate such things as shelters and transition housing. We're looking at the larger communities that we are funding to have a majority of their programs go towards housing first, but we believe it's important that this flexibility be there and that programs transition into a housing first model.

We've committed stable funding over five years at the same level to ensure that communities can plan and successfully implement the housing first approach. The other positive part of our HPS is that community entities and communities themselves make decisions as to where the funding goes. It's not the federal government, bureaucrats, or politicians in Ottawa making these decisions; it's at the local community level, which makes it a very strong and effective program.

We know that housing first rapidly ends homelessness and leads to other positive outcomes for quality of life. It's a sound fiscal investment that can lead to significant cost savings, and when we look at the evidence, it does. We're proud of this investment. The evidence shows that for the housing first group, an average of 73% of participants were in stable housing at the end of the study, compared with 32% for the usual care group over the course of the study.

Mr. Chair, as I've said many times, we want to do more than just create safety nets. A comparison I use is that we want to create trampolines, places where people can go from a difficult position and get to a better position. Housing first, the evidence shows, supports that. I'm proud of these investments.

I appreciate your support. I look forward to answering members' questions. Thank you.

9 a.m.

Conservative

The Chair Conservative Phil McColeman

Thank you, Minister.

We'll move on to the first round of questioning, the five-minute round.

I would just note to members of the committee that on today's agenda, under the orders of the day, there are two areas under the main estimates that actually will be addressed by Minister Leitch on May 15. Those are the Canada Industrial Relations Board, as listed, and also the Canadian Centre for Occupational Health and Safety. Those two areas will be dealt with by Minister Leitch coming to committee, so it's appropriate to direct your questions in the main estimates on the other two areas as listed.

Ms. Sims, you have five minutes.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

I really want to thank the minister for giving us two hours of his time today; well, both the ministers are. That's much appreciated.

Minister, the Alberta Federation of Labour has obtained documents showing that your department issued hundreds of LMOs in Alberta alone for well below the prevailing wage. This is a fact. We know it happened. Why were these employers granted LMOs when they were clearly breaking the rules?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

Employers who are clearly breaking the rules are not granted LMOs.

I don't know about the particular allegations to which you refer. It's possible, or I'll speculate, that you're referring to LMOs that were issued between April 2012 and April 2013, during which time we had instituted on a trial basis the flexibility to allow employers to pay 5% less than the median prevailing wage rate in low-skilled occupations, and 15% less than the median prevailing wage rate in high-skilled sectors, if and only if, Canadians in the same job at the same employer were getting paid at that level. Because the median is higher than the starting wage, this was an effort to stop the aberration of temporary foreign workers getting paid more than Canadians.

It may have been as a result of that, but as you know, we suspended that practice in 2013. Only 5% of employers have actually used that flexibility.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Thank you.

Are you going to make sure that each and every one of these employers is now paying the prevailing wage?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

Yes.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Are you going to make sure that TFWs receive back pay if they have not been paid according to the law?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

I hesitate because I'm wondering if it would be the responsibility of the provincial labour ministries if people have been underpaid. There's an overlap of responsibility with respect to workforce standards, of course. For example, provinces have to make sure people are getting paid the minimum wage.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

I realize there is an overlap, but would you then stop giving these employers LMOs?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

Oh, no, absolutely not.

Let's be clear. If we had evidence that an employer had paid less than the wage they're obliged to pay in the LMO, we would add them to the black list, which would preclude them from participating in the TFW program in the future. We would also look at other penalties, depending on the gravity of the situation, the potential criminal sanctions that exist for both summary and indictable offences in IRPA.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Thank you.

There are a couple of questions on the order paper asking, among other things, about the number of staff assigned to ensure employers are complying with the rules of the temporary foreign worker program as well as where these employers are, and how many, but we haven't received an answer. Will you commit to submitting the answers to those questions to this committee?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

Yes, if we are legally able to do so.... Just to be clear, there are some things, as I mentioned in the House the other day, which are subject to the Privacy Act; for example, particular names of applicants are subject to the Privacy Act. But in terms of statistics, yes absolutely....

I understand that the order paper question to which you refer is actually something like 45 questions which required thousands of documents so it could not be produced overnight. I do commit to getting that to you as quickly as reasonably possible.

9:05 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Thank you, Minister, because it's really important for us to have that information so we can take a look at what is really happening and get down to dealing with actual facts rather than a lot of other information.

I know you're new to this department, but you're certainly not new to this file because in our other roles we sat in similar spots. When was it that you yourself first figured out that the temporary foreign worker program was being abused?

9:05 a.m.

Conservative

Jason Kenney Conservative Calgary Southeast, AB

I have heard of reports, allegations, and rumours of abuse as long as I've known about the program, like we all have. To answer your question, I think my earliest impressions even before I became minister of immigration was that there were some bad apples, some bad employers, but that most employers try to follow the rules.

9:10 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Thank you, Minister.

9:10 a.m.

Conservative

The Chair Conservative Phil McColeman

That's the five minutes. It does go quickly, I know.

9:10 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

I thought I had seven.

9:10 a.m.

Conservative

The Chair Conservative Phil McColeman

No, they're five-minute rounds.

9:10 a.m.

NDP

Jinny Sims NDP Newton—North Delta, BC

Thank you.

9:10 a.m.

Conservative

The Chair Conservative Phil McColeman

Mr. Armstrong, for five minutes.

9:10 a.m.

Conservative

Scott Armstrong Conservative Cumberland—Colchester—Musquodoboit Valley, NS

I thank both ministers for being here today, as well as staff.

Minister, you referred in your opening remarks to the success we've had recently with the negotiations with the provinces on the Canada job grant. Could you elaborate on that and let the committee know exactly where we stand now, how we got here, and where you see us going in the future?