Evidence of meeting #47 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.) The winning word was enterprise.
A recording is available from Parliament.
Senior Research Officer, Canadian Union of Public Employees
No, but I do have the names of three experts in England that I'd like to share with you, if you indeed decide to go. We've been corresponding with experts on this in England and we would be happy to provide you with these names.
Conservative
Conservative
Colin Mayes Conservative Okanagan—Shuswap, BC
Thank you, Mr. Chair.
Thank you to the witnesses for being here.
I just want to follow up a bit on what Rodger has said about how everything we heard from you was negative, while at the last meeting we heard a lot of positive things. In one instance, one of the witnesses earlier this week said that they had partnered with a group. Part of the mandate was that they had to hire people with disabilities, up to I think 20%, and if they did that, they had a lower interest rate on the capital that was provided for the enterprise. Also, of course, there's I think a social return on that.
The social bonds are one issue, but social finance in the larger picture is to try to see if, between the private sector and possibly the public sector, we can have the return be the social value of the investment. Affordable housing is a good example, where maybe the government would provide money, interest free, to a developer and a municipality would waive the development cost charges or whatever to provide lower-cost housing to people who can't afford the housing market currently.
I guess my question, then, is a kind of challenge to you. What has a union done in helping to deal with social issues within the context of what you do in the labour market? Have you helped fund the hiring of people with disabilities? Have you assisted in projects that have value to the general workplace and that type of thing? That's—
Conservative
The Chair Conservative Phil McColeman
I'm going to intervene. I think you're off topic here. I'm not certain that they came to answer questions about their union and what their practices are.
If it deals with social finance, I'm fine with the question. But you're not asking if they're into social finance or not, Mr. Mayes, so I'm just cautioning you. I want to keep this on track. I don't want it to turn into something that's outside the realm of our study.
Conservative
Colin Mayes Conservative Okanagan—Shuswap, BC
Thank you, Mr. Chair. I agree. I take your caution.
The point I'm trying to make is about return on investment. Mr. McNeill, you said that every time somebody invests, they expect a return on their investment. Well, that return doesn't necessarily need to be financial. A return can be the fact that it has a benefit to the general...because not every person who invests is looking at the financial return. There are many people...and we just had a visitor to Ottawa here, Mr. Gates, who has extended over $65 billion to causes throughout the world.
I think it's important to put it in context. We're looking at this as a way that people can have the ability to feel that they're contributing, that they have a sense of helping their fellow man in whatever way. Those are the successes that we've heard. I don't think the intent would ever be to try to undermine the return or make it more costly for service delivery for the Government of Canada or any other level of government.
I'll get to a question here. Looking at social finance, other than the bonds, could you give me examples of where there's a possibility that we could embrace this in a way that would benefit the possibility of getting a social return?
National Representative, National Union of Public and General Employees
As mentioned, for community economic development there's a lot of potential. On the idea of something to encourage people to invest in a business that hires people with disabilities, an example comes to mind from Manitoba, where there is a business that specializes in installing geothermal heating systems on reserves to help people living on reserves reduce costs, but it's also providing skills training to people living on the reserves.
All of those make complete sense.
Conservative
The Chair Conservative Phil McColeman
Thank you very much. That's the end of that five minutes.
Madam Groguhé, you have five minutes.
NDP
Sadia Groguhé NDP Saint-Lambert, QC
Thank you, Mr. Chair.
My question is for Ms. Young.
You talked about the risk of linking the pay-for-performance model to impact bonds. You also said that the government will have to pay for service provision, implementation and evaluation.
Could you tell us what we could expect from that system? What will be the impact of that?
Senior Research Officer, Canadian Union of Public Employees
I'll use a concrete example of employment services for people who are on welfare. That's a common example. What happens is that companies such as Jobs Now and others tend to accept only people who have been unemployed for less than a certain period of time. They don't take the long-term unemployed as their clients. For example, in British Columbia I think it was that they wouldn't take anyone who had been on welfare for more than six months. However, people who are on welfare long term still need service if you want to get them active in their communities and get them employed. Somebody has to provide that service. But it's not seen as profitable for the private companies, so they don't provide that service.
If you still have the goal, if you want to provide employment services to help people be in their communities and make a living wage, you still have to provide that service. You're almost double-doing it, and the private company is taking the easy cases—they call it cream-skimming. The hard-to-serve cases are left to the public sector. Those are the most expensive cases, so it makes it difficult for the public sector, which has the responsibility to provide service to the most difficult cases.
NDP
Sadia Groguhé NDP Saint-Lambert, QC
Okay, thank you.
However, you are hinting at the limits of the model. But, in your view, what types of social problems should we focus the social finance on?
Senior Research Officer, Canadian Union of Public Employees
It's an interesting question.
Maybe small community economic development, as Andrew said. What I tend to look at when I'm looking at social finance is what safeguards there would be to make sure our worst fears would be less likely to happen. I'd be more interested in making sure there's a limit on the profit to be made; that there's a level of transparency; that the government actually has to get involved in the policy and the measures, and not the accounting companies, such as Deloitte; and that tests be set up to see whether, in fact, this is true or not.
When the Ontario government set up this test to compare employment services, I thought they were skeptical about what we said. When the results came back, that many years later, after doing a controlled study, it was interesting to see that, in fact, it was done just as well by the public sector, and it actually didn't cost as much.
National Representative, National Union of Public and General Employees
I tend to agree that in terms of employment through programs to create jobs through economic development, social finance is probably a lot more effective than other measures that have been used. Where I would be very leery is where you're using social finance to fund public services. That's just because the experience so far has shown that as soon as you get into that, there are going to be increased costs.
Conservative
Conservative
Brad Butt Conservative Mississauga—Streetsville, ON
Thank you very much for being here.
I just want to get on the record that your testimony today is not that all social finance is bad. That is not your testimony today, correct?
National Representative, National Union of Public and General Employees
I, at least, and I think Margot as well, am very specifically focusing on the problems with using social finance for public services. As mentioned, social finance for community economic development has a lot of potential.
Conservative
Brad Butt Conservative Mississauga—Streetsville, ON
Okay.
One of the things I do know about the unions is that they've been excellent supporters of the United Way across the country. United Way is really a social finance model. It leverages the private sector. They get donations in from the private sector. They get unions that contribute. Employees contribute. Communities benefit. The United Way is really, in my opinion, one of the best examples of social finance that we see in this country.
I'm assuming your testimony today is that you don't support the United Way?
Senior Research Officer, Canadian Union of Public Employees
That's just charity; that's not social finance.
Conservative
Brad Butt Conservative Mississauga—Streetsville, ON
Sure it's social finance. Social finance doesn't necessarily mean there's an economic profit at the end of the day. Social finance comes—
Conservative
NDP
Sadia Groguhé NDP Saint-Lambert, QC
Mr. Chair, our role is not to accuse our witnesses, but to ask them questions so that they share their viewpoints with us. As a result, I don't think that Mr. Butt's method is the most appropriate in the circumstances.
Conservative
