Human Resources Committee on March 23rd, 2021

[Pierre Laliberté]

I would say fairly shortly.

[Sean Casey, Liberal, Charlottetown, PE]

Thank you.

[The Vice-Chair, Bloc, Louise Chabot]

Thank you, Mr. Casey and Mr. Laliberté.

[The Chair, Liberal, Sean Casey]

I imagine that Ms. Chabot would like to speak again. I will therefore get back into the chair and yield the floor to her.

Ms. Chabot, you have the floor for six minutes.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Thank you, Mr. Chair.

I thank our witnesses.

Mr. Laliberté, I want to begin by thanking you for your testimony. The employment insurance commission plays a fairly important role in the administration and governance of our system. I also want to thank you for mentioning some of the avenues that can be considered to strengthen the employment insurance system, such as the number of weeks, the benefit rate, or, if I understand correctly, the possibility of increasing the number of workers eligible for the system that they pay into, as we must not forget.

My next question is about something a little less known, but very important. Last year, the government committed to reviewing the employment insurance appeal mechanism. We forget that, in this system, decisions are made and appeals are undertaken. The appeal process has been hit hard by recent changes. The government had committed to reviewing this mechanism to return it to its original tripartite format.

I believe the commission has been asked to work on this or to provide input. I would like to know where things stand.

The unions and the organizations for the unemployed were really very happy to hear that the government was considering this change. However, they have told me that the approach may have moved a few steps back.

What do you know about that and what are you working on?

[Pierre Laliberté]

Thank you for the question, Ms. Chabot.

Since we are talking about the changes announced just before the last election campaign, I want to take this opportunity to acknowledge the work done on the matter by the former minister responsible, Jean-Yves Duclos. I hope his health has improved. With respect to the changes to the appeal system, we have Mr. Duclos to thank that the ball is now rolling on some things. As you suggested, the appeal system had become dysfunctional. Our government was committed to restoring tripartism to the first level of appeal and to making the commission responsible for the process.

Unfortunately, that's not quite what we have been working on since then. The department has us working on a new mechanism, which would indeed include participation from representatives of employers and workers, but would ultimately report back to the Deputy Minister. In our view, and I think you would agree, that's not quite what had been asked for. In our opinion, it's important that the commission oversee accountability. I will tell you specifically why.

When the Social Security Tribunal of Canada was created, it was an independent structure that needed to report to no one. When the structure became dysfunctional, unemployed Canadian workers or groups of workers could only end up on the sidelines when they had complaints. It was absolutely impossible for the commission to hold anyone accountable. We do not wish to return to that situation.

However, we have been successful in making our concerns known. I say “our concerns” because I include the former employer representative at the commission. We are making the case that it's a significant deficiency. The COVID-19 pandemic has not helped us implement this new structure. We hope to be heard clearly enough to implement the changes in the right way.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

It certainly is a concern for groups representing workers. They have also informed Minister Qualtrough of it. They didn't understand why, between the commitment, which was well received, and the new slant being taken, the direction seems to have changed. Nor is it clear why the change happened. In any event, you are confirming that work will continue and that we can hope to return to the commitment that was originally made.

[Pierre Laliberté]

That is indeed what we are hoping for.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

People are very concerned about the two-zone issue in Prince Edward Island. Our committee Chair, Mr. Casey, asked you some questions about it.

However, there are also major concerns with respect to workers in the seasonal industry. We know that the government has pilot programs in place in several regions. It had committed to extending and improving them, but they have only been extended.

I don't know if the commission is studying this aspect of employment insurance inequities—the good old black hole—or if you have any solutions, but the goal is to eliminate it.

Considering that the economy in the regions relies on seasonal industries, their realities must be taken into account in the plan. Isn't that right?

[The Chair, Liberal, Sean Casey]

I would ask you to keep your answer brief, Mr. Laliberté.

[Pierre Laliberté]

We do have the pilot program results, which have been largely positive for those affected. We're hoping that some of the inadequate conditions will be improved.

If I'm asked, I will gladly come back to this.

[The Chair, Liberal, Sean Casey]

Thank you, Mr. Laliberté.

Thank you, Ms. Chabot.

Next is Ms. Gazan, please, for six minutes.

[Leah Gazan, NDP, Winnipeg Centre, MB]

Thank you, Chair.

My questions are for Professor Forget.

In your recent research about poverty and income security in the wake of the COVID-19 pandemic, you highlight pre-pandemic trends in the economy, things like a polarization of precarious and low-income work in the labour market, rising consumer debt levels and income insecurity, and ineffective income assistance programs. We've certainly heard the many problems with the current EI system today.

When the pandemic struck, these trends were made worse, certainly highlighted predominantly with BIPOC and disabled people who were forced into low-income and often precarious work, or even deeper levels of poverty. You've written that these trends highlight how poorly existing social programs, especially EI and provincial income assistance, address poverty and income insecurity.

Can you tell us why that's the case, and what changes are needed to improve EI?

[Dr. Evelyn Forget]

I think that EI is intended primarily to concern itself with maintaining a commitment to the workforce. The difficulty, when we're dealing with very low-income workers and precarious workers, is that we don't have that regularity of commitment. For example, when COVID came along, we saw that many people simply didn't have enough hours to qualify under the standard EI definitions, and hence many of them received support through the CERB.

These workers take a number of forms. I just heard from a musicians organization in Toronto this morning that 91% of their members didn't receive EI during the pandemic, and 65% of them received at least some support through CERB. People who work in non-standard jobs simply don't fit into the kinds of restrictions that are built into the system. We've just heard about it in terms of seasonal workers.

Trying to modify the EI system in order to bring all of these non-standard workers into the fold makes it more and more difficult to meet the needs of workers in standardized jobs who need to see increases in the level of support that they receive. If they leave aside the EI program and turn to provincial income assistance, those programs are, at the same time, encumbered with a number of barriers that make it very difficult to leave that system and move into the workforce.

I think we need a system that facilitates that transition in and out of the workforce for people who, for one reason or another, are going to work that way and continue to work that way. Sometimes it's the result of—

[Leah Gazan, NDP, Winnipeg Centre, MB]

Sorry, I have two other follow-up questions that are really critical.

Can you tell us why a guaranteed livable basic income is an effective mechanism for poverty eradication and income security, and how it can work well with EI? Change is difficult. You know I'm a big fan of guaranteed income. Can you explain how it can work well with EI?

[Dr. Evelyn Forget]

EI can work extremely well for some people, and as long as it works as a social insurance system there's no reason to talk about replacing it. We can transform that system to make it work for the people for whom it works.

I think that a basic income captures those people who simply don't work enough hours, or don't work regularly enough to qualify for the system without forcing them onto provincial income assistance.

[Leah Gazan, NDP, Winnipeg Centre, MB]

Finally, of course there are critics of guaranteed livable basic income and its feasibility, especially funding such a program along with other social programs. I often refer to the high cost of poverty. It is a program that pays for itself. Can you tell us why guaranteed livable basic income is feasible, and how is it feasible?

[Dr. Evelyn Forget]

In terms of the funding, I think we've seen two reports from the Parliamentary Budget Officer, one of which was conducted in 2018 during a normal year with normal levels of unemployment. The net cost of the program, rolling into it a number of other cash support payments from the federal government, was $43 billion, which means that it would have cost $23 billion a year more than we're currently spending. We're currently delivering through provincial and territorial income assistance.

When they repeated that exercise this year, of course the numbers were much higher because unemployment rates were much higher, hours of work were much lower, and the needs were greater.

One of the benefits of a basic income is that it is an automatic stabilizer. It automatically expands to meet the needs when [Technical difficulty—Editor] things like the pandemic, when transitions occur either in the economy or in individual lives. I think we can see that it's not coming in at an outrageously expensive amount of money. It's an expensive social program, but certainly within the capacity of a country like Canada to afford.

You touched on the other issue, and that is the downstream cost of poverty. It's something we pay very little attention to, but I think the final report of the commission on missing and murdered indigenous women pointed out that 80% of indigenous women are incarcerated for poverty-related crimes. Certainly the work I've done on health care shows that there are substantial savings in hospitalization and in other areas of health care when communities are offered a basic income.

If we look at basic income as an investment rather than a cost, then we can start talking about those returns, both financial and personal returns on investment.

[The Chair, Liberal, Sean Casey]

Thank you, Dr. Forget; thank you, Ms. Gazan.

Next, we have Mr. Tochor, please, for five minutes.

[Corey Tochor, Conservative, Saskatoon—University, SK]

Thank you very much.

Mr. Laliberté, it's shocking to hear your forecast that the employment fund is going to be in a $25-billion deficit. How do you think that deficit is going to get replenished?

[Pierre Laliberté]

I'm talking about a situation here that will come to be at the end of 2022, notwithstanding. We're in a period of extraordinary circumstances, and it is certainly our hope that as general revenues recover the red ink, last year's installment will also be the case for the next couple of years.

[Corey Tochor, Conservative, Saskatoon—University, SK]

It's not from EI premiums, though. You're saying the government is going to backstop it. Maybe that happened last year, but we don't know because we didn't have a budget last year to confirm.

[Pierre Laliberté]

No, it's being backstopped. There was an infusion of about $35 billion or $39 billion. It was done, and we're quite grateful for this because, quite frankly, the program cannot sustain that kind of—

[Corey Tochor, Conservative, Saskatoon—University, SK]

I appreciate that. I'm just going to be short on time here, Mr. Laliberté. I have a couple of other, different questions along that vein.

The Conservatives, like all parliamentarians, voted to help families with the ability to provide for their families because their livelihoods have been restricted because of the pandemic. Everyone voted for that. Everyone agrees that that's a role for government. It's the extra charges and how we get out of this that I'm kind of preoccupied with.

I'm kind of surprised today that we haven't talked about.... We talked about benefits under the program of just either weeks or real dollars out to people, but we haven't talked about how we actually improve employment opportunities for people. That's a big question economy-wise. How do you have the right policies in place to encourage a growing economy? Ultimately, that is what helps people get out of poverty, and the dignity and the virtue of work are a passion of mine that I believe cures a lot of ailments in our society.

In what ways can we improve the current program so that it helps these individuals find better employment after their benefits run out or during that time period? How do we make a better, more efficient system?

[Pierre Laliberté]

As you may know, part II of the EI program is entirely geared to labour market programming. That essentially does what you're describing: providing skills training, subsidizing people who want to start a business, engaging in job partnership programs. For the most part, the results of this...and that's documented if you go into any of the monitoring and assessment reports that we release every year; each province reports back their result. There are some very meticulous and sophisticated studies that have been done to measure the impact, and it's positive.

Basically, when I say it's positive, I mean that for every dollar you invest, you get more, tax-wise. We need more of that. We need more of—