Thanks for having me.
For the past 27 years, the Canadian Taxpayers Federation has been fighting across Canada for three fundamental principles: lower taxes, less waste, and more accountable government.
I want to thank the committee for inviting our organization to speak to you today. Over the last few weeks you've heard from many in Atlantic Canada who have outlined the problems all too well. Our population has declined; we are aging, and the cost to provide public services is becoming unaffordable. The solution that many have put forward is to find ways to bring as many new immigrants to the region as possible. This is a laudable goal, but it won't work in isolation from other changes.
Consider this. Between 2011 and 2016 over 31,000 more Atlantic Canadians have packed up and moved to other provinces in Canada than have moved into the region. Here's the problem: if we can't keep native-born workers who have roots here at home, how will we ever retain newcomers who are mobile and can find better opportunities in other parts of Canada? Of course we won't. It's all about the economy, and the Atlantic economy is failing under high taxes, excessive regulations, a failure to explore our natural resources, and costly bureaucracy.
Fix the economy and we can attract thousands home, as well as others from around the world. We are not economically depressed because of our geography or because we possess a culture of defeat. No, it's because the economic policies promoted by the Atlantic provinces and Ottawa, sometimes with the best of intentions, have failed to deliver the results they were intended to. Let me tell you a story about what I mean.
In this region, we have one of the highest unemployment rates. Our young people are moving west because they can't find good, well-paying jobs. At any one time, we have almost 100,000 people collecting employment insurance cheques, yet in this region, we are bringing temporary foreign workers into areas that already have lots of people without work. Why is this? The problem in part is created by a combination of the liberal use of the temporary foreign worker program and the abolishment of changes that tighten the employment insurance rules by both the Harper and Chrétien governments.
Fish plants and other businesses have responded to the labour shortages by demanding more temporary foreign workers. Most immigrants have a path to citizenship and enjoy the same economic freedoms as Canadians, including the right to accept a better-paying job. Temporary foreign workers have no similar bargaining power and are unable to climb the economic ladder. These workers have one option: to work for the company that sponsored them at the pay on offer or to return home.
Former New Brunswick Premier Frank McKenna came before this very committee and argued that TFWs needed a path to citizenship. I agree, but a temporary foreign worker on a path wouldn't be temporary and they would instead be like other immigrants. As it stands, the TFW program is un-Canadian. It is ill-liberal and immoral because it creates a permanent underclass of workers.
The TFW policy also drives down wages and causes more people who are looking for decent paycheques to move to central and western Canada, exacerbating the problems that exist. This in turn reinforces the argument that some Atlantic employers say they cannot find enough local workers, and it increases pressure on Ottawa to further increase the number of TFWs.
The solution is obvious. If workers aren't willing to work for the pay that companies offer, companies need to raise wages and pay a fair wage. It's time we prioritized jobs for Canadians and tightened the rules for temporary foreign workers. This would force companies that right now aren't paying a decent wage to increase their salaries to a true market rate. This would result in more unemployed Canadians being attracted to do the work and earning a decent paycheque doing it.
There are other parts to this. The government should look for ways to incentivize work and to get people off EI. The Liberal government eliminated the requirement for frequent and repeat EI claimants to accept work at slightly less pay and to consider marginally longer commutes to work. These changes were put in place to reverse the growing shortage of workers in areas of the country with high unemployment rates.
Unemployed Canadian workers have choices. They can work for low wages that are kept low by TFW policy, work elsewhere, or work for a few weeks a year and collect EI. In effect, companies are competing with the EI program in order to convince people to come in. Fixing EI is where Ottawa should focus its policy reforms, instead of making it easier to bring in TFWs.
Finally, we need to grow our economy. Our region is uncompetitive when it comes to taxes. An individual in Nova Scotia, for example, earning about $60,000 a year pays $1,500 more in income tax alone than the national average, not to mention the region has some of the highest sales taxes, corporate taxes and other fees.
In summary, there are three recommendations from our organization.
One, tighten the rules for permitting temporary foreign workers in areas of high unemployment. This policy would force companies to raise their pay and do more to hire unemployed Canadians who are currently collecting EI.
Two, as former Liberal Premier Frank McKenna said, reform the employment insurance program, and reinstate reforms by previous governments, both Liberal and Conservative, to encourage frequent EI users to transition back to the labour force. It's all about the economy. We need to promote pro-growth strategies that lower taxes and grow the economy. People don't leave home when they have jobs and opportunity. Solving Atlantic Canada's demographic problems with immigration is just part of the solution—