Thanks very much.
I thought I'd work to put some of the information that Ted shared in context and help you to determine what you, as parliamentarians, can do--and more importantly often not do--in order to help the situation.
I wanted to share with you--if you look at the top of page 3 of our presentation--the top graph on the small business priorities. I had mentioned to you that, no surprise, the total tax burden that faces Canadian entrepreneurs still seems to be very much stuck at the top of that list.
Some issues have changed, some have not. Regulation and paper burden is the second-highest priority issue on that list. Debt and deficit, though, has been rising. No surprise there. Employment insurance has been stable. I'll speak about that in a moment. One thing that has dropped is the concern over the shortage of labour.
Still, I wanted to draw your attention to the fact that 40% of Canadian small and medium-sized businesses are telling us that they still struggle to find the qualified labour that they need to put their products and services to market. I'll speak about that a little bit more at my conclusion.
In regard to employment insurance, I did want to talk to you a little bit about this, because this is a huge concern on the part of small-business owners at this time. This next chart on the bottom part of page 3 outlines that payroll-based taxes--EI, CPP, workers' compensation premiums--are the most harmful form of taxation that is imposed by different levels of government. Employment insurance carries with it some big, big worries for us right now. We very much supported the rate freeze that was introduced at the beginning of 2009. That was a fantastic measure on the part of government to ensure that at a very difficult time in our economic life cycle we did not see an increase in payroll-based taxes. It was very, very good news, and a huge compliment to the government for doing that.
Unfortunately, what we've discovered more recently is the government seems intent on requiring businesses to pay back the rate freeze that was enjoyed in 2009 and will be enjoyed in 2010. In fact, the entire cost of the increased usage of employment insurance is expected to be charged back to Canadian employers and employees come January 2011.
This will guarantee massive increases in payroll-based taxes at a very difficult point in our economy. Just as we are counting on small employers to hire more, to do more in job creation, and invest more in training, we are going to be hitting every employer and every employee with giant increases in payroll-based taxes and increases at the maximum level for years and years and years.
This is a real worry to us, especially when we put it in the light of the previous track record with employment insurance, where $57 billion was taken out of the employment insurance fund and put into general revenue and spent over the last number of years. That issue, of course, has happened over a couple of governments, not just one.
So we really need to see some leadership on the employment insurance front longer than this. There can be no communication that taxes have been kept frozen if we see large-scale increases in employment insurance. In fact, given the fact that $57 billion was taken out of the EI account, we feel that it is the obligation on the part of government to reinvest those dollars and put them back into the fund until that surplus has been repaid. Until that point in time, we hope that there will be no increases in our employers' or employees' premiums.
I will want to also speak to you quickly about regulation and paper burden. There is some real progress that has been made on that front. Again, I offer huge congratulations for the leadership that has been shown over the last couple of years with respect to achieving a 20% reduction in paper burden for small and medium-sized businesses. Some meaningful changes have been made on that front.
More needs to be done, certainly. We are coming up with a new research project on this, a sequel to our “Rated R” report, which spoke about the $30-billion cost of regulation to small and medium-sized businesses. We think that there is the need to institutionalize this process and to ensure that we continue to have ongoing metrics to measure how we're doing on that very important front.
The government has two very important powers: taxing and spending, and regulating and passing laws. We have some rules in place and some measures in place on the taxing and spending side, albeit with some failings, but at the same time, we need to do a lot more on the whole issue of regulation and its impact on small and medium-sized firms.
I wanted to just touch on a couple of other small things in my concluding comments here.
Again, I offer big, big congratulations to Minister Flaherty and the government for helping us address one of the most gripping issues that we've been challenged with over the past year, and that is rising credit card fees. The changes that have been put in place, the proposals that have been made with respect to a voluntary code of conduct, we feel will be a fantastic measure and will help small and medium-sized businesses from coast to coast in dealing with this very tricky issue and the threat to our debit card system in Canada.
I mentioned briefly demographic challenges leading to labour shortages. We can't take our eye off that ball. We need to continue to ensure that we have a vibrant, permanent temporary immigration program to allow us to address these labour shortages that many employers still are facing.
Internal trade barriers are still a significant issue. I was in Yukon, meeting with ministers of internal trade on that very front. A lot of progress is needed there.
For purposes of this committee, also looking at any help you can give us on access to broadband Internet and in terms of challenging the CRTC decision with Telus and Bell in allowing them to charge whatever the market would bear would be of help to us on that front.
As one final note, in terms of labour legislation, one bill, Bill C-386, is a huge worry to small and medium-sized businesses. A ban on replacement workers at this point in the economy would be absolutely devastating, and I don't think any politician who would consider himself or herself to be a friend of small business could possibly support a bill such as this.
Thank you.