Evidence of meeting #4 for Status of Women in the 40th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was jobs.
A recording is available from Parliament.
Liberal
Anita Neville Liberal Winnipeg South Centre, MB
The government has recommended the extension of the EI benefits by five weeks. I wonder if you can comment as to whether that is the appropriate way to go to meet the needs of women, or whether there are other approaches that might have been taken.
Prof. Kathleen Lahey
I would say that it is something that definitely should happen. Canada does not have a long enough benefit period. But for women who are now disproportionately excluded from the employment insurance system, even though they may pay into it for much of their working lives, it's still excluding them. Five extra weeks that will not go to someone does not help the person it doesn't go to.
What's so interesting is that there is also a rider that says that people who would have been out of the paid workforce for a very long time—for example, someone who has been staying home and taking care of children for more than a year, for maybe two years or three years—that will be treated as a special situation that needs particular help, but not for the average woman who is excluded systemically year after year.
Bloc
Johanne Deschamps Bloc Laurentides—Labelle, QC
Ladies, first allow me to greet you and thank you once more. You are practically turning into regulars at our committee. It is our great pleasure to welcome you because we are the richer for the work, the research, the insight and the data that you bring us. It is our hope, of course, that it can all lead to something. We have looked into a number of matters, including women's economic security. You have been of great help to us because of your documentation and your contribution as witnesses.
You were telling us about social development again. You said that Canada has dropped a lot in the last ten years. Canada is no longer in first place in social development and in gender equality. What place was it? Thirty-third?
Senior Economist, Canadian Centre for Policy Alternatives
She is saying 83rd in some.... I think it's about 33, isn't it? Thirty-third place in—
Bloc
Johanne Deschamps Bloc Laurentides—Labelle, QC
Thirty-third. Whatever; Canada at that level is a dramatic drop.
You do not have to convince me; I am already convinced. My colleague and I are working hard to criticize the program, which is an obstacle preventing women from achieving equality. I did the rounds introducing a bill that was rejected because they said it needed royal recommendation. I find that response discriminatory too because the bill reflected a reality, an even greater inequality between men and women in terms of accessibility to Employment Insurance. Once more, for financial reasons, there is a refusal to improve the situation and the lot of women. In a society like ours, I find that an outrage. We are going to reapply and introduce a similar bill again.
I have just come back from a parliamentary visit to Algeria and Tunisia. I was very impressed, especially in Tunisia, to see the advances that women have made in only a few years. The governments recognize gender equality and have written it into their constitutions. Perhaps the reality is somewhat different, but the fact of recognizing the principle in itself is a greater beginning than we have here.
People talk a lot about how reprehensible this program is because women are at a disadvantage compared to men. One question about pay equity concerns me greatly and I really want to ask you about it. Statistics prove that, in general, women in Canada are already at a disadvantage and earn less. They want this principle left to collective bargaining. I would very much like to know your position.
Prof. Kathleen Lahey
I think it is one of several key pieces that are all going in the same direction: watering down or eliminating pay equity at the same time as changes to employment insurance and adequate child care are introduced. All these things need to be changed. It's almost as if there's a list of things that have been accomplished for women in Canada and somebody is working down that list.
The pay equity provision is heartbreaking, and it should be taken out. Pay equity should be made a very high priority. That's my considered opinion.
Senior Economist, Canadian Centre for Policy Alternatives
We're here to discuss employment insurance today, but it is very challenging to ignore the tone that has been set in this response, and I say this with due respect. There has been a response from government to the economic stimulus that is required by the nation at this time, and abolishing pay equity had no place in that package. It was a non sequitur that should not have featured in this budget, and I would argue that it should never have featured as a government initiative implying that government believes that any strength comes purely from bargaining. We know that government has to be an arbiter of unequal bargaining strength and that women have fought for decades to guarantee a legislated level playing field.
But quite apart from the pay equity question is what we can do right now, outside of a legislative context, to improve access to a system that women and men and families and individuals have desperate need of. We are going to face a deluge of job losses in the next few months and the system is not prepared for this, and there is due blame to go around this room as to why the system is this way. It was both Conservative and Liberal cuts in the early 1990s that shrank access to the point where.... In the 1970s, when somebody was unemployed and the unemployment rate was 8% to 9%, the entrance requirements, if you were to convert them into hours, were 100-and-some hours. By the recession in the 1980s, it was 200-and-some hours, and now it's over 500. We know how to change it so that people can have some degree of protection.
May I just say, this is not just about justice and equity and all of those laudable things; it's about economics, because if you continue to let purchasing power go into a free fall at this point, if you just stand back and say, well, we'll do a little bit of infrastructure here and we'll do a little bit of this and that there—which is necessary—it will not be sufficient to fill the breach of what is going to be happening with the contraction of the private sector. If you look at recessions over the last seven decades, the scale of what is about to hit us requires massive offsetting momentum, and when you do things like pay equity and ignoring the changes that have happened to EI, there's no offset to the system, there's no way of preventing the free fall of purchasing power in too many households. This is not about fair mindedness; this is about preventing the recession from getting deeper and longer than it needs to be, which will bring in its sweep millions of households. I'm not overstating this.
Conservative
Candice Bergen Conservative Portage—Lisgar, MB
Thank you, Madam Chair.
I just want to take this opportunity to thank all of our witnesses for coming today. As a new member of Parliament, I appreciate that you took the time. As a new member of this committee, I realize that many of the issues that we're talking about have been studied previously, but there's always more work to do. With the economic hardships that we are experiencing, it is very important to look at all the issues.
Today, we have been mandated to deal specifically with the EI program. You did refer to the pay equity issue, and I accept your comments, but I respectfully disagree with you. I do believe that unions have a responsibility, and as a woman, I truly want to be treated equally. I want to make sure that if I was part of a union or part of a bargaining group that I would have the same treatment as my male counterpart in making sure that pay equity was achieved. That's just a side note.
I think as a government--and some of my honourable colleagues have been on the government side before--we definitely have a responsibility to balance programs and to assist individuals who are in need, both men and women, with responsible government. We have a responsibility to the taxpayer and to the private sector, which also bears a large burden for the general programs the government implements. We're also in an economic recession that is not of our doing, and you've referred to that as well, Madam. This is something that's hit us. I think we need to be responsible as a government so that we are not penalizing the private sector for something that is beyond their control. So as a government, as parliamentarians, and as advocates for women, how do we balance what we're doing as a government with helping people? I think that's what we truly want to find out and what we truly want to discover. Life is always about a balance, isn't it? That's our goal.
Ms. Lahey, one of your concerns is that the $2 billion this government announced in the budget for EI benefits tends to exclude women. That was your term, which is not too flattering, and it's not something that we really want to encourage. You specifically referred to the fact that, and I'll just read this:
New women workers who might qualify under these enhancements are those who have been staying at home for long periods of time with their children, not women who have merely taken maternity leave and then returned to non-qualifying work.
That struck me because many of the women in my riding are wives of producers and farmers who are going through very difficult times. Specifically, the livestock sector has been going through very difficult times over the last five years, even before the economic crisis hit. Many of these rural women--and I think I do speak on behalf of many rural women--focus on their family farm or their home, but they have to change focus and have to go back to work and get a job. Many times, though, they really want a job that is not overly demanding. They want to go to a job where they can put in their hours, but get back home and focus on what is most important to them. I see those new workers as being very different from, for example, a woman who has taken a full maternity benefit and then wants to go back to work. Do you see the difference between both of these workers, and do you acknowledge that we have provided...? You mentioned the 910.... We have reduced the amount of time that new workers have to put in before they collect EI, but I see a difference between new workers versus women who have taken maternity benefits and are entering the workforce. That's one of my first questions.
Liberal
Prof. Kathleen Lahey
I'll reply briefly to that. My colleague has some comments that she will also make in relation to this.
The workforce is highly diverse. Family forms are so numerous that they can't possibly be identified, and new ones are emerging all the time. The employment insurance system itself has a number of subprograms and seeks to fairly address the contingencies that arise in all of these different sectors.
But one of the hallmarks of responsible government action in this kind of situation is to focus on the most vulnerable. The most vulnerable are the people who have been so poor that they haven't been able to afford to take their full maternity leave, who have not been able to live in a family where, even together, the family has been able to take the full maternity leave, and whose incomes are so low that they don't qualify for any employment insurance at all.
So certainly there are specific situations where it might be nice to add a new fund to the employment insurance system to deal with situations such as those you describe, but the problem is that there's no systemic analysis that has preceded this kind of cherry-picking of groups in solutions. That's the problem.
Senior Economist, Canadian Centre for Policy Alternatives
I'd just like to say that while maternity issues are important, and while there is a whole host of different ways for the labour market to respond, we are facing an economic meltdown. So the farmers' wives you're talking about who are going to look for jobs may be bumped out of their jobs very quickly without sufficient hours, and people who are losing their jobs are not going to find other jobs.
The only way we are going to prevent this meltdown from pulling businesses down further with it and entering this downward spiral of insufficient aggregate demand because people don't have incomes, and the only way we're going to prevent people from saying they can't sell at these prices, shutting down their shops, and saying they can't produce at these prices and having to stop, is if you maintain purchasing power.
That is a downward spiral that can be avoided if you maintain purchasing power. Open up the door to EI now for everybody, for every circumstance, so that you can maintain a certain level of purchasing power in the system. That is my only comment.
When Henry Ford wanted to expand his market, he raised the wages of his workers so that they would buy stuff and grow the market. We can't raise wages now, but we can certainly prevent economic free fall in households.
Liberal
The Chair Liberal Hedy Fry
No, I'm sorry.
Ms. Mathyssen.
I'm sorry. I'm giving you guys a little bit of leeway, but I think you should remember that seven minutes is not a long time. If you could try to cut to the chase, we can get far more of your questions answered, because in the five-minute slot, you're not going to be doing very well.
I haven't started you yet, Irene. Go right ahead now.
NDP
Irene Mathyssen NDP London—Fanshawe, ON
Thank you, Madam Chair.
Thank you, Ms. Lahey and Ms. Yalnizyan. I appreciate your expertise.
As you've pointed out, we're at a crisis in terms of our economy. Things are bad now and they're going to get much, much worse.
This is an important study. What we're looking at, I think, is absolutely critical in terms of what's happening to people and to women.
What do you think we should include? What is absolutely essential as we go through this study in terms of what we need to look at?
Senior Economist, Canadian Centre for Policy Alternatives
You need to reduce the hours that trigger the entrance, make it uniform across the country, and let people in, even if it's only for two years as you've expanded the five weeks at the back end. Even if it's just for two years, do it now. Do it as fast as you can. Forget about the budget being passed. Start a whole other bill and start right now, because we don't have time to wait.
When you look at the statistics on how quickly unemployment jumps on top of a GDP decline, and when you look at the history of the last two or three recessions, this is coming at us like a freight train. We know what is about to happen and we are not prepared for the economic free fall.
Please work together to open up access. If that's all you do, it is something. In addition to that, a lot of people will not be able to survive on 55% of minimum wages of a part-time job. So expanding income support like the refundable GST tax credit is a remarkable way of making sure purchasing power goes to the people who spend all of it.
The IMF has said, if you are going to do economic stimulus in the form of income supports, any kind of tax reforms, any kind of new incomes, give it to the people at the bottom. Why? They spend it all. We have, starting in January 2009, a brand-new tax reform, the tax-free savings account. The benefits are going to accrue to people who are saving. Ladies, we have a crisis. We need people to spend, not save. Though it is prudent to save if you can, taxpayers should not be subsidizing the people who can afford to save at this moment, when we desperately need more purchasing power, more aggregate demand. It is an inappropriate way of distributing the scarce resources that we have at our disposal. That same amount of money devoted to increasing the incomes of people at the bottom means you get more purchasing power and in the local economy.
So there are lots of things that can be done, that can be done very quickly, but if you do not move with haste and with certitude that this is something that is going to actually support and stimulate the economy, we are going to be prolonging and deepening this recession far more than we need to. It's utterly preventable. That's the crazy part about this moment.
NDP
Irene Mathyssen NDP London—Fanshawe, ON
First of all, Ms. Yalnizyan, I want to come back to the chart you provided. There was a concern expressed with the delivery of Budget 2009 that $6 billion was set aside for tax cuts, and I think $1.2 billion was set aside to extend the EI period by five weeks. Your chart indicates that we could make significant reforms—a uniformed entrance, basing benefits on best 12 weeks, increased to 60%, etc.—and the cost would be $3.381 billion.
There will be those out there who say, “We can't afford this. We're in a recession. This is too great an expenditure.” Can you comment on your analysis and this chart and respond to that sentiment that this is too expensive in a time of recession?
Senior Economist, Canadian Centre for Policy Alternatives
I think we should remember that until 2008 the unemployment insurance account had nominally, notionally, a $54 billion surplus in it. When it was turned into a crown corporation, $2 billion of that amount was put in a reserve account, and we know that the official actuarials--I can't remember the title, but it's the same as the Auditor General--are indicating that in a downturn of the scale that we think we're facing, we're going to probably run a $10 billion to $15 billion deficit in that fund.
In truth, that $54 billion is not there. It has been given to tax cuts already and to other purposes of expenditures. So there's an opportunity to actually do something. There have been opportunity costs all along the line for the last decade to restore the cuts that were made in the early 1990s to the mid-1990s. Many people on this committee will have heard myself and others talking about how in the bad times the deficit was wrestled to the ground on the backs of the poor, particularly women, and in the good times that funding was never restored to the same program. So I don't need to say that again. But I will simply say that there have been choices made all along the line as to how to spend public resources and there are arguments to be made for tax cuts, debt reduction, and spending enhancements. Every government will choose its priorities in that way, but the truth is the money is there when you need it.
If you take a look at our economic history, as a nation we have decided what was needed to be done and we've done it, and then we've figured out how to pay for it--until we hit the 1990s, where the number one priority was to balance books. Since the early to mid-1990s, governments have been very much into accounting and accountability to not use more money than we have, but in fact we can raise money to do things that we think are a priority. We created unemployment insurance out of nothing because it needed to be there. We expanded it in the fifties; we expanded it again in the seventies. When we need it to be there we can do it, if that's our collective will. But it does require all of Parliament. It requires all of government to say, yes, we are going to move forward to protect people. I think that's the conversation we're at, Madame Mathyssen.
The alternative federal budget documents from which you're quoting are from a coalition of groups that are asking what it would take to stimulate, what it would take to actually bring us out of it. We started from a different starting point in saying we have a budget of x amount, so how would you do it? We started with the 2% of GDP stimulus that the IMF, the OECD, and everybody else around the world were saying we needed to have in concert, and that it was every bit as important to synchronize our stimulus as it was to sustain the financial system. This government moved very rapidly to work in concert with other partners to stabilize the financial system--and kudos--but when it came to the stimulus there was a good deal of hesitation all over the world; it isn't just Canada. There's been a good deal of “How should we do this?” What is true is that we all know the government must act, because the contraction of the private sector--households, banks, and businesses--is such that the only agent left to fill in that breach is government. If government does not act, and act strongly, we are just going to go into a protracted downward spell.
So we took the 2% that the IMF was saying we needed and we said, how many jobs can you create, what are the biggest multipliers for that package? Tax cuts did not feature because they don't create enough jobs. So we allocated it mostly in infrastructure, both green and looking forward, and in training and income supports. All of this not only sustains this period, but prepares us for the next phase of expansion, which is inevitable. We will come out of this period, and we are ill-prepared for the labour force problems we are facing in the next five to ten years, as my age group and others like me start to retire. We will not have enough teachers, doctors, and nurses, and we are not using this moment, which would be perfect to train them for that next step.
Liberal
The Chair Liberal Hedy Fry
Thank you. Your passion is remarkable indeed.
Now I would like to go to the second round, and it's five minutes. Please remember that I allowed a lot of leeway here, and I will try to do it again. Try to fit it in, please.
Lise Zarac.
Liberal
Lise Zarac Liberal LaSalle—Émard, QC
Thank you very much.
The figures provided today prove that it is both relevant and important to study the impact of Employment Insurance on women. The figures prove that women are more vulnerable; we really must spend some time on this.
Women earn lower salaries than men. Is there a study showing that women on maternity leave return to work quicker because they cannot afford to be on maternity leave for all the time to which they are entitled?
Will the five weeks that the government is now providing be used by women? Is there a study showing that they return to work quicker?