Debates of April 11th, 1994

Budget Implementation Act, 1994

[Nelson Riis, NDP, Kamloops, BC]

Mr. Speaker, I listened with interest to the comments of my hon. friend from Winnipeg North Centre in terms of the legislation before us.

I have a question for him dealing with the Royal Canadian Mounted Police and the problems faced by new constables. When they leave Regina, for the first three years of their service as new constables they receive six month pay increments to bring them up to a reasonable level of income. This legislation not only freezes the level of pay but freezes any increment initiative as well.

Young constables coming out of training are being asked to serve in cities like Toronto, Montreal and Vancouver. They simply cannot live on their stipend. It is impossible. These are bright, young, interested and aggressive young constables who want to serve their country at a time, I think we would all agree, when the need has never been greater and yet they cannot serve in at least some of these urban areas because of this freeze.

The hon. member will know that when the government changed the unemployment insurance program, which he referred to here, there was some acknowledgement that low income Canadians, particularly those with children, should receive some recognition for the changes in the economic plight that they face. Why would the government not do the same for these new constables?

I know that the commissioner has met with the government on this and has pleaded their case. Could my hon. friend shed some light on why the government at least to this point has not made any announcement that there will be some changes.

[David Walker, Liberal, Winnipeg North Centre, MB]

Mr. Speaker, I thank the hon. member for Kamloops for his question.

The broad brushes of the changes and the freezes and the extension of the freeze on public service salaries have obviously been of great hardship to the tens of thousands of people who work for us. It is something we take very seriously. The particular case of the constables is an example of the difficulties in which people find themselves at a particular point in their careers when the next move is out of the question because of some restraints on their compensation package.

I will undertake, as the member has, to raise it with the Treasury Board minister and the Solicitor General to ensure that as the salary freeze on public servants is extended for two more years, as it is in Bill C-17 to obtain the savings that Canadians are looking for, individual cases of hardship are brought to their attention.

[Jake Hoeppner, Reform, Lisgar—Marquette, MB]

Mr. Speaker, I have a short question for the hon. parliamentary secretary. I listened to the stats on unemployment. I also heard that there are 28,000 people who have given up looking for jobs. This is a big concern in Manitoba, especially on the farm scene.

Coming back from there, realizing what the transportation system is for grain and that the terminal operations cannot go to a seven day cycle to start moving grain faster, would the hon. member look at that and initiate some opportunities for people to be employed in that industry in order to give western Canadians a break so that they can really make and fulfil commitments with regard to foreign grain sales?

[David Walker, Liberal, Winnipeg North Centre, MB]

Mr. Speaker, I thank the member from my province.

I do not think this government in any way, shape or form takes any solace in the figures that were released last Friday, except as an indication that perhaps things are getting better in some parts of the country.

We want to see several months of improvement. When one sees a rate of unemployment across this country that high, one cannot take any satisfaction from it. The member from Manitoba and the member sitting behind him from Winnipeg know full well that this situation is going to require a lot more intervention. It affects not only the city of Winnipeg and other cities across this county, but also the farm industry.

Any ways that the member can suggest to improve the efficiency of the grain industry, which is so important to the west and to places like Thunder Bay, Montreal, Vancouver and other ports, will be taken under advisement and discussed with the minister of agriculture.

[Bill Blaikie, NDP, Winnipeg—Transcona, MB]

Mr. Speaker, while we are on the topic of grain cars I would like to suggest to the government member and also to my Reform Party colleague from Manitoba that one of the problems is the fact that we have grain cars sitting all across the country. Many of them are in Manitoba, the old boxcar type grain cars, and they are not being used.

The reason they are not being used is not because of railroaders, the government or anybody else. As I understand it, it is because the pools do not want to hire people to man the elevators in order to use the old boxcars. They have cut staff at the elevators.

We have the grain cars to move the grain but the people who are responsible for employment at the elevators will not make it possible to use these cars. That is only one dimension of the problem but I think it is something that should be put on the record.

[David Walker, Liberal, Winnipeg North Centre, MB]

Mr. Speaker, as the member for Winnipeg Transcona knows, the question of grain cars and the use of those cars is also tied into the Churchill route. As he knows, the member for Churchill has been very active in promoting the interest of that route and has been helped by the member for St. Boniface in whose riding the yards are located.

[Sheila Finestone, Liberal, Secretary of State (Multiculturalism) (Status of Women)]

Mr. Speaker, I found my hon. colleague's speech most interesting. I hope everyone will read it to get a clarification of the wonderful role that has been played to date.

In his next series of consultations, I would ask that the minister please ensure that more women's groups, more older citizens and ethnocultural communities are consulted. I know we did a fair job but not a good enough job in their view. I would hope that some commitment would be made as we go across the country on the next round.

[David Walker, Liberal, Winnipeg North Centre, MB]

Mr. Speaker, I thank the minister for her comments. I just met on her behalf with a group of women from Winnipeg, a black women's coalition, who brought these types of questions to my attention. They are very much on my mind.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, before I get into the content of what I wish to discuss, I would like to touch for a moment on the remarks of the previous speaker, the hon. parliamentary secretary for finance.

He painted a very rosy picture about the future of the Canadian economy. I would like for the sake of balance to point out some of the other opinions on where the economy is heading in the next little while.

First, over the last week we have seen a very volatile stock market. The dollar continues to be extremely volatile. Interest rates have been hiked in the last little while.

When economists comment on this, most often they point out two factors that contribute to this volatility. The first is continued high deficit and debt figures and a lack of confidence in the ability of the government to get a handle on the deficit and debt. The second thing they point to is the situation in Quebec and the possibility of Quebec's separation.

I urge the government to do whatever it has to do to get the debt and deficit problem under control. Though the minister waxes eloquent about the intent to get the deficit and the debt under control, so far the government has not convinced the markets it is going to do this. That is why we continue to have all kinds of uncertainty. It certainly hurts business and the economy in general in this country when there is that lack of confidence.

I will be addressing this bill with respect to the request for borrowing authority for the CBC. The rationale behind that request would give the CBC the ability to invest in systems and equipment that would make it more efficient down the road.

This request begs many questions. The first and most important question is the timing of this request. Right now the government is embarking on a management and funding review of the CBC. This request for borrowing authority presumes the outcome of that review. It is assuming the review will find that the CBC is a good steward of money and that it is a good manager with a solid management team.

I would argue that the facts really do not bear that out. I would point to the fact that the CBC has lost several senior managers in recent weeks. That leaves it weakened in terms of having the expertise to use that money wisely.

The second is the argument that the CBC in spending the money it gets from the government, about $1.1 billion a year, uses it wisely. I would beg to differ that it does.

Over the last few years the CBC has actually seen its revenues drop. That reflects two things. It reflects the lack of confidence advertisers have in the CBC to generate viewers, and also the programming of the CBC obviously is left wanting.

We have the CRTC commissioner recently criticising the CBC, pointing out that its share of viewership has dropped to 13.3 per cent, despite the fact that it has a virtual monopoly on Canadian programming and is rewarded every year with the $1.1 billion subsidy.

The first thing that really must be addressed when the government brings this bill forward, at least with respect to the CBC, is the timing. Why are we doing this now when there is a funding review about to take place?

It may, and I would suggest it will, find that the CBC is very weak in terms of its management because of the loss of so much of the management team and also in how it has spent money in the past. The Fraser Institute recently suggested that on average a CBC station spends over twice what its private sector counterpart spends on administration and programming. That does not bode well for taxpayers if we are preparing to give the CBC the authority to borrow money.

The CBC has a $40 million deficit on its operating budget this year on revenues of $1.4 billion. Allowing an indebted company to accumulate further debts at the public's expense is poor management and morally irresponsible.

We were talking a minute ago about the tremendous debt and deficit problems that we have in this country. Now we are proposing to allow the CBC to go ahead and borrow more money. Who is going to pay for that debt if the CBC cannot meet its financial obligations? It will be the Canadian taxpayers as usual. We will be picking up the bill for the CBC spending.

The other thing that really concerns me about this is who is going to be directly accountable to Parliament for this borrowing authority. It is true that the money will have to be approved by the finance department before the CBC gets it. I am not convinced because the CBC is a crown corporation and does not really depend on profits to keep it disciplined, to keep its expenses in line and does not have a bottom line like a private sector company. We really do not have those market disciplines to make the management in CBC accountable for that $25 million.

The budget document also suggests that the public broadcaster may be allowed to borrow an amount greater than $25 million with parliamentary approval. In effect the ceiling of $25 million is a decoy. How did the government arrive at that figure? What measures will keep it from becoming $50 million or $100 million? Until we have this management and funding review completed how will we know whether the CBC is capable of managing even higher levels of indebtedness? How will we know that it can repay $50 million or $100 million? Again, the question has to be who will get it off the hook if it is unable to repay that $100 million. Naturally the CBC will come looking to Canadian taxpayers for a greater subsidy.

The rationale behind this new borrowing power is supposed to allow the corporation to make investments in systems and equipment that will result in long term savings. What we have here in effect is a perpetuation of waste and inefficiency since the new Liberal government has given the CBC a $100 million reprieve on cuts announced by the previous Conservative administration and a further deferral of $150 million over five years. In effect, the government is to a degree reversing that. Until this review is undertaken it seems entirely premature.

The CBC has not demonstrated it can be financially responsible. While private broadcasters will send one camera crew to do the job, we can almost always count on the CBC sending three. It is a standing joke among private broadcasters how much money, how many reporters, how many camera crews, how many technicians the CBC has to devote to a single news conference in order to get the story that private broadcasters could get with one camera crew.

One of our concerns is that this crown corporation really has the best of both worlds. It has its feet in both the private sector and the public sector. It has its feet in the public sector purse to the tune of $1.1 billion. It also competes in the private sector with private sector broadcasters. Because of its huge subsidy and now a request for $25 million in borrowing authority it will also have the ability to further undercut advertising rates in the markets in which it competes with private sector broadcasters.

This is a concern to private sector broadcasters. They have raised this before and this issue is not going away. At a time when many private sector broadcasters are suffering-many of them are operating in the red-how can we not only give our support to this idea but why are we not going the other way and saying it is time to give private broadcasters a break by reining in the CBC a bit?

Perhaps we should be giving some consideration to making the CBC a little like public broadcasting in the United States where they depend a lot more on contributions from viewers. Many Canadian viewers send their contributions down to PBS in the United States. If I am not mistaken and memory serves me correctly, the majority of funds for those border stations comes

from Canadian viewers. That should set off alarm bells everywhere.

We have to ask ourselves in light of the decline in viewership for the CBC and in light of this request for more money why in the world is this happening. Why are we allowing this debate to even happen when we see all this money going south of the border? Should we not be trying to repatriate this money? Should the CBC be more dependent on viewer support than it already is?

With the CBC's tacit application for a new arts channel, the festival channel, will some of this money end up supporting this new application? The festival channel really is in competition again with the private sector. We have a very strong private sector application for an arts channel but it seems the CBC feels it has to justify its existence by applying for that new arts channel as well.

I have to wonder if this $25 million going to the CBC will end up in some way, shape or form being shuffled over toward the festival channel to help that channel get off the ground. The CBC has no mandate to be involved in this arts channel. Nonetheless it has found a very sneaky way to go in the back door to push for an arts channel to fall under the CBC purview. We have to ask ourselves whether the intent of the department is to shuffle some of that $25 million into the newly proposed festival channel.

We also have to ask what guidelines has the government established to the exercising of this borrowing authority. This has not been made clear. The government has basically said it will decide when the CBC comes to it whether the CBC's application for funds has merit. We are talking about a government that wants politicians and government to be more accountable.

We need to know before we approve this what kind of measures will be put in place to ensure this money is not wasted, that this money does get a return on investment because that is what they say will happen. We have to make sure it does not go into a festival channel to compete against private sector broadcasters. It is not at all clear that will not happen.

Those are the types of questions this government has to answer before we can go ahead and give any kind of support for allowing the CBC to have borrowing authority.

This really represents the opening of a Pandora's box. We wonder whether there will be an increase now among crown corporations coming forward to ask for borrowing authority. I would argue that is a very scary prospect.

Too often these different crown corporations do not have the private sector to compete with and keep them in line and they do not have a bottom line to address. Often they do not have to worry about what the shareholders will say and therefore very often can spend money very unwisely with impunity. That is a scary prospect when we have a $45 billion or $46 billion deficit this year entering into a new year when we may have a deficit in excess of $40 billion.

I will conclude by saying it is crystal clear that any attempt to revitalize the CBC using measures normally reserved for companies competing in a private marketplace undermines its integrity as a public broadcaster.

Any special measures designed to raise capital for the CBC such as loans, subscriber fees or licence fees would be an unfair advantage if the CBC underbids its private counterparts for any services which it offers given its heavy state sanctioned financing.

For that reason I urge the members of this House to oppose this bill.

[Dennis Mills, Liberal, Parliamentary Secretary to Minister of Industry]

Mr. Speaker, I listened attentively to the member opposite from the Reform Party. I feel his analysis of the CBC has been very narrow.

When I look at the CBC I do not see it just as a broadcaster. I see the CBC as an instrument to pull this country together. When we think of the CBC we do not just think about CBC television, but of CBC radio, of CBC Newsworld, probably one of the most efficiently run organizations in the broadcast industry anywhere in North America.

When we see the way it pulls this country together, whether it be in the arts, in current affairs in French and English, I do not know what other galvanizing instrument we have out there that can provide that type of service and support in this country.

There is another aspect of the CBC and we talk about accounting measures. My background is in business and I believe that it is very important to have full accountability of the CBC.

However, I do not think we are putting on the asset side of the sheet the great contribution the CBC has made in terms of training writers, producers, camera operators and technology wizards recognized all over the world. This is training support the private sector has been able to pull from to move into its own private broadcast units without having to fund any of that training and support. That is not just in television, it is also in radio technology, talent and service support.

Look at what the CBC has done in terms of the north. What person in Canada would not agree with the fact that the CBC has made a contribution in the north? What private broadcaster is even going to go there to help pull that part of our country into the mainstream?

I support the approach of the Reform Party to having accountability, but I wish the Reform Party would support our approach. We should look at all assets, all strengths, not just at one or two particular weaknesses. If the Reform Party were to put into its accounting analysis all other contributions the CBC has been

making, is making and hopefully will make in the future, it might think we are getting good value for taxpayers' money.

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, I appreciate very much the suggestions of the hon. member. However I think there is a consensus in the country that the CBC has to change.

The hon. member mentioned CBC Newsworld and how efficient it is. Within a year of applying for and getting its licence the CBC had to come back and ask for higher subscriber fees because it could not make it on what it was bringing in. Despite the fact it said it would not do so, the CBC came back and did exactly that. I would suggest that in terms of efficiency the CBC obviously did not look very far ahead.

When it comes to bringing the country together I very much appreciate what the CBC has done in the past with respect to that, but I point out that many private sector broadcasters do the same sorts of things. The CTV network brings the country together through its programming. It provides all kinds of programming that people across the county appreciate, not the least of which is its news and public affairs programming.

I point to the new specialty channel applications, for instance the proposed Bravo channel that would bring Canadian arts programming to the entire country at a much lower cost to subscribers than the CBC application. There are other ways of looking at it. There are other ways of bringing the country together that may not involve the CBC, or it may involve the CBC but a drastically reformed CBC.

Since 1987 there has been a decline in arts and children's programming on CBC. We have seen all kinds of soap operas in the afternoon and sitcoms in the evening in an attempt to bring back viewers. That is redundant. That is ridiculous actually, when we think about it. CBC receives $1.1 billion to provide Canadian programming and we have these American sitcoms coming in on all kinds of other channels. I do not think it is the role of the CBC to be replaying American sitcoms. We have to get away from that. The CBC has to change.

With respect to the hon. member, I think he is out of the loop if he does not recognize that the CBC has to change. I am not arguing that it should disappear, but it has to change. The friends of the CBC even point that out. It is time to bring some change to the CBC to try to make it more efficient and to respect the fact there are new forces in the country that will allow us to come together. We do not necessarily have to do it through the state sanctioned CBC.

[Eugène Bellemare, Liberal, Carleton—Gloucester, ON]

Mr. Speaker, I found absolutely dreadful the speech of the Reform Party member attacking one of our great institutions, the CBC, Radio-Canada in French. Being unilingual, he only mentioned the CBC and not Radio-Canada, but I imagine he meant both. I have a question for him.

Does the member sincerely agree that we must have a united Canada, coast to coast, from North to South and East to West, a bilingual Canada with two official languages, a united country where the Canadian culture can progress and where we can create jobs or does he believe the only important thing for the CBC and Radio-Canada is the bottom line? Does he not see in the CBC and Radio-Canada a human asset, a window on the Canadian nation?

[Monte Solberg, Reform, Medicine Hat, AB]

Mr. Speaker, in my vision of Canada I do not see it as a country that draws its culture from institutions. I do not think Canadian culture is a bureaucratic institution. Canadian culture is something that flows from the creative impulses of creative people.

Whether those impulses are channelled through the CBC, a private broadcaster, a private art gallery or whatever is not important. What is important is that these people go out and do their thing. If it can happen more efficiently through the private sector or if it can happen through a reformed CBC-and I remind hon. members that their own government has called for the review of the CBC-that is what should happen.

To hold on to some old, solid institution simply because it has been there for 50 years and not change it at all is absolutely ridiculous. It does not recognize that the world is changing and that Canadian artists and creators need all kinds of outlets to get their messages out. We should not necessarily have it flow mostly or completely through the state. That is a very bad idea. It is time to look at some new alternatives and it is probably the most human way to look at Canada's cultural industry.

[Maurizio Bevilacqua, Liberal, Parliamentary Secretary to Minister of Human Resources Development]

Mr. Speaker, the bill is a key element in a much larger process. Canadians told us they wanted a government that treated jobs as a priority. We have taken action on job creation through the infrastructure program and measures in the budget.

The government has begun to address fundamental issues facing our social security system. We agree we need a system that encourages participation and gives people incentives to contribute to Canadian society.

The current patchwork of programs no longer addresses the needs of Canadians. The bill underscores our commitment to Canadians that in two years we will be at the threshold of a new system. New ideas in social programs are being developed everywhere as part of the reform process. We have set aside funds to start work on some projects. The budget provides $800

million for two years for joint strategic initiatives with provincial and territorial governments.

The same search for innovation has shaped the design of the program we are establishing to assist people affected by the closure of the Atlantic fishery. The bill provides $1.7 billion of new money over the next five years through an Atlantic groundfish industry renewal and adjustment strategy to be developed in consultation with the public and private sectors.

We are discussing with our partners the development of a number of new jobs through such initiatives as expansion of the eco-tourism industry and aquaculture industry and development of new energy sources or the development of rural amenities.

Our changes to unemployment insurance are good examples of real effort to find balance and create jobs. We have proposed four areas of change to the UI act.

First, we will drop the 1995 premium rate to $3 and freeze or lower it for 1996, which businesses have assured us will create jobs. This premium rate will be 10 per cent lower than the $3.30 rate that would otherwise be required under the UI act. Second, we will strengthen the link between work history and UI benefits. Third, we will increase benefits payable to low income beneficiaries with dependants. Fourth, we will improve the fairness of the UI program by amending and clarifying how the voluntary quit and misconduct measures are applied.

Small business told us that any real effort to encourage job creation must look at the impact of payroll taxes such as UI. By reducing premiums we reduce the cost of employing people. For example, our premium cut and the subsequent freeze will save a business with 50 employees $15,000 during 1995 and 1996.

How will we improve the linkages between work history and UI benefits? One would be by increasing the value we place on long term attachment to work and the other by raising the minimum entrance requirement to 12 from 10. The new rules recognize that no one has really gained from a system in which UI became a regular part of income instead of temporary support during unavoidable job losses.

Leaders in Atlantic Canada have told us the 10-42 system has done more harm than good for their economies. With their help our social security reform will create a more effective system.

It is not just in Atlantic Canada where this attitude of UI as a regular income is considered a problem. We have received letters from across the country telling us that UI should be available to help those in difficult situations and not be a way of life. We need something to break the cycle.

I also take this opportunity to ensure that adequate support will be available to those most in need. The changes to UI increase the level of support for those with low income and dependants.

As we begin to shift from our current set of programs to something more comprehensive, we have decided to reintroduce a principle that was part of UI for 30 years. To help reduce the incidence of 1.2 million children living in poverty we have established a benefit rate at 60 per cent for those with both low income and dependants. For other claimants the rate will be set at 55 per cent. Those with low insured earnings of $390 per week or less in 1994 and who have dependants will qualify for the 60 per cent benefit rate.

We have also taken action to reintroduce an element of fairness that was lost in changes regarding suspensions, leaves of absence and when a person quits shortly before a known layoff.

First, if a worker is suspended from a job for more than a week the worker is considered to have been fired for misconduct. As a result the time worked before the suspension is not counted if the worker has to apply for UI benefits any time after the suspension is over.

Second, if a worker takes a leave of absence from work the leave is considered to be voluntary separation from employment. As a result if the worker is subsequently laid off after returning to work he or she may have to requalify to receive UI benefits.

Third, if a worker quits a job one or two weeks before it would have ended anyway then the worker may be denied all UI benefits. These measures are unfair.

We proposed that a period of suspension should not be treated as a loss of employment owing to misconduct. We propose that rules for leaves of absence be clarified so that workers who return to the workplace are not penalized.

We propose that legislation be amended to provide greater flexibility in the rules for workers who leave a job that would have ended anyway.

Another concern about the Unemployment Insurance Act is that too much pressure is placed on the worker claiming benefits to prove just cause for leaving employment. We propose that in cases in which information from both parties, the employer and the employee, is equally balanced that the legislation be amended to give the claimant the benefit of the doubt.

Overall these changes to the UI program will be reducing program expenditures by $2.4 billion per year once phased in. This reduction is necessary to offset the loss in premium revenue as a result of rolling back the premium rate of $3. The changes also begin the process of reform.

The bill provides the legislative flexibility needed to undertake a number of pilot projects aimed at improving the administrative efficiency of the UI program. The UI program contains several provisions introduced in the 1970s that arguably no longer fulfil the original purpose and only impose a heavy paper burden on employers and clients.

The complexity of the current system has effects on employers, claimants and the government in the areas of cost, accuracy and levels of service. These pilot projects will test alternative methodologies to demonstrate that costs could be decreased, accuracy increased and service improved.

There will be effects on UI claimants. This is a significant package of changes. Even now fully three-quarters of UI claimants return to work before their claims run out. The minister, members of the government and I want to work with the provinces to develop a common understanding of the implication of UI changes for provincial social assistance programs.

Preliminary estimates of the potential effects for provincial social assistance costs are small but we are proposing that officials from both levels of government meet to refine these estimates.

We would use some of the funds that have been made available for the joint strategic initiatives to help address the potential effect of the changes to the UI program. The government remains committed to preserving an unemployment insurance system that provides protection for Canadians who have lost their jobs and are seeking work, one that operates with financial integrity.

Any substantial change to UI as part of the social security reform will happen only after Canadians have had a chance to think about their priorities. We recognize the concerns Canadians may have about our decisions but we have pursued a balanced approach to interim change. Canadians understand that unemployment insurance must evolve in concert with the rest of the social security system. However, UI is only one aspect of that system.

To stabilize planning for both levels of government we have taken measures in this bill for other elements of the system, the Canada assistance plan and established programs financing. The cap on EPF for post-secondary education represents an important piece of the intergovernmental social policy framework. This bill stabilizes the planning framework for provinces and territories while we build a new system. CAP transfers will grow by about 5.4 per cent in 1994-95 and remain at that level until a new system is in place.

The joint strategic initiatives I discussed earlier will contribute additional funding to help provinces and territories to get started on testing new approaches and social security ideas.

EPF is a core of federal support that benefits Canada's youth through the slightly more than $6 billion per year we provide for post-secondary education. The budget provides for modest growth in our transfers under this program.

Funding for post-secondary education is only one aspect of our support for youth. We will pursue new approaches to internship, innovative alternatives that help young people with the transition from school to work. We are launching Youth Service Canada and will have program participants contributing to their communities and helping to protect our environment by this autumn.

Mutual responsibility is a key principle driving our discussions about social security reform. The government will invest in people, but people must also make a contribution to society.

Let me conclude by saying the government is committed to the issue of jobs and hope for Canada. It was our number one objective during the election and has been ever since. With this bill we have taken action. We have dropped payroll taxes to create a climate for job creation. At the same time we have created a stable planning framework for the period of change that lies ahead.

During that time we will build a system which helps Canadians find jobs, skills and the sense of dignity they have so clearly requested.

[Jake Hoeppner, Reform, Lisgar—Marquette, MB]

Mr. Speaker, I appreciate the parliamentary secretary's comments. I know unemployment is a big problem.

I hate to always bring up the subject of agriculture, but being from Manitoba it is very important to me. I wonder if the Liberal government would take into account that there are approximately 240,000 farmers in western Canada. According to Stats Canada's latest figures, these farmers earned an average of $16,000 a year before depreciation. It also showed that these farmers earned $32,000 a year from off farm jobs. If we could put agriculture back on a profitable basis there would be 240,000 jobs available to somebody else.

We have lost sight of the fact that agriculture is still the basic industry in western Canada. We have to make this industry profitable in order to provide other jobs.

Looking into the agriculture industry, we see that 500,000 jobs are created in the processing and retailing of agricultural foods. It is very important we make this industry viable again.

I would appreciate the parliamentary secretary's comments on this.

[Maurizio Bevilacqua, Liberal, York North, ON]

Mr. Speaker, I would like to thank the hon. member for his question.

As a government we are concerned about agriculture and the benefits which we draw as a nation from the production and sale of agricultural products. There is a great willingness in the government to bring about positive change to the lives of Canadians, whether they are affected by agriculture or the deindustrialization of the manufacturing base in Ontario.

On October 25 we received a mandate for change. People were tired of working harder and earning less money. Our young people were tired and feeling really hopeless about their prospects. That is true whether they lived on a farm or in a city. People felt that the rules for membership in our society had changed. Basically they were asking for vehicles of opportunity, a way once again to participate fully in the life of the nation.

In the last budget and in the throne speech we began a process as a government in co-operation with the people of Canada to redesign a new vision for the nation. That is why we entered into the very extensive process of reforming Canada's social programs.

Many governments in the past shied away from that. They were afraid, perhaps of the misunderstandings, of the code words. They were afraid to face the challenge of saying to people that the systems were no longer working and new ways of giving Canada a better social security system should be looked at.

We have accepted the challenge. We have said that unemployment insurance as it exists today simply does not reflect contemporary reality. Young people have asked for a vehicle of opportunity, something to have during the transition period between school and work. Therefore we are looking at internship and apprenticeship training programs, the Canadian youth corps.

We have told small business we understand when they say too much stress is placed on them. We therefore have decreased payroll taxes, the UI premiums.

We are doing many things to make people come together rather than split apart. That was the legacy of 10 years under the Conservatives where we saw polarization of classes and people really losing hope in our country. It is our number one challenge.

A very important part of this new vision we speak and act upon every day since the October 25 election is the people who are involved in the agricultural sector of Canada. We value the commitment and dedication they have made to developing a better society for all Canadians. The challenges are great. There is no question about that.

The measures we have taken in the budget set a direction but they are interim measures. There is much work to do. We have seen that we need to modernize and restructure our economy. We have to give Canadians tools to become productive, to share in the national vision that speaks to regaining the values that made this country a great nation.

I am, as you are, extremely tired of going into cities and towns where people are lining up at food banks, where we have the problems of latchkey kids, where our young students are not looking to the future in a positive way.

Our mission is to take back our communities. Our mission is to take back our nation, to give it back to the people. Together there is great potential to increase the quality of life for everyone who resides here.

[Nelson Riis, NDP, Kamloops, BC]

Mr. Speaker, I listened with much attention to my hon. friend and his very thoughtful presentation.

Many questions could be asked but I want to take advantage of the fact that he represents a Toronto constituency. As such he knows the special burdens someone from our large urban areas has to face.

I notice that when this bill was first introduced the President of the Treasury Board and Minister responsible for Infrastructure drew attention to the Royal Canadian Mounted Police and the tremendous contribution they make to our country, and their international reputation.

The freeze that was applied to the members of the RCMP along with others and the fact that no increments are allowed for two years place tremendous pressure on new constables as they leave the training facilities in Regina to go out and assume responsible positions around the country.

Their take home pay is about $1,800 a month. Even in Kamloops which is a lot smaller than Toronto I have had constables come to me with a breakdown of their monthly expenses. Living incredibly modestly they cannot live on $1,800 a month. That is in Kamloops. I can only imagine how much more of a problem that would be in a city like Toronto.

Would my hon. colleague consider taking back this kind of concern to the President of the Treasury Board. When one makes a freeze across a whole spectrum it might not have much of an effect on a public servant making $120,000 a year but it certainly will impact seriously on someone who brings home $1,800 a month and expects to raise a family on that.

Could I get some response from my friend. Will he raise with the President of the Treasury Board the plight that these new constables face in the RCMP when they are unable to have any increments when normally they would expect six increments-

[The Deputy Speaker]

Order please. The time is up. Please be brief in reply.

[Maurizio Bevilacqua, Liberal, York North, ON]

Mr. Speaker, I will be extremely brief in giving my assurances to the hon. member that I will bring his concerns to the attention of the President of the Treasury Board.

[Benoît Sauvageau, Bloc, Terrebonne, QC]

Mr. Speaker, today we have an opportunity to speak on Bill C-17. This five-part omnibus bill makes major changes to unemployment insurance.

The minister presents us with a bill, let me point out, dealing with compensation in the public sector, the Canada Assistance Plan, public utilities income tax transfers, various transportation subsidies, the CBC's borrowing authority and finally changes to the Unemployment Insurance Plan. Once again, it is quite a hodgepodge. The more things change, the more they are the same.

Radical changes are put in a bill without any specific orientation and we are told to take the whole thing as is. I will remind the Liberals, in case they no longer remember, that they were elected with a clear objective, supposedly to create jobs. But again, nothing, I repeat, nothing, has been done to achieve this objective.

A catch-all infrastructure program will create barely 40,000 temporary jobs, at an astronomical cost. I give you the figures quoted by the Liberals themselves; 40,000 new jobs is very nice, but if they achieve 100 per cent of their objective, they will not even have reached 10 per cent of the unemployed young people in this country. According to Statistics Canada, in February 1994, 428,000 young people aged 15 to 24 were collecting unemployment insurance, and the Liberals are proud that they may create 40,000 temporary jobs in a few years.

This government really shows disrespect for the people. If the Liberals cannot take significant action, even for the 15-24 age group, we can well wonder when people, seeing construction trucks driving around, as the Prime Minister said, will regain confidence in the economy, confidence in the government and confidence in general. So, as my fellow member from Mercier proposes, we should amend Bill C-17 so that it contains specific measures to reduce youth unemployment.

Furthermore, how can the minister bring in such a bill considerably modifying unemployment insurance while at the same time he is launching a Canada-wide consultation on how UI works? Strange. We can well wonder about this consultation or these consultations. In fact, what have the Liberals done since they came to power?

In finance, Canada-wide consultations, and bogus ones at that, as confirmed by the budget. In defence, they have struck a joint committee, with senators. Nothing but the best. Again, consultations. In foreign affairs, another joint committee. We really have to thank our senators for their contribution. Consultation again. In social programs, consultation. How wonderful!

A question comes to mind. I would like to know-and I would like comments on that later, please-if Liberals are totally devoid of ideas and opinions after nine years in opposition and, if so, how does it feel coming in from the cold after nine years? It was a rude awakening, was it not? One can certainly wonder, seeing that nearly six months into their mandate, the Liberals remain incapable of making decisions or making sensible ones when they do.

Through UI cuts, the Liberals hoped to save $5.5 billion dollars, over three years that is, and in a clearly inequitable fashion, as Atlantic Canada and Quebec will bear the brunt of the cuts. In fact, Atlantic Canada will suffer a shortfall of about $630 million, while Quebec will lose some $735 million a year in revenue. With 25 per cent of the population of Canada, Quebec will actually foot 31 per cent of the cuts announced by the minister. So, as you pointed out, and rightly so, it does happen that people get more than their fair share from the federal government. But in this case, it is at our expense.

Mr. Speaker, I would like to read you a quote from the red book that I have used in a previous speech: "-cynicism about public institutions, governments, politicians, and the political process is at an all-time high. If government is to play a positive role in society, as it must, honesty and integrity in our political institutions must be restored." I agree with that statement. I agree with the Liberals on that. I do not agree on everything but on that, I do. I will be bringing this up often because they are not acting accordingly and it is true that we must all work together to restore confidence in this place.

But what kind of cry from the heart will it take to make our friends opposite show a little good faith in their decision-making? In examining the budget papers, we see that this year's budget for the Governor General's office is $10 million. Ten million! One hundred million will be spent over five years for educational videos. One hundred million over five years, while the provinces and the unemployed have to shoulder $5.5 billion! And this is supposed to restore some confidence in our institutions.

If we are to make any headway at all in resolving the unemployment problem in Canada and Quebec, we have to consider occupational training. I would like the minister to explain to us how responsibility for occupational training is to be shared and what his position on this issue is. Under the Constitution, occupational training is a provincial matter, one which falls, therefore, in Quebec's jurisdiction. It arises from the province's exclusive jurisdiction over education. In 1942, Ottawa encroached on this and several others fields by virtue of its jurisdiction over unemployment insurance and its spending power. Increasingly, the federal government has meddled in

fields such as worker placement and the funding of occupational training.

Since the unemployment insurance reform of 1989, the federal government has used the Unemployment Insurance Account for training purposes. At the same time, it has considerably expanded its field of intervention to include helping labour markets adjust to the opening up of markets and free trade.

A total of some thirty initiatives have been grouped into four major programs, namely Labour Market Information, Community Futures, Employability Improvement and Labour Market Adjustment. The last two programs offer services to individuals and businesses, respectively. At the same time, Quebec adopted a similar program structure as recently as 1992. It entrusted its management to the Société québécoise de développement de la main-d'oeuvre or SQDM, a partnership between the private and public sectors.

To finance these services, the federal government's contribution to labour force training and adjustment in Quebec amounts to a little over $900 million for 1993-94. Of this amount, $320 million comes from the Consolidated Revenue Fund, or $150 million less than three years ago.

As for administration at the federal level, the Quebec region, which is described as one region among many others, is divided into ten networks roughly equivalent to the Quebec administrative division. About 100 Canada Employment Centres are responsible for administering unemployment insurance and managing manpower programs in their respective areas.

Each of these employment and immigration centres has its own local planning strategy or LPS. It includes some degree of co-operation with Quebec.

Last April, the job training centre network in Quebec was converted into 10 regional branches of the SQDM. In association with local partners, each of them is responsible for the management of Quebec manpower programs. Their action largely depends on federal funds and is often incompatible with the LPS, and federal priorities are applied to the regions.

Through its spending power and its jurisdiction over unemployment insurance, the federal government's power on job training in Quebec is practically absolute. This power was reinforced with unemployment insurance reform in 1989 when it became the federal government's favoured intervention tool in labour force adjustment and free trade.

Quebec's role has been reduced to that of a mere manager of some federal programs, as demonstrated by the January 1993 conference of federal and provincial employment ministers. Despite unanimous support by Quebec labour market partners and the creation of an administrative structure adapted to its needs, the SQDM, the federal government refuses to withdraw from this area and to transfer the allocated funds. It has kept its network of Canada Employment Centres despite Quebec's decisions.

At the federal level, manpower adjustment services offered by the federal government are divided into four main programs and 27 components. The result is something that can be a real headache for clients.

There are over 100 criteria, depending on the type of client, available resources and also on the region and local CECs. There should be three sets of priorities: national, regional and local. However, under this system, the needs of Quebec and local organizations are ignored. The result: unemployed workers who are wasting their time and courses for which there is no demand.

Quebec has two sets of programs administered by two separate networks: the manpower development corporations or SQDM, as I said earlier, and the Quebec labour centres. The first set of programs has 15 components and is aimed at people on welfare. The other set consists of ten operations which, since last year, have been regrouped in three main programs intended for businesses, individuals and victims of mass lay-offs, respectively. This adds up to a total of 25 programs.

The cost of operating all these programs is about $580 million for the federal government and about $70 million for Quebec, with $62 million being spent on the SQDM, the Quebec manpower development corporation.

My point is that it is high time we patriated this sector and put it under Quebec control. Another aspect of this bill seems rather absurd. I am referring to the premium rate of $3.07 for every $100 of insurable earnings which in January 1995 will be rolled back to $3. Remember, it was the Liberals who raised the rate from $3 to $3.07.

According to the Liberals, the roll-back planned for next year will help create 40,000 new jobs in 1996.

We will try to give a brief analysis of the Liberal approach to this question. It may seem complicated, but we will give it a try. Our conclusion will be somewhat Kafkaesque, to use a favourite expression of the hon. member for Verchères. Let me explain.

According to the old formula, unemployment insurance premiums would be as follows: in 1993, $3 for every $100 of insurable earnings; in 1994, $3.07, which is what we have now; and in 1995, premiums were to be raised to $3.30 per $100 of insurable earnings. According to the government's proposal, premiums which were at $3 per $100 of insurable earnings in

1993 will be raised to $3.07 as of January, which is the case now, but the rate will be reduced to $3 in 1995.

Let us see what happens if we pursue this scenario.

If the Liberals had maintained the old premium formula, we would have lost 9,000 jobs in 1994 and 31,000 jobs the year after. By raising premiums to $3.07, the Liberals get the following result: 9,000 jobs lost in 1994 they realize that, they said so themselves and 9,000 jobs gained in 1995, which means a grand total of zero. We lose 9,000 this year, we create 9,000 the year after, and the result is zilch. Wow, that is really something. Or so they say.

Actually we are not talking about 40,000 new jobs but 31,000 jobs saved and 9,000 new jobs after losing 9,000. Obviously, the end result of their excellent theory is zero.

We must conclude that once again, the government is trying to fool the public, but today's public is better informed and no longer prepared to swallow this kind of proposal.

In any event, it is clear that the previous government was a failure and that the Liberals will not be an improvement. The government should no longer play a leading role in creating jobs. Recent figures have shown that small businesses have been the main source of new jobs during the past few years and will continue to play that role. The Liberals realize that. Give credit where credit is due.

Today, for investors and small businesses, the government's role should be to protect public finances. A good government should control its spending. A good government should control the deficit, and by the same token, a good government will restore a climate of confidence.

The economy is based on confidence, and governments-I said governments-undermine that confidence by being inconsistent and have done so for far too long. To create employment we do not need construction equipment, as the Prime Minister seems to think. We need to restore a healthy climate of confidence that will encourage genuine economic recovery, which in turn will attract investment and by the same token create jobs, durable jobs.

However, we are convinced that because of overlapping programs and interdepartmental duplication, the federal government will never manage to meet this very simple objective. However, a sovereign Quebec that is master of its own destiny and controls the levers of its economy and decision-making processes will be able to meet this immense challenge. There is no doubt about that. We know, as Félix told us, that the best way to kill a man is to keep him from working.

[The Deputy Speaker]

Since there is no one to take the floor for questions and comments, we continue with the debate.

I wanted to recognize the hon. member for Windsor-St. Clair, but I do not see her in the House. The hon. member for Kent does not seem to be here either. Since it is the Liberals' turn-

I would request hon. members to get the member for Windsor-St. Clair as quickly as possible, please.

Is there a question or comment for the Official Opposition?

[Some hon. members]

No.

[Shaughnessy Cohen, Liberal, Windsor—St. Clair, ON]

Mr. Speaker, I am pleased to rise today in this debate to speak to the government's proposed changes to the unemployment insurance program and in particular those changes that address the problems of low income Canadians and their dependants.

These changes to unemployment insurance are the first step toward a reform of our social security programs. They are the first step toward making these programs more responsive to the needs of Canadians as this country enters the 21st century.

The government is not taking this step unilaterally. The Minister of Finance engaged in extensive discussions with Canadians before bringing down the 1994 budget. The Minister of Human Resources Development has consulted and will continue to consult with business, labour and Canadians from every walk of life about social security reform.

This government knows that the life of every Canadian will be affected for many years to come by the results of this reform. That is why we are taking steps to ensure that Canadians will receive maximum benefits from these changes.

We have also taken special measures in our proposed changes to the unemployment insurance plan to protect those Canadians who are most vulnerable, those with low incomes who support children, aged parents or other dependants.

Under the current unemployment insurance rules, people who claim unemployment receive a benefit rate of 57 per cent no matter what their circumstances. Under our proposed changes there would be a two part benefit rate, 60 per cent for those with lower incomes who have dependants and 55 per cent for all others.

To qualify for the higher benefit rate a claimant must have insurable earnings of $390 per week or less and have dependants. This would entitle the claimant to $234 weekly in

unemployment insurance benefits. However, this government does not want rigid rules regarding eligibility to hurt those in need whose weekly incomes may be slightly more than $390.

Accordingly, we have also proposed that all claimants with insurable earnings between $390 and $425 receive the same weekly benefit of $234. All those with insurable earnings over $425 will receive 55 per cent of their earnings as benefits. We estimate that this will improve benefits for 15 per cent of unemployment insurance claimants or about 250,000 Canadians and their families.

The economic restructuring of our country owing to the forces of globalization and technology is creating a society increasingly divided between those who have well paying, secure, skilled jobs and those who are doing part time, low paid temporary work without the benefit or hope of advancement.

The segment of our population that has been hardest hit by this trend is women, in particular women with children. Women's roles in our society have undergone enormous changes since the social security system was first established.

Thirty years ago Canadians believed that most women would get married, have children and stay home to take care of their families. That was in the days when one wage earner could easily feed and care for a family and still put money aside for a holiday. Times have certainly changed. Today it takes two wage earners for most families to keep their heads above the poverty line.

Women now represent 45 per cent of the Canadian workforce. Unfortunately most of these women work for low wages. On average a Canadian woman working full time today earns just 72 cents for every dollar earned by a man. Those statistics say it all.

In 1990 about 5.4 million working Canadians received a total income of less than $10,000. Of these, 64 per cent were women. At the other end of this scale the picture is entirely different. In 1990, 3.3 million working Canadians received a total income of $40,000 or more. Of these, only 22 per cent were women.

Most working women in Canada have children. Many of these women are single parents bearing full responsibility for their children. The result is one of the most unacceptable facts of life in Canada: We still have 1.5 million children living in poverty. This is an unacceptable situation for one of the wealthiest nations on earth.

Our proposal to provide greater unemployment insurance assistance to those with low incomes and dependants will have an immediate impact on those Canadians most in need: the women and children of this country who are having trouble making ends meet.

Providing greater unemployment insurance assistance to low income Canadians with dependants is a signal to all Canadians that this government believes in equity and fairness. We want to make sure that if we have fewer unemployment insurance dollars that those dollars we do have will go to the people whose need is greater.

The proposals set out in the 1994 budget to change the unemployment insurance program are important first steps but they are only interim measures.

The reform of social security programs is essential if we are to meet head on the challenges of the 1990s and beyond. We can no longer use an outdated system to solve modern problems. It just is not working. We have too many people without jobs, too many families under stress, too many young people who have given up hope and too many Canadians who have lost their confidence in the future.

We cannot achieve change unless we shed the policies of the past that simply are not doing the job that they are supposed to do. We cannot achieve change if we try to cut and paste programs, patching something here and adding something there. We cannot achieve change unless we are willing to lay the system bare, putting every component under scrutiny.

This government believes we have to start with a clean slate and create a new framework for our social safety net. That is why this government is undertaking the most significant and wide ranging review of our social security programs in Canada's history.

[The Deputy Speaker]

I think it is understood that the member is dividing her time with a colleague. Nobody is standing on questions or comments.

[Rex Crawford, Liberal, Kent, ON]

Mr. Speaker, it gives me great pleasure to rise today on behalf of my constituents and speak about Bill C-17, an act to implement the first Liberal budget in 10 years.

The budget shows we have a game plan and that we are going to stick to it. We are delivering on our commitments, funding every key initiative in the red book. With our top priorities of jobs and growth, we are offering a balanced approach with emphasis on economic renewal, deficit reduction and social reform.

As represented by Bill C-17 presented by my friend and colleague the Minister of Finance, we are renewing our commitment to economic justice for a fair and lasting prosperity that can put Canadians back to work.

We have all come through a vigorous election campaign. Everyone had their losses, but the pain of our defeats is far less than the pain of the people I have met.

We have learned it is important to take issues seriously but never to take ourselves too seriously. I am sure we share the same cause, the cause of the common man and the common

woman. Since the days of Laurier, King, St. Laurent, Trudeau, Turner and now Chrétien, our commitment has always been to those humble people of our society, the farmers, the labourers and all others who work day in and day out to provide a better life for their families.

This budget continues that firm commitment, clearly establishing a framework for economic renewal and investing in the skills of Canadians. We support job creation with the national infrastructure program, youth internship and apprenticeship programs.

Unlike the previous Conservative government the new Liberal government has pledged that we will never misuse unemployment, high interest rates and human misery as false weapons against inflation.

We have pledged that employment is the first priority of our economic policy. A rollback of the unemployment insurance premium rate to the 1993 level of $3 for 1995 and 1996 saves businesses over $300 million a year which can be reinvested in new jobs. A Canada investment fund to provide venture capital for innovative companies and a Canadian technology network to help small business to get access to new technology are just two examples.

Small business is the backbone of the economy and that is where we have placed our emphasis. These are not simplistic pledges; they are the heart of our tradition. They have been the soul of our party across generations. It is the glory and the greatness of our Liberal tradition to speak for those who have no voice, to remember those who are forgotten, to respond to the frustrations and fulfil the aspirations of all Canadians seeking a better life in a better land.

Programs may sometimes become obsolete but the idea of fairness always endures. Circumstances may change but the work of compassion must continue. It is correct we cannot solve problems by throwing money at them, but it is also correct that we dare not throw our national problems on to the scrap heap of inattention and indifference.

The poor may be out of political fashion but they are not without human needs. The middle class may be angry but they have not lost the dream that all Canadians can advance together. Canadians are tired of changes that merely nibble at the edges. We will implement bold, sweeping reforms that will ensure Canadians can adapt to the challenges of the new economy. We need to build bridges to work, to independence, not dependence. We must better deliver to those in need and at the same time make sure the social safety net remains affordable.

We will overhaul these programs to help Canadians move into the workforce. The demand of our people in 1994 is definitely not for bigger government but for better government. Some say government is always bad and that spending for basic social programs is the root of our economic evil, but the present recession and unemployment rates cost our economy billions of dollars every year. Unemployment and recession are the biggest spenders of all.

We are the party that brought the Canada pension plan and medicare to the nation. We have always been the party of hope. With the budget of my friend and colleague, the Minister of Finance, we are offering new hope to a Canada uncertain about the present but unsurpassed in its potential for the future.

To all those overburdened by an unfair tax structure let us provide new hope for real tax reform. Instead of shutting down hospital wings let us shut off tax shelters. The budget closes loopholes and brings greater fairness to the tax system.

During the recent election campaign I listened and learned from the people of my riding of Kent, the heart of southwestern Ontario.

I listened to a factory worker in Chatham, Ontario who had six children to support and was going to her factory shift. I listened to a Motor Wheel employee with four kids and many bills who lost his job after 25 years at the plant. It is now an empty shell of a building, shut down, throwing hundreds on the unemployment lines. I listened to a farm family in Howard township who wonder whether they can pass the good life and the good earth on to their children. I listened to a grandmother in a seniors home in Dresden who has only the old age pension to make ends meet and wants her remaining years to be dignified and decent. I listened to a 23-year old out of work, to students without the tuition for university or college and to families without the chance to own a home.

In my riding especially I have seen the closed factories and the stalled assembly lines of Chatham and Kent county. I have seen far too many idle men and women desperate for work. I have seen far too many working families desperate to put food on the table, to make the hydro, mortgage and car payments with one parent either working or laid off while being taxed to the hilt.

As I arrived at 4.30 every morning at the plant gates during the election, I also sensed a yearning for new hope among the people at every factory and every corner store. I felt it in their handshakes. I saw it in their faces. I shall never forget the mothers who had to work on the 5 a.m. shift to earn enough money to feed their children.

I shall always remember the veterans in the Royal Canadian Legions and the seniors in nursing homes who have lived in a Canada of high purpose and who believe it can all happen again. They are all optimistic. If only they had a government that was on their side, a government that spoke out for the little guy.

I believe we are that government. Today in their name, for the people of Kent, I am here to speak for them. It is an honour and a privilege to be a member of Parliament, but our highest duty, our overriding passion is to stand with our constituents to express the thoughts and concerns of those who do not have paid

lobbyists to do their bidding or special interest groups to fax dozens of pages of information across the country.

My special interest group is my constituents and I will fight for them every day. I am proud to support the government and Bill C-17.