Mr. Speaker, I am pleased to speak on Bill C-17, an act to amend certain statutes to implement certain provisions of the budget tabled in Parliament on February 22, 1994.
The provisions of Bill C-17 respecting unemployment insurance are unacceptable, as a whole and individually, particularly as far as benefit rates are concerned.
In my speech on the budget, I reminded the House at the time that Montreal has become the capital of poverty. In March 1994, according to Statistics Canada, there were 151,270 UI recipients in Montreal. In the greater Montreal area, 18.5 per cent of families are living under the poverty line.
I have asked a question about the effects the increase in unemployment will have. The unemployment rate has grown from 9.1 per cent in December 1989 to 13.8 per cent in December 1993, exceeding the growth of the unemployment rate in Saint John's, Newfoundland, for the same period, while in Toronto it had gone from 4.1 per cent in December 1989 to 11.5 per cent in December 1993. I also pointed out that, even before consultations on the needs of the population start, the UI reform would have an absolutely catastrophic effect on the provinces' finances.
The budget measures will result in an increased need for social assistance at the expense of the provinces which will then have to cut, as usual, in their social programs and services because transfer payments are frozen.
Last Thursday, Statistics Canada announced that long-term unemployment had increased in 1990, 1991 and 1992, which means that fewer people received or qualified for unemployment insurance. It is estimated that more than 10 per cent of unemployed workers have turned to provincial social assistance programs.
The Bloc Quebecois has proposed that this Bill, in Clause 22, be amended by replacing line 16, on page 11, with the following: "(ii) the greater of 57 per cent of the".
The purpose of this amendment is simple. At present, the rate of weekly benefit payable to a claimant is equal to 57 per cent of his average weekly insurable earnings; the government plans to reduce this rate to 55 per cent. The Bloc is merely asking to leave it at 57 per cent.
As we know, insurable earnings are based on average insurable weekly earnings over the reference period. For example, a person whose average insurable weekly earnings amount to $620 would see his or her benefits decrease from $353 to $341 if the bill is passed without amendments.
The government tackles its deficit by gradually eroding the benefits of the poorest.
Let us also keep in mind that the benefit rate will be reduced from 57 per cent to 55 per cent for about 85 per cent of recipients.
Once again, government savings are achieved on the backs of the unemployed. I would like to remind you that businesses whose annual UI contributions are less than $60,000 qualify for a tax credit to cover the increase in their contributions up to $30,000.
What a funny UI program: the government does not have money to pay benefits to the unemployed but finds the necessary resources to pay some employers' contributions to that same plan. Another double standard, not to say anything about social equity.
The changes to the benefit structure are simply designed to erode income replacement programs and introduce the principle of justification based on means. The double benefit rate structure is outrageous. Like the Canadian Labour Congress, we must recognize that workers' income is not based on their family status any more than their premiums, hiring or dismissal.
For a government to conceive such a program strongly contradicts the principle of income replacement and other aspects of the labour market; it is a disgrace. This government is destroying the basic principle of income replacement that was the hallmark of the Canadian UI program for many years.
The formula described in clause 22 whereby a higher benefit rate would be given to low-income claimants with dependants hides the fact that other planned changes in this bill will decrease the benefits paid to these same people.
In fact, the advantage of a higher benefit rate will be cancelled by the stricter eligibility standard, a reduction of 12 to 10 weeks of work and a reduced benefits period. The real reason for this bill is to reduce benefit levels. I remind this House that the benefit level has already been reduced twice: from 66 to 60 per cent of salary under Bill C-21 in 1990 and from 60 to 57 per cent
of insurable earnings through the amendments made in Bill C-113 in 1993.
How can the public not be cynical towards governments when it sees this Liberal government pursue the very policies it denounced when it was in opposition barely a year ago? I will take this opportunity to quote the present Prime Minister in a letter dated March 26, 1993 to opponents of Bill C-113: "The Liberals are dismayed by these measures. By reducing benefits and further penalizing those who voluntarily leave their jobs, clearly the Conservative government cares very little for the victims of the economic crisis. Instead of attacking the real problem, it is attacking the unemployed-" That was barely a year ago.
Conservative or Liberal, it is the same thing. The poorest people, who are the victims of this system, are attacked. The proposed changes in Bill C-17 will lower the benefit rate for the great majority of claimants to 55 per cent. The lower benefit rate was adopted for just one reason: to reduce spending on unemployment insurance.
Like others, including the Public Service Alliance, I reject the two-rate benefit structure described in this bill, as well as the lower general benefit rate. In fact, it is important for benefits to be paid to all claimants on the basis of their former employment income.
The government points out that the 60 per cent benefit rate will apply to only 15 per cent of claimants. However, I will add that the reduction of the benefit rate from 57 to 55 per cent will apply to 85 per cent of claimants. The Canadian Labour Congress points out that the higher benefit rate, even the 60 per cent rate for recipients with dependents and a low income, is not designed to increase the protection afforded to the unemployed.
The $12 per week involved is cancelled out by more stringent eligibility standards or the duration of benefits, or both. In the case of workers deemed ineligible because they cannot even get 12 weeks of work, this means a total loss. The government did not tell us how many of those recipients who earn less than $390 per week and who have dependents will lose everything.
With this measure, the Liberal government is getting closer to the American pattern regarding weekly insurable earnings. Indeed, Canada reduces its rate from 57 to 55 per cent, while in most American States that rate is 50 per cent.
Taken together, the new unemployment insurance measures will translate into savings of $725 million for the government in the first year, and $2.4 billion in the two subsequent years. This decision however causes a serious prejudice to the unemployed, who will see their purchasing power diminish and will thereby make less of a contribution to the economy of their region and community. The government is only creating a greater gap between the rich and the poor.
Eighty-five per cent of the claimants of unemployment insurance will lose money in order that the government may avoid the painful exercise of cutting costs of government operations. Only claimants who have both dependants and a dismally underpaid job will be able to receive 60 per cent of insured earnings.
Like Quebec with the "boubous macoutes" of the Quebec Liberal government, the rest of Canada will see the emergence of its own flock of overzealous federal civil servants trying to track down their quota of bad abusers the system. The witch hunt is on.
For the most part, it is divorced workers responsible for single parent families who will have to prove that they have dependents. What an incredible mess! The government is adding yet another administrative level, "jobs, jobs, jobs", at the expense of taxpayers, to harass the unemployed.
Some used to say "poor Canada"; now, thanks to the Liberal government, this country will be even poorer.