Mr. Speaker, I am pleased to rise in the House today to speak on one of the most important pieces of legislation on the agenda of the government.
The government in its commitment to Canada said new employment insurance legislation would be law by July 1 of this year. I begin my remarks by encouraging hon. members to give swift passage to the bill so that Canadians can begin to quickly benefit from a more fair and balanced regime, one that removes the inequities that have characterized the current unemployment insurance system.
The new proposed EI system follows more than two years of consultation with Canadians in all walks of life. I held four town hall meetings in the fall of 1994 to get the input of people in my riding. Because of this public input, the new employment insurance bill will help unemployed Canadians get jobs. It will strengthen work initiatives, ensure fairer treatment for all workers and help workers adjust to our changing economic climate by investing in back to work benefits. It will save Canadian taxpayers $1.2 billion by the year 2001.
I will concentrate now on the benefits to a large group in my riding, the part time workers and multiple job holders. As amended by the standing committee, the new system is simpler, more modern and fairer. At the centre of the new approach is the method of qualifying for EI based on hours of work rather than weeks. A week is a very clumsy measure of a person's work. Using it to calculate unemployment insurance credits is neither accurate nor adequate.
For the current unemployment insurance purposes, a week is a week whether it contains 15 hours or 70 hours. This fails to accommodate the reality of today's labour market where more and more people are working part time and holding more than one part time job.
In the current system a person needs 15 hours of work in any one week to qualify for UI. Less than that and the person is out of luck. Over time this has led to a situation in which some employees hire a person for less than 15 hours a week in order to avoid UI premiums.
I have heard from many constituents in my riding who have suffered due to this barrier. A worker with less than 15 hours per week, even working year round, could not qualify for UI. Neither could a person holding two or three small jobs which may well be the hour equivalent to a full time job.
For example, someone holding down three part time jobs requiring 14 hours per week, totalling 42 hours, does not qualify for UI benefits. On the other hand, a person with a single 42 hour a week job does qualify. This is double jeopardy for part time workers and holders of multiple jobs. They have difficulty getting more hours of work because of the 15 hour ceiling imposed by employers. What they do get does not qualify them for UI benefits.
By counting hours per week, the new employment insurance act brings forward these inequities and treats them on a fair and
equitable basis. EI also provides better rules for setting the level of benefits for part time workers. Current UI benefits are based on total earning weeks prior to job loss. The new EI system will use average earnings over a fixed period before job loss. The period will vary with the unemployment rate in each region. Benefits will be based on the average weekly earnings figure, with the result that all earnings in the fixed period will count toward benefits. That is a fair system.
With amendments introduced as a result of the standing committee review, the gaps in income will be taken into account through an improved method of looking back 26 weeks prior to the claim. Furthermore, regional differences in employment conditions will be taken into account by a new divisor that is two weeks more than the minimum entrance requirement for the region.
These measures link benefits more directly to earnings than the current UI system. They provide greater incentive for workers to seek additional work.
Bill C-12 benefits part time workers and multiple job holders in several fundamental ways. The higher a worker's earnings in the 26 week period prior to unemployment, up to an annual ceiling, the higher the benefit regardless of the work pattern. Total earnings in that 26 week period prior to unemployment from all jobs, including part time jobs of less than 15 hours per week, are included. Extra work during the fixed earnings period, even at lower wages, will add to average earnings and therefore benefits.
The effect of all of this is that under EI 2.4 million people who are now part time workers will have their earnings insured, compared with the current 1.9 million. No less than 500,000 additional part time workers will have their work insured for the first time. Some of these workers will have to pay premiums for the first time as well. It is estimated that 76 per cent, some 380,000, will have their premiums refunded.
As a group, fewer part time workers will pay premiums: 1.7 million under EI compared with 1.9 million under the old UI. About 300,000 part time workers now paying premiums who earn less than $2,000 per year will have their premiums refunded. That is significant. For the remaining 1.6 million part time workers who now pay premiums under the UI system there will be a reduction from $3 to $2.95 for every hundred dollars of insurable earnings. In all, part time workers as a group will pay a total of about $6 million less in premiums than they do today.
Bill C-12 provides an employment insurance system that matches current economic realities in Canada. Employment insurance will continue to provide income support for 2.4 million
unemployed Canadians. Employment insurance matches the varying labour market conditions across the country. Employment insurance treats all workers fairly and realistically measures their work in calculating benefits. Employment insurance encourages workers to add to their hours and incomes and discourages dependency on income support.
The new system's active employment measures will contribute to getting the unemployed back to work and will contribute to job creation and growth. Employment insurance requirements will be much simpler for employers to administer.
Having contributed for 32 years to this program, I know it needs to be changed. The members of our party and I are prepared to support this legislation. We must move quickly to assist the taxpayers of Canada so that $1.2 billion will be saved by the year 2001. Members have every reason to pass the bill into law without delay.