Madam Speaker, I rise today to speak on the bill regarding employment insurance.
Over the past two years, the government has carried on extensive consultations in relation to matters of social policy, in particular the question of the unemployment insurance system which will now be called employment insurance.
It is very fitting that the new name of the system is employment insurance. We do not talk about having death insurance although we only get that insurance when we die. It seems reasonable not to call it unemployment insurance since the idea to be reinforced is that of people having employment, not unemployment. We want to assist people in achieving employment, which is what this bill is all about.
The bill is about helping people to get jobs. It is also about strengthening work incentives. I do not believe this bill is perfect which is why I am glad that the human resources development committee over the past number of weeks has had a chance to look into the bill, to hear witnesses and to discuss possible ways to change it.
Two other members and I have brought forward amendments. There are over 200 motions to amend the bill. I believe many of them will go through and will improve the bill substantially. It is important that fairness is ensured in the system through these changes.
This bill will also help workers adjust to changing economic times. One of the most important changes to the employment insurance system will be the process of counting hours of work rather than counting weeks of work. That seems to be a more reasonable and accurate way to measure work. Most people work according to the number of hours per week.
In Atlantic Canada this change will mean that the vast majority of workers, for example, those in seasonal industries who often work more than 35 hours a week-some as much as 70 hours per week-will now get full credit for the hours they work. That is a very important change that will benefit people in Atlantic Canada.
It is also important to realize that under the new bill every hour and every dollar counts toward people's benefits. That is a change from the past. Before, whether you had 16 hours a week or 80 hours a week, it meant the same thing. That is surely not an accurate way to measure work or what will be insured. The new system will improve on that substantially.
For example, consider a person in the construction industry, which is usually a seasonal industry. During the summer months, the heavy months of work, people will often work up to 70 hours a week. People in that sector will benefit from these changes. A week in which they work 70 hours will mean the equivalent of 2 weeks toward eligibility.
One of my original concerns about the bill was the way it dealt with the divisor. The divisor is the number of weeks by which people's income is divided to determine what is their income.That is then multiplied by 55 per cent to determine what their benefits are.
The problem I had with that was that under the original bill in the highest unemployment regions people were required to work three or four weeks beyond the eligibility period. Let us say it was the equivalent of 12 or 14 weeks. In the 12 week areas they would have to work the full 16 weeks, and about 17 weeks in the 14 week areas in order to get the full benefit, whereas in the areas of lowest unemployment where it would be easiest to get additional work they would have to work no further weeks of work.
It is similar to saying that in the areas where it is toughest to get additional work, that is, the areas of highest unemployment, an incentive is needed to get additional work and there is supposedly no need in the areas of highest employment where it is easier to get additional work. It would have meant hardship for the people in Atlantic Canada and in other high unemployment regions across the country. I felt it was very important that we remove that kind of hardship from the bill.
By the same token, there were various groups, even unions in some cases, who came forward to say that it was true that there were some people who, after getting their 12 weeks of eligibility, would stop working. They would arrange to get themselves laid off or whatever. I do not think it is a big number of people but they exist. We have been told by those people and others that an incentive is needed for people to work a little extra, to ask them to stretch a bit but not to ask them to go off a cliff.
I put forward the idea that instead of having the addition of four weeks in the highest unemployment areas and the addition of zero weeks in the lowest, it should be a flexible eligibility plus two weeks period for the divisor.
This is a complicated subject. Many people will find it a little complex and hard to understand. The point is that it will be fairer across the board for all Canadians. It will mean that the divisor period will follow the rate of unemployment.
As the unemployment rate in an area goes down and it becomes easier to find work, people will have to work a little longer to get their full benefit. As the unemployment rate in an area goes up and it gets harder to get those extra weeks of work, they will have fewer weeks to work, maybe one or two, obviously depending on the nature of the unemployment rate, to get that full benefit.
That is an important measure. It will have a cost to it. It will mean $95 million will go back into the economy. It is a very important measure particularly in the areas of highest unemployment which would have been unduly harshly impacted on by the bill as originally written.
I am delighted the government has accepted my proposal. The minister has put forward an amendment which requires a royal recommendation since it involves the spending of funds. He has also put forward proposals by my friend from Fredericton-York-Sunbury and by one of the members from Toronto.
He put forward an amendment in one case regarding the gap or the question of weeks of zero employment. This would have been very problematic in some areas. There was another relating to exempting people in low income families from the intensity rule. That is a very important measure. The other measure will give people who are working while on UI a credit toward their next term on UI and a credit in relation to the intensity rule.
Those are very important measures which will substantially improve the bill. I do not claim that this system will be perfect. I have never seen a government system that is perfect. I once heard someone say that the thing about all human institutions is that they have human failings. We are probably never going to create a perfect institution.
The idea is to improve the situation as much as possible. Certainly, the change from a weeks based system to an hours based eligibility system will dramatically improve the employment insurance system for the majority of people who are claimants in my region. That is very important.
There was another thing that was very important to me about this bill. When I first learned about the proposals on this bill last summer, one of my biggest concerns was that there was a reduction in the amount of funding going toward this. I recognize that there was an increase in the cost of the program from $8 billion 10 years ago to $20 billion today.
My constituents have said that people should not be making high incomes year after year and also drawing as much as $10,000 in UI year after year. People are very strongly against that. I told the Minister of Human Resources Development it seemed to me that if we were going to change the system, the way to do it was to take it out of the high end, not the low end.
The result is that people in low income families will end up getting about 14 per cent more because of what has been brought forward with the family income supplement. It is a very important progressive measure in the bill. It will mean that those low income families who depend on unemployment insurance will get a boost, a little more than the regular 55 per cent that others will get.
It also means that for the vast majority in the middle the system will be maintained in a very positive way. But the fact is, for those who make $50,000 or $60,000 a year there will be a reduction because the employment insurance benefits of those people will be clawed back. The vast majority of Canadians will strongly support that change. It is one I certainly support. This is a very progressive measure.
We saw changes to the unemployment insurance system by the previous Conservative government which simply slashed and cut. It increased the number of weeks required to work and cut the amount of benefits and that was it. That was not the proper approach. The system needed vast reform which we have done. It will be a very strong and much better system.