Debates of May 6th, 1996

Petitions

[Peter Adams, Liberal, Peterborough, ON]

Mr. Speaker, I have two petitions. On the first petition those who signed want to draw the attention of the House to the following. Acts of discrimination against lesbian, gay and bisexual Canadians are an everyday reality in all regions of Canada. This kind of discrimination is unacceptable in a country known for its commitment to human rights, equality and dignity of all citizens.

Therefore the petitioners call upon Parliament to act quickly to amend the Canadian Human Rights Act to prohibit discrimination on the basis of sexual orientation and to adopt all necessary measures to recognize the full equality of same sex relationships in federal law.

Mr. Speaker, the second petition is also from people in Peterborough riding who are concerned about the effect of proposed changes in human rights legislation on the family.

They request that Parliament refrain from passing into law any bill extending family status or spousal benefits to same sex partners. They further request that Parliament not amend the human rights code, the Canadian Human Rights Act or the Canadian Charter of Rights and Freedoms in any way which would tend to indicate societal approval of same sex relationships.

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, I am pleased to table a petition against the planned dredging operation at pier no. 2 in the port of Sorel, which would involve discharging contaminated sediment and sludge in open waters, on the shores of Saint-Ignace-de-Loyola Island. This petition was signed by approximately 400 residents of the Berthier Islands region.

These petitioners are dead against this project, which they feel is only shifting the problem from the south shore to the north shore of the river. They call upon the government to show respect for the quality of the fauna and flora and, if the project must proceed, they demand that the polluted sludge be disposed of on land. It is not good enough to just shift the problem, possibly to another federal riding.

Questions On The Order Paper

[Ovid Jackson, Liberal, Parliamentary Secretary to President of the Treasury Board]

Mr. Speaker, I ask that all questions be allowed to stand.

[The Acting Speaker (Mr. Kilger)]

Is that agreed?

[Some hon. members]

Agreed.

The House resumed consideration of Bill C-12, an act respecting employment insurance in Canada, as reported (with amendments) from the committee; and of Group No. 3 of motions.

Employment Insurance Act

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I am pleased to take part in the debate on this bill. Not many of us will have this opportunity, since the government decided to gag us by resorting to time allocation, as it did in committee. This is indeed what the government did in committee and it is doing the same thing now, at report stage, in the House.

In the nine or ten minutes at my disposal, I want to stress a number of points concerning which the government's approach in this bill is very ill considered. But first I want to congratulate the 250 to 300 people from my region who came Saturday to protest against the unemployment insurance reform, now called employment insurance, and to tell this government that it is headed the wrong way and that it must go back to the drawing board.

Of course these people are upset that, through all sorts of schemes, the government will take $5 billion from the unemployment insurance fund and use it to reduce the deficit in a somewhat artificial way. The government will appropriate $5 billion from the UI surplus and use it to reduce the deficit. This is tantamount to a hold-up by the government. Yet, Liberal members rise one after the other in support of the bill. People are obviously upset by such manipulative techniques.

Again, it must be stressed that, while the government wants to appropriate this money, it does not even contribute to the unemployment insurance fund, which is totally funded by employees and employers. Employers and employees' contributions are administered under an act of Parliament, and the public would have liked to take part in the debate so that, together, we could decide the future of the unemployment insurance program as a whole, not unlike Quebec is currently doing via its socio-economic summit, where we first agree on the goals and then try to come to an agreement on the terms and conditions.

This would have been the ideal course of action. Instead, the government conducted all kinds of so-called consultations to finally substantiate its position and make it look like what the people wanted. That is not what I heard last Saturday in my riding and what was heard in most Quebec ridings either. Demonstrations were held in many places in this regard.

We have missed an excellent opportunity-with the government's several initiatives to amend the unemployment insurance scheme in recent years-to finally reach a consensus about the main goals. For instance, should unemployment insurance funds be used to stimulate job creation or only to operate a real insurance scheme? This would have made for a healthy debate. Instead, the goal set by the Minister of Finance was the following: "Do as you please, but just make sure a $5 billion surplus is maintained for us to dip into year after year". As a result, the surplus is added to the consolidated fund, giving the illusion that the deficit has been reduced.

But something bothered a number of people, and on Saturday I had the chance to explain in some detail one of the main reasons I oppose this bill. This reason is that, at a time when the year 2000 draws near and when we are looking at new ways of sharing the labour market, here comes a piece of legislation which will have the opposite effect by encouraging people to work more extra hours and employers to have employees do more overtime instead of hiring more employees, which would make the labour force grow.

At a time when the unemployment rate is extremely high, when, at the social level, the gap between the wealthier and most disadvantaged segments of society is widening, there is food for thought here.

Let me explain in more technical terms the effect of reducing maximum insurable earnings from $42,000 to $39,000. When an individual has exceeded the maximum insurable earnings or is about to exceed them, neither he nor the employer pays any more unemployment insurance premiums. So, if you put yourself in the place of the employer, you will say: "Well, I have work to be done, what shall I do? I can take an employee who has already reached his limit and make him work more hours, and, what is more, I will not pay any more premiums on his new hours". Or, you could hire a new employee. But if you do that, you have additional employer costs to pay and you will pay unemployment insurance premiums.

So, automatically, to avoid all the bureaucratic paper work already required of businesses, employers say: "So, we will give our employees even more hours of overtime". It is a vicious circle. More overtime, more fatigue, more accidents, and so it goes. This is totally opposite to the way things should go into the 2000s.

This represents a serious problem and there is nothing in this reform which will mean that the job market will be better shared under this new arrangement which goes by insurable hours instead of weeks.

Another point, without going into worker training in detail, is that the total muddle that already exists in this area is being maintained; that perhaps, one day, they would consider turning training over to the Quebec government, that this will be discussed.

Meanwhile, the department brings in supposedly transitional programs, but these are planned for three years, so little confidence is there that any real agreement can be reached with Quebec about turning training over to the province.

In short, the government would have the opportunity with this reform to have what our colleagues over there are talking about so often, an administrative reform. They could preach by example, going beyond mere words, and ensuring that this bill transfers the administration of active employment measures and the unemployment insurance fund to the Government of Quebec, in the case of Quebec.

But there seems to have been the usual slip between cup and lip-a big one. This leaves people somewhat cynical about politics. That on top of all the unmet commitments and unkept promises makes any confidence in this bunch impossible. I see you are in agreement with me on that, Mr. Speaker.

A last point: a problem that is still cropping up in the 90s in many places, and one from which our region is not exempt. There are many businesses that have been around a long time. In some sectors of economic activity there have been major changes, speeded up by the arrival of free trade. Certain economic sectors, the textile industry among others, have not been extremely competitive, except in certain subsectors, so massive layoffs are now taking place and major businesses are being restructured. Some people who have been working for the past 15, 20 or 25 years, a number of years in the same job, are finding themselves at age 40 or 50 faced with plant closures and not much hope for the future. They are extremely worried, yet they have a number of good working years left to give. Work is, after all, part of our lifestyle and impacts on all other aspects of our lives. We have missed the opportunity here to look at the changes to see how we might adapt an employment insurance program, as they want to term it, and as they want to really make it, to that new reality.

It should be remembered that when we were sold the idea of free trade, and I was one of those who believed in it and still do, they said that there would have to be transition mechanisms. These are not just to support business, but also to support individuals. Here, we have a number of years where absolutely nothing has been done, and the impact on people has been tragic.

So why was provision not made for longer periods of unemployment insurance, for manpower training to be turned over to the provinces, which, if they had had increased resources, would have been able to offer longer training periods that were more adapted to needs? You do not just go from working in textiles to working with computers overnight. This is quite a leap, as I was saying earlier. So, nothing in that sector.

There are many things missing from this bill. In the minute I have left, I am going to look at the real purpose of this reform. Is it to make cuts that will enable the Minister of Finance to save $5 billion, or is it to adapt our social programs to the reality of the next century? If it is for the latter purpose, we would have a different sort of bill before us. The sole purpose of the bill we are now looking at is to bring down the deficit temporarily by dipping into the unemployment insurance fund, and not to adjust to the new reality of the job market.

In conclusion, I would like to remind hon. members that this money belongs to employees and employers. This must always be pointed out, because people often have the impression that the government contributes to the fund. Since 1990, it has not contributed a red cent, and yet it uses the unemployment insurance funds, manages them, and they have become an employment tax.

It is unacceptable that in a reform such as this, those who provide the money that goes into this fund are not involved to a greater and more genuine extent. That is why there were 250 demonstrators Saturday in Abitibi-Témiscamingue, and a number in other locations in Quebec, and that is why people will continue to express their disagreement, because they do not believe that the government is capable, in this and in many other areas, of adapting to the reality of the next century.

[Dianne Brushett, Liberal, Cumberland—Colchester, NS]

Mr. Speaker, I am pleased to support Bill C-12, an act respecting employment insurance.

The proposed employment insurance system is the result of more than two years of consultations with Canadians. This legislation will help Canadians get back to work. It will strengthen work incentives, ensure fairness and help workers adjust to economic change.

Today I will focus my remarks on the effects of the legislation, the effects it will have on women in the workforce and on seasonal workers.

The idea that women will be penalized by changes to employment insurance has become a familiar refrain from the opposition benches, but do not believe it. One of the two overriding goals of the new system is to make it more inclusive than the old one.

Employment insurance legislation recognizes the importance of the participation of women in the workforce. Women make up nearly 70 per cent of Canada's part time workforce. Many of those women are not insured for UI or maternity benefits. Only those women who work for one employer 15 hours a week for 20 weeks are ensured for UI and maternity benefits. Many women hold two or three part time jobs but together they do not have the benefits, but they make work 30 or 40 hours a week or more.

Under the new system, however, an additional 270,000 Canadian women who work less than 15 hours per week at any job or who juggle several jobs at once will finally be eligible for employment insurance and maternity benefits.

Employment insurance provides opportunities for women to increase their employment by lifting the 15 hour glass ceiling. Under the UI system many employers restricted part time workers, particularly women, to less than 15 hours a week in order to avoid paying premiums. With the new EI system all hours count toward a claim. This means men and women who hold down several jobs will now be fully insured if they take sick leave, maternity or paternity leave or if they should lose one of their jobs for any reason.

Employment insurance also guarantees that anyone who earns $2,000 or less a year will have their premiums refunded. This initiative alone will benefit 1.3 million young Canadians. An hour based system ensures all workers are treated equitably and that non-standard workers are brought into the system.

More important, the hour based system will benefit seasonal workers. Under the current UI system it makes no different whether a person works 15 hours a week or 50, the result is the same. The hour based system is a better measure of work effort and therefore provides greater incentive for seasonal workers to remain employed as long as they can.

A good example are the workers in the fishing and forestry sectors who work long hours during the weeks of available employment. Under the current system there is no incentive to work longer than the minimum number of weeks required. More often than not someone has come into my office and told me: "I worked 14 weeks and I thought I was qualified. I learned that this month I need 15 weeks because the level of employment and jobs available are a little higher". They have worked to jerk the system around to what would meet their needs. This no longer will be acceptable. The more hours worked, the more available the benefits will be.

It is important to remember that 96 per cent of current UI claimants will continue to be eligible for benefits. Furthermore, all claimants start with a clean slate on July 1, 1996. That is, they will not be penalized for previous use of the UI system.

Three recent amendments to the legislation to ensure that Atlantic Canadians and seasonal workers are treated more fairly have been brought forward. The first amendment answers concerns about gaps or breaks in employment. This amendment will allow claimants to count back 26 weeks to find the minimum number of work weeks specified by the divisor in their area. In these cases claimants will be eligible to ignore weeks of no earnings and instead have only weeks of actual employment. This amendment

alone will bring $246 million into certain regions where there is more difficulty with employment and more seasonal work, and it will be spread evenly across the country.

The second amendment modifies the divisor to calculate those weekly benefits. This amendment will also benefit high unemployment areas and result in $95 million extra coming into those poorer regions.

The third amendment addresses Atlantic Canadians' concerns about the intensity rules. This will exempt those families of low income, less than $26,000 a year. Those people who receive a reduced benefit as a result of working while on claim will be given a credit for the purpose of the intensity rule.

There are additional assets and benefits to this new legislation; the family income supplement, the wage subsidies, the self-employment assistance program and the skills and loans grants as well as earning supplements. Additionally, child care support will be available for women receiving employment benefits.

This legislation is an enhancement to encourage work, to encourage longer periods of work and to ensure a fair, equitable disbursement of wages throughout our system. It will actually create work for Canadians. The government promised to create jobs for Canadians and this legislation is part of that commitment.

For more than two years now I have been holding town hall meetings. I have sat with labour leaders in Nova Scotia, as well as the membership. I have travelled to the rural coastal communities throughout my riding to hear from seasonal workers. Some of those workers said "the system has been there and we have used it, perhaps even abused it".

One fisherman said to me: "I earn $40,000 to $50,000 a year as a lobster fisherman and my wife helps out so we both are eligible for benefits. Therefore through the winter months, after a two month lobster season of earning that much money, we go on to the UI system and we have a steady income coming all year. I am ashamed to tell you that because the kid over on the gas pump who is earning $5.15 an hour pumping gas pumps gas all year long, 52 weeks a year. That kid is subsidizing me; he on minimum wage and me taking $50,000 out of the system as an employer, as a fisherman, plus UI benefits.

"I am ashamed to say it, but it has been the system and I have continued to use it. I am glad to see you are correcting these inequities so that our young people, women and those who have not had as much opportunity will now have a sense of fairness and part in the system where they can work".

My constituents want this bill passed. They have been part of the discussions and part of the debate. I congratulate the minister for his sense of fairness, his determination, as well as the committee for listening because we have brought amendments forward and we have listened to those people, in particular where there are more seasonal workers and where there is a higher rate of unemployment.

The legislation is long overdue and we have spent too long actually discussing it, almost up to two years. I have no problem with suggesting all members support this bill and I encourage their support to pass it as quickly as possible.

[Yves Rocheleau, Bloc, Trois-Rivières, QC]

Mr. Speaker, I am very happy to have once again the opportunity to speak to Bill C-12, more specifically to Motion No. 4, which would delete clause 2 in this bill in its entirety. This clause contains a number of definitions that shed new light on the intentions and the hidden face of this government.

As the small-minded manager it is, this government intends to resort to drastic measures to put its fiscal house in order. This bill shows all the prejudices stirred up by this government against those in financial trouble, those who have just lost their jobs. They want to use affidavits as defined in the bill: "`Affidavit' means an affidavit sworn or affirmed before a commissioner of oaths or any other person authorized to take affidavits".

This shows the kind of attitude behind this eminently dreadful bill. It also tells us about the means this government intends to use to discourage those who want to prevail themselves of something they paid for, unemployment insurance. Clause 2(3) shows its intention to use modern means of communications, and I quote:

(3) A document or other communication under this act or the regulations may be in electronic form and a reference in this act or the regulations to a form, record, book, notice, request, demand, decision or any other document includes a document in electronic form.

Those who watched oral question period saw what can happen with electronic means. We can see it today in the problems with guaranteed income supplement. We know that this government is set to install computer terminals across the country. We know that the government is about to introduce infocentres. We in the Mauricie region and all of Quebec know something about this.

In his great wisdom, the Prime Minister has decided to establish in his own riding-what a coincidence-an infocentre, thereby taking these services-if one can speak of services-away from regions already receiving them so they could be consolidated in his riding. This brings us, as you will have figured out, to discuss the

implied administrative restructuring within the Department of Human Resources Development.

Let us not forget that this technology is to be used by the Department of Human Resources Development. We all know how impersonal contacts are between a machine and a human being. Such a system leaves something to be desired. Based on first-hand information received from the department, the use of such computerized systems is not giving good results. Still, the government wants to impose such systems on people who are vulnerable, workers who lost their jobs and who may be emotionally affected.

This brings us to discuss the decision to move the employment centre from Trois-Rivières to Shawinigan. The city of Trois-Rivières is the capital of the Mauricie region. Until now, as logic would have it, the regional centre serving the whole region was located there. However, the Prime Minister, in a display of smart thinking and wise leadership, decided to change all that. The questions I put to the minister regarding this issue are on the Order Paper. I am still waiting for answers. There are four of them. I will summarize them quickly.

Was there any recommendation to the minister by public servants or public officials, who can think for themselves and who are not biased, regarding the location of the new regional centre? Yes or no? This is what we want to know.

If a recommendation was made, did the Prime Minister's office or the Privy Council intervene to change that recommendation, along with the decision that should normally have been made by the department following such recommendation?

Were comparative studies made on the advisability of establishing this regional management centre in Shawinigan instead of Trois-Rivières? Was some sort of impact or cost-benefit study done regarding the decision to move from Trois-Rivières to Shawinigan? Were the costs of the move, including relocation costs, to Shawinigan-Sud, taken into account, given that there are no public transportation services between Shawinigan and Shawinigan-Sud, and given the impact of vacating facilities for which, according to sources, the government has a lease running until 1999, and which will remain empty until further notice, again according to sources, particularly in the context of streamlining government operations? This is the sort of measure being applied by this monstrous Department of Human Resources Development, in its attempt to modernize its structure.

Personally, the more I look at this bill, the worse it seems. It is a dreadful bill because it makes culprits out of victims. Let me quote the following sentence we find in the summary of the bill: "This creates a system that better accommodates the variety of work arrangements in today's labour market".

Instead of referring to the variety of work arrangements, it should speak about the insecurity of the labour market these days. The true reality of work is unemployment. They pretend they are improving the situation with a bill making victims the guilty ones. A bill whose climate unfortunately stems from an ideological trend-we must not hide the fact; on the contrary, we must recognize it-a trend called neo-liberalism, a school of thought whereby people are increasingly blamed for their own situation, under the pretence of individual accountability.

The rich get richer, the poor poorer, the middle class is challenged through this type of highly modern, highly generous measure we used to call unemployment insurance. Slowly but surely, we are questioning the fundamental concepts of the collective workings of our society.

The recent comments of the Minister of Industry, with which I agree wholeheartedly, should be proof enough of the seriousness of the situation. I can easily comment on this point because, during my career, I worked with businesses going through such hard times that they had to contemplate massive layoffs. At the time, I would step in on behalf of the Quebec government, and in cooperation with an employee committee, I would try to identify the root causes of the problem and develop a recovery plan, with a view to saving jobs.

What is happening these days? Something quite new, something outrageous and quite immoral in my opinion; imagine a major corporation-in a sector such as banking, the oil industry, forestry or the automobile industry-posting record profits, huge profits, and the same month shamelessly announcing the layoff of thousands of workers due to streamlining and foreign competition. These reasons make sense internally, but in social and collective terms they are indefensible and must be condemned. If the situation is left unchecked, it might eventually trigger social and economic upheaval. It is high time for this country to hold a debate to put public morality back in its rightful place.

[Ethel Blondin-Andrew, Liberal, Secretary of State (Training and Youth)]

Mr. Speaker, I am pleased to have the opportunity to comment on Bill C-12. This is progressive legislation that will bring in a much improved, modern, fair and balanced employment insurance regime and basically remove the inefficiencies and inequities of the unemployment insurance system.

Further, the employment insurance regime introduces an important measure in the government's jobs and growth agenda. The employment insurance plan not only provides income support for unemployed Canadians, but it is a powerful tool to put them back to work. It creates a balance.

As the secretary of state for youth, I am particularly pleased about the effects of Bill C-12 on Canada's young people. The speech from the throne signalled the government's priority concern for youth, and the budget followed through with positive action.

Young people are particularly challenged in today's economy, many of them experiencing a catch-22 situation. No experience means no job and no job means no experience. Unemployment for people under 25 is one and a half times the national average.

We recognize that there is much to be done. I believe the words of the Prime Minister bear repeating: "Above all, we want young Canadians to become active participants in our economy. They want jobs. They deserve jobs. Young people want to embrace the future and not fear it. And it is up to all of us to create that hope and opportunity for them".

Following this vision, the government has appointed a ministerial task force on youth which has begun consultations with Canadians on the issues facing young people in making the transition from school to work. The report of the task force will form the basis of the federal youth strategy to be announced this fall.

The task force will be attending town hall type meetings across the country, hosted by local members of Parliament and senators. Members will seek the views of young people, local youth service organizations, local business representatives and other interested Canadians.

I am happy to say that such a town hall will be held soon in my home town of Yellowknife. I encourage all members to take an active interest in these very important discussions. Indeed, ensuring that young people have a strong foothold in the labour market is vital to Canada's future prosperity and global competitiveness.

In the meantime, we will have employment insurance that will be of great help to Canada's young people. There are special provisions within the bill for young people. The new employment insurance provisions contained in Bill C-12 are amended not only to be fair and balanced, but they are particularly beneficial to young people.

One of the difficulties with the current UI system is that it measures work in terms of weeks. Weeks are often a poor measure of time spent on the job, particularly for part time workers and multiple job holders, which many young people are. With the hours based system of Bill C-12, part time workers' earnings are insured. Four out of ten of our part time workers are under the age of 25.

Under unemployment insurance, employers have tended to limit part time employment to less than 15 hours per week per person in order to avoid having to pay UI premiums. This has meant that no only did these workers get less work, their earnings were not insured. Employment insurance eliminates the 15-hour job trap, since all hours will now count toward eligibility. More young people who enter the labour market after leaving school and who must rely on a number of small jobs to earn a living, will now have insurable employment.

On the other hand, employment insurance also reduces the risk of young people developing a dependency on employment insurance. Many young people enter the labour market and end up on UI benefits before completing their education. They put themselves on the all too often familiar treadmill, short periods of work followed by periods of unemployment insurance. That is what Bill C-12 will discourage. It will encourage young people to complete their education rather than dropping out to take insecure work.

The higher entrance requirements under employment insurance mean that young people must develop a stronger attachment to the labour market. Measures of this sort have been recommended by two recent government reports. The report of the Standing Committee on Human Resources Development recommended longer qualifying periods to encourage young workers to remain attached to the workforce longer and to improve their career prospects. The Working Group on Seasonal Work and UI also recommended stiffer entrance requirements for young people.

As for contributions to EI, premiums will have a minimal impact on young people. A student working 14 hours a week at $7 per hour would pay less than $3 per week in premiums. The hours will now be insured, which will help meet entrance requirements when entering the labour market full time. Further, premiums will be refunded to about 625,000 young people, 49 per cent of all those who receive rebates. Of the total young people receiving rebates, 400,000 will be full time students.

On the benefits side, whereas total benefits paid out under EI will be somewhat less than under UI, benefits paid out to young people by the year 2001-2002 will decrease by 6 per cent, considerably less than the expected overall decrease of 9 per cent.

Young people will also benefit from the employment benefits provided under EI. Several of the employment tools will be of help in getting young people back to work. For example, targeted wage subsidies will help young people who qualify for employment insurance benefits to get needed work experience to qualify for more stable or permanent jobs.

Like some of the other measures I mentioned earlier, Bill C-12 firmly supports a top priority of the government, the jobs and growth agenda. A key element of that strategy is the investment in Canada's youth.

Measures are already in place to address the needs of young people: youth service Canada, the youth internship Canada, the student summer job action program, the Canada student loans program. The budget introduced a learning package with tax and savings incentives, as well as child care support for single parent students.

The learning package provides an additional $165 million in tax assistance to students and their families. Additional tax assistance is provided to students by increasing the base for the education tax credit by 25 per cent, from $80 to $100 per month. There is also a 25 per cent increase to the limit on transfer of tuition fees and education credits to family members who provide support to students.

Saving for education is further encouraged by increases to the registered education savings plan limits. The low income, single parent students are helped through child care expense deductions. The budget took further immediate action by increasing the summer career placement program funding from $60 million to $120 million.

The government is on track with the jobs and growth agenda. More than 600,000 jobs have been created since 1993 and unemployment is down by two percentage points. With a youth strategy in place we will be able to ensure that Canada's young people share fully in economic growth.

I have had the opportunity to meet with many groups. Yesterday afternoon I met with an Elks club, members of community organizations and an RCMP officer, as well other interested citizens. They are people from all walks of life who share an interest in the wellness of young people, in their futures, in the investments we make as families and leaders to the well-being and the future of young people.

We met to discuss how to ensure a better future and a better quality of life for young people in our community. That desire is not particular to my riding but is something we all share as members. Communities take other initiatives. Government is the facilitator. It provides the legislative tools, the resources.

We have been able to encourage the public to take the leadership and the responsibility. Some members opposite have said that this bill in some sense refers to victims. It is not so much that people are victims but that they should take personal responsibility for their futures. If young people are encouraged they will not be afraid to do that.

There are many young people out there working, learning and securing a better future for themselves. They need our support.

[Pauline Picard, Bloc, Drummond, QC]

Mr. Speaker, I am pleased to speak once again to Bill C-12. However, I would have preferred to give my views on a bill that would really address unemployment problems everywhere in Canada and in Quebec. A bill that would have proposed concrete measures to stimulate employment and thus have given back hope to thousands of people who are desperately trying to enter or re-enter the work force.

Let me tell you that I am always a little surprised, since we have been debating this reform for such a long time, to hear colleagues from the other side of the House extol the virtues of this reform, when everybody in Quebec and Canada is protesting daily to condemn the perverse effects of this reform.

So, let me say that I do not understand these members of Parliament who represent the people, the constituents of their riding. These people must also go to their member of Parliament to say: "What the government is doing to us does not make any sense. This reform is creating poverty".

There is no concrete measure for job creation in this unemployment insurance reform. Furthermore, the government is taking billions of dollars, for the sake of being a good government, and after that, in the next budget, it will brag: "We have been a good government, we have reduced the deficit by so much". But it did it by emptying the people's pockets.

Frankly, I would like to warn people when they hear government members say absolutely absurd things, and say that this reform is really the best there is at this time, that they really did a reform. I do not think they did a good reform. They are creating poverty. This reform is unfair, regressive, anti-employment, and it is creating poverty.

I would like to explain to our viewers how this bill will penalize the unemployed and those who are without a job, especially young people and women. The eligibility criteria are tougher. Previously, 12 to 15 fifteen hour weeks were all that was required to qualify, depending on the region. You had to work 15 fifteen hour weeks, or a total of 180 to 300 hours per year. Those who accumulated between 180 and 300 hours of work, depending on the region, qualified for benefits.

Now, between 12 and 20 weeks at 35 hours per week, or a total of 420 to 720 hours per year, will be required. In other words, an individual has to work, depending on the region, between 420 and 700 hours, or more than double the time, to qualify. For newcomers, that is to say those joining the labour market, the number of hours of work required to qualify will increase threefold, which means they will be expected to accumulate 910 hours before

becoming eligible. This is really an unrealistic expectation, given that there are no jobs. None have been created and no steps have been taken in that regard. The government is just hitting the unemployed over the head.

What is ever more appalling about this measure, this reform, is that once again women, because of their precarious condition, and young people will bear the brunt of a bad reform. Why? An impact assessment carried out by the federal government shows that the hardest hit will be individuals whose annual income is under $25,000. That takes the cake. It is a well known fact that women and young people are the ones who earn the least. Women still earn 70 per cent of what their male counterparts make. Once again, women will be the big losers.

Second, we are told that eligibility requirements will be tighter, eligibility being determined on the basis of the total number of hours worked over a given time instead of the number of weeks worked. In addition, contributions will have to be paid starting with the first hour of work. This means that the young student working for a fast food chain, not to name any names, who, as is often the case, was hired to work between six and ten hours per week, will have to contribute to the unemployment insurance fund starting from his first hour of work. While he is forced to contribute to the fund, this student will never get to draw a penny from it during all his years as a student employee.

They will dip into-not to say steal-his premiums in order to reduce the deficit. This money is really being misappropriated. Then they claim that, this year, they doubled the amount of money set aside for students, for youth employment projects, and that they really want to help students. This is a smoke screen because as soon as they start working, they will pay UI premiums without ever qualifying for benefits.

Bill C-12 will greatly reduce the number of people eligible for benefits. Furthermore, as I showed you earlier, even those who do not qualify must contribute to the fund, getting poorer in the process. Another reason why this bill is unacceptable is because it would consider spousal income in determining if someone is entitled to receive the supplement. That takes the cake.

Unemployment benefits will be calculated on the basis of income, when we know that women have always earned less than men. If both spouses lose their jobs, the man will receive benefits because of his higher income, while the woman will be forced, once again, to beg for the money to buy a pair of stockings. This is an unacceptable policy that takes women back 50 years. This bill is highly discriminatory. I cannot understand why the women in this House did not rise against this bill. This is appalling. Once they understand the clause concerning the penalty they will have to pay, all women will rise against this bill.

Finally, the bill seeks to reduce the maximum benefit period, which would inevitably result in a more rapid transition to social

assistance. Only 55 per cent of those who are jobless will be eligible for benefits. Where will the others go? They will go on welfare. This is called dumping the deficit into the provinces' backyards. The provinces will once again have to foot the bill.

And what about maintaining duplication and overlap? This will promote neither an effective employment policy nor employability, including for women.

There is unanimous agreement in Quebec regarding the need for an employment development policy. This bill will have tragic consequences everywhere in Canada and in Quebec, because the Minister of Human Resources Development, with the quiet complicity of the Minister of Finance, has decided that a reform of the unemployment insurance system was in order. We never opposed the idea of a reform, of modernizing the system, of making sure that the moneys are used in the best interests of workers. This is what we advocated.

Since you are indicating that I only have one minute left, I now come to my conclusion. Protests were held everywhere and there will be more, because the victims of this measure realize what the government is doing and they simply cannot accept it.

How could they accept, with an annual income of $10,000, $12,000, $15,000, or even less, that the federal government is targeting these people and ask them to pay for its mismanagement? When people have to make do with the meagre income provided by a system such as the unemployment insurance system, how can they quietly accept the government's decision to reduce benefits, even though there is a surplus in the fund?

This government will have to answer for its actions at the next general election.

[Warren Allmand, Liberal, Notre-Dame-De-Grâce, QC]

Mr. Speaker, I welcome the opportunity to speak to Bill C-12.

As a member of the human resources development committee, I was able to participate in the hearings on the bill which were carried on this spring over a five week period and during which time we heard from 79 witnesses, individuals and groups. In addition, there were numerous written briefs considered by the committee.

When the bill was tabled late in 1995 my initial reaction was to oppose it because it proposed substantial cuts to the UI system which in my view were unfair and unjustified. For seven years, from 1984 to 1991, I was the employment critic for the Liberal opposition and during that time with the support of my party severely criticized the Conservative government for similar cuts.

Furthermore, during the 1993 election campaign the Liberal Party made no mention in the red book or elsewhere of proposed cuts to unemployment insurance. Quite to the contrary, we condemned the Conservatives for their attacks on this and other social programs.

Despite my initial opposition, I decided to participate objectively in the committee process, to listen to the arguments on both sides and then decide what position to take to oppose or support the bill in whole or in part.

I was encouraged by the minister, who said that within certain limits he would accept amendments to improve the bill, which he has done, and I congratulate him for it. In particular, I refer to the amendments presented by the members for Fredericton-York-Sunbury and Halifax West to change the method for calculating benefits, which amendments will substantially reduce the cuts to benefits as set out in the original bill. Also, amendments were presented by the hon. member for Etobicoke-Lakeshore to exempt low income families from the intensity rule.

The original bill would have cut $2 billion from the unemployment insurance program. These amendments by my colleagues will put back approximately $400 million. All in all the committee did good work. It did the best it could within the fiscal framework, but there is the problem.

One provision of the 1995 budget was to cut the unemployment insurance program by 10 per cent. Consequently, despite the goodwill and amendments of the committee, the bill still results in serious cuts to unemployment benefits at a time when a large number of Canadians are unemployed.

I decided to participate in the committee to honestly listen to the arguments on both sides. The more I listened to the evidence in committee the more I became convinced that on the whole the bill was wrong.

It is true the bill does contain some improved measures such as the hourly base for qualifying for and calculating UI benefits. Under the present law a person must work at least 15 hours per week in order to qualify with the result that many employers hire workers part time at less than 15 hours per week simply to avoid paying their contributions. Under this bill, all hours of work will count for qualification with the result that part time workers will have a better chance to qualify. This is definitely an improvement.

There are other improvements as well. However, the net result when the improvements and the cuts are added up is that fewer people will be covered and the benefits will be lower than under the present system.

As a result of earlier cuts by the Conservatives prior to 1993 and by the Liberals since 1993, the percentage of the unemployed covered by unemployment insurance dropped from 87 per cent in 1990 to approximately 50 per cent to 52 per cent today. Unfortunately this bill will make it worse. In addition, even with my colleagues' amendments, benefits will be lower for most claimants who qualify.

My main concerns about this bill are the following. First, although the move to an hourly system is good in itself, the number of hours of work required to qualify is too high for both regular and special benefits. As a result it will be more difficult for workers to qualify under this bill than under the present law. While some part time workers will gain under these new rules, many workers will lose and will not achieve coverage.

My second concern is that benefits will be reduced for three-quarters of unemployment insurance claimants as a result of three provisions in the bill. The first is the new method of calculating insurable earnings and benefits through the divisor rule. Even with the improvements of my colleagues the benefits will still be less. The second is the intensity rule which reduces benefits for those who are obliged to make repeated claims. I say obliged to make repeated claims. I have in mind seasonal workers and workers who are hired on a temporary basis. The third is the provision in the bill to reduce the maximum insurable benefit from $448 per week to $413 per week. That is the maximum benefit.

My third concern is that the bill reduces the duration of benefits, the time for which benefits are paid, from a maximum of 50 weeks to 45 weeks. As a result there will be more unemployed persons with no benefits. They now qualify for up to 50 weeks; they will be cut off at 45 weeks.

Some supporters of the bill believe that these measures, the measures to restrict coverage, to reduce benefits and to reduce the duration of payments, will force unemployed workers back to work. This belief presumes that work is available which is certainly not the case everywhere. It also presumes that most workers prefer unemployment. Again, there is no evidence to support that. I would say that a great number of workers want to work. There are some who do not and would live off welfare or unemployment insurance but they are a very small number.

These measures might also force the unemployed to take lower paid jobs. With economic growth increasing, such as was stated in both this year's budget and last year's budget, this only continues to widen the gap between the rich and the poor. Why should we force people into lower paid jobs if economic growth in the country is in fact increasing? This is not economic justice.

Another major concern I have with the bill is that it allocates a greater percentage of the UI fund to training and employment support measures. I fully agree that these measures are absolutely essential but until recently they have been paid out of general revenue and not out of the UI fund.

What has happened is the government observed that this year the UI fund would have a surplus of approximately $5 billion so it decided to take some of that money to pay for training which had been previously paid out of general revenue. In the budget last year the government decided to cut approximately $2 billion from the unemployment insurance system, reallocate $800 million of that to training and employment and at the same time the government reduced its funds for training out of general revenue. In fact, the government is solving its general deficit problems by cutting expenditures for training which were made out of general revenue and then taking money for these same purposes from the UI fund.

I must remind the House that the UI fund is made up of payroll contributions from employers and employees. Not all Canadians contribute to this fund. The original and principal purpose of the fund was to sustain the unemployed while temporarily out of work. It was to help the unemployed to pay their bills, to pay their rent, to pay for their food and to keep their children in school. That was the principal purpose of unemployment insurance.

Training, like education, was always paid by all taxpayers because in the long run it benefits all taxpayers. The payment of primary and secondary education is not restricted to parents and students. Why should training then be paid only by workers and employers?

Furthermore, the proposed system leaves individuals who do not qualify for unemployment insurance without the same training and employment opportunities. In particular, immigrants and women who have been at home taking care of their children and go back to work would not qualify for this training and these employment benefits because they have no attachment to the unemployment insurance system.

In conclusion, I would support any measures which would correct abuse and encourage a return to work. However, in my view this bill punishes the innocent with the guilty. I will support the government's amendments to improve the bill but I will also support other amendments that will improve the bill. I must say that I will have to oppose those parts of the bill which reduce coverage and benefits.

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Mr. Speaker, I would kick myself if I did not begin my remarks by mentioning that at least one government member has shown some understanding in his analysis of this bill. Incidentally, he is from Quebec. I congratulate him even more for that. Thus at least one Liberal member from Quebec has understood. What the member said is exactly what we keep hearing in demonstrations and in our ridings.

This is a bill that, yes, has some improvements in some respects, but that, all in all, is a bad piece of legislation, a bill we must vote against. Hats off to the hon. member for Notre-Dame-de-Grâce who stood in the House to say so.

[Some hon. members]

Hear, hear.

[Michel Bellehumeur, Bloc, Berthier—Montcalm, QC]

Another thing that bothers me somewhat about all this analysis and about the whole issue of unemployment insurance, is when they limit or try to limit my right to stand up and express my views. I feel this has been done many times with regard to this bill. It was done right at the start when we skipped second reading to allow members to study the bill in committee and hear people before making recommendations. The aim of this process was to enhance the members' contribution. However, what did the government members do in committee? They gagged us so that we could not work at this bill, which is unacceptable.

Or course, the government did not want to see people like the hon. member for Notre-Dame-de-Grâce come to every hearing and say that this is a bad bill for such and such a reason, with very specific cases. Obviously, the government did not want to hear that.

Nor did it want to hear Bloc members echo their constituents' views that women and young people will not benefit from this bill, and that the unemployed will get clobbered. The government did not want to listen. It introduced a gag motion, and it is doing so once again at report stage. It is turning a deaf ear to people's views.

The government's goal is quite specific. It wants to save money on the backs of the unemployed. So we can understand why the government is doing what it is doing.

The government and the minister just sound ludicrous when they say these amendments are good, because unemployment insurance will be replaced by employment insurance. When one looks at the outcome of these amendments, it would be more appropriate to call it poverty insurance, because the only sure thing with this bill is that the unemployed will have a hard time, and in more ways than one.

I have been trying to determine what this bill's goal is. With all the nice speeches we have heard day in and day out, would it be to create jobs? I think the evidence of expert witnesses in committee makes it clear that this bill will kill jobs. Nothing in this bill can create jobs. So that is not the goal.

Would it be to help the unemployed? How could it be, when the bill takes money right out of their pockets. Demonstrations and briefs to the committee leave no doubt. It is clearly not the goal. Would it be to improve the quality of life for women and young women? It is equally clear that this is not the goal. Even the true Liberal member for Notre-Dame-de-Grâce just told the House that it was not.

I did look at the situation women are in, but since I am not that old, I looked even more closely at the situation our young people are in to see if this bill is going to be any help to them. Well, the answer is no. Nothing, whether it is in the rate or the premium calculation, is of any benefit to young workers.

So, why bother with this reform? It is easy to understand once you are aware of the financial situation of the government and of the calculation method used by the Minister of Finance. The main objective of the federal government is to grab $5 billion to pay off the debt. It is rather hard to see that the only way for the government to reduce the deficit is at the expense of the poor. It is shameful from a party that claimed to be close to the people and have social democratic leanings. It is disappointing to see that the only money the government has been able to grab was, again, at the expense of the poor.

The government is doing the very opposite of what Robin Hood did. It steals from the poor to be in a better position to help the rich. That is what this unemployment insurance reform is all about. Yet, in the red book and during the election campaign, the government did not, to my knowledge, say that it would pick on the unemployed, that it would grab them by the throat, as the Liberals love to say. I did not hear any such thing.

To do so, the government introduced Bill C-12. Look how thick it is, and the government wants us to pass it at full speed. The bill has over 100 clauses, and countless subclauses. There are many changes. We need go no further than clause 2, which is covered by some of the amendments we are considering today. In clause 2, the government gives a whole series of definitions, for things as simple as an affidavit. If you want to confuse the public, you might as well go all the way. Everybody knows what an affidavit is, but the government felt the need to define it.

There is also a definition of an interruption of earnings, a labour dispute and documents. There is a whole series of definitions whose objective and, maybe, only positive aspect is to make a living for lawyers. Since I am a lawyer, I may talk for them. Lawyers will use all those definitions to slow things down as much as they wish. The other side of the coin is that public servants will also use those definitions but not necessarily in the best interests of the unemployed, obviously.

The interpretation will be to the effect of restricting even more eligibility for unemployment insurance. We, the official opposition, cannot agree with that. That is why we are against clause 2 and asking that it be abolished. In any case, the legislator does not talk for the sake of talking. If a series of definitions is provided, they will have to be interpreted.

Even more important is the last point where the government says that this reform will help the unemployed as regards their employ

ability. In a clause which, again, goes against the pretensions of the government, it is clearly said that programs will raise the employability level of recipients.

Any decision by a public servant regarding the eligibility or non-eligibility of an unemployed person for a training program cannot be appealed. This is what this bill is all about. A public servant will make an arbitrary decision that the unemployed will not be able to appeal. Today, 75 per cent of appeals made by the unemployed are successful.

Why do you think the government has thought it necessary to put that in the bill? Simply because public servants will be instructed to crack down harder on the unemployed so that the government reaches its objective, which is to reap $5 billion. This is clear.

When the minister tells us that he will propose this or that amendment to improve the bill, this is hogwash because, ultimately, the $5 billion target remains. Let us reduce this $5 billion target, let us talk about a target of maybe $1 billion, and then the amendments might be significant. But ultimately, what good does it do to rob Peter to pay Paul?

The minister still has these $5 billion to artificially reduce the deficit, and to do it at the expense of the unemployed. This is the price we have to pay because the government does not care about the unemployed.

[Paul Devillers, Liberal, Parliamentary Secretary to President of the Queen's Privy Council for Canada and Minister of Intergovernmental Affairs]

Mr. Speaker, I am pleased to speak today on this important restructuring of the current unemployment insurance system.

I want to congratulate my colleagues who sat on the parliamentary committee and worked on this complex problem. This bill is about modernizing our unemployment insurance program, that was created in the 1970s. Because more and more Canadians are affected by rapid economic transformations and the government's budget for social programs is already stretched to the limit, no one can deny that these changes were needed.

I would like to focus on three topics today, which are the computation of eligible hours, the effect on small businesses and the application of this system to high income earners.

First, this bill constitutes, in my opinion, a fundamental change as far as eligibility to the system is concerned. From now on, eligibility will be based on the number of hours worked and not weeks. In today's labour market, a system based on the number of

weeks worked creates unfairness. For many workers, one week does not mean 40 hours from Monday to Friday any more.

When establishing the eligibility of workers according to the number of hours worked, the government wants to ensure that every hour of work counts. Thus, it would be more advantageous to work as long as one can. The new system takes into account the fact the labour market has changed and that millions of people now have work patterns that no longer correspond to the traditional work week. They deserve the same protection as their fellow citizens holding regular jobs get in case of a layoff.

The new system is a lot fairer for people working part time or in seasonal industries. For example, people working less than 15 hours a week will be insurable from now on. With employment insurance, 90,000 part time or seasonal workers will become eligible for benefits. Many will become eligible earlier and for longer periods and will see a bigger part of their earnings insured.

Second, I would like to talk about the effects of the bill on economic growth. The government's objective is to create an environment that is good for business, economic growth and job creation. That is the main objective of our employment strategy.

That objective will be met in many ways. I will cover only two. First, the lowering of the maximum insurable earnings will match more closely than the present system insurable earnings and salaries in Canada.

That change will lower the payroll charges, thus increasing the revenues of employers as well as those of employees. The reduction in employer and employee contributions will be particularly apparent in high salary sectors.

Second, one element of the employment insurance program will constitute an important support program for small businesses. You will agree with me that small businesses are vital to Canadian economic renewal.

The small business support program will reduce the impact of any increase in the contribution level. This will be aimed at companies with fewer than 25 employees that will pay less than $30,000 in premiums in 1996. Any raise in the contribution level representing $500 or more as compared with the base year, 1996, will give the employer a partial rebate. Companies affected will get a rebate of up to 50 per cent of any raise in 1997 and 25 per cent in 1998. This two-year program will begin in January 1997 to coincide with the implementation of the first dollar earned policy and the annual calculation of maximum insurable earnings. Employers whose 1996 contributions are less than $25,000 will be entitled to a maximum yearly rebate of $5,000. Those whose contributions are between $25,000 and $30,000 will see their maximum rebate reduced dollar for dollar.

Finally, I would like to talk about this system as it applies to high-income people. Some of my constituents have mentioned the fact that, under the present system, it is possible to work a few months during the year and to increase one's income by drawing unemployment insurance for the rest of the year, and to do so year after year. This inequity was raised by several Canadians during the consultations that led to this bill.

The employment insurance program will have stricter clawback provisions. Claimants who will have received more than 20 weeks of benefits over the last five years and whose income exceeds $39,000 will have to reimburse a greater portion of their insurance benefits than is the case at the present time. These people could have to reimburse up to 50 per cent of the benefits that were paid to them.

High-income earners who contribute to the program will continue to have access to reasonable benefits in case of unforseen job loss. However, those who work only part of the year and whose income is still higher than average will not be able to increase their income by drawing considerable amounts in employment insurance year after year.

In conclusion, I think this bill makes necessary changes to the unemployment insurance system to modernize it. The new system confirms the value of work since every hour of work counts. So the system will protect 97 per cent of the labour force. It will be more fair and more balanced. It provides for recovery of benefits, thus guaranteeing that people with high incomes receiving benefits frequently will no longer benefit from the system unfairly. Finally, the move to employment insurance will be gradual so that small businesses will have the time they need to adjust to the changes. This bill represents a compromise between our budget constraints and our desire to offset the negative effects of unexpected loss of employment.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, like my colleagues, I must also state that this bill is a poor one.

I would like to congratulate the member for Notre-Dame-de-Grâce, the only government member who seems to have understood something and who had the courage to rise in this House and honestly speak his mind.

As I have already said, this bill dealing with employment insurance in Canada, which is now at report stage, is a real injustice. It is unfair, regressive, anti-job and it will only cause poverty. Never before has any government so seriously challenged the social safety net essential to citizens. Employment insurance,

or rather poverty insurance, will offer the unemployed less and less support; they will be left to fend for themselves.

With a $5.5 billion surplus and an unemployment rate exceeding 20 per cent in some regions, I cannot fathom how we can call this bill an employment insurance bill.

One point particularly close to my heart goes back to the last unemployment insurance reform. I remember the Liberals, then in the opposition, had raised quite an uproar when the government changed the system so that workers willingly quitting their jobs, or being fired, were excluded from the unemployment insurance system.

And what will the present bill change? Absolutely nothing. The government is not correcting the injustice it denounced so strongly when it was in the opposition. Clause 33 of the bill confirms the principle. It says claimants will not be entitled to benefits if they voluntarily quit their job or lose it because of so-called misconduct.

Did the government consider those who hold several jobs? This new system will take into account each hour worked. Three hours at McDonald, four hours at Harveys, one week-end at Loblaws. According to the government, this is the way low income earners will be able to become eligible for employment insurance.

But what will happen if a worker who is holding several casual jobs decides to voluntary quit one to readjust his work schedule? Will this voluntary departure be entered in his file? Will he be eligible for employment insurance?

This is only one small example of the many flaws of this reform. It has all kinds of flaws. Eligibility criteria are being tightened. Before, 12 to 15 fifteen-hour weeks, for a total of 180 to 300 hours, depending on the situation, were needed to become eligible. With this bill, to become eligible will require from 420 to 700 hours of work, or 12 to 20 thirty-five-hour weeks. In the case of new entrants to the labour force, the number of hours necessary is three times higher that it was.

From now on there will two categories of unemployed workers: the regular ones and the frequent ones. Those with an attachment to the system will see their benefit rate drop from 55 to 50 per cent, or 1 per cent for every 20 weeks they were paid benefits. This measure means that people will have to work longer to be entitled to lower benefits for a shorter period of time.

This bill is regressive because there will only be one premium rate, a fixed rate for all workers, and maximum insurable earnings will be $39,000 instead of $42,380 as under the current system.

I will give you an example of the consequences of this measure. A worker who earns $39,000 or less pays 2.95 per cent of his salary in premiums. A worker who earns over $39,000 a year will stop paying premiums once the threshold is reached. The more a worker earns, the more his percentage of premiums drops.

The employment insurance bill is also an anti-employment measure. In fact, the five-cent reduction in workers' premium rates, from $3 to $2.95, and the establishment of the $39,000 ceiling on insurable earnings, gives capital intensive businesses an advantage over labour intensive businesses, which are essentially small and medium size businesses that create jobs. This measure encourages overtime among high income earners.

This is a motion that really hurts workers. The load is lightened for high income earners, while those who earn less are asked to carry a greater burden. As I have just said, higher wage earners are simply being given an opportunity to work extra hours, which will automatically eliminate jobs.

Not only does the reform encourage overtime, but it also encourages people to hold down two or more jobs. Despite all that has been said about reducing the work week in order to create employment, Bill C-12 is headed in a completely different direction.

Finally, this bill will lead to poverty. By reducing benefit rates, taxing workers from the first hour and tightening eligibility criteria, thus cutting off certain clients entirely, the new measures will result in an increase in the number of people forced to turn to welfare.

This bill has wide ranging effects: young people, women, immigrants, new claimants, the regions, family benefits, eligibility and the calculation of benefits, seasonal workers, self-employed workers and the handicapped. To sum it up, this bill is just like this government. It dabbles with everything and solves nothing.

[Rose-Marie Ur, Liberal, Lambton—Middlesex, ON]

Mr. Speaker, I am pleased to take part in the report stage debate on the employment insurance legislation, Bill C-12, which will surely have a positive impact on all communities of Canada, including my riding of Lambtom-Middlesex.

It should be mentioned from the outset that the old Unemployment Insurance Act has not been revamped for 25 years. The technological revolution that has been sweeping over the economy during this period of time has also been a force in reshaping, reconfiguring and redesigning our jobs.

Let us be clear. Changing technology does not mean there are no jobs. It does mean there are different jobs often in different places and often requiring different skills. The result is that people today change jobs more frequently not only within the company or industry but crossing into new industries and occupations as whole industries are reshaped and new ones spring up.

This new economic renewal has its positive side. It has brought new opportunities, new growth, new jobs, over 600,000 new jobs since the government was elected two and one-half years ago. An innovative economy also requires innovative social policies and I strongly believe Bill C-12 delivers.

Today I will address two key structural changes which are important features of the bill. The first is the switch from using weeks of work at UI covered jobs to using hours of covered work as the main unit of account for the new employment insurance program. The second is the new intensity rule whereby the replacement rate for insured earnings would fall with increased use of the program over the previous five years. I strongly support both of these innovations. Each is a made in Canada solution to important problems with our present unemployment insurance program.

The first of these two key proposed changes, the shift to using hours of work as the main unit of account, is a forward looking provision that will greatly affect program coverage in years to come. We currently have a program that excludes jobs offering less than 15 hours of work per week from UI coverage. Part time employment is on the increase for many reasons. However, as part time employment continues to grow, the portion of total employment in our economy that is UI or EI covered would also continue to fall.

Unemployment insurance programs in Canada and in other developed countries have been in place long enough that most of us have come to take for granted the important economic stabilization functions of these programs. For example, when any country slips into an economic recession, those who are laid off must cut back on their expenditures far more severely if they are ineligible to collect earnings from insurance benefits. In addition to the damage to them and their families, the large decreases in expenditures also translate into lower levels of sales and even more layoffs.

This circular spiral of layoffs leading to sales decreases which lead to more layoffs can potentially result in deep economic depression. I believe this is every bit as possible now as it was back in the 1930s without powerful economic stabilizers like our UI program that push up the standard of living of those who have this coverage. Thus, the value of UI or EI programs as an automatic stabilizer depends on the broadest coverage possible.

The proposed move to an hourly as opposed to a weekly unit of account will, I believe, reverse the erosion of our present UI program due to the increasing numbers of part time jobs that are ineligible for coverage under the present program rules. This will definitely help to preserve the important economic stabilization rule of this program.

The change will lead to greater equity of treatment for part time versus full time workers. This is increasingly important in an economy where growing numbers of people can only find employment in part time jobs though they may be working full time when their hours of work and all jobs are counted.

Before offering my comments on the proposed intensity rule in Bill C-12, it is worth mentioning that the 1971 changes to the UI Act set our UI program on a course toward becoming an income transfer rather than a social insurance program, characterized by an unwieldy mix of regional equalization and federal welfare transfers in a social insurance program format. I am convinced that the intensity rule would help re-establish UI or EI as a true social insurance program.

I use the term social insurance to mean a program that provides insurance coverage against specified perils, with those paying for the program receiving fair personal value for their money. True insurance coverage is not the same as having individual rainy day accounts that eventually can be used by individuals for other purposes if the insurance peril does not occur, in other words, if what was paid in is not fully used to cover peril related damages for the individual.

True insurance means that those who are covered by the program, who are unlucky and suffer the insured peril, whether it be fire, theft or unemployment, can draw out more than they paid in according to stated rules. On the other hand, those who are lucky and never do suffer the peril they are insured against must be satisfied with having enjoyed the peace of mind of knowing they were insured.

All true insurance programs involve some sort of experience rating or other risk related adjustment of the premium payments versus the coverage levels. There are essentially two forms of experience rating in most insurance programs. Those in higher risk groups either must pay higher premiums for the same coverage levels as is common for automobile collision insurance or get less coverage for the same premium rates.

The proposed intensity rule in C-12 adopts the latter approach. That is, all claimants with more than 20 weeks of regular benefits in the previous five years would have their benefit rate gradually reduced. It would decline by one percentage point for each 20 weeks of past benefits collected to a floor of 50 per cent of insurable earnings.

The maximum benefit rate under Bill C-12 would be 55 per cent of insurable earnings. I believe this is more than fair. This is true to the experience rating adjustment of any real insurance program. It is also worth mentioning that everyone would start EI with a clean slate. Previous use of UI benefits before July 1, 1996 will not count.

Our present UI program is not means tested and is not paid for out of general tax revenues. It is entirely funded by payroll taxes on those covered by the program and their employers. Yet it is not experience rated either and is thus not really an insurance program. In fact, all those covered by the program are taxed according to the same schedule.

Those at greater risk of becoming unemployed because they live in regions with higher unemployment rates are given more rather than less coverage. Those in high unemployment regions become eligible to collect UI benefits with fewer weeks of insured benefits and can continue to collect benefits for more weeks.

At present the use of our UI program is constrained by neither experience rating nor means testing. The intensity rule addresses this by introducing a mild degree of general experience rating in the UI program.

Rather than largely excluding seasonal workers such as those engaged in the construction trades, as was the case prior to the 1971 changes to the UI program, Bill C-12 will provide high risk workers with coverage. However the degree of coverage would diminish with increased claims over the previous five years. In this way broad coverage would still be maintained without risking a runaway growth of program costs.

I am convinced that the intensity rule would successfully change the current UI system by transforming it into a real and much fairer insurance program. Of course many of those in intermittent employment truly cannot find other work.

Canadians have demonstrated time and again that they are willing to make personal sacrifices to provide financial assistance to others who are in real need. That is why Bill C-12 contains a number of provisions to address this reality. For up to three years those who have exhausted their benefits will have access to target employment benefits such as wage subsidies, earning supplements, self-employment incentives, and skills and loans grants.

Experts have looked at all aspects of how the old UI system operated. They know it can affect the behaviour of employers and employees in ways that Canadians simply do not accept any more. Bill C-12 is a good piece of legislation that successfully addresses some of the more current aspects of our system.

After 25 years of the status quo, it is time Canadians had an employment insurance system that better reflects the realities of the 1990s and beyond.

[Yvan Bernier, Bloc, Gaspé, QC]

Mr. Speaker, once again this marks a sad moment in the life of a member of Parliament, to have to stand up in this House to speak on a bill with such devastating effects on the lives of our fellow citizens. We have said many times, and are forced to say again today, this is a sad day. People are not yet properly aware of the consequences, and that is what I find surprising. Unemployment insurance-let us call a spade a spade-is a tool of economic stabilization. It is something that is necessary and useful in most of our ridings. I do not think it is just a coincidence that it is a Canadian invention.

How can we make people understand? How can we ensure that the hon. members across the floor understand, when the time comes to vote on these motions, on this bill? What can we do to ensure that people will understand all of the importance of what is at stake. The hon. member across the way, in some bits of her speech on this group of motions, referred to a program that has not changed in 25 years. I may perhaps be in agreement with certain points. We ought perhaps to have started changing a few things, but changing unilaterally, and in the way that has been adopted, means that the only beneficiary of this reform will be the coffers of the government. It can hardly be a surprise that the opposition is making an outcry. It is hardly a surprise that there has been an outcry in certain ridings that have to live with serious unemployment. Their outcry comes as no surprise.

How is it that here, in this House of Commons, in this Parliament-and yet we have in front of us some educated people-we are unable to make them understand that?

I can hardly believe it, and I am not anxious to see the effect all this will have. We have unemployment insurance as it exists currently, and we have the problems. I would like to be told once again, but where do we see in this bill that people will really be sure to get a job? The government is only playing on words. It has only been window dressing, to introduce measures to reduce the amounts given to claimants and the length of time they will receive them.

As was said earlier, everyone will be affected. I come from a remote riding, the Gaspé Peninsula. Incidentally, I think that is the most beautiful part of Quebec and of Canada, the nicest riding. It is not only people who make their living from the fisheries and forestry who will be affected. People who work in construction, whether in Montreal or in Toronto, are also experiencing some fluctuation in their field, and they will be seriously affected.

I can give you an example in that regard. With this new bill, a person working in construction will find himself trying as much as possible to put together his work hours or work weeks in a given time, because if he is not careful, the amount of benefits he will receive when he is not working, that is, when he is on unemployment insurance, or employment insurance, will be reduced.

Consequently, people will only want to work during periods where it will be to their benefit, but not necessarily when the customer needs their services. A Montreal customer might need a door handle fixed on a Saturday morning in February, but it might unfortunately be more convenient for the worker to do it in May, because he could then add it to his hours of work during the summer. This is just one example.

I know that this group of motions refers to it without referring to it. I am trying to see where it is mentioned in the definitions. But the details on how to calculate the hours of work-for fishermen, for example-will be in the regulations. This is just to show you how obscure the process is at this time. It is easy to see why both the opposition and the people want as much time as possible to discuss and study this bill.

I was going to give some examples concerning fishermen, self-employed workers and lumberjacks. Under the current legislation, benefits are based on the number of weeks. The people in my region are used to quantifying their work. This is something tangible. A vat of fish is not the same as a given number of hours. That is how pay is determined and how benefits are claimed at the end of the year. As for lumberjacks, they chop 1, 10 or 20 cords of wood. Again, this is something tangible. How will this be converted to hours of work, after the bill takes effect?

The current definitions and regulations do not specify how this will be done. They say it is coming. It is coming so fast that we will get run over because we could not see it coming. The people have a right to know exactly how all this will be calculated, because it is their lives that will be affected.

Madam Speaker, I know that you, too, come from a region with many forestry workers. You know how hard these people work. I cannot see them walking around with notebooks in their hands, saying: "Hey, boss, I worked in this part of the forest for an hour". No. They will say: "I cut so much wood". Will there be a conversion? How will all this be calculated? I do not know. The vast majority of people do not know.

One thing that is becoming clear to them is the impact the cuts will have. We are told right away that there will be a dividing factor. The effect of this dividing factor will be to reduce the benefit amounts. What good does it do the public to get fleeced like that?

I would have expected a bill of this importance to rely on partnership with the public, to call upon the public's co-operation. From the outset, the public is told: "You will receive benefits over a shorter period, your benefits will be lower and, if you claim benefits too often, we will get on your case and impose another penalty on you".

All this is quite disheartening and does not leave much leeway to try to amend the bill. That is why, with the group of motions before us, we hope to review all the proposed definitions contained in the bill. There is nothing in there to make people feel secure and to give them an idea of what could be done to protect them. It is all going one way and one way only, straight in the government's pockets.

But the people cannot in turn dip into someone else's pockets when they go shopping after work, looking for a product that they need. They have worked, they have learned to live with the shortage of employment around them and to supplement their monthly income with unemployment benefits, but overnight all this will change, yet they are expected to believe that it will be good for them, while it has been made clear from the beginning that they will receive less money. That is beyond me.

I raised this point last week, but now that I have found the quotation again, I would like to read it once again. The person who used to sit in front of me, the former Minister of Fisheries, Mr. Tobin, broke his silence last week. He made a statement on May 1. He said to the Prime Minister: "No more cuts please". He is very polite, but he still asked that no more cuts be made. He said that, while his province collected a disproportionately high amount of money, because of its disproportionate reliance on federal transfer payments, it has reached its limit. The Prime Minister's best friend is giving him a warning while they are still friends: "Enough is enough". We are already hit hard because we lack jobs. Now, in addition to that, the victims of that job shortage will be targeted.

The one thing I deplore is: Why did the member for Humber-St. Barbe-Baie Verte wait until he was gone? Why did he wait until he left Ottawa to make himself so clearly understood? He is now the premier of his province and he sees how the lack of jobs affects his population. He says: "What Ottawa is doing is not right".

But he is no longer here. Will I have to wait until others leave before saying these things? The damage will have been done. The government imposed time allocation. We are being gagged. This is what it means. We are forced to contain ourselves, to not speak longer about a bill that will deeply affect society in Canada and Quebec.

We are told: "Yvan, shut up, you said enough". But those who, not long ago, had the power to speak in this House and are now gone say: "What Ottawa is doing is not right. Enough is enough".

I hope that some members opposite will rise and will not wait until they leave Ottawa to say to the Prime Minister: "We cannot go ahead with this reform. We must find a partnership with the opposition and with interest groups to rebuild this system in a climate of confidence and dignity". Currently, given the bill before us, the government is only helping itself.

For these reasons, I cannot support this legislation and I will rise again, as soon as other motions allow me to do so, to voice my opposition.

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

Madam Speaker, I am very glad to have another opportunity to speak on Bill C-12, which will bring forward a new employment system for Canada.

I was very ashamed of some of my colleagues opposite with regard to the HRD hearings. For two and a half years we travelled across the country listening to more than 1,000 individuals and groups of people. We were there. This legislation reflects a lot of what we heard.

I remember being in Alberta. Sure, we might have been a little tired at the end of those 12 and 15-hour days. We had walk-ons, where any individual who showed up could appear before the committee. As Liberals we were willing to listen to people.

People appeared before us with tears in their eyes. There was no press. They were not trying to impress anyone. They were asking for help.

Tomorrow, in Ontario, there is going to be a reformatory budget. The budget brought by this group of people in Toronto, as in Alberta, will attack the working people, or the people who thought they were going to be working.

[Bob Mills, Reform, Red Deer, AB]

There is pride in Alberta in balancing the budget.

[Larry McCormick, Liberal, Hastings—Frontenac—Lennox And Addington, ON]

Yes, there is a lot of pride in Alberta, but I have neighbours in Ontario. I have friends in Alberta who taught school for five or six years. They have given of themselves for their education. Today, these people are gone. We are not investing in the children. We are not investing in our future. Its reformatory tactics are disgraceful. Thank goodness, we have a Liberal government, a government that will give people an opportunity to help themselves.

There are many benefits available in part II of the bill to help people help themselves. The former minister for HRD is from the Winnipeg area. I remember at committee being frowned at by a few of my Liberal colleagues and being applauded by some of the Reform Party when I said that there was some abuse in the system.

Finally, I said to the former minister: "If you want the public," this was my humble opinion, "to accept what we were trying to do, I think we should at least acknowledge the abuse". Today, the minister has done that.

From looking at the direct abuse, we are going to be able to take that money and offer it to people who want to help themselves. In all the provinces of this country, 45 per cent of the people who have fallen through the cracks-it can happen-are friends and neighbours of ours to whom it happened. If these people worked one day in the last three years, if they had a work attachment, five days following the birth of a child, they now qualify to access any one of the five tools in part II.

There are the targeted wage subsidies. This is not just subsidized jobs, but on the job training that will make a difference in their lives. It gives people some heart. We will not be cutting at random like the Ontario government will do tomorrow.

There are targeted earning supplements and self-employment programs. As a small business person I have attended some of the classes under HRD that are available since I do not know how long this job will last.

I have seen people attend the classes to get ready to start their own businesses. It has made a difference. Statistics show when a person starts a business usually he or she will employ one more person. We have to give people a chance to help themselves.

There will also be job creation partnerships, skills loans and grants. For my hon. colleagues and friends opposite, yes, the provinces will be able to make the decisions.

I have heard many people talk because of the misinformation out there about this reserve fund being used to pay part of the deficit. As we all know, that is not allowed by law. It will not make any difference to the deficit in the long run. A reserve is a very necessary part of this bill.

The other day the department furnished us with a table that showed the cumulative interest charges. More than $1 billion had to be repaid out of UI premiums because of outstanding deficits between 1991 and 1995. By contrast, twice that amount, $2.3 billion, was repaid following the previous recession in the early eighties. It makes much sense and will create jobs to have a cushion there if there is another recession.

Many witnesses appeared before us. I quote one witness who was among the last 85 to appear. Professor Alice Nakamura, a distinguished doctor in the faculty of business at the University of Alberta, put a lot of work into this bill:

I committed a great deal of time and effort to the Axworthy social security reform task force. Many of those around me told me I was foolish to do that. "Look what happened to previous attempts for reform attempts", I was told. I knew what they were talking about.

This doctor had committed time and effort to the MacDonald royal commission on the development prospects for Canada. She continued:

I was advised that the different political parties and the provinces would not be willing to pass up the opportunities for partisan gains that a UI reform attempt invariably brings.

You have proven wrong all those who told me this reform effort was a waste of time. Bill C-12 tackles serious problems with our present UI program, making use of the best available research about how our labour markets and social programs function. And it is a bill that pays careful attention to the real life problems of transition. It strikes a careful balance between the desperation of people who cannot find enough work and have depended on the income from UI benefits, and the desperation of economic analysts who recognize the threat which trends in our present UI programs pose for our economy and the future employment.

The prospects for these people will be dim, but now there is hope for many people. As the doctor reminded us, she believes future generations will look back on our efforts in deep admiration and gratitude.

Many witnesses from across the country appeared in front of the committee. We heard from unions. They complained. They said we did this wrong and that wrong, that we were going too far. We heard from other social groups that said we were not going far enough, vice versa. This is an excellent piece of Liberal legislation in which we show we have listened to the people, that we care about the people. We are not just looking after people from one province.

That would not be a fair shot to my hon. colleague. I do want to recognize that the members from the Bloc who have sat on our committee for the last two and a half years were there. I saw them burning the midnight oil listening to people in all 10 provinces, two territories and the eastern Arctic with concerns.

There is a third party in the House. I would not say its members were not present at hearings. However, I do not think it is commendable to go on hearings across the country, stay for an hour or so each day, then go on to the street to campaign and hold press conferences. It is very shameful.

With my small business background I spent time looking at this bill. There is really good news. I did many miles on the weekend. I talked to a lot of people. I talked to small business people about the GST. I would like to have seen us go further with the GST but, as the Minister of Finance says, if we do one thing wrong and we waste a dollar we cannot bring the deficit down very steadily as we are doing now.

The interest rate today in Canada is a bargain and is creating jobs. The low interest rate we have today is putting confidence back in the marketplace. Friends of mine have said they would not want to have a business because there is too much paperwork.

After Mr. Harris gets his reformatory budget on the floor tomorrow, I am sure he will start thinking about how he can help the province for the right reasons. Regarding the GST, putting the two taxes together will make for half the paperwork.

This bill does a lot for small businesses. The record of employment, the one page form I spoke about the other day, comes with a 30 page instruction manual on how to fill out the one page. This will not be necessary anymore. There will be straightforward records where the regular payroll records can be followed and put on the sheets to report them; great progress.

No wonder the bill has been endorsed by the chambers of commerce and many business groups across the country. Again, it is unfortunate that members of the parties opposite feel it is their responsibility to take misinformation from this place. For once I would like to see the second party and especially the third party support what is good for the country and for individuals and give these people an opportunity.

With this legislation we are giving people an opportunity to help themselves. What more can we do? People do want to work and take part in the workforce. They want to feel they contribute to their country. This EI bill will make it possible for them.

[The Acting Speaker (Mrs. Ringuette-Maltais)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Mrs. Ringuette-Maltais)]

The question is on Motion No. 4. Is it the pleasure of the House to adopt the motion?