Mr. Speaker, Bill C-2, now in third reading, is, let us not forget it, the same as Bill C-44, which had been introduced in the last parliament before the election campaign as an act of contrition by the Liberal Party. It was as the party it had said “We did reform EI in a way that is extremely hard on the workers, the unemployed and the employers. In the end, we more or less used the till to fight the deficit. We are introducing this bill because we have recognized, long after everybody else, that the intensity rule, for example, was a low blow and unacceptable for the workers”.
It deprived people, most of them with low salaries, of the money to make ends meet. We were told that the reduction would amount to only $10 or $11 a week, but for the worker who earned $250 or $300 a week and lost his or her job, this small amount was what was missing to buy butter, to finish paying the rent or things like that.
The Liberal Party realized that its reform did not make sense. but nonetheless, during the election campaign it said that it would go further than Bill C-44. The Prime Minister himself said that “Major mistakes have been made and EI has major shortcomings, and they should be corrected”.
When the House reconvened, we were very surprised to have brought before the House Bill C-2, which is a mere copy of Bill C-44. But what is important to mention is that a poisoned gift was left in the bill in the form of clause 9. Under this provision, the government would alter the legislative arrangements for setting the premium rate.
In other words, after the vote to be held this afternoon, if the Liberals maintain their position, the government would no longer have to strike a balance between the EI plan and the plan requirements. It would no longer have to give back to the plan the money it used for purposes other than what the EI plan was originally set up for. In fact, it would be able to spend the money on any government operation.
What this means is that this clause will legalize the mismanagement of funds, the theft of the hard earned money the government has been taking from the pockets of workers and the unemployed for several years now. This is why, right from the outset, we in the Bloc Quebecois have said that we would not be voting in favour of this bill if that provision was left in.
We were able to get the consensus of all the other opposition parties. We also have the support of the auditor general, management and unions. Both the CLC and the Conseil du patronat du Québec said they did not want the federal government to make sure it can do whatever it wants with the money without having to account for it.
The figures have been more or less the same for the past few years: each year, $18 billion is collected in premiums and $12 billion is put back into the plan. This leaves a surplus of $6 billion, which is used to cover the government's general expenditures, to pay down the debt with money belonging to those who contribute to a fund that has become a very regressive payroll tax.
Members should know that premiums are paid on a maximum annual income of $39,000. This means that people earning $45,000 do not pay premiums on the extra $6,000 and, therefore, do not contribute their fair share toward this portion of the government's general expenditures. Those with the lowest earnings contribute more than their fair share.
Even worse, people like us, MPs, and all those who are self-employed, such as physicians and lawyers, those who do not pay into the plan, make no contribution whatsoever. They do not carry their share of the burden, not out of malice but simply because the government has turned this into a regressive payroll tax, allowing it to dip into the pockets of those most in need. And it did not stop there.
Since 1997 there has also been a terrible tightening up of EI eligibility criteria. Fewer people qualify. I heard the parliamentary secretary mention 88%. What she is saying is that 88% of workers would qualify for benefits should they become unemployed. The purpose of the EI plan is to provide financial support not to those who have a job but to those who are unemployed. In this case, it is not 88% but rather 40% of the workers who really qualify for employment insurance when they lose their job.
Since the reform, thousands of young people pay premiums from day one and in the end they never qualify for benefits. Only 25% of the unemployed young people qualify. This means that 75% of them are paying for nothing.
Clearly, we had many reasons to oppose the bill. We still played the parliamentary game and I think that in the end it will have paid off. Sixty or seventy groups were heard by the committee. The great majority of them were from Quebec and had been recommended by the Bloc Quebecois. One after the other they systematically told us that it was not Bill C-2 but real reform of the employment insurance system that they wanted.
They talked about everything that was wrong with the bill. The committee unanimously adopted a motion that I brought forward. I will read it because I think it is the only message of hope we have on the whole employment insurance system. It reads as follows:
That the Standing Committee on Human Resources Development and the Status of Persons with Disabilities report to the House of Commons all other amendments to the Employment Insurance Act and that this report be tabled to the House no later than June 1, 2001.
Between the November 2000 election and the date when parliament returned, the government did not do its homework. Perhaps the Liberals told themselves “Let us give it a try. Let us table Bill C-2 as if it were Bill C-44. It might work and we will not have to give them more”.
However we were there to do our job. We heard witnesses in committee and they showed that many more amendments were required. All committee members, whether from the Liberal majority or the opposition, supported the motion that I proposed. I hope this will allow us to finish the job in the coming weeks, so that by early June we can have a new government bill that will correct the other flaws of the plan.
There are many things that are unacceptable. Let us begin with the creation of an independent employment insurance fund. The frustrations of the workers and employers who appeared before us had to do with the fact that people contribute to a plan over which they have no control. They find this unacceptable. That issue will have to be debated again because it is not true that people who contribute to the plan will continue to give 33% of the money to the government.
Either the government will turn contributions into a payroll tax—and then we can make a complete overhaul—or we will have an independent fund but that issue is still on the table.
There are other matters that are urgent as well, very important ones having to do with unemployed workers' bread and butter, such as abolishing the waiting period. No benefits are paid during the first two weeks of a period of unemployment. This is a throwback to the old Unemployment Insurance Act of the 1940s. Now that people pay premiums from the first hour, why must we still have this waiting period, which no longer exists in many countries? It should be abolished.
Coverage could also be increased from 55% to 60%. Unemployed workers were among those who helped to pay down the deficit but they did not get tax breaks because they do not earn enough to qualify for any significant deductions. One way of helping them would be to give them an adequate income between jobs.
Our seasonal workers also need a status which is independent of economic activity, because a period of growth like the one we are now experiencing has a negative effect on them. We require them to work more hours to qualify but we allow them fewer benefit weeks when all is said and done, although they are in jobs which give them 15 or 20 weeks of work year in and year out, economic growth or no economic growth. They do not get 25, 30 or 40 weeks of work in forestry or tourism because the economy is booming. They might get an extra week or two but not 8, 10, 12, or 15. This is something that needs to be addressed.
We also discussed the whole issue of self-employed workers, of whom there are an increasing number in society. They represent an important segment of the labour force but are not covered by any plan. It would be necessary to reflect, to make recommendations, to ensure people of worthwhile, minimal protection. We need, to take advantage of the present situation since we sense that it is possibly going to lead to a downturn, or perhaps already has. Before we get into a recession, or worse yet, a depression, we need to have a system in place that will provide people with enough to survive on. I am willing to bet that the present system will not.
There are all manner of other improvements needed. There is the discrimination toward young workers and women who are new to the workforce. They will be required to have accumulated 910 hours of work before being eligible for employment insurance. It has already been shown, although it took three years, based on the statistics, that the intensity rule was not having the desired results. This has cost people $250 million since 1997.
I requested an amendment to Bill C-2 that would take the retroactivity back to January 1, 1997. The reply from the minister, who had to authorize this, since royal assent was required, was “We find that is too much money to have to pay back to people”. It was not, however, too much to take from them in the first place. It was perfectly all right to take it from the low wage earners. This is one more thing that needs examination and correction as soon as possible.
Then there is the whole matter of the older workers. We live in a society that has produced people who often have worked in a factory or in various sectors where there are massive layoffs as they reach the age of 45, 50, 52, 53, or 55. These people find themselves without a job and cannot easily be retrained for other types of work. All the active measures are in place to help them learn other trades but it is not true that a forestry worker can be turned into a computer technician overnight. There is a limit that cannot be crossed. There are people like that.
We live in a society benefiting from gains in productivity but the government should have the courage to distribute them properly, to create a bridge so that when people 52, 54 and 55 years of age cannot be reclassified in another job, we can find a way for them to carry on until they are entitled to their old age pension. This too is part of an employment insurance plan.
I will give some examples but there are a whole lot of others that will have to be corrected by June 1. We must be able to make proposals. In my opinion, the ultimate scenario is one in which there will be a number of proposals that could receive unanimous committee approval, I hope, and a number of others that will not but at least the door would be opened after five years' effort.
Let us think back to 1995-96, after the employment insurance plan was tightened up. At the time, we said it was unacceptable. We heard the Prime Minister say “The unemployed are beer drinkers”, something he apologized for in the fall of 2000. The trend has been reversed but we must not stop halfway. We must devise a real, adequate employment insurance plan.
It is sad that all this is happening when the government is grabbing the fund's surplus and no longer wants to comply with the act's provisions requiring the system to balance out over a single economic cycle.
The chief actuary of the EI plan has said that a reasonable surplus to deal with any economic crisis would be in the order of $14 billion. Yet the current surplus is over $30 billion. The only way the government has found to avoid meeting its obligations is to remove from the EI commission the right to set the premium rates. We are faced with a situation that is not very pretty.
However, we know why the government has done this, that is because the EI commissioners have gone as far as they could. They could not, in conscience, go any further and tell the government that it was reasonable to leave the premium at $2.25 when the plan could balance out with a premium of $1.75. The employers and the unions were unable to support the government's policy. Therefore, the way the government found was to say “We will remove your moral responsibility, we will remove from you the responsibility of making a decision and, thus, we will be able to do as we please”.
Faced with this situation, we feel it is obvious that the legislation is still unacceptable. I say to all workers, all employers and all the unemployed that the representations were not made in vain.
Tenacity is important. A task has been given to the human resources standing committee. It has until June 1 to recommend further amendments to the employment insurance plan. I think a door is now open and we will be able to finally convince the government that it has a responsibility in this matter.
Obviously the finance department and the federal government are really intent on grabbing as much money as possible. With that money, they can then spend in all kinds of sectors that are not under their jurisdiction.
The witnesses who appeared before the committee and all those who have a good grasp of the situation have shown a great deal of tenacity. For one thing, they have certainly understood that the federal government has diverted their contributions to the employment insurance plan.
The deduction on our cheque stub does not indicate general government expenses or payroll tax but employment insurance premium. For every $3 in premiums, $2 go to the EI fund and $1 to other expenses. This, people still find unacceptable.
During the campaign and at the beginning of the debate on this issue, the Liberals accused the Bloc of stalling this marvellous bill and suggested that those we are supposed to stand for would not put up with our attitude.
I did some checking. I went in the field and asked around to see whether ordinary citizens thought we were right to say that the bill was unacceptable, because it is not true that the government is doing its job by putting $500 million into a plan with a $28 billion surplus. People said to us “Go and say that it is unacceptable for the government to help itself to the surplus like this. Try to win other points, try to get them to see reason”.
The work we have done and the witnesses we have heard from are proof of people's tenacity. I am not saying that the battle is over and won. I am saying that we will have a chance in the next two months to submit a report through the Standing Committee on Human Resources Development and the Status of Persons with Disabilities, which will make it possible to finish the job and to bring about real EI reform. I hope we finally achieve this result because we will have done our job.
After being told that people chose to be unemployed, after seeing something like the intensity rule imposed, we will have abolished it and we will realize that it is the same sort of situation with young people. They are not going to work longer just because 910 hours are required. They are going to work as long as there are jobs and opportunities and we give them a chance. In this way, we are going to help the regions hang on to their resources.
This is an important point. For decades there was a social pact between Canada's resource regions and its central regions. We in the resource regions provided the raw materials: wood, wood products, agriculture and tourism. In return, we had an EI plan that gave people a decent income during periods of unemployment, particularly during the winter.
With the new EI plan, this pact has been broken. Workers have seen their income support taken away and have been told to manage on their own. In return, the government has not really given them anything to help them diversify their regional economies. One of the consequences has been the exodus of young people.
When, in our areas, there are no young people to take over, it is a catch-22 situation that must be resolved. One of the tools we have to do it—and it is not the only one—is to provide reasonable eligibility conditions for employment insurance so that the young worker who has accumulated 600 hours is not forced to move in order to get the 300 missing hours, never to return after all the resources we put into training him. As we can see, there are still many things to be changed in the employment insurance system.
We will vote against Bill C-2 because the government has decided to maintain the misappropriation of the premiums paid into the system. I believe that this attitude is responsible and that we have the opportunity to transform further the legislation. In that sense, I hope I will get the same support during the next few months. I also intend to consult the people and ask them what their priorities are.
We know very well the requirements that should be in the employment insurance system. We can negotiate efficiently until June with the government to find out what the priorities of the people are. I will do that during the next few weeks. I will try to ensure that we will be able to bring about other changes that will be those that the people really want.
In this way, we will be able to carry out our mandate, which is to ensure an adequate distribution of wealth by means of a real employment insurance system and not a system by which the government puts in its pocket money coming from employers, employees and the unemployed.