Mr. Speaker, the Conservative Party supports the principles set out in this bill.
In supporting the principles of the bill, we look at the fundamental values behind it, the values of fairness. We look at helping those genuinely in need in society. We believe that people should be able to enjoy the fruits of their own labour. We also believe that the best form of employment insurance is a strong economy that creates jobs so people never have to be unemployed.
I thought I would start by first responding to some things that my friend the parliamentary secretary said about why the employment insurance fund was rolled into the consolidated revenues of the government. He pointed to the Auditor General's reference to certain accounting principles.
However, what happened is that the Liberal government then used that technical approach once the fund was rolled into consolidated revenues as a free ticket to raid the employment insurance fund to the tune of some $46 billion over 10 years.
That is $46 billion that the government took from employers and employees who contributed in the hopes of having their work and their future secured. The government used that money, diverting it for other purposes, perhaps including, as my friend pointed out, supporting the sponsorship scandal that has drawn such attention in recent days.
What my friend also failed to mention was the role that the Auditor General played in exposing the inappropriateness of that government diversion of funds from the employment insurance purposes for which they were intended to other purposes. That was condemned by the Auditor General one year after another and in one report after another.
It was not until this government faced a minority situation, where opposition parties could bind together to bring to the fore the importance of this issue, that once and for all the government is being held to account. That theft from workers and employers who paid in that money is hopefully going to be brought to a halt.
Certainly this private member's bill put forward by my friend from Manicouagan is a good example of how we are working on this side of the House, regardless of the party we belong to, to try to bring an end to the theft of those moneys by the Liberal government.
The $46 billion accumulated notional surplus from the employment insurance system reflects what was, over the past decade, a deliberate program of overtaxing workers and employers in order to divert those moneys to fund other government priorities.
As has been mentioned, the Conservative Party worked very hard at committee to have the first eight recommendations of the employment insurance subcommittee approved and adopted. The recommendations were designed to bring the system into fiscal responsibility. We were pleased to see that happen.
Those are only recommendations out of the committee. We are concerned that the government may not respond appropriately. When I hear the comments from the parliamentary secretary, I am concerned that it may not. That is why this private member's bill from the member for Manicouagan is most timely.
The practice of diverting those funds to other purposes, as has occurred with the $46 billion out of employment insurance, is intellectually dishonest. It violates the law. That is exactly what the Auditor General found. That practice has attracted her criticism repeatedly. It also represents, most profoundly, an unfair and regressive form of taxation.
Instead of funding government spending increases out of more progressive forms of taxation such as income taxes, the use of this EI surplus for that purpose takes proportionately more from the working poor and from small businesses. As such, it taxes those who can afford it least, shifting the burden from those who have means.
The reason is simple. When someone pays into employment insurance and they achieve a certain income level there is a cap that they run into. Those who have high incomes and earn far more than the cap stop paying into employment insurance. As a result, the burden falls disproportionately on those with lower incomes.
That may make sense in an employment insurance system where only a certain portion of earnings is insured, but when that money is taken and used instead for the general programs of the government, it represents a replacement of what would otherwise be income taxes, a much more progressive form of taxation, a much fairer way of funding government programs.
For that reason, we find the approach taken by the government in the past 10 years of diverting these employment insurance funds to be an unacceptable, punitive approach that has hurt workers more than anybody else. On the other hand, it could only have happened by having insurance premiums that were too high. That was the other thing the government did over the past decade to achieve the $46 billion surplus. Consistently, illegally, year after year, the premiums were set far above what was necessary to maintain the system as viable, resulting in a surplus. In so doing, what effectively was occurring was that those taxes themselves, those premiums, were too high. That is a job killing payroll tax. It stifled and continues today to stifle the ability of employers to create new jobs and economic growth.
As I have said, the best form of employment insurance is the creation of new jobs. That has been harmed consistently by the $46 billion in overtaxation through EI premiums in the past decade, something that has yet to stop. Even in the new premium which has been set, any basic math tells us that a surplus will continue to be generated. Our priority is to stop the unfair practice which hurts working families and the businesses that have had their money taken by the government under false pretences. The theft must stop and the money must be returned.
Some items trouble us about the proposed legislation. It is the commission with its 17 members and a potential policy-making role.
We feel that the fundamental structure of employment insurance as a program should remain primarily a matter of government policy. The number of 17 commissioners perhaps seems to us an unwieldy and large number. For that reason, I am somewhat encouraged by the Speaker's ruling and would encourage my friend from Manicouagan to consider shutting that portion of the legislation which stands as a barrier to its passage. This would make it possible for us to embrace the bill with a full enthusiasm completely.
There are other problems with the employment insurance system as it works today. One of the biggest problem is that people fall through the cracks. Increasingly the government in an effort again to shift that burden out of their own revenues has layered program after program, what are essentially social programs, on to the employment insurance mechanism as a vehicle to deliver those social services, whether they be maternity leave or extended maternity leave, compassionate care leave and the like.
The problem is that increasingly more and more Canadians are not part of the employment insurance system or, if they are, they are not eligible in the special, unique circumstances that arise. People fall through the cracks. This increasing reliance on employment insurance to deliver things like maternity care, compassionate care and sickness leave and the like results in a discriminatory situation where many Canadians simply do not have the support they need. That has to be addressed in the long term.
Similarly, the reliance on using employment insurance as the vehicle to deliver training means we are delivering training that often is not aimed at increasing the productivity of society or ensuring that people actually are better off after the training and better equipped to get a job. Rather, it treats it as an extension of the employment insurance system. Decisions are made on what training to pursue based on length of eligibility and whether we can extend our eligibility, rather than will this help us to contribute more to the economy. Will this mean we end up with a more productive workforce? Will this mean we will have overall economic growth?
Those issues have to be addressed in the long term. While they may not be addressed in this bill, these are things I think are important priorities and they certainly are for the Conservative Party. I am not sure they are for the government yet, but we will continue to press them to make it so.
Finally, I wanted to address the issue of long term viability of the employment insurance system. We think it is important that the management of the system, the premiums, the rate setting mechanism which has been politicized in the past decade be restored to accountability. This has to be the number one priority. Before we start looking at major changes to the system, we have to ensure we have corrected the mismanagement, the fiscal theft that this government has engaged in for years. We have to ensure that the new structure of it can be viable.
Before we tinker with it massively, we have to ensure it is viable and works and can be sustainable. Our concern is that if one makes too many changes too quickly, we may face a situation where the long term viability of the system is in jeopardy.
I am confident that the proposed legislation before us in Bill C-280 does not do that. I am confident the legislation would help to contribute to restoring fiscal accountability in the system, putting an end to the consistent theft of workers' and employers' contributions to employment insurance and their diversion to other purposes by this government.