The Chair is now prepared to rule on the point of order raised by the hon. parliamentary secretary to the government House leader on October 7, 2009 concerning the requirement for a royal recommendation for Bill C-395, An Act to amend the Employment Insurance Act (labour dispute) standing in the name of the hon. member for Berthier—Maskinongé.
I would like to thank the parliamentary secretary for having raised this important matter, as well as the hon. member for Berthier—Maskinongé for his remarks concerning the bill.
In presenting his concerns with respect to Bill C-395, the parliamentary secretary stated that in his view the bill infringes upon the financial initiative of the crown. Specifically, he pointed out that the bill seeks to change the purposes of the Employment Insurance Act by adding a new provision that would extend the qualifying period for an undefined period in case of a work stoppage caused by a labour dispute. He also argued that by altering the calculation of the qualifying period, the bill would result in increased government spending on employment insurance.
In support of his contention that the bill requires a royal recommendation, the parliamentary secretary made reference to a Speaker's ruling on Bill C-265, An Act to amend the Employment Insurance Act (qualification for and entitlement to benefits) on March 23, 2007 and a ruling by the Speaker of the Senate in Bill S-207, an Act to Amend the Employment Insurance Act (foreign postings) on January 29, 2009.
Both bills were similar to the present bill in that they sought to modify the employment insurance qualifying period, and both were found to require royal recommendation.
In his intervention, the hon. member for Berthier—Maskinongé argued that a royal recommendation is not required since the funds in the employment insurance account are paid by workers and employers and do not constitute government funds.
The Chair has examined the bill carefully and, it is clear beyond all doubt that Bill C-395 alters the terms and conditions of the existing program under the Employment Insurance Act. The argument put forth by the hon. member for Berthier--Maskinongé regarding whether or not funds contributed to the employment insurance fund constitute public revenue is a recurring argument. It has been brought forward during similar discussions on Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system) as well as Bill C-269, An Act to amend the Employment Insurance Act (improvement of the employment insurance system) from the previous Parliament. In essence, all monies received by the government, regardless of source, are deposited in the consolidated revenue fund and become public funds, that is, funds of the Crown. The Constitution Act of 1867 and Standing Order 79 apply to these funds. Thus, a bill proposing a new or increased expenditure of public funds, that is, an appropriation, requires a royal recommendation.
The employment insurance program operates under this framework. The funds in question are public funds and their management is subject to the financial initiative of the Crown.
By extending the qualifying period for employment insurance benefits by the amount of time a person was unemployed due to a work stoppage resulting from a labour dispute, Bill C-395 is increasing the expenditures under the act. These expenditures would be paid out of the consolidated revenue fund. As the House is aware, such provisions can only be put to the House for a final decision if they are accompanied by a royal recommendation as set out in Standing Order 79(1). Consequently, the Chair will decline to put the question on third reading of the bill in its present form unless a royal recommendation is received.
Today's debate, however, is on the motion for second reading, and this motion shall be put to a vote at the close of the current debate.