Mr. Speaker, I am delighted to participate in today's full-day debate on the government's recent changes to the working while on claim component of the employment insurance system. I am not sure that the government is equally delighted, though.
That is the beauty of the days that are set aside by the rules of the House for the opposition to choose the topic of debate. They represent a relatively rare opportunity to hold the government to account on issues the Conservatives would just as soon not have exposed, and no issue is more on point in this regard than the government's recent changes to the employment insurance system. That is why my NDP colleagues and I decided to make the working while on claim component of EI the topic of today's debate and to put the government's record to a vote.
For those who may be watching at home, let me just remind everyone what the motion before us entails. It says:
That, in the opinion of the House, the new Working While on Claim pilot project is: (a) not benefiting the vast majority of EI recipients who are able to find employment; (b) creating a disincentive to take part-time work; and (c) leaving low income Canadians worse off than before; and that the House call on the government to take steps to fix Working While on Claim immediately.
Anyone who has given this issue even cursory thought would know that all three claims in this motion are absolutely correct. Contrary to the minister's claim, the changes do not benefit the vast majority of EI recipients. They do create a disincentive for accepting part-time work while on claim, and it is the lowest income earners who are hardest hit.
If this were any other place and people were to cast their ballots based purely on the facts, this motion would pass unanimously. However, there is a reason why some have called this place Disney on the Rideau. There is often a suspension of belief that renders surreal results. To prove my point, just watch the vote tomorrow night. In the meantime though, let me first prove the facts.
In their 2012 budget, the Conservatives announced their intention to make changes to the working while on claim pilot project. Previously, EI recipients who accepted work were allowed to receive the greater of $75 or 40% of their weekly benefits without any money being clawed back. Above those thresholds, earnings were clawed back dollar for dollar.
Under the new national pilot project, workers are allowed to keep 50% of every dollar they earn up to 90% of their insurable earnings, but importantly, they lose 50% from the first dollar earned. Nonetheless, it was the intention of the new working while on claim program to encourage work by not clawing back 100% of earnings above the threshold of one or two days of work.
Of course, we all know where roads paved with good intentions end up, and this pilot project is no exception. As has become clear in the month and a half since the new pilot project was announced, the new program has had the effect of targeting the most vulnerable workers. It reduces the earnings of those who can only find one day of work a week, as well as those who receive Canada pension plan benefits or other income while on EI.
MPs' offices have been flooded with complaints and even employers are complaining because they are unable to find people to take piecework now, because one day of work per week no longer pays. However, the minister responsible stubbornly maintains that there are no problems requiring her attention.
The Conservatives claim that the new pilot program would incentivize all EI recipients to accept new work. According to budget 2012, “This new pilot will ensure that EI claimants always benefit from accepting work by allowing them to keep more of what they earn while on EI and supporting their search for permanent employment”. Similarly the parliamentary secretary claimed in the House on September 24 that “those who work more will be able to keep more when it comes to their employment insurance”.
Unfortunately, the cold reality belies the Conservative rhetoric. When compared to the expired program, the new pilot program discourages part-time work or low-paid work for many EI recipients because they will be allowed to keep less than they were under the old system.
Mathematical equations do not make for a riveting speech but they are essential to proving the point, so bear with me for just a moment.
Let us take the average earning EI recipient. In 2010-11, the average regular EI weekly benefit was $370 a week. This means that previous earnings for the average EI recipient were about $670 per week. Under the new system, the average EI recipient will have no incentive to accept new work unless they earn over $300 a week. For example, if this person accepted work earning $150 per week, they would essentially lose $70 under the new system compared to the old.
I know it all sounds a bit confusing, but it is easier to understand if we look at EI recipients with both the maximum earnings and those with lower earnings.
Let us start with the maximum earnings. In 2011, the maximum EI regular benefit was $468 a week. This means that the previous earnings for the maximum EI recipient were at least $850 per week. Under the new system, the maximum level EI recipients would have no incentive to accept new work unless they earn over $350 per week. For example, if EI recipients accept work earning them $200 per week, they essentially lose $90 under the new system compared to what they would have kept under the old system.
For EI recipients with lower earnings, if they previously earned $300 per week, they would get $165 per week on EI. Under the new system, these recipients would have no incentive to accept new work unless they earn over $125 per week. For example, if they accept work earning them $75 per week, they essentially lose $30 under the new system. That does not even take into account work-related expenses such as transportation and child care. If those additional expenses are factored in, very few EI recipients benefit from accepting work while on claim.
Despite all of that evidence, the minister continues to claim that the “vast majority” of EI recipients working while on claim benefit from her new pilot project. Interestingly though, when pressed she is unable to give any figures to back up her claim.
In fact, the amount of money committed to the program clearly indicates that the Conservatives know that the system is less generous than the older one. In 2010, the working while on claim pilot cost the government $132 million. In 2011, the government extended the pilot for one year with a budget of $130 million. However, budget 2012 set aside only $74 million for the new pilot project. That was to cover two years, not one. Consequently, there is roughly half the money over twice the time, or a 75% cut. That hardly supports the Conservatives' contention that EI recipients will now be better off.
If we do not trust the government's own figures in that regard, and who could blame us, I refer members to a report by the Canada Employment Insurance Commission, which estimated that while 403,000 Canadians would benefit from the program, 240,000 would be negatively impacted. That means that nearly four in ten EI recipients are worse off as a result of these changes, stretching beyond credulity any possible definition the minister might offer of the “vast majority”.
Employment insurance is not a government benefit; it is paid for by workers and employers. Canadians pay EI premiums in good faith that EI will be there for them in times of unemployment. The reason my NDP colleagues and I brought forward today's motion is to protect that sacred trust from the government's repeated meddling in the EI system without so much as consulting the very workers who paid for the system. It is time for the Conservatives to stop attacking unemployed Canadians, blaming them for their own unemployment, and to get serious about developing a job creation strategy and to invest adequately in skills training.
I will be interested to see how the Conservatives vote tomorrow night. They can no longer claim they are unaware of how their program changes have impacted the lowest earning EI recipients. It is time they own up to the mistake and fix it.
There is no shame in making a mistake. The shame lies only in the refusal to acknowledge and correct it.