Mr. Speaker, I am very pleased to rise in the House today to speak in favour of the motion put forward by my colleague from Charlesbourg—Haute-Saint-Charles. I am also very honoured to share the time with my colleague from Vancouver East, although I am not sure if she reciprocates. She just about forgot me, but never mind, I am up now.
The motion that we are talking about today focuses on the Conservative government's provisions to the working while on claim pilot program and calls on the government to take steps to fix the program immediately.
Some heady claims have been made about the government's revisions to this program. The Minister of Human Resources and Skills Development has been quite adamant on two claims: first, that the vast majority of employment insurance recipients will benefit from these revisions; and second, that everyone who works will keep more. Her parliamentary secretary, the member for Simcoe—Grey, has been equally unequivocal in these very same claims for the revised working while on claim pilot. However, all is not what it is claimed to be.
According to a recent publication of the Mowat Centre for Policy Innovation entitled, “What the New EI Rules Mean”:
EI beneficiaries with earned incomes that are around half the size of their weekly EI benefits (or smaller) will generally see a decrease in total income. This is because they will experience a 50 per cent clawback on income that was previously exempt from any clawback. EI beneficiaries with earned incomes that are greater than roughly half the size of their weekly EI benefits will generally experience an increase in total income, because they will experience only a 50 per cent claw back on income that was previously subject to a 100 per cent clawback.
So much for the claim that “everyone who works will keep more”.
What about the “vast majority” benefiting from the revisions?
According to a May 2012 report by the Canada Employment Insurance Commission, 240,000 EI recipients stand to be negatively impacted by these revisions. That is about 40% of all EI recipients, which is a far cry from the vast majority by any reasonable definition.
The commission expressed its concern about disincentives built into these revisions and notes:
...claimants who currently work a few hours a week while on claim, below the current allowable threshold, may decide to not work these potential hours as they would be subject to the 50% earnings exemption from the first dollar earned.
Compounding the problem here is the fact that those who are adversely impacted by these changes are those who can least absorb this financial setback. It is those who earned income that was less than half their claim who will be penalized under these changes.
It is not the operating assumption or principles of the NDP that workers on EI need incentives to look for and secure work. However, what the working while on claim program is meant to do is remove disincentives to work. In this, the revisions to the program fail miserably in that it has put in place, by way of removing the shift in clawback, a very obvious penalty for about 40% of EI recipients seeking to get back into the labour market. This is moving backwards at a time when employment insurance, properly managed, would provide an opportunity to move forward for Canadians.
With 1.4 million Canadians still unemployed, and I would note 300,000 more than pre-recession levels, we should be extending EI stimulus measures to wrestle down current unacceptably high levels of unemployment in this country.
With most Canadians living paycheque to paycheque, we should be eliminating the two-week waiting period. It must be remembered that employment insurance is not available to those who voluntarily leave their work. Therefore, there should be nothing punitive in a system that is intended to provide support to those who find themselves involuntarily without work. This, after all, is an insurance scheme that workers have paid into in an effort to save themselves from financial ruin should they lose their livelihoods.
Further to this point, and to ensure that EI provides meaningful benefit levels, the rate of benefits should make their way to 60% of insurable earnings.
It has also been noted by many that periods of unemployment are getting longer. This signals the need for improvements in the quality and monitoring of training and retraining programs.
As the last proposition, I would propose that we return the qualifying period to a minimum of 360 hours of work, irrespective of the regional rate of unemployment. This is a critically important proposition. Since the mid-1990s, the number of unemployment persons eligible for EI benefits has fallen by half, from about 80% to 90% down to about 40%. It has been estimated that Liberal government policy changes to the Employment Insurance Act in the 1990s are responsible for about half of this decline in EI eligibility.
Certainly there has been an obvious and precipitous decline in eligibility in the wake of the stricter eligibility requirements introduced by the Liberal government.
The other part of the equation that explains this rapid decline in eligibility are the long-term changes in labour market that have been ignored by both Liberal and now Conservative governments.
We should consider the following: Since 1976, the number of multiple job holders has increased by 150%; the number of part-time job holders has increased by 55%; and self-employment has increased by 29%. As one expert on employment insurance, Professor Leah Vosko, said:
Workers least well-protected [by EI] are clustered in part-time and temporary forms of paid employment and self-employment, and in sectors of the economy long viewed as ancillary but experiencing considerable growth in recent decades, such as sales and services....
This is a particularly important analysis for my riding of Beaches—East York and my city of Toronto. The changing labour market has reshaped my riding and my city socially and economically. I would note that while there has been a 59% increase in the number of temporary and contract jobs right across this country over the past decade, over that same decade there was a 68% increase in Toronto. Part of this story too has been the loss of well over 100,000 manufacturing jobs in Toronto, even pre-2008 recession.
Again, Professor Vosko was quoted in a recent study on the EI system as follows:
A notable overarching finding is that EI’s entry requirements disfavour part-time workers. For instance, in urban areas and metropolises, where entry requirements tend to be highest, more than 50 per cent of workers in this group do not meet the 700 hour threshold.
Insensitivity of regular benefit requirements to the changing nature of employment in this formula contributes to disentitlement of workers falling outside the norm of the full-time permanent job in low-unemployment regions where workers in part-time and temporary forms of employment face high entry requirements.
So it is that, in Toronto, less than 25% of unemployed workers are even eligible for EI benefits, far less than the national average for eligibility, which hovers around 40%, and well below the pre-Liberal reform levels when 56% of unemployed workers in Toronto were eligible.
There was a time in our history that employment insurance played a critical social and economic role by countering poverty and limiting income disparity in this country. Over time, successive Liberal and Conservative governments have undermined the effectiveness of our employment insurance system to accomplish these goals which has been done both through deliberate changes to the system and by way of the sheer failure of successive federal governments to adapt the system to changing labour market conditions.
This, of course, is to say nothing of the failure of successive federal governments to ensure that Canada has labour markets that provide good, productive jobs, jobs that can support families and keep Canadians out of poverty.
In the meantime, I urge the government to fix immediately the harm it has caused with its revisions, the working while on claim program.