HUMA Committee Meeting

STANDING COMMITTEE ON HUMAN RESOURCES DEVELOPMENT AND THE STATUS OF PERSONS WITH DISABILITIES

COMITÉ PERMANENT DU DÉVELOPPEMENT DES RESSOURCES HUMAINES ET DE LA CONDITION DES PERSONNES HANDICAPÉES

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, March 13, 2001

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[Translation]

The Vice-Chair (Ms. Diane St-Jacques (Shefford, Lib.)): Good morning, everyone. I would like to welcome both our guests and our colleagues to today's meeting. As you know, we're just back from a week in our respective ridings; so we were not on the Hill last week.

I would remind you that this meeting is being televised from beginning to end.

We are going to resume our hearings on Bill C-2, An Act to amend the Employment Insurance Act and the Employment Insurance (Fishing) Regulations.

We will be distributing to you a brief from the New Brunswick Federation of Labour. The other briefs will be distributed later this week, once they are translated.

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I would like to introduce our guests this morning: Jocelyn Dupuis and Richard Goyette from the Conseil conjoint de la FTQ- Construction et du CPQMC; Mr. Roy and Mr. Matte from the Fédération des travailleurs et travailleuses du Québec (FTQ); Mr. Blair Doucet and Mr. Maurice Clavette from the New Brunswick Federation of Labour; and Ms. Elaine Price from the Newfoundland and Labrador Federation of Labour. Mr. Rick Clarke will not be here today. He represents the Nova Scotia Federation of Labour and will be here on Thursday morning, March 15.

Excuse me, I have forgotten some people. I had not noticed that there were some people sitting at the back. With us as well are Mr. Ron Smith from the Newfoundland and Labrador Federation of Labour and Mr. Felix MacDonald, from the Prince Edward Island Federation of Labour. We would like to welcome all our witnesses.

I would like to remind you that after your presentations, each member of Parliament on each side of the table will have about five minutes to ask questions and make comments. We are going to try to keep within this deadline so that everyone has an opportunity to ask questions. I may have to interrupt you, and I apologize for that, but, as far as possible, I am going to try to stick to the schedule.

So, with your permission, we will follow the order of the witnesses we have on our list. So I would ask Messrs Dupuis and Goyette from the Conseil conjoint de la FTQ, to make their presentation in about five minutes, if possible.

Mr. Jocelyn Dupuis (Director General, Conseil conjoint de la FTQ-Construction et du CPQMC): Good morning, Madame Chair, ladies and gentlemen and other witnesses appearing before the committee studying employment insurance.

The Joint Council of the FTQ-Construction and the Quebec Provincial Council of Construction Trades is a union body representing 75,000 wage earners in construction in Quebec. These workers hold jobs in 26 trades and 23 occupations. At the moment, we are the only recognized union agent for bargaining and signing collective agreements for workers in the construction industry.

In the brief that we'll be tabling next week once it is translated, the Joint Council demonstrates, using statistics and tables, that construction workers are among those most badly served by the Employment Insurance Act. The amendments introduced into the Act in the last 15 years have reduced the benefit rate, the duration of benefit periods and the quality of benefits, not to mention the fact that they are no longer raised.

The Joint Council maintains that the production practices developed in the construction industry force construction workers to be unemployed, when their first choice would be to work. More specifically, among both the suppliers of work and consumers, no one wants to be put on a list to get his building or his construction project.

In practice, this means that the industry has to maintain available labour pools in order to meet the demand for workers. For the latter, this lack of management of the labour force means that they are forced into periods of unemployment every year. Our society has clearly demonstrated that it has chosen not to establish the mechanisms that would enable construction workers to work throughout the year: there is no even distribution of work, no planning, and no provision about not piling up contracts, and so on.

Unless these things are done, the Joint Council maintains that the Employment Insurance Act must, more than ever, continue to cover construction workers who are between jobs. It is time for the Employment Insurance Act to eliminate those aspects that were described, not so long ago, as deterrents. That is why the Joint Council is calling for amendments to the Employment Insurance Act. These amendments should put in place a system that would really protect workers in the construction industry.

The Joint Council is putting forward 12 demands which can be broken down into three themes: a re-evaluation of the benefits plan, support for occupational training and better administrative rules. The construction industry in particular has a development program to support occupational training. With $90 million, I think we could try to change the program to meet workers' needs and give them an opportunity to develop and acquire new skills when they have a job.

I will now turn the floor over to Richard Goyette, who will provide you will more details on the demands presented in our brief.

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Mr. Richard Goyette (Assistant Director General, Conseil conjoint de la FTQ-Construction et du CPQMC): At this point, Madam Chair, we can tell you that the first table in the brief to be tabled, which compares the plan before 1996 and after 1996, clearly shows that there has been a radical drop in benefit periods—a drop of 50%. Regardless of the conditions, regardless of the fact that the number of hours worked is the same in terms of weeks, there has been a 50% reduction in the plan. We consider this an enormous cut.

In the brief, we say that people in the construction industry are not unemployed by choice, but because of the mobility of the labour force. As a society, we have to make a choice. Do we agree to rationalize investment, so that work does not pile up, so that there are no waiting lists, and so that we maintain an available labour pool to meet the needs of certain individuals? That is a choice we must make as a society: either we have people available and we provide them with benefits, or else everyone is going to work. We are going to call for full employment, and we will reduce the labour pools and if people want to build, they will have to wait until workers are available.

I know that time is important, and I would not want to go much beyond the five minutes I have been given.

The drafts you will be getting clearly demonstrate that it is not true that the construction industry is a seasonal industry. For example, in February 1975, more hours were worked than during the summer of 1999, even though 1999 was a very good year for the construction industry and saw almost twice as many people working. The same is true for the months of January and December. So, the fact is that people are available to work, provided there is work available. But we are not the people who provide the work. Once again, the whole argument we present in our brief is based on the choice we make as a society. Do we want available labour pools? If that is what we want, than we will have to pay the benefits.

Thank you very much.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Dupuis and Mr. Goyette.

I will now give the floor to Mr. Roy and Mr. Matte, from the Fédération des travailleurs et travailleuses du Québec.

Mr. René Roy (Secretary General, Fédération des travailleurs et travailleuses du Québec): Madam Chair, honourable members, as you said, we have a brief that outlines our argument in full. I will read you a brief summary of it and explain the FTQ's proposals.

Our general impressions of the bill are mixed. Although we acknowledge that the bill makes some changes that we ourselves have called for, we must nevertheless note that the government has not gone far enough. The least we can say is that not all the injustices created by Parliament in the preceding reforms have been corrected.

We deplore the fact that the proposed reform does not put in place a modern, efficient tool for unemployed men and women. The new, amended act will be far from meeting the needs of the thousands of contributors who cannot qualify for benefits under the current rules. We think that Parliament is missing an important opportunity to adapt the legislation to the modern reality of the labour market. In our view, at least two of the amendments to the act are merely rectifications that should have been made long ago.

The FTQ is pleased that the intensity rule has been eliminated and that the clawback penalties have been made more flexible. As we said when they were introduced and have repeat regularly, these punitive rules were unacceptable. The intensity rule is particularly difficult for those who unfortunately work in seasonal industries only. The FTQ acknowledges that the elimination of the intensity rule and the reduced impact of the clawback rule are improvements to the EI system. However, the FTQ recommends that the government go further and eliminate all clawback provisions.

The number of weeks during which unemployed men and women are entitled to benefits has also been reduced significantly in the preceding reforms. The resulting loss of income was particularly significant for seasonal workers who, increasingly, run out of benefits before their jobs start. That is why the FTQ is calling for the restoration of the 60% income replacement rate.

The FTQ is also asking for the maximum EI benefit payment period to be increased to 52 weeks. The FTQ therefore recommends that the government abolish the 910 hours of work required for those re-entering the labour market. Moreover, the eligibility rules, in terms of hours of work in order to qualify for EI, should be reduced to a minimum of 360 hours for those administrative regions most affected by unemployment and proportional reduction for other regions.

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The FTQ recommends that a new Program for Older Worker Adjustment, POWA, we introduced as soon as possible. In addition, the FTQ is calling for agreement with Employment-Quebec for the administration of this new program. The FTQ demands that older workers who are laid off be entitled to receive EI benefits, regardless of any severance payment they may have received.

The FTQ asked that the period during which an employee is involved in a labour dispute be eliminated from the qualifying period for determining eligibility and the amount of EI benefits.

The FTQ recommends that Parliament ensure that the boundaries of administrative regions be changed with the sole objective of helping the unemployed people in these regions.

The FTQ recommends that the Employment Insurance Commission retain exclusive responsibility for setting the contribution rate.

The FTQ also reminds the committee of its proposal regarding the establishment of an independent employment insurance commission.

The FTQ also suggests the creation of an employment insurance fund independent from the government and administered by contributors. The Auditor General of Canada could be responsible for the smooth operation of this fund.

In conclusion, we would again like to thank you for inviting us to present our views and those of our members on the proposed changes to the EI program. We think that any employment insurance reform should be based on the following considerations and principles.

Do I still have some time?

The Vice-Chair (Ms. Diane St-Jacques): Yes.

Mr. René Roy: The plan should be a genuine social insurance: unemployment insurance is a social insurance that guarantees some income security and continuity to people who are without work. As such, it must be a universal program. Any measure that moves towards private insurance or assistance is therefore unacceptable. Even though the primary objective of the program is not to guarantee a transfer, that is income redistribution among individuals, groups or regions, like any social insurance program, it is nevertheless called upon to play this role.

A policy of full employment: the current unemployment problem in Canada is fundamentally linked to the lack of jobs, and not to the lack of mobility or interest, laziness or other equally ridiculous reasons put forward in recent years by a number of economists who claim to be psychologists. The best way of reducing EI expenditures is therefore to adopt an economic strategy designed to achieve full employment. In this context, EI funds can be used for special job creation purposes and for employment training programs, but cannot be used to harm contributors who are entitled to receive benefits for which they paid insurance contributions.

The program should be focussed on human need: income security and continuity are essential to promoting the adaptability of the economy and also the mobility, multi-skilling, qualification and motivation of workers. The current ideology of the federal government, which has resulted in drastic cuts in the duration of benefits, goes in exactly the opposite direction.

Finally, the program should be managed by the province: because of the ties between social policy and the employment policy, although we think Quebec is in the best position to co- ordinate all labour force policies, it is necessary and urgent that the Ottawa and Quebec governments harmonize and co-ordinate their social policies on employment with a view to introducing a strategy of full employment.

Thank you for the time you have given us.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Roy.

We will now hear from Mr. Blair Doucet and Mr. Maurice Clavette from the New Brunswick Federation of Labour.

[English]

Mr. Blair Doucet (President, New Brunswick Federation of Labour): Thank you, Madam Chair and members of the committee. We appreciate the opportunity to appear before you with our presentation for the New Brunswick Federation of Labour. In the true spirit of New Brunswick, we will make a bilingual presentation. Brother Clavette will do it in French, myself in English.

I'd like to start by saying that New Brunswick is a province where there is a lot of seasonal work in the fishing industry, in the forestry, with the peat moss, and in a lot of cases in construction. We are not seasonal workers. I'd like it understood that there is seasonal work in our province. Workers are workers, and if that's all they can get, we need benefits during that period of time.

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It seems fair to us that the positive corrective measures contained in this bill be adopted rapidly in the House. But it would be trickery to conclude that because of this the work is finished. Too many people still suffer from past changes to the unemployment insurance legislation to perpetuate such a disgrace.

This is why we are uniting our voice with the Canadian Labour Congress and other labour organizations in the country, and also with the New Brunswick Common Front for Social Justice, which groups together more than 125,000 members from social, religious, and labour groups.

We urgently demand that weekly benefits correspond to 60% of a claimant's insurable earnings; that eligibility criteria be the same throughout Canada—360 hours for all categories of claimants, including regular, maternity, illness, training, etc.; and that the definition and categories of “just cause” for being entitled to benefits be widened, with the onus of proof for refusing benefits falling on the commission.

We also demand that most contract workers be defined as employees, with changes made to ensure coverage for these workers, and that the duration of eligibility for benefits be extended in order to eliminate the “black hole” periods, which create situations of despair and extreme anguish for thousands of workers holding seasonal jobs.

We also demand that money be made available for training and that training time be considered eligible for benefits; that the unemployment insurance fund no longer serve to fund federal social programs or to reduce federal debt or the taxes of the rich; that the commission and the unemployment insurance program be independent; and that the federal government reimburse the $30 billion already taken from the unemployment insurance fund.

We also endorse all other recommendations submitted by the Canadian Labour Congress.

[Translation]

Mr. Maurice Clavette (Secretary Treasurer, New Brunswick Federation of Labour): Like a number of other Atlantic regions, New Brunswick has just gone through a difficult time because various governments in Ottawa made changes that were too significant and too unfair to the unemployment insurance program.

These days, it can no longer be thought that people in New Brunswick are satisfied with unemployment insurance. As we tried to demonstrate earlier, and we think that even in Ottawa people are starting to understand, it is the jobs that are seasonal, not the workers. Moreover, there is sufficient evidence to the effect that when decent jobs are available, New Brunswickers are there to fill them.

We have earned our reputation throughout Canada, but we cannot all move to central Canada or to the West. There are already too many families that have been broken up because of these forced economic exiles. We also need a large enough critical mass in New Brunswick to fill the seasonal jobs, to catch fish for you and supply paper and furniture for Ottawa, Toronto, Winnipeg or Vancouver.

Furthermore, new jobs are being created in our region, and although some were precarious at the beginning, they are promising, whether they are in the textile industry, in new technologies or in tourism. We have every confidence that New Brunswick is currently on more of an upswing than a downswing. We don't need central and Western Canada to continue putting us down. More than ever, we need encouragement as much as jobs. Do not discourage us! Thank you.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Clavette Mr. Doucet.

I will now leave the floor to Ms. Elaine Price from the Newfoundland and Labrador Federation of Labour.

[English]

Ms. Elaine Price (President, Newfoundland and Labrador Federation of Labour): Good morning, Madam Chair.

The Newfoundland and Labrador Federation of Labour is pleased to have the opportunity to appear before the standing committee and present our views on Bill C-2.

An accessible and responsive employment insurance program is vitally important to all working Canadians. It is needed to address the fundamental insecurity all workers face in a market economy. When properly used as an insurance program to reduce the economic risks of unemployment, it plays an important counter-cyclical role in stabilizing both individual and community incomes during rough economic times.

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Earlier cuts, along with the introduction of the 1996 EI Act, have resulted in the systematic dismantling of our UI program. The human costs of these cuts have been extremely high for millions of working class Canadians, their families, and their communities.

The decline in family income, along with the increases in child poverty, food bank usage, and homelessness, can be directly linked to the erosion of our unemployment insurance program.

In Newfoundland and Labrador, for example, the number of UI beneficiaries has declined by 46% since 1993. Unemployed workers, families, and communities have lost $462 million annually in EI benefits. That's a lot of money.

While the amendments proposed in Bill C-2 will help correct some of the inequities caused by the EI Act, they do not address the real issue: the need for a national employment insurance program that is accessible and responsive to the needs of working Canadians in an economy that is experiencing rapid restructuring.

Our federation supports the elimination of the intensity rule, with retroactive application. This rule, which specifically targeted seasonal workers, is draconian and punitive in nature. The truth of the matter is that we've been calling for it to be abolished since it was introduced in 1996.

While there is no doubt that seasonal workers who do manage to qualify for EI will benefit from the elimination of the intensity rule, this does nothing to help millions of unemployed workers who still do not receive benefits.

We need an EI program to be there for unemployed workers, their families, and their communities when they need it. It must be made more accessible and responsive to the hundreds of thousands of Canadian families struggling to cope with unemployment in an economy that's undergoing massive and rapid restructuring.

The modifications to the clawback provisions of the EI Act are definitely a small move in the right direction and will help to correct some of the injustices perpetuated against unemployed Canadian workers. However, the flawed rationale that instituted these clawbacks in the first place will continue to be used against claimants receiving regular benefits.

Government has acknowledged that the clawbacks, which were introduced as a penalty to discourage frequent claims, make no sense when applied to claimants for pregnancy, parental, and sickness benefits.

Logic should also dictate that taxing any back benefits claimants receive due to layoffs also makes no sense. Working people have no control over the circumstances of job layoffs. These decisions are made by employers and are dictated by greed, the marketplace, and the environment.

Imposing penalties on Canadian workers unfortunate enough to experience a layoff in order to discourage frequent claims is just as flawed and ridiculous as imposing penalties on those who make EI claims for pregnancy, parental, and sickness benefits.

Establishing the repayment threshold at $48,750 and exempting first-time claimants from the clawback provisions will undoubtedly benefit some seasonal workers. However, the clawback provisions will remain in effect for above-average income earners. This is punitive. Not only do above-average income earners receive less than 55% of their earnings, because of the maximum benefit imposed by the legislation, but they also pay back a larger portion of their benefits in taxes.

The clawback provisions of the EI Act must be abolished for all claimants. The Government of Canada must not continue to use the EI Act to punish working people who have the misfortune to lose a decent paying job. It must also stop forcing the citizens of this country into a low-wage economy, which is exactly what the EI Act does.

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There's no doubt that the modification to exempt EI claimants receiving maternity and parental benefits will be of value to parents fortunate enough to qualify for maternity or parental leave. Unfortunately, it will do nothing to help the 100,000 women in the workforce who every year take pregnancy leave without EI maternity and parental benefits because they can't get enough hours to qualify.

Older workers here are also affected horrifically, and we have to do something to enable working Canadians to upgrade their qualifications and skills. The EI program can and should be used for that purpose. Our federation of labour supports the CLC recommendations that the 910-hour re-entry requirement be abolished. We also support the CLC recommendation that the national entrance requirements be 360 hours for all claimants.

With respect to premium-setting powers, our federation believes the Canada Employment Insurance Commission must keep its power to set the premiums and govern the use of the fund. Employment insurance is a program paid for by workers and their employers. The Canadian federal government doesn't contribute one cent to the EI program. The $36 billion in accumulated unpaid benefits that government has borrowed—or stolen, however you want to look at it—from the fund over the past six years belongs to workers and their employers. They're the people who pay the premiums. That money must be repaid to the fund, with interest.

The federation also supports the CLC recommendation that provisions be made to secure the integrity of the EI fund for unemployed workers, and that Bill C-2 be amended to give the Canada Employment Insurance Commission greater authority and autonomy and to allow it to create an arm's-length employment insurance trust fund.

Our federation—

The Vice-Chair (Ms. Diane St-Jacques): Ms. Price, can you make a short conclusion? We are over time.

Ms. Elaine Price: Our federation also endorses the CLC proposals for modernizing our unemployment insurance program. We're in the 21st century. The program was built around a market and a labour force for the 1930s. It's time to modernize it. It's time to make the employment insurance program more responsive to the needs of working Canadians in the labour market of the 21st century.

Bill C-2 will help some, but it doesn't go far enough, and it doesn't help to build the kind of EI program we need.

Thank you.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Ms. Price.

Mr. MacDonald from the Prince Edward Island Federation of Labour.

Mr. Felix MacDonald (Treasurer, Prince Edward Island Federation of Labour): Thank you for providing the opportunity for us to make a presentation before this standing committee.

It's important that the people process not be forgotten in the decision-making. It is still important, and I would like to support the comments of my esteemed colleagues from Atlantic Canada and the great province of Quebec.

The articulation and delivery of employment insurance programs across this nation all have distinctive favours, because of the widely divergent regional economies and delivery structures in all the provinces. So when EI programs for income and maintenance support meet an acceptable economic standard for individual and family well-being, the benefits to the community's health are enormous.

But training is where the future is, and access to skills training dollars is tied to EI eligibility. EI eligibility in turn is tied to insurable earnings from actual labour-force participation. The unemployed in P.E.I. face structural barriers to employment and are often excluded from training opportunities. P.E.I.'s primary resource-based economy is seasonal in nature. This structural barrier denies many labour-force participants full employment. EI is therefore necessary to stabilize the social and economic community on Prince Edward Island.

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The P.E.I. Federation of Labour supports the modernization proposals of the Employment Insurance Act. We applaud this committee in its quest to make this act more sensitive to the micro-economies within the Canadian family. Our federation supports the modernization as outlined by the Canadian Labour Congress in its protocol of May 8, 2000.

The federal government must stop being irresponsible in its current policy of pilfering the EI account for non-insurance purposes.

The Employment Insurance Act must be expanded to cover all types of employment and must be structured so that at least 70% of the unemployed are protected.

Payments of benefits should be increased to two-thirds of gross weekly pay.

The divisor formula must be redesigned so that it counts only the weeks a claimant actually worked. There should not be any hidden penalties built in.

We must establish that 360 hours are needed to qualify for all categories of benefit claims, including new entrants and re-entrants. Perhaps it could be less, depending on the region, if the particular micro-economy requires it.

The structure of the benefit period should also be established to ensure income maintenance support for seasonal economies.

The current gap in the existing program should be eliminated and the clawbacks should be abolished.

The employment insurance fund should be separated from government accounts and the commission's authority should be fully restored.

Training and job-related education should be treated as equivalent to job searches for laid-off workers. The act should support training by giving up to five weeks' leave for every year in the labour force.

The P.E.I. Federation of Labour asks you to take significant steps to reduce the impact on the community of workers dependent on EI assistance. This can be done by ensuring that changes to regulations and administrative procedures are clearly communicated in order to reduce undue hardship on benefit claimants.

As Mr. Ken Georgetti, president of the CLC, said, “Clearly, the purpose of unemployment insurance has been lost.” We must come back to the premise that the UI Act was created to provide economic stability in the community.

From 1993 to 1999 P.E.I. lost $52 million-plus, without adjusting for inflation, in UI income. These are consumer dollars lifted directly from the economy that would have been spent at home, not deposited in a sheltered tax haven outside the country, where no benefit is realized by the community.

P.E.I.'s labour force participation rate stands consistently at approximately 66%. However, I question whether the people who are not counted in employment statistics are included there. I suggest that they represent some 5% to 6% of the labour force at any given time. These people have fallen through the cracks of the system. They are the employed and unemployed workers who are not attached to the labour force.

The EI-funded programs provide stability not only to workers' incomes, but also to the business community of P.E.I.—and to the nation as well. If this stabilization is maintained at an adequate level, it ensures that the business community has a ready and willing workforce available, trained and experienced, when work picks up in season.

We must also come to terms with the redefinition of work in the new economy. I believe that in the past we have failed to recognize the value of the volunteering performed in our communities by recipients of EI. As well, in terms of adequate income maintenance, the role played in our communities by stay-at-home mums and dads who are seasonally employed has also been undervalued.

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We must recognize that a community is more than just economic activity. It is a place where people live, dream, and play. These activities are valuable and deserve support. Look at us now, with no dreams, little to eat, and no play.

The P.E.I. Federation of Labour believes that working Islanders have a vibrant and exciting future as individuals...and as a province of this great nation. We will reach our full potential, especially within the regional context of Atlantic Canada.

The UI fund is not—I repeat, not—a handout to P.E.I. from other regions in Canada. It is an important thread in the fabric of the Canadian economy. Our natural resources are no less important than those of the west, and we definitely feel just as important as the warehouses of central Canada.

In your deliberations on the EI Act, the P.E.I. Federation of Labour asks you to be sensitive to our needs of today and our dreams for tomorrow.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. MacDonald.

[Translation]

We will now begin the question period. I repeat that we should try to keep within the five-minute time limit. There are a lot of members present this morning, and we have a number of witnesses. I apologize ahead of time, but I may have to cut you off. There will definitely be an opportunity to come back on the second round.

We will start off question period with Val Meredith, followed by Jeannot Castonguay, Monique Guay, Judi Longfield, Yvon Godin, Joe McGuire, Greg Thompson and Alan Tonks.

[English]

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Thank you, Madam Chair, and thank you, gentlemen and ladies, for appearing before the committee and sharing your concerns about the EI legislation.

I just want to assure all of you who have mentioned a somewhat western bias that I represent British Columbia. Many workers there find themselves unemployed because of seasonal work in the fishing, logging, and construction industries. So it's not an issue that just applies to you.

I've heard a number of different views from you, some of them relatively consistent. What I've heard is that changes need to be taken in the approach to EI, and you don't feel this bill represents that. Most of you mentioned issues that aren't under this legislation, so I have to assume you would all agree that we need to really look at and review the whole EI legislation in all its complexities.

I'd like to raise a number of specific issues. Mr. Roy, you said the federal government needed to get out of rate-setting, that setting rates should be the exclusive jurisdiction of the commission. I heard some support from others on that, but not everybody brought it up. How do you see the employers and the employees regulating and controlling that exclusively, outside government jurisdiction?

[Translation]

Mr. René Roy: Several years ago, the Commission itself had the power to set unemployment insurance premiums. I'm trying to remember—I have not read the argument presented in our brief, but that power did belong to the Commission, and we want the Commission to have it back. The employment insurance plan is managed by the government, but it belongs to workers and employers, because they are the ones who pay the premiums. Employers calculate those premiums into their labour costs. For all practical purposes, those premiums are almost tax deductible, because they come under operating expenses. For workers, those premiums come under expenses as well, and they get a de facto tax credit because they pay employment insurance.

In the FTQ's opinion, the plan belongs to employers and workers, and we should come back to the old rules of the game. The Commission should set the premiums. That is its job.

Is there anything you would like to add?

Mr. Michel Matte (Servicing Representative, Fédération des travailleurs et travailleuses du Québec): That is how it worked in the past. We were consulted about the process in 1996. I was part of a committee. Because of the 1982 economic crisis, while there was a major deficit, the government proposed a 5- or 6-billion- dollar surplus in the fund that could be used to help during the economic crisis. Like the Canadian Labour Congress, we said a 5- to 8-billion dollar surplus might be acceptable, but not more.

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I won't tell you the amount the fund has reached now. Before 1996, the Commission calculated the average cost of the plan over the previous five years, and set the premium on the basis of that average. We could do the same thing again.

The legislation was amended in 1996. The Commission administers its own budget, as do all commissions. It determines the amounts it will need for 52 weeks, and other items. The unions had talked about a fund of 5 to 8 billion dollars.

[English]

The Vice-Chair (Ms. Diane St-Jacques): A small one?

Ms. Val Meredith: Yes.

We've heard from people representing the employers who approach this committee that if it's a tax, then call it a tax. But they felt it was unfair for employers and employees to be funding programs outside the insurance program. Would you agree with that comment?

[Translation]

Mr. René Roy: Absolutely. I hope I understood properly, because I was having some difficulty... If you are asking whether we agree that using employment insurance money to subsidize programs other than employment insurance constitutes abuse, then obviously we agree. We object most particularly to the fact that the federal government is paying its debt with the employment insurance fund surplus. We agree that the money in the employment insurance fund should first of all be paid to those who are losing their jobs. At present, 37% of unemployed people are receiving employment insurance benefits. That percentage is much too low. It has already been as high as 70%, and we would like it to go back to 70%.

However, we do agree that part of the employment insurance fund could be used to train workers, re-train them in second careers or help them maintain their skills through government programs like those we have had in the past. We have an agreement with Quebec, under which Emploi-Québec manages those programs. We agree with that as well.

The Vice-Chair (Ms. Diane St-Jacques): Thank you. Now we move to Jeannot Castonguay, and then to Monique Guay, Judi Longfield, Yvon Godin, Joe McGuire, Greg Thompson and Alan Tonks.

Mr. Jeannot Castonguay (Madawaska—Restigouche, Lib.): Thank you, Madam Chair, and thank you to all our guests.

In planning the future of a country and a society, it is very important to have experts like you give their views. In the past three weeks, we have heard a variety of witnesses and many different opinions. I believe that everyone has the same objective, to find equitable ways of helping workers who need help at a point in time along the way.

A number of witnesses said that employment insurance should be a genuine insurance plan. Others gave a different view, saying that they prefer to see it as a form of social support. They felt this was the real mission of employment insurance.

However, Madam Chair, there is an opinion we hear again and again. We are told that, if everyone had jobs, there would be far fewer problems.

I come from a region where many jobs are seasonal. I appreciate the remarks made by my friend Maurice Clavette, who said that it is not the workers who are seasonal. I have been singing that tune here on the Hill for a month and a half now, and it is something I believe in very strongly.

Do you have any suggestions that relate to the real world? How can we change things in regions that have a great many seasonal jobs? In the future, how can we try to create jobs, generate employment, which in the end is what will improve the outlook for everyone? We know that is our goal. But how can we achieve it in all the different communities? Do you have any suggestions?

Maurice, perhaps you...

Mr. Maurice Clavette: Thank you, Mr. Castonguay.

I must tell you how much I appreciate the fact that some members of Parliament from New Brunswick finally seem to be waking up. That is probably why we are here today, attempting to influence the course of Bill C-2. In the past, New Brunswick MPs of all political stripes were asleep at the switch.

But now it's time to wake up and take action, because we have seen just how much damage we have done. You are quite right in saying that, in our region—and by our region I mean Madawaska and Restigouche, as well as the Acadian Peninsula, perhaps—many jobs are still seasonal. There is nothing we can do about that.

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One thing I find unfortunate, and which might have helped, is that the government has engaged in what we often call devolution, or decentralization. The federal government has given the provinces money to take over manpower training. At the time, I believe that the amounts involved were $87 million for New Brunswick, and probably more in other provinces. What I find unfortunate is that most of the money transferred from the federal to the provincial government today is used to subsidize industries, companies which for the most part do not need such subsidies. The money could be put to better use in regions like Chaleur, the Acadian Peninsula or Madawaska, to provide genuine training in an attempt to remedy some of the problems there.

Today, jobs have been created in some sectors. But unfortunately, our workers are untrained, and frequently lose their jobs because of their lack of training. If the money were being used properly, to provide training for them, there could be long- term benefits for everyone. I don't know whether that answers your question.

The Vice-Chair (Ms. Diane St-Jacques): Mr. Castonguay, you have time for a brief comment.

Mr. Jeannot Castonguay: Madam Chair, Mr. Clavette raises an extremely important point. Last week, I heard the same remarks in my region from workers who said they were having a serious problem. The provincial government had been given money for training, but when they took their requests to that government, they were told that unemployment came under federal jurisdiction and not to bother them with such things.

Thank you for raising that point, Mr. Clavette.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Castonguay.

Monique Guay, Judi Longfield, Yvon Godin, Joe McGuire, Greg Thompson and Alan Tonks.

Ms. Monique Guay (Laurentides, BQ): Thank you, Madam Chair.

I would like to congratulate all the unions for being here today. We are familiar with the work you do, especially with workers. We know how much you try to assist them, and help save their jobs. I have also noted that there is something you are quite unanimous on—we are not talking about seasonal workers, but about seasonal industries.

My riding depends a great deal on the seasonal tourist industry, among others, because 80 percent of workers in the region are in the tourist industry. When the snow melts, they are out of work. That's how it is. No more jobs. They get employment insurance for six to eight weeks or so, and then they go back to work in the summer. This affects me a great deal.

My first question is to Mr. Roy, of the FTQ. Among other things, Mr. Roy, I would like to hear your views on the young people who first joined the labour market and are required to work 910 hours, and on the women who go back to the labour market and are also required to work 910 hours before they qualify for employment insurance. I consider this measure wrong, and I feel it should not even exist. You also mentioned the POWA, in which I am very interested. Please give me your views on it.

I will keep my comments brief because I want to give you time to answer. The independent fund is an extraordinary idea. If you remember, we asked that the bill be divided in two so that we could develop and review the issue in depth. I would like to hear your opinion.

Lastly, I would like to hear you talk about self-employed workers. Though they have not been mentioned yet, 18 percent of workers are self-employed, and that figure is increasing. This is the shape the economy is taking today. I would like to hear what you have to say about self-employed workers. The floor is yours.

Mr. René Roy: I will begin by answering your last question. The situation of self-employed workers is not good at all. They are poorly identified. At present, with the government of Quebec, we are attempting to amend the Labour Code so that at least those self-employed workers who depend on the industries—because there is a category of false self-employed workers that has been identified—can become unionized. They can be identified, so they can have access to employment insurance and other privileges provided for under the law.

As for employment insurance as such, we felt we should examine the issue of self-employed work elsewhere. The POWA has been an excellent program, and we do not know why the federal government removed it from employment insurance. In view of today's rapidly changing technology, the program is even more important than it was in the past.

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For example, for people who were 55 years old, the program made it possible to combine retirement and POWA, and people could hire young employees, particularly in times of high unemployment. It was an excellent measure.

We think we can do the same thing with Emploi-Québec, since Emploi-Québec manages job supply and demand and a whole. Unlike what we have seen in New Brunswick, Emploi-Québec ensures that the money does not go to companies that do not need it, but to workers who need training to adjust to new technologies and retrain for the labour market. The POWA was extremely useful and humane.

Before that, workers who retired could receive unemployment insurance. Some workers had been on the job for 30 years, and had never drawn unemployment insurance benefits. This was an easy measure that helped them, that facilitated the transition into retirement.

I am moving quickly because there is never much time here. But I was asked a number of questions, Madam Chair.

With respect to the independent fund, you are quite right in saying that we have one at the CSST. In fact, we have one in several organizations. The labour market partners—employers and employees—are perfectly capable of managing the fund. And of managing the premium rate. The fund is theirs. As far as we are concerned, this is not really a problem. It has been done elsewhere, and there are many examples of places where it is done well. So we don't see why we shouldn't be able to manage the fund. In any case, it is one of our proposals.

The Vice-Chair (Ms. Diane St-Jacques): You can comment after...

Ms. Monique Guay: I hope that I will have a chance to ask other questions during the second round, Madam Chair. I hope that the briefs which have been tabled today will be useful, and that the government will take them into account—because at present, the bill as it stands is completely unacceptable, and we know that a bill as important as this will not come back before a committee next year. It will take an other five, or even ten, years before we review this legislation again. Therefore, I hope that all your proposals will be taken into account, and I will come back with other questions during a second round.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Monique. Now, Judi Longfield, Yvon Godin, Joe McGuire, Greg Thompson and Alan Tonks.

[English]

Mrs. Judi Longfield (Whitby—Ajax, Lib.): Thank you, Madam Chair, and thank you to those who've travelled to be with us.

Since 1996 and the reforms, labour organizations from across the country—it's not just from the Maritimes; I'm from Ontario and I've heard from the construction industry, the tourism industry, and the lumber industry. Ms. Meredith said she hears about it from her folks out in British Columbia. So this is a country-wide problem.

We've certainly heard about the intensity rule and clawbacks, and I think we've listened. We've eliminated intensity and reduced clawback.

But there's one area I can't seem to get my head around, and that's the divisor provision. Certainly under the old unemployment insurance program, a number of people felt there was really no incentive to work beyond the minimum number of weeks. That was why we introduced the divisor clause.

As a result of monitoring and assessment, it appears that only about 2% don't work beyond the minimum time. Yet I keep hearing concerns about the divisor provision.

Perhaps you can help me understand: if our statistics and monitoring indicate that 98% of claimants actually exceed the minimum, why is it still seen to be such a pressing problem?

Mr. Felix MacDonald: In relation to the divisor formula, I can give you a specific situation we're dealing with on Prince Edward Island right now. As of yesterday, the seasonally adjusted unemployment rate on P.E.I. is 11.6%. That means that in order to be able to file, a claimant requires 490 hours of employment. Now, perhaps that employee is able to accumulate 490 hours over a 10-week period. Based on earnings of $9 per hour, that will give him approximately $441 gross per week. But what happens is, instead of dividing that $441 by 10, which is the number of weeks actually worked, we have to divide it by 16, which is the minimum divisor we can use administratively. This means that the amount of weekly earnings recognized by the commission is only $275 a week. If you're under the intensity rule and go down to 50% of that, then the worker ends up with only $137 per week gross—which represents a 30% claim benefit rather than a 100% benefit.

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That's one area where the divisor has a significant impact, because it's set to a minimum based on the unemployment rate in the community, not on the number of weeks it's earned, necessarily. I hope I make myself clear. In other words, if you work 10 weeks and earn $4,990, it isn't divided by 10, it is divided by 16.

Mrs. Judi Longfield: You say the rate is 16 weeks. How often is it adjusted?

Mr. Felix MacDonald: Every time the seasonally adjusted rate comes out—whether that's quarterly or monthly, I'm not sure. But from an administrative point of view, it does change on a regular basis.

Mrs. Judi Longfield: You have data. Statistically, how many people are affected by this? Presumably, everyone's trying to work as long as they possibly can. But with seasonal work, I know sometimes the weather is good, sometimes it's bad. Sometimes there's a market for your product, sometimes there isn't.

How many people are affected by this? What percentage of your workforce?

Mr. Felix MacDonald: On Prince Edward Island, where work is highly seasonal, they're looking at anywhere between 45% and 50% of claimants. That number may be adjusted by experts in the department—I'm just making that assessment on street knowledge.

Mrs. Judi Longfield: This is where I have a problem. You're telling me 45% or 50% are affected, and yet monitoring assessment says that nationally it's 2%....

[Technical difficulties—Editor]

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): Could we fix this? A technician is on the way. Perhaps we should stop for a few minutes. The meeting is suspended.

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The Vice-Chair (Ms. Diane St-Jacques): We can resume the meeting. I apologize for the problem.

[English]

Judi, I think you have a small question.

Mrs. Judi Longfield: Yes, Madam Chair. During the break I had the opportunity to speak to one of the other witnesses. Perhaps Mr. Smith might comment on my concerns. The information I have on the divisor rule perhaps does not reflect the reality.

Mr. Ron Smith (First Vice-President, Newfoundland and Labrador Federation of Labour): I believe the information you have is correct. It could possibly be that nationally, 2% of successful claimants are affected by the divisor rule. But I think this doesn't reflect the reality when we change the entrance requirement, the 910 hours. Then all the people who normally would have qualified for UI, and would have had less than 14 weeks, and therefore would have been affected by the divisor—these people have been disqualified entirely. In Newfoundland, that was 46% of the claimants.

What you did was wipe out 98% of the people who would have been affected, and you're left with 2%. That's the reality.

The intention of the 14 weeks was good, but it had the opposite effect. What you have is people working more than 14 weeks who would have worked more than 14 weeks anyway.

That's why I support the idea, which we haven't discussed yet, that the qualifier here should probably be 12 weeks. I would suggest that the commission should look seriously at it being the best 12 weeks in any year and not the last 12 weeks.

I've had a fellow who worked—and someone said, “I can't give you his name, because somebody's going to cut off his claim”—

Some hon. members: Oh, oh!

A voice: You'll have to find out when you go back.

Mr. Ron Smith: This fellow worked 14 weeks at $18 an hour. When he was laid off, he was offered a job at $10 an hour. But he couldn't take it, because if he did, he'd end up with a 30% decrease in benefits for the 26 weeks remaining till he got back to work again. So you were actually punishing him for accepting employment.

That's why I think you have to do away with the divisor altogether and go back to your 12 weeks—and make it the best 12 instead of the last 12. In a lot of industries, such as retail, quite often the last four or five work weeks are partial weeks, just two and three days, instead of full work weeks. So the workers say to their employers, “Lay me off now.” The employers say, “Safe enough”, and lay them off. They can't afford to work with your system; they work your system their way, asking for layoffs. It has a very negative effect on the number of person-hours worked by these people.

The Chair: Thank you, Mr. Smith.

Thank you, Judi.

[Translation]

Now we shall move to Yvon Godin, Joe McGuire, Greg Thompson and Alan Tonks.

Mr. Yvon Godin (Acadie—Bathurst, NDP): Thank you, Madam Chair.

First of all, I would like to thank you for coming to Ottawa today to represent the workers of one part of this country. I'm certain that many of you are from the working class, and not from universities, like those professors that are supposed to know all the answers to our problems, and that would tell us how to manage our employment insurance system.

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That said, I have a question that flows directly from the comments made by my colleague Jeannot Castonguay. He asked how jobs for those people could be found, since they no longer have employment insurance. Do you have any ideas on that? I have a bit of a problem here, because for six or seven years, the government has been saying that the answer and the solution is to find a job. But by saying that, the government fails to recognize that there are seasonal jobs in Canada. That's what we call “putting the cart before the horse”.

For example, in my riding, we are losing an average of $69 million a year in employment insurance benefits. Here is my question: is this not one case where we are putting the cart before the horse? This is mostly affecting small- and medium-size businesses. Instead of going ahead, putting an infrastructure in place and creating jobs, the government has punished people who did not deserve to be punished. We should be focussing on economic development, rather that punishing the men and women who work within a system that belongs to them. That is my first question, Madam Chair.

My second question will be very brief, because I would like to hear our witnesses' response.

In 1992, when I was a negotiator for the union, we were bargaining to obtain separation pay for workers who were laid off. This was to help people get new training. And help SMEs do something more than just sit there. Now, employment insurance considers this a salary, and those people are not entitled to employment insurance benefits for perhaps a year. Isn't that a punitive measure? I think someone from the FTQ commented on it. He said that this was wrong, that this should not be considered a salary. Rather, it was money given to a worker to enable him to retrain. He had paid employment insurance premiums all his life, for thirty years or more, and that money was being taken from him. I'm going to say it straight out: it's theft—the workers' money is being stolen, and they are not being giving a chance.

I'd like some answers on that. Thank you.

Mr. Richard Goyette: With respect to regional economic development, for some types of jobs—particularly in construction—it is obvious that we must make some choices. We must make economic development choices, and we must make rationalization choices.

The law is drafted as if the data were objective and the economy were stable, both over long periods and within a given year.

In the brief we will soon be distributing for information, take a look at the variations in hours between 1957 and 2000. That will give you some idea. There are also variations within any given year. We have no choice—either we have stability in economic development, at which time the law takes it into account, or we have no stability, and the government does not intervene in planning. When that happens, one way to improve things is to subsidize employees. There are not just two methods. In our brief, we talk about 12 methods.

I also heard the question by the lady seated on my left, who asked about the number of weeks, and the denominator. It's the same thing again. If the economy is stable, the denominator is not any more punitive than necessary, but when you have patterns where people work, then don't work from year to year, when they find themselves on social assistance because they are no longer entitled to employment insurance, then it is the plan that lies. Its foundation may be equitable, but there is still a lie there, since we act as if the economy were stable, when it is not. As a result, the legislation incorporates measures such as hours, the denominator rule, eligibility categories and other means, and seasonal workers find their benefits cut because they are not actively seeking employment in a sometimes disadvantaged region.

The legislation is constructed as if we lived in an ideal world, when in fact we don't. We constantly encounter economic difficulties, and that is the problem. We cannot respond with statistics, if today we have 2, 3 or 40%. We have to ask questions about recent economic development in your region, about economic activity in the country over the past year, and about the economic development in your province. Then, we could have legislation that reflects the economic development. But this is not how it's done, and that's the real problem.

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The economy fluctuates, but we have legislation that does not take those fluctuations into account, and imposes penalties on workers who are hit by the repercussions of unequal investment, unequal development and frequent lack of planning, both by the federal government and by provincial governments. Salaried employees pay the cost, because the system tends to penalize them. It's as if Canadian workers were the investors responsible for economic development, when in fact they are employees.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Goyette. Your time si up.

Mr. Godin, perhaps you could come back later with another question.

Mr. Yvon Godin: I will come back for the answers.

The Vice-Chair (Ms. Diane St-Jacques): Unfortunately, your time is up.

Let's move on to Joe McGuire, Greg Thompson and Alan Tonks. Later, we will come back to Carol Skelton.

[English]

Mr. Joe McGuire (Egmont, Lib.): Thank you, Madam Chair. I'd like to welcome all the witnesses today.

I'd like to solicit your advice on what we should do with this bill. As you know, it's been introduced, an election has been run on it, it's been included in the budget, and so on. Should we pass this bill as quickly as possible as is and continue our work on these numerous other changes that a lot of witnesses are bringing in, or should we risk losing the bill and try to bring in amendments? What would your advice be to the committee to recommend?

Ms. Elaine Price: I think it's obvious, based on what you've heard around the table this morning, that there is consensus that the proposed amendments in the bill are progressive in nature—they will help some unemployed workers—but they don't go far enough. So perhaps a good way of approaching this would be to view Bill C-2 as the first tiny step towards modernizing the employment insurance program, and then make sure appropriate action is taken to put a process in place to allow labour and employers to work together as equal partners with government in developing an EI program that's responsive to the needs of working Canadians in the 21st century.

Mr. Joe McGuire: Is that agreed, Mr. Roy?

[Translation]

Mr. René Roy: In my opinion, you can keep your bill. It is there solely to let the government set the premium rate for the next two years. That is why the government is pushing the bill through so quickly. It also wants to justify the fact that it took some $22 billion from the employment insurance fund surplus. Some amendments are good for workers, but we would like to see a real plan.

In any case, the government could very easily give the Commission back the right to set the premium rates, by Order in Council. Then, we could take the time to rebuild the plan as it was in 1971, Bryce Mackasey's system—as we know, Mackasey was a good Liberal. You should be able to do it as well as he did.

[English]

Mr. Joe McGuire: So you would agree with Ms. Price then, pass this and continue our work?

[Translation]

Mr. René Roy: I don't think we need to adopt a bill at present.

Mr. Jocelyn Dupuis: When the legislation was amended in 1996 or 1997, I came to a press conference here in Ottawa to say that the amended legislation had created two classes in society: construction workers and other workers. Construction workers are condemned to submit a new application for employment insurance each time a contract terminates. They have no choice.

There are 103,000 construction workers. Though it may seem impossible, I do believe it is true: 100%—each and everyone—of construction workers submit a new employment insurance application each year.

Bill C-2, formerly Bill C-44, introduces an amendment. After five years, the percentage construction workers receive will go from 55% to 50%.

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We are touching on a number of very important issues: eligibility with respect to the number of weeks, and the qualifying period for construction workers. In our brief, we put forward over 13 issues, of which some are a priority: the qualifying period, among other things, for seasonal construction workers, and immediate termination of employment, which may occur in the middle of a week, on a Wednesday or a Thursday.

In my view, the one who works in construction on a daily basis is condemned to have only two or three days a week, or even one day a week, during his qualifying period. So obviously, the construction worker, who has paid the same premiums as everyone else through a payroll deduction made by his employer... It is unacceptable to us that Bill C-2 does not increase the qualifying period, the eligibility period, and indexation, which has been reduced to 1.7% or 1.8%.

In our view, the average salary for the qualifying period in recent years for construction workers should be $22,000 to $23,000. If in the future we do not find some way to guarantee that benefits will make up the salary for a given year through an insurance plan, this would be unacceptable for construction workers in Quebec.

Our association includes 75,000 members, but in fact we represent 103,000 workers. We consider it unacceptable that this bill be adopted without amendment.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Dupuis.

[English]

Mr. Joe McGuire: I'd just like to say that if Mr. MacDonald and I went home without the intensity rule, we'd both be hanged.

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): We will have a chance to come back to you in the next turn, Mr. Roy.

Now, Greg Thompson, Alan Tonks, Carol Skelton and Jeannot Castonguay.

[English]

Mr. Greg Thompson (New Brunswick Southwest, PC): Thank you, Madam Chair.

I want to thank my colleague from the Alliance for the preferred seating arrangement here this morning. It was very generous of her. That's what we call cooperation on this side of the table.

My first question refers to the presentation by the New Brunswick Federation of Labour—maybe Mr. Doucet or Mr. Clavette could respond. I just want some clarification on page 6 of your report. The bottom paragraph reads:

Setting rates for unemployment insurance benefits, whether it be maintaining, lowering or raising these rates, has never been of major concern to us.

I guess I'm a little surprised by that. Blair or Maurice, maybe you could comment on that statement and clarify it, if you wish.

Mr. Blair Doucet: I think we're basically saying that as workers we don't mind paying our fair share for insurance premiums or benefits for unemployed workers. We're alluding to it that way, not because we think it should be completely out of sight. We think the surplus generated every year through premiums paid could be used by the unemployed. But in fact it's not, and that makes it very difficult for people to get unemployment insurance benefits.

So at this point, the premium isn't an overriding concern for us. But to repeat myself: we're saying it would be fairer if the money went back to the people who deserve it, and not into the government coffers to reduce the deficit, for example, or to fund certain programs. That's what we were alluding to.

Mr. Greg Thompson: But you don't look on the premium, Blair, as a burden to your workers or the industry? You don't view it in terms of one of those ugly payroll taxes, for lack of a better expression? Because of the contributions on $100, if you look at the employee and the employer, it amounts to a little over 5%.

I hear some complaints about that being too high. And of course the reason for the $3-billion-plus surplus is that the commission has been taking too much out of your hind pocket and too much out of your employer's hind pocket. That's the point I'm making.

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Mr. Blair Doucet: Yes, but I disagree. I don't think the surplus is there because of that. I keep saying the surplus is there because we as workers can't tap into the system.

So we haven't been overly concerned. We think it's a just rate at this point in time. Now, of course, we'll continue to monitor that. It's a just rate, but it should go back in to the people who rightly deserve it.

Mr. Greg Thompson: Then there's the other point, in the bill itself, where the role of the commission will be suspended in its ability to set the rate. Do you see any political advantage to the government in doing that? In your view, why would they want to suspend the power of the commission to set the rate, which means obviously it could be lowered tomorrow to something in the order of $1.75 and still allow the fund to sustain itself? Maybe you could comment on that, Blair.

Mr. Blair Doucet: I think we have to go back into what our presentation really says on the commission having the ability to do this. I think it's much like, or it should be much like, a lot of the commissions we have provincially. I could cite an experience we have had in New Brunswick, I'm sure not unlike any other province in this great country. In fact, I could say, looking at certain commissions and boards, such as health and safety, for example, where we're arm's length away from the provincial government, this commission could be exactly the same to the federal government.

Let's face it, the chair of that commission will always come appointed by government, so there's a reporting system. That reporting system would go to the proper portfolio in the federal system, and it would be looked after that way. We have to look at people having the ability to make decisions on their own behalf rather than, again.... We contend that the legislators haven't done a good job.

When I look at money that I've put in over the years, I've been fortunate to have worked since I've gotten out of high school, for the last 34 years, but should I fall on tough times over the next couple of years before retirement, I think it would put me in another frame of mind. It's all right for us to talk about it, but when you've actually witnessed it or felt it as an individual, it's a different system.

Mr. Greg Thompson: I know I'm almost out of time.

Blair, on page 8 of your brief, you sum up some of your positions point by point. I know you can't cover all of them and I know this is not part of the bill as such, but one of the areas you left out is the boundary issue in New Brunswick, which is a big issue, in identifying pockets of high unemployment. This last boundary or restructure after the commission reported back last summer created some difficulties in some parts of New Brunswick, not truly reflecting the seasonal nature of employment in those regions.

Could you comment on the boundaries problem and what you would like to see happen in regard to definition or identification of those higher unemployment areas?

The Vice-Chair (Ms. Diane St-Jacques): Mr. Doucet, are you able to give a very quick answer? We may have to come back.

Mr. Blair Doucet: I can try to answer very quickly.

Without a doubt, the boundaries posed a problem for the New Brunswick Federation of Labour when it first came out. Let me give you the example of Madawaska County, which was in another area. So maybe there should be a percentage that's unified right across this country, regardless of the unemployment rate.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Doucet.

[Translation]

Mr. Clavette, Mr. Thompson will come back on the next turn. You will get a chance to make your comments.

Mr. Maurice Clavette: I would have liked to comment briefly on the three questions put, but if you tell me that...

The Vice-Chair (Ms. Diane St-Jacques): We have to ensure that everyone gets enough time, but you will get a chance to come back during another turn.

Mr. Maurice Clavette: Very well.

The Vice-Chair (Ms. Diane St-Jacques): So, we have Alan Tonks, Carol Skelton, Jeannot Castonguay, Monique Guay, Joe McGuire and Yvon Godin.

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[English]

Mr. Alan Tonks (York South—Weston, Lib.): Thank you, Madam Chairman, and thank you to all the representatives. This is my first time on this committee, and I'm learning a great deal.

I also note, from the New Brunswick perspective, that my colleague Mr. Godin can take great pride in the affirmation of support that you give him. I may say that if he has paid for it, he hasn't paid you enough, but from what I've observed he's earning the faith that you put in him.

What I'm trying to understand is there's a recurrent theme, which is that the clawbacks and the intensity formula were punitive; get rid of them.

We hear from staff regarding the provisions for the gap that occurs for seasonal industries that it is falling with respect to the number who are poised to collect in the next seasonal cycle. We're told on the divisor formula that there are two points of view. The divisor approach is one for which the quote was used that actually as a result of it, 2% of EI claimants entered the program with less than two full weeks above the minimum entrance. In other words, 98% of claimants maximized their weekly benefits by working a little longer. When you add all that up, regardless of what position you take, we are just tuning or retuning a program.

I am persuaded that when we have a low minimum wage—which is abysmally low in New Brunswick—whether the entitlement is 55% or 60% of benefits, on terribly low wages the equity issues that you've all spoken to will never be achieved.

My question is a general one. Never mind the methodology of setting new rates; what are we doing to come to grips with this huge issue of not just tuning employment insurance but a program of guaranteed income support? Are there any groups with respect to the presenters that are looking at the issues of seasonal industries, at the issues of minimum wage across the country, the inequities the country is imposing that cannot be addressed through employment insurance? Is there anything we're doing that goes beyond that? Thank you.

The Vice-Chair (Ms. Diane St-Jacques): Mr. MacDonald.

Mr. Felix MacDonald: If I understand the question, to Mr. and Mrs. on the street who are worried about going to the grocery store next week—and this is the only research I have to go on, the street research—the unemployment insurance scheme has, for those in need, been successful in that it's well funded. The only thing we've done is play around with the parameters to such a degree that it hurts a great percentage of our labour force simply because they don't qualify any more. So we have to move towards allowing these people accessibility to the programming that is available.

The gaps do exist regardless of what the statistics say. I know Mary and Jimmy and Johnny are still worried about that six weeks to two months during which they're not going to have any income. We have ended up with what we call the working poor, which has grown astronomically within our province, guys who are raising families, three children and a wife, on $10 an hour, and spending an hour travelling each way to keep a job that has no future to it. He has gone to take training that he had to pay for because it was learner-funded.

I can think of one example. The guy is so in debt and his credit rating is so ruined, he's done for life. He'll always be a statistic. That's what we've done, and that's what we have to be accountable for.

Mr. Joe McGuire asked the question. Yes, I would sooner go home without an intensity rule and take the chance and be hung. The other thing is that we have to be prepared to accept the responsibility and move on to expand the system in order to be able to accommodate those who don't have the skills and the work opportunity.

The Vice-Chair (Ms. Diane St-Jacques): Thank you.

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Could you make a very quick comment because we have to—

Ms. Elaine Price: The point that needs to be made is that it's very difficult for any group, either nationally or provincially, to try to do things, concrete actions, to increase minimum wages or ensure that we have living wages when we have an employment insurance program that seems hell-bent on forcing working Canadians into a low-wage economy.

A couple of weeks ago there was an article in The National Post. This call centre set up in Newfoundland, because of our low-wage economy, offered to pay people $7 per hour, and the Canadian manager of an American company that happened to be located in B.C. was bemoaning the fact that seasonal workers in Newfoundland who were getting unemployment insurance were getting more than $7 per hour. That's what we're contending with. So we have a problem.

The Vice-Chair (Ms. Diane St-Jacques): Thank you very much.

[Translation]

Now, we have Carol Skelton, followed by Jeannot Castonguay, Monique Guay, Joe McGuire, Yvon Godin, Judi Longfield and Greg Thompson.

[English]

Ms. Carol Skelton (Saskatoon—Rosetown—Biggar, Canadian Alliance): Listening to the comments this morning and going through everything...Mr. Doucet talked about the despair in his region and Mr. MacDonald talked about some of the social problems and everything, and that the purpose of EI has been lost. As a mother of a labourer I understand that totally. I want to say too that we in western Canada understand and we support what you are saying to us, and we want to listen to what you're saying because each province is different.

I want to know if each of you feels that the social programs that have been added to the EI program, or what I feel are some of the social programs, are hampering the EI program presently. Do you think reducing the social program right now would help them?

The Vice-Chair (Ms. Diane St-Jacques): Are you putting that question to somebody?

Ms. Carol Skelton: It's about some of the training programs that are being put in. Sorry, I should have said training programs.

Mr. Blair Doucet: Let me give you a personal feel on some of the training programs. When it was transferred to the provincial government—and I work for a rather large company, a multinational company, that makes quite a few billions of dollars—they claimed, as a pilot or a stand-alone company, that in fact they weren't making money. That stands to be corrected, depending on the auditors and the books that are put forward, because it seems from one quarter to another they could go the opposite, to making, again, millions of dollars in a different quarter.

In fact, we have gone through some downsizing—or layoffs, I should say; I shouldn't say downsizing—because of the greed of directors, we believe, who say they have to be competitive. That word has always bothered me because I don't what it means. Competitive with whom? With the free trade economy and so on.... To this day I don't have an explanation from employers of what competitive means.

In fact, I would say I was forced—my membership is now being faced with layoffs because of the employer's decision to add profits to its shareholders—to go to the provincial government. Mind you, it was hand in hand with the employer. But I was bothered by that. Is it right for a multinational company—and I don't have the figures right now, but I can tell you they turn over much profit in most cases; they're very wealthy—to go into that system and get $2.2 million for training for something that I believe in the past was the responsibility of the employer?

• 1150

Yes, we had to do it to be self-sustaining, to make sure that our people didn't fall off on unemployment insurance, because we know from experience what that did to them. But on the other hand, was it right to go after those dollars for that reason?

I think there have to be check-marks in place, but again, I'm not against money being put out for training. But check-marks have to be put in place, and that is a specific matter I know I can talk about, because I was bothered by going—and we did get the money. Because, after all, it is our money. It may have been wrong that it be used for that, when the employer maybe should have paid.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Doucet.

Madame Price.

Mrs. Elaine Price: First of all, I think the point needs to be made that access to training and education funding under the EI program is extremely limited. As a matter of fact, it's more limited now than it has ever been. I think that point has to be made. I would argue that access to training and education under the EI program needs to be expanded. Right now you have to be on unemployment insurance and be unemployed in order to qualify for EI training. I've had discussions with employers and workers alike; they are extremely concerned. There is no way an employer and a group of workers, working collectively, can even access EI funding in order to upgrade skill levels, to enhance employability, or to maintain employment. There's no room for proactivity under the EI program with respect to training.

The other question that has to be asked is this. We're continually talking about the need to develop a culture for lifelong learning. How, in the name of God, are we going to do it when access to post-secondary education is becoming unaffordable for an awful lot of people in this country? Two-thirds of the people who are unemployed no longer qualify for unemployment insurance. So who is going to pay?

We're going to pay. This country and the people of this country are going to pay, because access to education and training is critical if we're going to build the kind of competitive economy and competitive workforce we need in order to be able to survive. And we can't do it, because there's no support, and the EI program actually works against labour organizations. I would suggest that a lot of employers will tell you it works against them too.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mrs. Price.

[Translation]

We have already gone overtime. You will have to be brief.

Mr. Richard Goyette: I will be brief. Even when, in the private sector, attempts are made, for lack of a better word, to subsidize training, people are having their employment insurance benefits taken away from them. We are a case in point. We have a training fund for our people. In the construction industry, training is often given during layoff periods. However, even in that case, if we try to help people by subsidizing them, they will lose their employment insurance benefits. Consequently, one of our demands is that the act should stipulate, at least where employers and unions agree to subsidize training, that people should continue to receive their benefits.

The Vice-Chair (Ms. Diane St-Jacques): Thank you very much.

Now, Jeannot Castonguay, you have the floor, followed by Monique Guay, Joe McGuire, Yvon Godin, Judi Longfield and Greg Thompson.

Mr. Jeannot Castonguay: Thank you, Madam Chair.

Bouncing ideas off each other allows us to find the best solutions. I sincerely believe this. I would just like to say, Madam Chair, that I spent several hours talking to people in my area in an attempt to understand the complexity of the framework of the Employment Insurance Act. I think that it is almost scandalous how complex this act is. Everyone is trying to understand all the ins and outs of the act. So many amendments have been made to the act that eventually bits had to be added in an attempt to complete it.

I wonder whether it isn't now time to advocate that the bill be overhauled on the grounds that Canadians want to work and that unfortunately, sometimes, some people lose their jobs. I wonder whether this isn't the long term solution. Try as we might today to add amendment on top of amendment, the fact remains that the act is an old structure, which, I believe, isn't necessarily built on the most solid foundation.

I would like our witnesses to give their thoughts on an approach based not on patching up the existing act, but quite simply, on creating legislation which meets the realities of 2001, for people who want to work and who, unfortunately, are laid off.

Mr. Richard Goyette: The timescale is the major issue here. It would be very risky to pass Bill C-2 in its current form and leave the rest till later.

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A case in point is benefit increases. Benefits have not been increased since 1996, and even in 1996, benefit levels had already been cut. The system for increasing benefits set out in Bill C-2 would mean that benefits would most likely not be increased for 10 years. Consequently, that would mean that at the very least, employment insurance benefits will not have been increased for 15 years.

This was debated throughout Canada in the 1970s. Rather than letting the government be pressured from various quarters into hiking or not hiking benefits, almost all Canadian legislation solved this issue through compensation at both a provincial and federal level.

In 1996, the federal government did an about-face. A system for increasing benefits no longer exists and the system which has been set out in C-2 means that benefits will not be increased for a further 10 years. Can we allow the income threshold of Canadians to decrease over a period of 15 years? Can we accept the fact that, since 1996, benefit periods have been cut by 50%? Can we allow Canadians to continue to be caught in the denominator trap for years to come? In reality, it is a trap, because people have to cope with short and long periods of economic development or temporary employment.

Since 1996, traps have existed in the employment insurance system. Both eligibility and benefit period have been cut. In one fell swoop, benefit periods were reduced by 50%. That's a dramatic cut! And benefits have not been increased. Trade unions cannot make any concessions on this because we are talking about the annual income of all benefit recipients, and of all Canadian workers. There has to be a minimum level. We cannot make any concessions on benefit periods, on quality and on increases in benefits. We believe there has to be a national standard. Canadians have to be able to count on at least that protection. That does not rule out an overhaul of the act at a later date.

I might be repeating myself here, but I want to point out that benefit periods were cut by 50% in 1996. That's a major cut. Benefit periods went down from 28 to 14. We think that, in particular, failing to increase benefits and implementing the denominator rule was a way... That can't go on.

I'd like to talk about one little detail here. I don't want to spend too much time on it, but we all know that in terms of insurance budgets, be it for benefits, a provincial automobile insurance act or a provincial industrial accident act—there are all types of insurance in Canada—they are managed in the same way as private insurance companies manage their budgets. There is a single budget. Risks are budgeted, since Canada has a lot of expertise on risk budgeting, and an insurance premium is set. All this is done purely on an accounting basis. When in 1996 the benefits set out in the act were drastically cut, this cut was purely based on an accounting calculation, and its impact was known.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Goyette. Mr. Roy, could you please give a brief response? Unfortunately, we're running out of time.

Mr. René Roy: If you had not interrupted my colleague, Mr. Goyette, I think that he would have gone on forever. He is a very interesting speaker.

One of the things the FTQ is advocating is a policy of full employment. I think that my sister from Newfoundland talked about that earlier. We could appear before another committee and give you the A to Z of full employment policy. We have been demanding that for several years.

We think that the Employment Insurance Act as it stands is a good piece of legislation. However, the problem is that since 1990, the government has amended the legislation four times. Each successive amendment had a negative effect on the act. We could have lived with the act as it was in 1990 or even as it was in 1971. This legislation was directly focussed on laid-off workers. The act is not as complex as all that. It's an insurance policy. If someone loses their job he or she is eligible for money until he or she finds another job. If he or she needs training, he or she is given training. It's quite simple. What is complicated is that some people want to make the act more complicated to cut benefits. That's it in a nutshell. I could go on forever too.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Roy.

Monique Guay you have the floor, followed by Joe McGuire, Yvon Godin, Judi Longfield and Greg Thompson.

Ms. Monique Guay: Thank you, Madam Chair.

I think that most members of this committee have the same feeling about this bill. We have been looking at Bill C-2 for three weeks now and we have the impression that it is a piece of legislation that the government wants to ram through.

We have certain concerns about this bill. Most witnesses are dissatisfied with it. We are not talking about just the unions here, but the majority of witnesses.

• 1200

I was talking earlier with Mr. Roy and he was saying that Mont-Tremblant, which is where I'm from, is a beautiful region. Yes, we have Mont-Tremblant, but we also have seasonal work and low-wage jobs. We all know that people who work in hotels and restaurants, and chamber maids, etc., don't earn $15 or $20 an hour. When these people have to leave their jobs for a month and a half or two months and when a couple is employed in the same industry and when of each of them has a two-week wage penalty before they are eligible for employment insurance benefits, I don't think that they really want to use employment insurance. However, they don't have a choice. It is part and parcel of this industry and I think that this industry should be completely separate from the rest. Well, that's my opinion and my vision of things. Perhaps you could talk a bit about that later.

I have a question for you, Ms. Price. We have talked at length about women, and I think that you mentioned them too. Indeed, in terms of women, I tabled some major amendments to Part II of the Canadian Labour Code to allow pregnant and nursing women to take precautionary leave from employment. All my amendments were rejected. I wanted all Canadian women who fall under federal jurisdiction to have the same rights as Quebec women. In Quebec, we have a very good system, which works very well. I would like to have your opinion on women who have to work an often outrageous number of hours to be eligible for employment insurance and who cannot take precautionary leave or quit their jobs until they have worked a specific number of hours, even if they are pregnant.

[English]

Ms. Elaine Price: That's one of the reasons we're arguing that the EI Act needs to be modernized. That's one of the reasons—I've probably walked into “I gotcha you now”, haven't I? When do we pass the bill, or do we face losing some of the progressive and some of the positive changes that are proposed? The intensity rule does have an impact on a lot of seasonal workers and on a lot of women. I would really hate to see that lost. There are too many people being hurt by it not to change it.

The same thing applies to the clawback provisions. There are too many people being hurt by the clawback provisions to turn your back on it. The qualifying period, which is what you're talking about, is also a real issue. It's an issue for young people who are trying to get into the workforce. It's an issue for older workers who've been displaced and have difficulty finding re-employment. If you're an older worker and a woman—or if you're a younger worker and a woman—you're going to have a much more difficult time than a male who fits that category. The EI legislation is actually discriminatory against women, and a couple of those changes will help address some of that discrimination.

One of the real problems with the bill is that it does nothing to deal with the qualifying period, eligibility, and that's the crux of the matter. Two-thirds of unemployed people in this country are not receiving unemployment insurance because they can't qualify for it, and an awful lot of them are women.

There are a couple of clauses here that will try to address some of the gender discrimination that currently exists because of the EI bill. But it doesn't go far enough, and it's not going to help more working people, nor is it going to help more women qualify, because the eligibility rules haven't changed.

If there were some way of fishing out the good things and moving with them, ensuring that the commission maintained the right to set premiums, and putting a process in place where there could be some sort of bipartite or tripartite approach to developing, or modernizing, our EI program, I think all of us would be winners.

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): You have 15 seconds for a brief comment.

Ms. Monique Guay: I would like to make one last comment, Madam Chair. It's a very brief comment. I would like to suggest that we all do our homework on this issue. We should not just convene witnesses so that they can present briefs that we will ignore. It's very important that we consider what they have to say. These people work very hard. Indeed, they, the workers, make up a large percentage of the population. We have to genuinely consider their comments and we should not allow the government to grab the employment insurance fund to pay down the debt. That is completely outrageous. It's scandalous. That fund is there as an insurance policy for people who need it and who require benefits until they find a new job or are retrained in another area.

• 1205

If the government does grab this money, Canadians and Quebeckers will rise up because they won't accept that type of behaviour.

The Vice-Chair (Ms. Diane St-Jacques): Thank you for your comments, Ms. Guay.

Now, Joe McGuire, you have the floor, followed by Yvon Godin, Judi Longfield and Greg Thompson.

[English]

Mr. Joe McGuire: Thank you, Madam Chair.

The topic of the training has come up with just about everybody here this morning. Maybe this question has nothing to do with the present bill, but the labour market development agreements have been signed with all the provinces with the exception of Ontario, and you get the impression that labour is not participating in how those moneys are spent. I would say in New Brunswick you must have in excess of $50 million in your agreement. I think P.E.I. has $25 million and I think Saskatchewan must have $40 million or $50 million.

Everybody has these labour market development agreements that are supposed to be used to train labour to develop their skills. They're five-year agreements, and I think they're up this year. Maybe the committee should be looking at some of these agreements and how they're working across the country, with the exception of Ontario, which hasn't signed. But if these hundreds of millions of dollars are not being spent for labour market development in training workers, then what are they being used for?

Mr. MacDonald, do you want to respond to that?

Mr. Felix MacDonald: Thank you.

I'm involved in the process associated with the LMDA in Prince Edward Island, and it all boils down to the fact that the LMDA is serving a very worthwhile purpose and is doing the job extremely well. I can vouch for that because of the discussions that are going on around the table on that particular issue. But it gets down to the fact that it doesn't matter how much fancy dance we do, if buddy has to go and borrow $2,000 to $5,000 to access a three-month program in order to be able to fund the learner financial responsibility associated with taking the employer-focused training, in order to be able to access an entry-level job that is going to be at $10 to $12 an hour, there ain't no way, and there's no fancy way of saying it, that he is going to be able to pay back his Canada student loan. It doesn't matter how much we increase the ceiling, etc., when he has to deal with doing without income for x number of weeks, feed his family, look after his other responsibilities, and then get to work.

I can give you example after example of case after case. In one particular case a young fellow is working at a job making $7 an hour and he wants to take training in a trade. He's forced to quit his job. He had been under the understanding that the UI fund would assist him. He quit his job to go for the training. It ends up that he doesn't qualify for the unemployment insurance assistance because he wasn't on UI; he was working. But he quit a $7-an-hour job to take training in a trade. He has three kids at home and a wife. That kid will never come out from under that, and it isn't with an awful lot of pride that I relate that experience.

Mr. Joe McGuire: So are you going to be suggesting improvements to this new agreement when it's renewed?

Mr. Felix MacDonald: The agreement provides the facilitation of the infrastructure, Mr. McGuire, as I understand it. Correct me if I'm wrong on this.

What I'm talking about in relation to that agreement is the ability of the individual to be able to access the training. I think we should really, seriously look at perhaps eliminating learner-funded portions of training and find some way within the system to support that so that they can be trained. You spend $3,000 to become trained in the aerospace industry now at an entry-level job and within five years that job is obsolete and you have to reinvest again. So you only have five years to amortize your debt. You can talk about taking it over a 15-year period, but when it gets down to the street, it has no relevance, gentlemen and ladies.

The Vice-Chair (Ms. Diane St-Jacques): You still have one minute. Do you want to use it?

Mr. Joe McGuire: Mr. Roy wanted to say something.

The Vice-Chair (Ms. Diane St-Jacques): Mr. Roy.

[Translation]

Mr. René Roy: I can't allow that type of comment to pass.

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Mr. McGuire seems to think that because New Brunswick has raised a problem with regard to the finances of a corporation, the whole gamut of programs with the provinces should be reviewed. If that is indeed what you think, I completely disagree.

Quebec receives around $541 million for worker training programs from Emploi-Québec. People are employed there. I myself work there and I think that we are setting up programs which work rather well. I'd just like to point out that the maximum training subsidy is 25%. Employers who wish to obtain a training program are required to invest 75%. We never give more than 25% for worker training.

Now, I think that for the good of the current economy, it is vital that governments take a hand in training. This is what employment insurance could be used for. It could be used for training, for retraining, for vested benefits, and for an ongoing training policy, which are vital in today's society. Consequently, we should not take issue with that here.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Roy.

[English]

Very quickly.

Mr. Joe McGuire: I was wondering if Newfoundland had a response to that.

The Vice-Chair (Ms. Diane St-Jacques): A very quick answer, Ms. Price.

Mr. Elaine Price: It's interesting, when we have a co-managed agreement in Newfoundland and Labrador, co-managed by the federal and provincial governments, and when the agreement was signed and they were putting the structures in place to manage it, the president of the Newfoundland and Labrador Employers' Council and myself, as president of our Federation of Labour, asked to have a meeting with the appropriate provincial government officials to talk about what role “we” could collectively play in helping them with the Labour Market Development Agreement and having input into it. We were told, in no uncertain terms...not quite this way, but what they meant was “go pound rocks”.

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Ms. Price.

Now, Yvon Godin has the floor, followed by Judi Longfield and Greg Thompson.

Mr. Yvon Godin: Madam Chair, I would like to come back to the concern that I expressed earlier. It is as if each time we speak, we have to do it quickly. We have to hurry along. It's as if we had to adopt Bill C-2 as quickly as possible and that worries me.

The Vice-Chair (Ms. Diane St-Jacques): That's because we want to enable everyone to have a second bite of the cherry.

Mr. Yvon Godin: I understand, Madam Chair. Everything moves along so quickly here, but the changes which would help workers which desperately need them are much slower in coming.

My question, especially when I hear that the government wants to ram through Bill C-2—Mr. McGuire said that he feared losing employment insurance—is whether you believe, as I do, that the government will be in a position of calling the shots if it manages to get this legislation through Parliament so easily. If it only takes the government a day to legislate on the problems relating to workers who have returned to work after a strike, it should be able to address our employment insurance problem. I think that we should give the government at least two days for that.

Do you agree with me that, since 1996, enough studies have been done? We know what the problem is. The real issue with Bill C-2 and it is a dangerous issue, is that the government wants to ram through its legislation and then not address the real problems until the next election.

I'd like to know whether you are concerned by the way things are shaping up. Are you concerned by Bill C-2, and its intensity rule, when there are many seasonal workers who need this 5%... That small figure represents $11 more on the week's grocery shopping. That helps a lot. We are aware that construction and automobile workers in Ontario want the clawback rule to be implemented. All these people are making demands which have to be met. Things have to be hurried along. Bill C-2 must be adopted as quickly as possible. However, after it is adopted, it will be up to us as parliamentarians to argue the issue.

We have to deal with the real problem of the $32 billion that the government has grabbed and give it back to workers and companies. I would like to know how you feel about the way Bill C-2 has been handled.

The Vice-Chair (Ms. Diane St-Jacques): A comment.

Mr. Jocelyn Dupuis: I think that Mr. Godin has touched on a very important point for construction workers and even Canadian workers as a whole. I think that we should think back to the government's stance before the election. The government was pushing through Bill C-44. The construction industry and other organizations in Quebec and other provinces were very vocal in their protests against this bill. The construction industry had adopted a very strong position. You have to remember that.

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During the last election campaign, we met with all the parties. I think that the events of this period are still fresh in the minds of Quebeckers. Construction industry workers held very noisy demonstrations in Quebec against Bill C-2.

I won't repeat what we've already said, because I think that we have laid out the most important points for workers in the construction industry. However, when I see a committee wondering whether it should take a more comprehensive look at the issue, and we don't dispute the fact that it should, I immediately think that I managed to convince my audience. We were directly involved on the Joint Council board, with all the parties, in asking construction industry workers to give us a chance. We committed, on the provision that we appeared before a committee, to try to improve Bill C-2 somewhat, because construction workers and workers in other sectors were urging us to do so. Delaying the process because of its complexity, would only serve to delay the government, which was elected by Canadians, from assuming its responsibilities. On that we're sure.

You will see the table in our brief. When you look at what has happened since this act was implemented, you can see 71.66%, 77%, 60%, 93.57%, 94.55%. You'll also see that in the construction industry it has been cut from 55% to 50%. This trend is being reversed in 2001.

If you ask yourselves the right question, you'll find the right answer. We are here today to get answers. The government needs to listen to Canadian workers and it needs to amend the bill, and then it must commit, if you want to go further, to reviewing all the issues which must be looked at if a new study by a parliamentary committee is not to be put off for a further 10 or 15 years. We will keep hammering away at this issue, like we have done today.

The Quebec construction industry and the building trade in Canada as a whole, has made commitments and demands and our workers are well aware that we are asking you to make productive amendments today.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Dupuis.

[English]

I think, Ms. Price, you have a small comment. Do you have something to say? No.

[Translation]

Judi Longfield, you are our next speaker, followed by Greg Thompson.

[English]

Mrs. Judi Longfield: While we're discussing employment insurance and talking about the number of seasonal employees who are having great difficulty collecting benefits, or appropriate benefits, at the same time we're hearing reports across the country of the thousands of jobs that are going unfilled because of a lack of skilled labour. We're seeing it in the construction industry. We're seeing it all over.

We're never going to eliminate seasonal jobs. They're appropriate in a country such as ours. We're always going to need fishermen, we're going to need construction people, and we need people in tourism. You can't eliminate, nor would we want to eliminate, seasonal jobs. What we need to provide is the ability to have a multi-trained, multi-faceted workforce who can move between segments of the population. If you're a fisherman, maybe you'll have skills that could be applied in the tourism industry at another time. You might have two careers, as it were, depending on the season.

On this whole business of training, I listened to some, and I hear over here that the labour market agreements are...go pound rocks or do whatever. I hear over here that it's working very well and don't tinker with it. In Ontario we don't have one at all. Regardless of what we do, when we look at renegotiating, we have to take in the very real concerns of the particular areas, particular provinces, and particular people you're dealing with, because obviously one size does not fit all. Even when there is co-management, it doesn't appear to be working in the way in which we had envisaged. We need to look at it.

How do we promote lifelong learning, which is something we want to do? How do we provide for the most appropriate retraining? We hear that if there are employers who are anxious to help retrain and to build the skills that are needed, the people who are participating in it are actually penalized because their benefits are cut off if they're in a subsidized program.

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We heard from the Ontario construction industry about the two-week waiting period for apprenticeship programs that are vitally needed and where people want to go. But they just feel they can't be without that benefit for the two-week period of time.

So how do we provide for the appropriate retraining, the appropriate apprenticeship, while at the same time understanding the nature of employment insurance and all the various groups you have to deal with?

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): Mr. Clavette wants to reply.

Mr. Maurice Clavette: One way to go about things would be the following, and I think that I've already touched somewhat on this issue today.

I have sat on an employment insurance appeal panel for several years and I regularly see students, people who have left their jobs to return to school, be it to attend a community college, to train as a nurse or to learn any type of trade. This has become practically impossible, especially over the last few years.

In the past, the Commission was able to buy places and identify specific trades, but in our days, that's no longer possible. So what do we do with those people, especially those in Edmundston, where I come from? We have seen a difference since we transferred Restigouche to Charlotte. Employment levels aren't the same and you can see a difference. People in this area quite simply can't afford to return to school.

In answer to your question, I think that this is what we have to do. Instead of giving major amounts of money to large companies... I could give you the names of several companies in New Brunswick who have been given money who don't need it. It's heartbreaking when a young girl or a young boy appears before the appeal panel and they meet 19 of their contemporaries who go to school in Bathurst and who are eligible for government assistance. The current situation is that money is taken from Human Resources Development Canada and sent to Human Resources Development New Brunswick. It's heartbreaking to be told, and shown evidence that 19 out of every 22 people in the province receive education assistance, when people in Edmundston, which has been integrated into a different region, are not eligible for the same assistance.

I think that answers your question. You have to have the money required to help these young people who want to get themselves out of the unfortunate situation they face.

It's not true that people from New Brunswick are lazy and want to profit from the system. At a given point in time, we were called the “10-42s.” My colleague undoubtedly remembers this. That's not true.

Let's give them the opportunity to get some training or to be retrained and then these people will work, get off the system and everyone will benefit.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Clavette.

Mr. Dupuis, a short comment, if possible.

Mr. Jocelyn Dupuis: The honourable member mentioned the issue of finding a solution for the construction industry with continuing education. We have a very different system in Quebec. A para- governmental organization represents the parties and has access to construction industry representatives. We always try to convince the parties by telling them that we have to have some control over labour force management. Currently, there are 103,000 construction industry workers. Every year, there are a maximum of 70,000 to 75,000 who are actually employed. There are always 25,000 workers who are available and who are receiving employment insurance.

We made a request earlier, in our demands, as to continuing education and training in other areas so that workers would be more employable, with the qualifications required for a trade or for a job that has openings.

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We could establish a system where the work is spread over time, with the labour force that is available on the market place. If we needed 50,000 or 75,000 workers, we would have available to us 50,000 or 75,000 workers. The legislation would have to be more flexible. When one would go into continuing education or retraining, there would be some form of supplement. As we said, we have a program that is being put into place where we currently have a 90 million dollar fund. We could convince the 35 to 40% of our workers, instead of just 10%, to upgrade their skills or get skills in an another area. Then, they would no longer have to rely on employment insurance because they would have more work available to them in their field, which would give them better chances of finding a job.

Therefore, in our opinion, we have to control labour force management and link continuing education and unemployment insurance. I think that that would help us solve the major problem that we face in the construction industry. In Quebec and in the provinces, the situation varies depending on whether there is a labour union or not.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Dupuis.

Greg Thompson.

[English]

Mr. Greg Thompson: Thank you, Madam Chair.

I think most of us in this room would agree that we want to maintain integrity in the EI system. We don't want to see abuse and fraud in the system itself. I think most of us would also argue that they have been minimized. How many people, especially at the minimum wage level, would intentionally try to stay on unemployment insurance when the benefit would be about $3 an hour, or $120 a week? Despite that, I see evidence that, from time to time, the officials abuse their powers in attempting to weed out abuse and fraud in the system.

In fact, in his latest report tabled in the House of Commons, the Auditor General identifies the lack of training of officials to actually identify abuse and fraud without the tools or the wherewithal to do it. What that tells us is that obviously some people who should be prosecuted or dealt with aren't dealt with successfully simply because of the lack of sophistication on the part of the CCRA and HRDC. The other downside of that, of course, is that some people are being prosecuted unfairly because they are not identifying the real violators, if you wish.

In New Brunswick, I've had many cases of this abuse of individuals by departmental officials brought to my attention. The most famous outside of my home province of New Brunswick, of course, is the famous shellfisher case in P.E.I.—which I'm sure some of you are aware of—that eventually reached the federal tax court. The tax court, for lack of a better expression, ruled in favour of the shellfishers. Their appeals were upheld, and if you read the transcript of that trial, some of the comments are not very complimentary to the department.

So, based on your experiences, could anyone comment on the abuse of some of our constituents, especially the lower-wage earners, the poorer constituents, if you wish, those who are not as highly educated as others? It looks like what I'd say is systematic abuse by officials within the department.

Ms. Elaine Price: I'd like to make a very quick comment.

When you consider that less than two-thirds of the unemployed people in this country are receiving employment insurance, I would suggest that instead of focusing on abuse, it's time to start looking at making sure people can use the system.

Mr. Blair Doucet: Very simply put, I've always had a saying, especially in this situation of unemployment insurance. If you want to talk about abuse—and I believe the question I got may be supportive—I used to say that for every person abusing the system, a hundred are being abused. But I think that number can go tenfold. For every person abusing the system, a thousand are being abused.

The Vice-Chair (Ms. Diane St-Jacques): Thank you.

[Translation]

Mr. Goyette.

Mr. Richard Goyette: I'd like to make two brief comments on legislative abuse, if I can call it that. For example, the provisions of sections 19 and 15 state that an individual could be asked to repay benefits where in reality there was no overpayment. For example, there is a penalty applied if during the course of a week, our income was $500 and we declared $700. That becomes a false declaration and based on the mechanism—which I will not qualify—pursuant to the legislation, individuals will be penalized. It does not make any sense.

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We're asking for something else. If I committed a crime today in Canada, my legal counsel could make representations to the court to have the sentence varied—and I am talking here about a crime—whereas pursuant to the EI legislation, the court will not hear any representations on sentence.

If we are talking about abuses, there are all kinds of abuses. I would even say that there are legislative provisions which are abusive. I don't feel that Canadians, whether they are employers, employees or parliamentarians, whatever their profession may be, have more of a tendency to abuse things than others. Generally speaking, within a system, there are about 5% of people who abuse the system. And those are the numbers we see for just about any group insurance program or even a private insurance program. Unfortunately, those are always the ones we hear about. But what I am referring to here is abuse within the legislation, and I think that changes have to be made to sections 19 and 15 and, finally, representations should be admitted as to the penalties. In Canadian law and administrative justice, this is a recognized practice.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Goyette. Mr. MacDonald, if at all possible,

[English]

a small comment.

Mr. Felix MacDonald: There's nothing complicated about the situation when you consider that somebody who is on minimum wage, as was referred to by a member of the committee, has a choice between feeding the kids this week and reporting the income next week or in two weeks' time, as opposed to reporting it this week in order to be able to maintain some semblance of cashflow.

There's a moral responsibility here to a degree, too. This is a wealth distribution program, and it's needed to put bread and butter on the table for the kids. It doesn't finance wealth accumulation accounts.

Thank you.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. MacDonald.

[Translation]

We have now completed two rounds of questions from the members on both sides of the table. We will now hear a last question, but really

[English]

a very short question for Val Meredith.

Ms. Val Meredith: Just to preface my question, I have four sons, two of whom have gone through apprenticeship programs. One of them was sponsored by the unions. I heard a lot of talk about education programs, job training, the responsibility of provincial governments, and the responsibility of the federal government. I'd like you to address the issue. What role do unions have in the job training in your fields?

Mr. Felix MacDonald: In our particular jurisdiction, I know the unions, like the carpenters' union that I belong to, have taken a very progressive approach to supporting training in order to help to meet the skills trade shortage that's imminent in Atlantic Canada. That's why there has to be a really aggressive approach taken to accommodating training for the individuals, so that they can transfer from non-demand occupations to occupations where there is going to be a demand. And it's not just young people we're talking about here. We're talking about displaced people like myself.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. MacDonald.

[Translation]

Mr. Dupuis or Mr. Goyette.

Mr. Richard Goyette: In the construction industry in Quebec, continuing education rest with the parties; that means that all the decisions made about continuing education from the course content to the training program to who is the head of the school, are the responsibilities of the parties. Since our new structured continuing education has been implemented, namely since 1987, we have spent $200 million. Currently, and this is solely in the area of continuing education and retraining, we invest $35 million. Therefore, it is not a matter of saying that there is no continuing education; it is a matter of knowing whether there will then be employment for those people who have completed some continuing education.

All this goes to say that in Quebec, the decisions are made by management and union at a consultation table, and the provincial government, who has jurisdiction in the area of training, approves.

The Vice-Chair (Ms. Diane St-Jacques): Thank you. Mr. Clavette.

Mr. Maurice Clavette: I am going to give it to you straight, because I think that we are lagging behind, as they say.

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In New Brunswick, the only participation that we have as to how money is spent for training, is through certain committees such as the Labour Force Development Board, where several members of the federation sit. But we have no decision-making power, as to where and how federal monies which are transferred will be spent in the area of training. We are saddened by the fact that in reality, the federal government transferred this money without really looking into what would then happen to it, without imposing conditions as is the case in other sectors, such as health, for example. No conditions were imposed. They just handed their pot of money to the provincial government and the provincial government can do as it sees fit. It is truly deplorable. There should have been conditions, guidelines which would have to be respected.

The Vice-Chair (Ms. Diane St-Jacques): Mr. Clavette or Mr. Roy.

Mr. René Roy: There are a large number of areas where we can deal with training, because the training of workers is in our opinion the most important thing to do. For example, at Emploi- Québec, which manages the money that the government transfers to Quebec, which, with the money invested by the province, represents some $800 million, we provide training to about 215,000 workers in Quebec. Unions sit at the same table as management representatives to manage this whole issue of training.

We criticize the system, because it needs improving, but the labour movement does have an opportunity to speak to this issue, as well as the people who work in the construction industry, who have just spoken. We also speak to industry, by sector. We have sectoral committees who are directly involved in such areas as for example aerospace which is a very very powerful area in Quebec. We even built a specialized school which offers training to workers in the aerospace industry since the demand for workers is so high.

I will be very happy to talk about this at great length, because it is an area which affects us a great deal. We do an awful lot in this area.

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Mr. Roy.

[English]

Ms. Price, for a last comment.

Ms. Elaine Price: Very quickly, I think my friends from Quebec have raised a very valid point. Training is and should be a shared responsibility. It should be a collective responsibility of all stakeholders.

If we're going to address and respond to the problem of where employers, labour, and government work together to develop a mechanism or a means to deliver training, we need a situation that can respond to the needs of working Canadians today. I would suggest that instead of pointing fingers, we should be looking at processes that we could put in place to facilitate the dialogue and the shared decision-making. Doing that is going to be necessary if we're going to meet the training challenge facing this country.

It seems to me as though the Quebec model is working. Perhaps we should start learning from it, start looking at the possibility of taking the positive aspects—I'm sure there are some hiccups—of the Quebec model, and start trying to transfer that model to other jurisdictions.

[Translation]

The Vice-Chair (Ms. Diane St-Jacques): Thank you, Ms. Price.

On behalf of my colleagues, I would like to thank the witnesses: Mr. Jocelyn Dupuis and Mr. Richard Goyette from the Conseil conjoint de la FTQ-Construction et du CPQMC; Mr. Roy and Mr. Matte from the Fédération des travailleurs et travailleuses du Québec (FTQ); Mr. Doucet and Mr. Clavette from the New Brunswick Federation of Labour; Ms. Price and Mr. Smith from the Newfoundland and Labrador Federation of Labour; as well as Mr. Felix MacDonald from the Prince Edward Island Federation of Labour.

Thank you for your highly enlightening comments.

I would like to remind my colleagues that this afternoon's meeting will be at 3:15 p.m. in room 269 of the West Block. Have a good day, everyone.

The meeting is adjourned.