HRPD 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]

Wednesday, May 13, 1998

• 1549

[English]

The Chairman (Mr. Reg Alcock (Winnipeg South, Lib.)): Let's get under way. Welcome to meeting number 36 of the human resources development committee. I appreciate all of you being able to be here this afternoon.

• 1550

Shortly after the committee convened for the first time last fall, in addition to the normal work that comes out of this committee, which is driven by the House, on legislation or estimates or the various other things we get asked to do, the members of the committee began a discussion, first among themselves and then more formally among various members of the committee and the research staff that support the various parties, trying to deal with a couple of questions, some of which arise from the changes in what we've traditionally called the social service system.

The changes to the unemployment insurance program have produced a series of events. We notice that a much smaller number of people are able to access those services. A lot of work was done by members of this committee in the previous House and by some of the people seated across from us on the changing nature of the workplace and the way in which some of our labour legislation may need to evolve to provide protection to workers who are no longer traditionally organizable. That was one of the issues we talked about in Bill C-19: how do you reach out to workers who are working at home and working on contract and those kinds of things?

Also, statements were made during the last election and by the Prime Minister that as we move to a balanced budget and start to accrue surpluses, there will be an opportunity to reinvest some portion of that surplus in new programs. That begs the question: what are we going to reinvest in? If we have the opportunity now to finally begin to think again about how we might see the social service evolve, where do we want to make those investments?

Given the diversity of opinion that sits around the table—and I'm going to ask members to identify themselves, as I will you, before we get started—one of the things we always struggle with here, as those of you who have been here before know, is the constant political battle and the fairly well-defined positions of the various parties. So what we as members have tried to do is reach beyond that and look at those issues where we think we can achieve some level of consensus.

The work we're doing right now and that we're asking you to involve yourselves in is being driven by this committee, not by the government. This is a decision solely of the members of this committee in a genuine attempt to find those areas where all of us can agree on a direction for—and there are many names for it—the redevelopment of the social safety net, the rebuilding of the social safety net, the re-creation of it, or the elimination of it, for some.

The process we've chosen in the past—and we've found it works most effectively—is if we take a little time to allow people to get into the subject. We generally ask someone to make a presentation to get us started and get us thinking about it. In this case we've asked John Richards from Simon Fraser, who has been involved in a body of research recently and has recently published a book. We thought we would ask John to make some opening comments to set the stage and then ask various members of the panel we've brought together to join in the discussion. And I will attempt to guide and direct it into useful channels.

• 1555

Our members around the table all have a great deal of experience with this topic and some strongly held positions, so I suspect it will be a fruitful discussion.

As we have begun to exhaust the first round of the discussion, a truly delightful and enjoyable supper will be brought in, and we will continue to go until we feel we have exhausted ourselves and the topic.

We've planned to go until about 8 p.m. or 8.30 p.m. We don't need to go that long if we feel we've hit a point where we've dealt with the issues people want to have put on the table.

At the conclusion of this, we the members will meet in camera, not tonight but at a subsequent meeting, to look at what part of this discussion we can build a consensus around, a consensus that we will then report to the House.

Perhaps we could start with Libby.

Could you identify yourself, Libby? Then we'll come down through the members and researchers and then start with Professor Verge and go down the presenters. Okay?

Ms. Libby Davies (Vancouver East, NDP): Hi. I'm Libby Davies. I'm the NDP representative on the committee and I'm the critic for children, youth, post-secondary education, and social programs.

[Translation]

Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ): My name is Paul Crête and I am the Bloc Québécois critic on human resources issues. I am particularly concerned about the holes in our social safety net.

Mr. Jean Dubé (Madawaska—Restigouche, PC): Jean Dubé, Progressive Conservative member, and party critic on human resources and labour issues.

[English]

Mrs. Diane Ablonczy (Calgary—Nose Hill, Ref.): I am Diane Ablonczy, the official opposition critic for human resources development on the committee.

[Translation]

The Clerk of the Committee: Danielle Bélisle, Clerk of the Committee.

[English]

The Chairman: I'm Reg Alcock, the MP for Winnipeg South and the chair of the HRD committee.

[Translation]

Mr. François Bastien (Committee Researcher): François Bastien, senior partner with Tremblay, Guittet Communications. Our firm helped the Committee organize this round table.

[English]

Ms. Sandra Harder (Committee Researcher): I'm Sandra Harder. I'm one of the researchers for the committee.

Ms. Bonnie Brown (Oakville, Lib.): I'm Bonnie Brown. I'm the member of Parliament for Oakville, Ontario.

[Translation]

Mr. Nick Discepola (Vaudreuil—Soulanges, Lib.): Nick Discepola, Liberal member for Vaudreuil—Soulanges.

Ms. Claudette Bradshaw (Moncton, Lib.): Claudette Bradshaw, Liberal member for Moncton, Riverview and Dieppe.

Mr. Pierre Verge (Laval University): Pierre Verge, Faculty of Law, Laval University.

Mr. Serge Brault (President, Adjudex Inc., Arbitration and Mediation Services; member of the Advisory Committee on the Changing Workplace of the Department of Human Resources Development): My name is Serge Brault and I am an arbitrator— mediator. I was a member of the Committee that drafted a report presenting the collective thinking on the changing workplace.

[English]

Ms. Lara Edwards (Articling Student, Heenan, Blaikie): I'm Lara Edwards. I'm with the law firm of Heenan, Blaikie in Toronto.

Mr. Brian W. Burkett (Labour Lawyer, Heenan, Blaikie): I'm Brian Burkett. I'm a management-labour lawyer with Heenan, Blaikie in Toronto as well.

Professor John Richards (Simon Fraser University): I'm John Richards.

[Translation]

Ms. Jocelyne Côté-O'Hara (Chief, C20—Communications Consultant): My name is Jocelyne Côté-O'Hara and I am a telecommunications and broadcasting consultant for a variety of sectors. I am also a director of several corporations.

[English]

Ms. Arlene Wortsman (Director, Labour Studies, Canadian Labour Market and Productivity Centre): I'm Arlene Wortsman, the director of labour for the Canadian Labour Market and Productivity Centre.

Mr. Eugene Kostyra (Regional Director, Manitoba, Canadian Union of Public Employees): I'm Eugene Kostyra, regional director for the Canadian Union of Public Employees in Manitoba.

Ms. Nancy Riche (Executive Vice-President, Canadian Labour Congress): I'm Nancy Riche, executive vice-president of the Canadian Labour Congress and labour co-chair of the Canadian Labour Market and Productivity Centre.

[Translation]

Ms. Michelle Tremblay (President, Tremblay, Guittet Communications): My name is Michelle Tremblay. I am an advisor to the Committee..

[English]

The Chairman: Thank you very much.

Are there any questions on how we'd like to proceed now?

John, would you like to get us started?

Prof. John Richards: Thank you.

The rule of the game, as I understand it, is you will let me talk for 20 minutes before you get sufficiently fed up with me.

An hon. member: Before we interrupt you.

Prof. John Richards: Yes, before you interrupt.

Where to begin? Obviously

[Translation]

I want to thank you for inviting me to be here today. Yesterday, I was in Quebec City talking about national unity,

[English]

and now we are here talking about social unity. They are indissociables.

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I think it may be fair that for one minute I give you my biography so you can place me. In my youth I was briefly an NDP MLA in Saskatchewan, and at 25 I knew everything about how to govern the world. Now at 50 I know very little. I now teach public policy at Simon Fraser University, and to complete the contradiction, I co-directed a major series on the social policy for the C.D. Howe Institute in Toronto—corporate Canada at prayers, I like to describe it. We have produced 15 volumes involving 50 people. And I recently wrote a survey volume, which was an attempt to synthesize what 50 people had written plus add my own spin. Today, I'm going to, in 20 minutes, give you the summary of that book, which is in turn a summary of what 50 people have written.

What, in this context, can I contribute? First, it is the question of modesty. If you will permit, I am delighted, in having flown from Quebec to Ottawa this morning, to have read the three major papers in the country. I shouldn't necessarily call them major, but the Globe and Mail, La Presse and Le Devoir. And in the Globe and Mail, Bob Rae has a kind of mea culpa to the effect that the welfare state is in trouble but that traditional NDP policies of spending more money won't work. I invite all of you to read Bob Rae in the Globe and Mail today. If you haven't done so, it's one of the more astute pieces of self-analysis that Bob has undertaken recently.

I quickly turn to my friend Alain Dubuc. Alain, who is a contemporary and like me very much a man of the left historically, writes today, and I cite:

[Translation]

Governments, both federal and provincial, have decided to change the philosophy behind their social programs. By tightening up UI eligibility criteria, Ottawa showed that it wanted to break the culture of dependency, particularly in the regions. As for the provinces, they wanted to get away from the “poverty trap” created by programs designed to make welfare more attractive than work.

They are betting that these reforms will force people to change their behaviour and help them to extricate themselves in a lasting way from the vicious cycle of poverty. Yet it is pretty clear that while the beneficial affects are not immediate, the shock was instantaneous. By changing the ground rules, these reforms have affected the standard of living and quality of life of UI beneficiaries.

[English]

And without repeating the same message, Sansfaçon in Le Devoir says essentially the same thing. And I take from this a kind of encouraging introduction that at the end of this decade we are looking very hard, a number of us in the media, in politics and in academia, about making the welfare state work.

What's wrong with the welfare state, I'm going to use as the first category that I talk about. And each of these subjects we could stop at and discuss for a term of lectures at a university, and obviously we're talking about many things. Having been a politician, I appreciate the pressures on you in terms of reading, in terms of thinking about many things simultaneously.

One body of work I invite you to read is the thinking that has gone on in Sweden, a country whose welfare state is renowned for its generosity, a country that, like Canada, experienced an acute fiscal crisis this decade and has been forced to rethink very hard its social programs. To cite just one individual whom I respect in this process of Swedish re-examination, there is Assar Lindbeck. He's somebody worth reading and he has identified four of what he calls hazardous dynamics of welfare states.

First is the potential to overshoot in design of policy. Initially the results and the changes in behaviour are minor, and it requires up to a decade or longer before the full ramifications come to bear.

Second is that overly generous social programs can create macro-instability.

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Third, the success of the welfare state depends upon administrators like Allan Blakeney. Let's be partisan for a moment and refer to my home province of Saskatchewan. If one loses the culture required of good professional management of complex social programs, such as social assistance programs and hospitals and schools, the programs themselves cannot perform the functions you want.

Fourth, there is a danger in certain programs that what begins as economic instability, which people are trying to correct by means of social programs, creates the kind of political instability that is worse than the economic instability you're trying to cure. A classic example of that is what we have done with the fisheries industry on both coasts. The primary instability is no longer whether the salmon turn up but what will be the nature of federal subsidy programs.

Having said that, I want to emphasize—and again this is an attempt at synthesis—two major wrongs that are taking place in civil society. If the first part of the discussion pertains to how we manage social programs, I would suggest there are two major big problems that you and I have to contend with in the next millennium.

One is the polarization of earnings, particularly among men. It's a very general phenomenon in all industrial countries that men with narrow and low skills are earning less now than they did a generation ago. It's true in Canada that by various measures of the spread of the earnings distribution—I'm not talking about income from earnings plus transfers, but what people can earn in the market—this is spread out, not particularly for women, but it certainly has for men, and it has quite serious consequences. Another generalization, I submit, is that the inequalities based on age have become worse. Young people always earn less than older people, education adjusted. That gap has become bigger.

Secondly, the reward to education has become greater, which is another way of saying, in effect, that you had better finish school. This is all confirmed in the 1996 census material, which has been published, and I was reading it again in the Globe and Mail while coming today.

To finish off this extremely crude summary, income distribution for families has not changed dramatically, because among families at the bottom, transfer income, half of which is provincial essentially, has filled in the gap. But this is a very dramatic change, which I think—and I shall come to it—has some negative consequences. A quarter of a century ago, two-thirds of income among families who were poor by various criteria came still from earnings. That ratio is now only one-third. Two-thirds is taken up by transfers.

The second big problem—and as a middle-class, white, WASP male, born in England, it is delicate to raise it—is that there is something ominous happening in terms of families. I do not think we can tolerate continuing with the indifference that we currently have in public policy towards the stability of two-parent families.

I am totally conscious that this invites the idea that I'm going to rant in some misogynous fashion, and I don't have time to defend all my flanks here, but I just cite one piece of evidence that particularly bothers me, and this is that the proportion of single-parent families has approximately doubled to be one in six, according to the last census. Roughly 60% of these families are poor; hence an increase in poverty is very much linked to the increase in single parenthood. To give the most dramatic example, which I've been involved in working around, approximately half of native families in prairie cities are headed by a single parent, and there are entire neighbourhoods in Winnipeg, Regina, Saskatoon, Edmonton and Calgary that are dominated by single-parent families on welfare.

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What's to be done? I've now eaten up 10 minutes, and I'm going to have to say what's to be done in 10.

There are five grand themes, and we can pull apart each of them.

The first is that we did the right thing as Canadians, Ottawa and the provinces, to have balanced our books, which meant we had to cut program spending. There are many individual mistakes that we made.

[Translation]

As a general rule, however, it was the right decision, whether we're talking about Mr. Bouchard, who wants to achieve a zero deficit next year, Roy Romanow, who balanced his budget in 1995—his province was actually the first to do so—Ralph Klein, who did the same thing, or Paul Martin who achieved this at the federal level. Overall, it was something that had to be done.

[English]

One theme that comes out of this is: keep clean books, and do not run social programs off-line. The Canada Pension Plan difficulties are in part to be explained by the fact that, on an accounting basis, it has always been difficult for journalists, politicians, and ordinary people to understand what was going on because it was kept off-line.

Point number two, program accountability is crucially important. In effect, what I am saying is going to be music to the ears, I suppose, of both the Bloc and Reform. We need a greater respect for the division of powers, but in general, one level of government only should be responsible for particular programs.

In effect, I am pleased that we have, in a sense, put an end to conditional grant fiscal federalism. Conditional grant fiscal federalism, at its peak in the mid-1980s, comprised equalization, the Canada Assistance Plan, the EPF, and effectively the UI program. All of this amounted to 6% of GDP, which was far too large an amount of cash to be washing across the country. It produced far too many perverse incentives, both with individuals and provincial governments, in terms of the management of a good welfare state.

Okay, point one is to balance the books. Point two is accountability. In general, only one level of government is to be responsible for each.

The third point is to respect comparative advantage. This will not be music to the ears of people in Ottawa. I think there is a relative advantage for Ottawa in straightforward transfer programs by using income tax, for example, but most programs are administratively complex, and whatever the failings of particular provinces, they do it better in general.

Accordingly, I'm much in favour of devolution to the provinces of most social services. I'm not inviting the federal government, now that it's out of its fiscal deficit, to think aggressively about expanding into new social programs. To be blunt, I think the Millennium Scholarship Endowment Fund was a mistake and an unwarranted intrusion into provincial education jurisdictions and an unnecessary affront to Quebec.

Let me give you a very concrete example. Consider child benefit programs for children. There is a fair consensus that we have feminized poverty. The combination of single parenthood and the polarization of earnings has resulted in families with children—in particular, that's single-parent families with children—being an increasing share of those who are poor. What should we do about it?

I'm pleased the federal government has put in place, in effect, a small, modest negative income tax that is a kind of platform upon which the provinces can build their initiatives. We really do not know what the best policies are to help poor families with children.

I think that, writ large, we in Canada are doing the right thing at this point with the federal government undertaking a relatively simple, relatively modest negative income tax—this is the so-called platform—while the provinces are, to use a technical term, doing their thing.

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British Columbia has opted to greatly enrich the federal negative income tax with its so-called family bonus program.

Alberta's approach is a much more tough-minded one and has yet to be adequately evaluated. Essentially, there is a strong attempt on the part of Alberta to restrict access by young people to social assistance.

Saskatchewan, the government with which I have the closest of links, has undertaken a major initiative this spring, including a major permanent employment subsidy to low-income parents of families with children. Administratively, this is a very complex undertaking to do well.

The pioneer in Canada in doing this is

[Translation]

APPORT, a Quebec program that offers parents employment income assistance. I see this as a major program, for its ability to encourage low-income families to return to work. I will say more about it later and explain why I consider it so important.

[English]

Quebec not only has obviously this APPORT program, which it is in the process of revising; it has launched a major early childhood program with a very generous child care program.

There are just four examples of interesting experiments that need to be rigorously evaluated to see whether or not in a few years hence they're doing what we want.

For anybody who is particularly interested in my particular interest, which is the role of employment supplements in helping families who are poor, I brought along the draft of my latest contribution to this, which is a book we're going to publish at the C.D. Howe Institute.

So far, I have given three themes: one, balance the books; two, accountability; three, respect comparative advantage.

Theme number four is that public policy should be doing more to help ordinary, middle-class, two-parent families with kids. Put “two-parent” in brackets.

Look at what we did with the best of intentions in the last generation. Again, this is a controversial subject. I invite you to think of a stereotypical situation of a family that's poor and in which the parents have little formal education. A generation ago, if she got pregnant, do they marry? Do they make a go of it as a family based on what he could be expected to earn, essentially? Conversely, do the two engage in so-called single parenthood?

The relative fiscal incentives to do one or the other have drastically changed. We have targeted the benefits. Social assistance benefits are now either the same or somewhat larger, depending upon the province, than they were three decades ago. In Ontario, for example, despite the cuts in 1995 upon the arrival of the Harris regime, they are more generous than they were in the 1970s.

On the other hand, as I said earlier, we have this phenomenon of the decline of what you can earn in the bottom quartile, particularly among men. This has had a large effect, and there are some disastrous marginal tax effects in all of this as you think about getting out of welfare and getting into the labour force. Essentially, welfare is a dollar-for-dollar exercise. It's a 100% marginal tax-back on earnings.

In Saskatchewan, only 10% of families who receive social assistance also have reported earnings. One of the things that we're trying to do with the earning supplement, to be blunt, is to lower that tax-back. This is nothing particularly new. The British Labour government, in its first budget this spring, is planning to spend up to $12 billion Canadian in a major expansion of an employment supplement in Britain.

Once you get beyond the range of social assistance in which you've got something approaching a 100% tax-back in most jurisdictions, you get into the range of modest middle-class earnings. Middle class is a very elastic concept, but let us say $20,000 to $40,000. For many families in that income range the marginal tax rate is effectively well above 50%. That is because, first, we have high income taxes in this country because of the folly of two decades of deficits, and second, we are clawing back targeted programs. For example, under the family bonus program in British Columbia, if you are a parent with two kids, you'll be paying something like a 16% premium on your income tax over that range. It's not a sustainable exercise.

• 1620

As you think about how to spend this fiscal dividend—this is a very blunt piece of lobbying—I think there is a very strong case to be made that there should be less clawback of these targeted benefits. That is in order to help ease the fiscal burden on modest families with children in the $20,000 to $40,000 income range, who are facing marginal tax rates that are too high.

I think this is good politics in the sense that you can sell it collectively as a tax cut. On the other hand, it is good social policy because these unnecessarily high marginal tax rates on struggling families in the $20,000 to $35,000 income range are just unacceptable if we really do want to have families working.

The fifth and the final theme is one that is relatively non-controversial. That is the need that all governments must undertake, which is to have active labour market programs that greatly ease the move from high school into work for those who do not take professional training. These must be well developed, much more so than they are currently for those who are on social assistance and are having difficulty getting back into the labour market.

All of this is going to have major problems for reorienting unions, given their difficulties in this decade as the union density declines.

There is a major role for the federal government in evaluating such programs—and again, this is self-pleading, as opposed to academics, that we always want to evaluate and evaluate. It means jobs for us.

The one major weakness in many social programs that are put in place with the best of intentions is a reluctance to engage in arm's length evaluation. The federal government is particularly well placed to undertake high-quality, publicly accessible evaluation, which is far more complex than it originally seems.

Simultaneously it must be rigorous. It must be done in a fashion that can be communicated to people who are interested, and to do this is a real skill. There are certain agencies that have an international reputation for doing this kind of work, such as the Manpower Development Research Corporation, and the Institute for Research on Poverty at the University of Wisconsin. These are two American examples that have an international reputation in doing this kind of work.

[Translation]

Mr. Alcock, I realize I have taken five minutes more than I was allotted. So I will stop now. Thank you for your kind attention. Now, it's time for discussion.

[English]

The Chairman: That's four minutes and twelve seconds, to be precise about it, which I am compelled to be at times.

Let me just ask if there are any questions for clarification. Bonnie, do you want to...?

Ms. Bonnie Brown: Sure, Reg.

The Chairman: By the way, just before you start, it's going to be a little more difficult to maintain the speaking list here, so catch my eye.

An hon. member: It's very hard to see.

The Chairman: I'll ask Danielle and the others to watch.

Bonnie, please.

An hon. member: Just for clarification, what kind of run are we going at?

The Chairman: Just questions of clarification, and then I want to bring in a couple of the other presenters to let them have at it.

Ms. Bonnie Brown: I was interested in one of your last comments when you were suggesting less clawback of programs from families in the $20,000 to $40,000 range. But based upon something you said earlier, are you suggesting that there should be less clawback only for two-parent families?

• 1625

Prof. John Richards: No. That's a valuable question. By no means am I wanting to restrict this to two-parent families. But let's be honest: when we start designing a major family tax credit in that range, we are primarily going to be giving aid to families that are two-parent.

Most single-parent families are earning less than $35,000. By no means did I want to prejudice single-parent families, but I'm trying to be brutally blunt here. If we did it as I would like, if we spent $5 billion in order of magnitude annually on a major child tax credit program, that would result in a significant lowering of marginal tax rates for families in the $20,000 to $40,000 range.

There should be no illusions as to what kinds or categories of families would be the primary beneficiaries. That's all.

Ms. Bonnie Brown: You've talked about keeping things off-line. I'm sorry, it's a phrase I don't understand. You said that the problem with the CPP is that it was kept off-line. What does that mean?

Prof. John Richards: It's accounting jargon. In all governments there is a temptation not to run programs as if they were coming out of the consolidated general revenue; rather, they try to think up a reason whereby it is appropriate to construct separate accounts for them.

Thus, in the public debate, which is crucial to the survival of good social programs, about how much we want to tax ourselves, how much our social programs are costing, is the respective government running a surplus or a deficit, primarily everybody looks at what's above the line. If there is a major social program with major fiscal implications about future taxation that is not being acknowledged because it is being organized on an off-line basis, this seriously distorts the public debate, and it leads to cynicism with respect to the fiscal exercise.

Parties of all stripes have been guilty of it, from the British Columbia NDP, which builds its schools off-line, to the Saskatchewan Tories, who were notorious for doing the same thing, to the Quebec government which this year has cleaned up its accounts in a major and significant manner. It is a non-partisan observation.

Ms. Bonnie Brown: How many reports have you done for the C.D. Howe Institute?

Prof. John Richards: I have been editing volumes for them since 1993. To this point I have co-edited 13 books. I have contributed to a number of others.

Ms. Bonnie Brown: And yet you still call yourself an academic?

Prof. John Richards: I do indeed, madam.

A voice: That was in the form of a question, was it?

Ms. Bonnie Brown: Yes.

The Chairman: Jean Dubé.

Mr. Jean Dubé: Thank you very much, Mr. Chairman.

I listened carefully to your comments about the growing gap regarding single families in poverty. It just keeps getting wider. And you mentioned the need for a good education, because the gap seems to be growing there as well. You said that single men who were uneducated were unable to find employment, and good employment.

From what I hear you saying, and if I'm hearing correctly, Canadians are overtaxed. Do you think now that the basic income tax credit should be increased to $10,000? Do you believe that we should be taxing people who make less than $10,000?

Prof. John Richards: The first point is, are we overtaxed? We are not overtaxed relative to what we did in the last two decades. Collectively as provincial governments and the federal government, we had to pay for what we're doing. There was no way around, writ large, raising taxes. We've also reduced expenditures this decade.

So I don't accept the implication that perhaps you were trying to imply, that we are overtaxed given what we did to ourselves. I do accept the interpretation that we're overtaxed relative to some sense of stability, and that we have to reduce taxes.

• 1630

But I'm very leery of much further reduction in public sector program expenditures overall. We have quite dramatically reduced the share of government in GDP overall—federal, provincial and municipal—from something like 50% at its peak to about 43%. We should not go much lower. As we reduce debt service costs, we will be able to get more service for our dollar, hence we're going to have the potential to make some tax cuts.

To come to your final question, which is should we be taxing families under $10,000, I don't think it's particularly useful for me to say yes or no to that. I'm not in any way trying to avoid the specifics of income tax design, but the general position is, I'd agree with you, that we start taxing at too low a level of income.

Secondly, we don't accommodate sufficiently the distinction between families with and without kids. Hence, we ought to have an income tax system that lowers income taxes for families with kids relative to families at a comparable income without kids.

So my first inclination in trying to think about tax reduction is to combine it with social policy, by trying, particularly in the $20,000 to $40,000 range, to lower the marginal tax rate that effectively these families are paying. Is that a sufficient answer at this point?

Mr. Jean Dubé: It's sufficient at this point. I'll be back.

The Chairman: Okay, Diane.

Mrs. Diane Ablonczy: I have two quick questions. One is that we were surprised in committee a few weeks ago, when Statistics Canada made a presentation, to have them tell us that although families are getting poorer in Canada, there is no widening of the gap between rich and poor. I wonder if you can comment on that, because you talked about families and about incomes, and about the income gap. Have you studied that phenomenon at all?

Prof. John Richards: Well, I'm again a pygmy on the shoulders of others. We published a 250-page volume on income distribution in the social policy series by Charles Beach, who's an economist at Queen's University—and I certainly invite people to read it if you have pleasure to do it. I'm guilty here of summarizing, but I will do it anyway. He looked at income distribution from 1971 through to 1992, so he doesn't have the last five years of data in this particular study.

Another piece of work I'm going to quickly summarize is a Statistics Canada piece of work that looked at families with children whose total income was less than half of the median, the median being roughly the average. The quick conclusion they come to is that over those two decades approximately, income distribution stayed remarkably the same in the following sense: that in the share of families with total income less than half the average and families that were between 50% and 150% of the median, there was very little change. On the other hand, the Statistics Canada study illustrates that among the poorer families, transfers became far more relatively important because of this declining earnings phenomenon.

Mrs. Diane Ablonczy: I have a second quick question. I won't guarantee that for the answer, Mr. Chairman.

The Chairman: I will start to squeeze the answers.

Mrs. Diane Ablonczy: You mentioned that the welfare state is kind of under review. I guess that's the premise of your work. You mentioned Sweden and other states and Canada. It strikes me that if government is moving away from a welfare state approach to more of a less dependent, more targeted help to the most vulnerable, citizens' expectations of government and the politicians are going to change, which I guess is something we're interested in.

For example, if the welfare state approach is the one we're following, then clearly the government that promises to be the most generous is going to be the most highly regarded. If there is going to be a shift, then it seems that people's expectations of government and of political decision-makers are going to shift as well.

• 1635

Have you given any thought to whether that shift in fact is taking place? If so, would you comment on it?

Prof. John Richards: Reg wants me to say all of this in 30 seconds, or else he will beat me from across the table.

My quick answer: yes, the welfare state is changing, but in self-defence, I titled the first chapter in this book “The Welfare State is a Good Thing”. I by no means want to be associated with a certain tradition that thinks this is fundamentally a mistake.

We have reduced public sector spending to roughly the proportion of GDP that it was in the early 1980s. I think this is—give a point or two—about right. Relative to the average industrial country, a reasonably generous set of public programs is still feasible, given this tax level.

I think that since we finally have accepted as Canadians that there are limits and the welfare state cannot grow, we are collectively thinking much harder about the efficiency of programs, and all to the good.

The Chairman: I'm going to take two more questions, one from Libby and one from Monsieur Asselin. Then I want to bring some other folks in. So I will leave it to you to indicate who wants to jump in.

Ms. Libby Davies: Mr. Richards, I've read some of your material before meeting you today, and I've heard you on the radio as well. I have to say that what you offer up in terms of your five themes or areas is very far removed from my riding of Vancouver East, where there's a lot of poverty and unemployment.

Reading through your themes that you come up with here, it seems to me that you're not talking about dealing with inequality in income. The suggestions you put forward here really seem to me to continue to hammer people who are very low income.

Why would we, for example, increase the child tax benefit to two-parent, middle-class families, when the income problem is for poor families, whether they're single-parent or two-parent? Why would we emphasize workfare as something that somehow victimizes the unemployed person, implying that it's their fault they're not able to find a job?

I find your approach doesn't really address the inequality that's a reality in my riding and many other places. It really just reinforces the status quo and somehow says, well, if we just support the middle class, somehow everything will come out all right. I really don't see how that kind of approach is going to change anything fundamentally in terms of the welfare state.

Prof. John Richards: My first response, Libby, is to stress that I respect the work you have done. I have not done it. I live in East Vancouver, and I'm conscious of the work that you have done. I do my little bit, but it has not been, at the ground level, anything like what you have done.

My second point, in the ten seconds before Reg shuts me up, is that there is a really fundamental difference between you and me in what we respectively think to be good social policy. I'm not trying to fudge it. I think there is a disagreement, and I think in certain fundamental ways you're wrong.

Ms. Libby Davies: Can you tell me how?

Prof. John Richards: Well, Reg is going to—

The Chairman: You can answer.

Prof. John Richards: I don't want to abuse the privilege of being intervener.

The Chairman: I think she's gone down a road here that's an important one.

Prof. John Richards: The honest, full answer to your question, Libby, is that I believe social policy in Canada—and in other countries; it's not unique to Canada... Social policy advocates such as you—and this is not a personal attack upon you at all; it's an observation—have over the course of the last 25 years increasingly defined their goals, in a short-term manner, of preservation of the parameters of particular programs, whether it be the rules for unemployment insurance, whether it be the social assistance program that exists at a particular point in time, or a particular housing subsidy. There has been in the public discussion of social policy—which is crucial—a kind of downgrading and refusal on the part of the social policy advocate community to respect and understand and think through how you manage social programs.

• 1640

I'm very conscious that I'm saying this as a middle-class professor, and I have close links with the Saskatchewan government at its senior levels—and there is a strong public sector administration tradition in Saskatchewan, running back to Tommy Douglas and Allan Blakeney—and that it is far from being the complete truth. But there is my answer: that the social policy advocacy groups are not willing to think hard enough about what some of the long-term negative consequences are of the policies they advocate.

The Chairman: Do you want to expand on your question a bit?

Ms. Libby Davies: Well, I really don't think you answered the question, because I actually agree. I think a lot of us who are involved in advocacy and social justice do have short-term goals because we're fighting. It's true; we are fighting to keep a UI program or a Canada Pension program, so that's a fair comment. But I don't think that's what the debate is about. I think we could talk about what our longer-range goals are as social democrats or progressive people.

You're saying there's a problem with the welfare state, even though you believe in it. Okay. What I'm saying back, though, is that I really fail to see how the answers that I think you're providing address any of the inequality that exists, other than to reinforce some sort of notion that if we protect the middle class everything will be okay. I really challenge that, because I just don't see where it's backed up. I just really don't see where anything is going to come out better. I don't feel that you really answered the question, at least not for me.

Prof. John Richards: I'm at your discretion, Mr. Chairman.

The Chairman: Oh, please, I would like you to respond.

Prof. John Richards: I responded initially because you talked about my hammering the poor. If you're going to talk in those emotional terms, I'm inevitably going to be defensive.

Ms. Nancy Riche:

[Editor's Note: Inaudible]

Prof. John Richards: Let me now start answering your question.

Nancy, I'm going to try.

I mentioned one policy in my opening address, because it was clearly directed at the federal government and is something I think you as federal politicians should think hard about. That is the tax structure and what it means with respect to families.

Let me give another example, which bears on the provincial level. Quebec and now Saskatchewan are going to spend a lot of money in a major supplement to the earnings of low-income families. The Saskatchewan program, begun this spring—and this a permanent program, not a short-term program—envisions that there will be a supplement ranging from something in the order of 20% to 45% over the take-up range, which is up to $12,000 in earnings per year, as a function of the number of children.

The desire here is “make work pay” on the grounds that in terms of trying to help particularly the children of low-income families, the role-model effect of working parents is crucial. Raising the minimum wage is not the way to go in general, because it makes even more difficult access to the labour market for people with limited skills.

On the other hand, we definitely cannot just leave income distribution as what it would be, based on this problem of polarizing earnings. I'm not saying that's the be-all and end-all. I'm just wanting to say that there are many new ideas that are worth contemplating and thinking hard about, which typically, in the short run, advocacy groups oppose.

The Chairman: Claudette, did you want to jump in on this particular question?

Mrs. Claudette Bradshaw: Yes, just for a fast one.

The Chairman: Is it on this issue or is it...because Mr. Asselin does have a quick question.

Mrs. Claudette Bradshaw: Okay. Get him, and I'll get him after.

A voice: You'll ask him; not you'll “get” him.

Mrs. Claudette Bradshaw: I'll get him.

The Chairman: I'm going to use the position of chair just on one area here, and then I'll go to Mr. Asselin, John, before I give you a chance to respond.

Somebody said many years ago—I don't think it was Eugene Kostyra, but it was certainly somebody in his government who commented once that—

Prof. John Richards: I didn't catch your...in whose government?

The Chairman: I'm just trying to place where I heard it. The comment was that bringing about change in social policy is a little like trying to change a tire on a moving car. That's what I heard Libby ask.

• 1645

You've laid out a framework that talks a bit about a number of things that I think have some strength to them, but what I think I heard Libby say was that we're talking about this problem with the clawback from the middle-class families, but I'm up to some level of my body in people who need help today. I don't see them addressed in this framework.

Libby, am I asking it properly?

Prof. John Richards: May I respond to that, please?

The idea that any one person, whether it be Libby, you, or me, fully understands the complexity of human problems or what governments should and should not do is wholly presumptuous.

I'm here before you with a certain amount of immodesty, perhaps, under these chandeliers. We're talking about single parent poverty and various other phenomena, and if I have anything to offer it is what I have done as an academic and as a policy wonk for a policy institute. Wearing another hat, I can talk about the problems of my community clinic in east Vancouver and trying to keep the damn thing financially afloat. I am in no way wanting to imply that what Libby has done, or what you have done, in social work is less important or more important than what I'm doing. All I'm saying is you must look at all of these components.

The Chairman: Yes. I think I'll leave it there. I suspect we'll come back to some part of it.

Mr. Asselin, please.

[Translation]

Mr. Gérard Asselin (Charlevoix, BQ): As a member of the Bloc Québécois, I want to welcome you to the Human Resources Development Committee.

My first comment would be that time will most certainly take care of number of things. When a referendum was held in 1980, between 30 and 32% of Quebeckers voted in favour of sovereignty. In 1995, we came within a few hundred votes of Quebec sovereignty. Why?

Well, we don't really have to do much of anything. The federal government does it for us. Rather than acting to try to save Canada, it works to the detriment of Quebeckers. You talked about the fact that the federal government wanted to achieve a zero deficit, but the fact is it did so at the expense of all the provinces of Canada, especially Quebec. This year, it reduced its transfer payments to the provinces and to Quebec by some 11 billion dollars. And while Quebec is experiencing financial difficulty and trying to achieve a zero deficit, the federal government is slashing transfers to the provinces for health care, education and social assistance.

When the federal government decides not to compensate and assist people who became infected with Hepatitis C between 1986 and 1991, once again, the provinces are stuck paying the hospitalization and drug plan costs. There again, the provinces have to foot the bill.

When the federal government decides to slash provincial transfers for education and proposes to issue cheques with a red flag on them, through something called the Millennium Scholarship Foundation, I call that interference in the province's education and professional training system, particularly Quebec's system.

When the federal government makes drastic cuts to employment insurance, once again, the principle of the communicating vessels seems to prevail. If one worker in two no longer has access to employment insurance, ladies and gentlemen, we will be creating a great deal of poverty. We will be forcing workers to go on welfare and suffer severe financial and family hardship.

Quebec is paying 28 billion dollars in direct taxes and 4 billion dollars in GST, while the federal government is giving the provinces less and less of their due, both Quebec and the others.

When there was discussion of repatriating jurisdiction over manpower and job training programs, a number of unanimous resolutions were passed, by the Parti Québécois, the NDQ, the Liberal party and the National Assembly. To an increasing degree, the National Assembly is passing unanimous resolutions through which Quebec is laying claim to its management rights.

A municipality taxes its voters by levying property and business taxes and provides services directly to its citizens. A province should be able to do the same—in other words, tax its citizens and provide direct services.

• 1650

The federal government has an increasingly centralist focus, and that is its big mistake. It should be managing only common services, such as national defence, Canada Post and any other services the provinces would like it to manage.

I don't know whether you agree with me, but when it comes to health care, education, social assistance, training and manpower, it seems only natural, in order to prevent overlap and duplication, that these areas be within the exclusive jurisdiction of the provinces. You will see more and more unanimous resolutions being passed in the National Assembly, even with Jean Charest, who knows how the federal system works and will soon know how the provincial one works. I have no doubt that Jean Charest will know how to defend the voters that put their faith in him once he has a seat in the Quebec National Assembly.

Here is my question. Do you agree with me that Quebec is right to claim its due in relation to the $28 billion in taxes and $4 billion in GST it pays into the federal system and that the federal government was wrong to slash provincial transfers? Many provinces, including our own, New Brunswick and Nova Scotia, are experiencing financial difficulties, while the federal government is sitting back comfortably paying down its deficit. All it has to do is continue to rake it in.

Mr. John Richards: Thank you for your comments. I'm afraid I won't be able to fully satisfy you. I am basically a federalist, although I fully agree with some of your comments. Let me explain.

I agree that there is too much overlap in social programs and that this undermines their credibility, while occasionally showing politicians at both levels of government—and I could give you specific examples—to be completely irresponsible, since they talk about the benefits of what they do, without mentioning the inevitable costs. So, on that point, I would say you are absolutely right. The Millennium Scholarship program is ill- conceived and it is certainly a good example of that tendency.

In my view, manpower training should, in an even more clear and definitive way than it currently is, be a provincial responsibility. But I don't want to go any further in that direction. I find your criticism about what the federal government did in 1995, when it eliminated certain programs and decreased transfer payments, to be somewhat illogical. There's no doubt all the provinces were hit hard. The cuts were made unilaterally, without negotiation. But just think about it. Overall, the federal government spends almost one-quarter on transfers to the provinces, another third or quarter on its own social programs and the rest on the remaining programs. The federal government had to make cuts; it was a painful process, but it did what had to be done. From your comments, one would be tempted to think the federal government should perhaps have made similar cuts to programs such as old age pensions. Overall, provincial transfers were cut by between 20 and 25%, depending on your method of calculation, between 1994 and this year. Those costs certainly don't make things easier for provincial governments.

Apart from transfers and social programs, cuts to other programs were in the order of 20%. The remaining programs, which were not subject to such deep spending cuts, are programs aimed at the aboriginal communities, old age pensions and employment insurance, although the latter was cut somewhat. But the overall amount for those three components—and I realize there are many others as well—has remained fairly constant.

However, it is a little illogical to criticize the federal government for reducing interference in areas of provincial jurisdiction by cutting conditional transfers that in fact limited the provinces' freedom of action. As members of the Bloc Québécois, which defends provincial jurisdiction, you should in a way be thanking Ottawa for withdrawing and eliminating the distortions created by previous programs.

• 1655

[English]

The Chairman: Thank you, Mr. Richards.

Now, let me invite some others from that side of the table. Mr. Kostyra, did you indicate an interest in joining us in this discussion?

I should say for the benefit of members, particularly members on this side, that Eugene, in addition to being from CUPE, was in my time the finance minister of Manitoba and well respected there.

You were a Conservative at that point, weren't you? We're delighted to have you here, and I think you make an important addition to this discussion.

Mr. Eugene Kostyra: I wanted to raise a couple of questions to our speaker. Maybe I'll wait until he rejoins us.

The Chairman: I don't want this to become focused on just one idea.

Ms. Nancy Riche: But you invited only one speaker, Reg.

The Chairman: I have a whole table of you here.

Ms. Nancy Riche: Yes, but one side. One person on one side got 20 minutes to prepare.

The Chairman: How long do you want, Nancy?

Ms. Nancy Riche: No, no, you were starting to say you weren't going to let this be...and you guys set it up.

The Chairman: Okay, that's fair enough.

Ms. Nancy Riche: Fair enough, that's right.

Mr. Jean Dubé: Let's hear from the other—

The Chairman: Absolutely.

I'm sorry, Nancy, our point of departure was that it was selection based solely on that.

Eugene, why don't start with a question, comment, enlargement, redirection, or whatever you choose.

Mr. Eugene Kostyra: I want to start with a couple of questions. Because I saw the agenda, I presume we're going to get into more general debate or discussions amongst all the participants. There are two areas I wanted to asked questions on.

One was this proposal you put forward about maintaining accountability between various levels of government. You said the way to do it was to have distinct areas of social policy for specific levels of government.

I think I read somewhere you said as well that if a level of government takes on that distinct responsibility, it should raise all the revenue to pay for the social policy area. If that's the case, how do we reconcile the huge differences in our country in the ability of the various levels of governments to raise funds and the various levels of need that may exist in various regions in the country?

Prof. John Richards: Mr. Chairman, do you want me to respond to this one?

Mr. Eugene Kostyra: I have two questions. I let that one...and I can raise the second one.

An hon. member: Mr. Chairman, I don't want the people who've come to share their expertise to also be caught in this questioning of Mr. Richards, who's had more of their time than we ever predicted. I would like to hear what they have to say, either their comments on what he said or their own issues around work.

Mr. Eugene Kostyra: Let's hear what you guys have to say. Let's hear the other end of the spectrum also.

An hon. member: Let's hear everybody.

The Chairman: Eugene, do you want to turn it around into what's behind it? Do you want to expand upon it a little bit? Then if someone wants to start down at this end of the table, I'll just go back and forth, giving each person an opportunity to get into the discussion, and then we'll see where we go.

Mr. Eugene Kostyra: There are three areas I'd like to comment on initially that caused me great concern in terms of this discussion.

First, to pick up on the question I was raising, behind the question is a real concern that if we move further to this notion that one level of government is going to look after a specific area, how do we deal with the inequities that exist in this country by nature of geography and a whole series of other factors? I think that direction would be a disastrous one to go in. I think it would exacerbate, and indeed increase, the inequalities that exist in our country. The impact would be the greatest on the poorest people in our country. I have a real concern that moving in that direction would cause greater inequalities to take place and would put people in that position into a far worse position.

• 1700

The second area I wanted to comment on is the premise that people—the children and the parents—who are in a two-parent family situation are better off than people in a single-parent family situation. I take that as a correct statement, but to say the solution is to have only two-parent families to me is wrong-headed. It's not looking at what supports or needs people in a single-parent situation have and what should be done to increase their ability to have more productive lives and to give better treatment for their children. Why do they lack an education? Why do they lack opportunities for education or training or re-training? If they're people who have fallen out of the labour market or if they haven't got into the labour market, what are the impediments there?

I think it's far too simplistic to say that if we have incentives that will increase two-parent families, somehow we'll deal with the problems that exist in single-parent family situations. The situation may be correct, but the solutions are not going to do anything or will do very little to correct the problem and, in effect, in some ways suggest those people should be penalized because of the situation they're in.

I think that's a wrong-headed approach to some real problems. I think it's off the track and not all that conducive to looking at some workable solutions to the problems this committee and a lot of Canadians are concerned about.

The Chairman: Can you enlarge upon that a bit, Eugene, in the whole area of devolution of responsibilities from the federal government to the provinces?

Mr. Eugene Kostyra: Well, I have a real concern that it's causing a situation that's going to make it more difficult for the poorer regions of the country to have programs that are relatively equal to programs in other parts of the country. I think we're already seeing this take place, because obviously there is not an equal ability to raise revenues. I think there is a role for some shared responsibilities, and there certainly is a role for ensuring there is some means to continue, if not expand, some of the equalization we've had in the past.

That's not to say we shouldn't be looking at what level of government is best able to deliver the programs. It's not to say we shouldn't look at fundamental change in those programs. But the answer isn't simply to put it all to one level of government and say go and run it. I think that's too simplistic for very complex problems and issues.

[Translation]

The Chairman: Mr. Verge.

Mr. Pierre Verge: Professor Richards has spoken with great skill and experience about the adjustments that could be made to our Canadian conception of the welfare state. In his remarks, he essentially referred to views about social public policy in general.

I am trying to make the connection between the concerns he raised and some of the issues discussed in the material sent to us for this afternoon's round table. It places a great deal of emphasis on changes in the workplace. We know that traditionally, social policies in particular were predicated on the traditional circumstances of a worker with a stable job.

• 1705

Yet here, we have abundant documentation. I refer in particular to the report of the Advisory Committee on the Changing Workplace, a committee chaired by my immediate neighbour at this round table. We can see from the material provided that stable jobs still exist, but there are a lot fewer of them.

Many new forms of work are now emerging. There is so-called self-employment in some cases, such as when a contractor is not really a contractor but works under the cover of self-employed status. Then there are the many cases of people who have only short-term contract work, and soon find themselves jobless.

Also, this material places a great deal of emphasis on the need for periods of professional training on the job, perhaps following a period of unemployment, and so on.

So, to a great extent, employment no longer means the kind of stable employment we are used to. To tie in with what Professor Richards was saying, I would ask the following question: How can our social policies and legislation be adjusted to suit the new context, which for the most part no longer involves stable employment?

[English]

The Chairman: Arlene Wortsman, do you want to jump in on this?

Ms. Arlene Wortsman: It was a question direct to—

The Chairman: But I'm going to slow down that interaction for a minute and get a few more opinions on the table before we—

Ms. Arlene Wortsman: Fair enough, Reg.

I assume the reason you've asked me is because of where I come from. The organization I deal with is a business-labour organization. Nancy is the co-chair, and we've spent a lot of time dealing with issues around workplace change, both looking at workplaces themselves and examining the case studies, looking at innovative best practices to see how companies, unions, employees, and employers are adjusting to it.

From our work, there are a couple of issues that I think you need to consider. It's correct that the standard form of work, the traditional kind of job, is becoming more a minority than a majority. There are non-standard forms, whether it be part-time contracts, temporary, contingent. That's what's becoming the norm out there.

Our labour laws, in all jurisdictions, don't reflect that. They were written at a time when it was assumed that people worked 9 a.m. to 5 p.m. and had very traditional kinds of jobs. We need to have the legislative framework adapted to meet the realities out there.

In relation to that also is the issue around benefits. Traditionally, we had looked to the state for benefits, and that is slowly eroding. Where people derive benefits from their job, if the standard form of work is changing, fewer people are getting their benefits from their employment. How do you deal with issues around health, dental, pension, the self-employed? What kinds of forms need to be addressed around that?

The last issue I would ask you to look at is the issue around training. We did a study in 1993 around technologists and technicians, and in the course of that study, we discovered that those people would have to renew their training every three to seven years in order to stay up to date; that was in 1993. With the changes in technology and the advancement that's taking place, it's probably going to be a shorter period of time.

Most people get their training through their employment. If you're self-employed, if you're a temporary person, if you're a contract person, how do you get your training? Does that become solely your responsibility? How do you constantly update your skills?

The other thing that is happening is that the level of skills required in jobs is constantly being raised; it's being ratcheted up. We have a fairly high level of illiteracy in this country, too, so those people are prevented from even coming into getting that training.

Those are the kinds of issues I came prepared to talk about, rather than addressing a specific comment to Mr. Richards.

• 1710

The Chairman: Mr. Burkett.

Mr. Brian Burkett: I would just piggyback on Arlene's comments. Those are the sorts of issues that have involved me over the last few years.

I read with interest the OECD job study from 1994-95, which talked about labour market rigidities that are found in legislation passed by governments. After reviewing some of the European models and then the United States model, it showed that these rigidities created high structural unemployment in the European countries as opposed to the United States. If you transport that domestically, it causes you take a close look at your labour laws—not just labour relations law, but employment standards, for example. Those things are of interest.

The only other comment I'd make is that training is an absolutely vital issue. I've always viewed it in terms of the spectrum ranging from what used to be the Japanese model—a job for life—to the American deep south model of employment at will, where you could be gone the very next day.

But what's emerged through people such as Robert Reich and the Clinton administration is the view that what employers owe employees is training and cross-training so they feel secure in their current employment. They may not have a job with that company forever, but they will be marketable within today's new economy. That's a vital issue I'd like to hear some discussion on as well.

The Chairman: Serge, do you want to jump in on that?

[Translation]

Mr. Serge Brault: I want to thank you for inviting me today. If I can just try to draw a parallel between the questions of concern to me—on which I claim to have limited expertise—and Professor Richards' comments, I would say that we need to periodically evaluate social programs in the broad sense, in other words from the standpoint of the framework they provide for the workplace and employment.

Through the work we did in our group last year, we were able to see, among other things, that a number of fundamental changes are affecting the way we earn a living. The way people work is changing, because the economy is facing long-term structural change.

For instance, in terms of work-related issues—and this goes back to what Mr. Burkett and others were saying—it is clear that a wide range of legislation that falls within your purview has a direct impact on income, employment, mobility and training, and that these statutes have very often been framed on the basis of an economic model that is now disappearing. It will not be extinct by tomorrow morning, but it is in the process of becoming so, as the knowledge-based economy, an economy that focuses more on services than on big business, takes hold.

For example, we noted that labour legislation as it relates to collective work relationships, to workers' rights to representation or to the funding of certain social programs is based on the premise that people always work in the same place, for a single employer and for enough hours to fund a certain number of programs.

Yet our own observations—and I noticed that one of the chapters of our study on the changing economy had been reproduced here, in the material prepared for the Committee—show that those who work a lot are working more and more and that those who work little are working less and less. We are seeing a kind of cleavage. There are also new forms of work emerging that our current legislation was not designed to handle.

The issues we have to explore as a society, whatever our reasons for doing so and at whatever level we try to take up the challenge, include the need to understand the depth of this change, which is colossal, long-term and historic, rather than cyclical. This is not just a passing event, trend or cycle, but something that is here to stay. So, that is the issue we are up against and that we have an obligation to explore in a committee such as yours, not only in relation to pension legislation, but also legislation dealing with manpower training, labour standards, as Mr. Burkett was saying, and the organization of collective work relationships.

• 1715

If we increasingly marginalize workers in relation to our system, at some point, our system will become obsolete, in that the clients it is serving, as well as the clients funding it, rather than being part of that system, will be completely outside of it. Those are issues that must be of concern to all of us and that it would be worthwhile to discuss.

Thank you, Mr. Chairman.

[English]

The Chairman: Thank you, Mr. Brault.

Ms. Côté-O'Hara.

[Translation]

Ms. Jocelyne Côté-O'Hara: It is difficult to add anything. Perhaps I should begin by thanking this gentleman, because he has provided us with a very detailed description of the real challenge facing us.

[English]

We're facing terrible challenges, and I don't know why I'm here either. Someone else said they weren't sure why they were here. I am really in between a rock and a hard place, but I'm pleased to be part of a reflection.

I've spent the last 15 years in the high-tech field in the telecommunications and related sectors, after 15 years in the public sector. I've always been quite interested in work in transformation. I do think your biggest challenge as a government and as a committee as you do your work is to really scope out the extent of that total transformation that is occurring out there in the nature of work.

Being involved as I am with a lot of large corporations even today as a corporate director, I know they're not going to get bigger. They're all getting smaller, and they have a very different attitude towards the nature of work. So work is now living in a much different, embryonic, dynamic field.

The worst part, which I see all the time, is we do not have yet the right education or training system to be able to respond. You have to watch where the competitive players are going to come from.

Just to throw a little bit of nonsense in here, Americans are now developing for-profit universities and training schools that are coming into this country. They've engaged already in discussions on getting chartered to provide the form of education—this is degree-granting—that we should be looking at quite seriously, because they're winning the edge.

This is the University of Arizona, I think. Some of you are nodding; maybe you know about this. This is amazing. I say “amazing” because they have five campuses in the United States and they're seriously coming into this country. They're offering the form of training that Arlene alluded to, and it's going to be right downtown, where people work, or in the suburbs, where small embryonic groups of small companies or home-based operations are.

So what you have to do is bring in as many of the people who are scoping out the creative forces and the innovation happening out there as you can, worry about the education and training, and look at the work cycle—the life cycle of people at work—because it's not at all what it was for most of us who are of the same vintage here, or a similar vintage.

The challenge has been well... I very much like what was just said before, because the question has to be: what does the worker today expect from his government? He doesn't expect what he did 10 years ago. And the laws on the books are going to say, “Where's that work? Where are people going to work in 10 years? What's going to be the nature of work?” It's going to be even more dramatically changed than it already has been.

• 1720

The Chairman: Nancy, I'm going to come to you, but let me just try to reflect on two things.

One of the things we get caught up in here at this committee, and try to sort out all the time, is in some ways reflected in what's been said thus far. We have the position of the Bloc, which is a particular position relative to a political position relative to their place in Canada, which adds a dimension to it, although the Bloc members who are on the committee regularly are intensely interested in employment insurance, all the support workers and all of the other kinds of things that drive all of us here, although in a slightly different context.

But this problem that's been identified through the collective reflection on and need for the change in labour legislation and policy—the kind of questions you were raising, Arlene and Serge—is something that got us wondering. We have this instrument called the unemployment insurance program—or you may want to call it EI, which I think some of us still have difficulty with. It's an instrument that doesn't provide the kind of support it did at one time, and whether you agree with the changes or not, the observation is that it doesn't. So you begin to try to answer Arlene's question about how this evolves and whether this is one thing that could evolve as a support. Is this something we should start to consider as a support?

Then you get the position Mr. Richards takes that you have some jurisdiction there, but the federal government should withdraw from active measures, leave them to the provinces, and act in a sort of income redistributor function. Eugene raises the confounding problem with that: that's fine, but does that mean Alberta does really well because it has the money to pay for some of those things?

Arlene's question was how do I get trained if I don't have the money to train myself and I don't have the money to go to that private university? Do we just leave the smaller, less well-off provinces or the provinces with the larger unempowered populations, which brings me back to Libby's concern about the fact that I have people here who need bread today and what's our role?

Prof. John Richards:

[Editor's Note: Inaudible]

Mr. Reg Alcock: John, I want Nancy to come in, because she doesn't have very strong opinions most of the time and she might add to this. But we get caught in the problem of trying to reconcile those two things. It's not just the pressure from the Bloc that says “Get out”.

Nancy, is it fair to ask you to...?

Mr. Nancy Riche: Is it break time? Thanks, Reg.

I want to speak, and I'm glad it's moving to a different place, but I'm not going to let some of what Professor Richards said go unchallenged. It was a pretty simplistic presentation we received here today. As I said as I was shouting across the table, I'm very disappointed the committee would invite Professor John Richards. We all know what his premises are and his answers, according to some of the stuff I read. He calls them the answers without a balanced view. I think you may have tried to do that and it didn't work out.

I want to respond to some of the comments he made, because it's very important we all understand. You can't let a statement like “We have feminized poverty” go as if we, the government, the welfare state, feminized poverty, without talking about the number of women who've had to leave abusive marriages, live in shelters and become single-parent moms without spouses.

We cannot let it go when we talk about two families where Professor Richards talks about a man and a wife, with no understanding of homosexual families. We have moved a long way in this country on the basis of equality in that a family is not necessarily a man and a woman and kids. Sometimes it's a single-parent mom, a single-parent dad or a homosexual couple, male or female.

He does not say in his presentation that other factors attribute to the well-being of children and how they grow up, like neighbourhood and level of income. We're just left with the two-parent man-woman family, and it's not fair to just leave that on the table.

He doesn't mention the wage gap between men and women in terms of equal pay for work of equal value, which of course is a law in this country and is certainly recognized, or the number of men who've left marriages and never paid their fair share for raising children.

• 1725

So let's not talk about these things as if it's one straight... “Straight” is a good term for Professor Richards.

Let me talk about the fishery. Since I come from Newfoundland, you can imagine I can't not respond to the suggestion that the crisis in the fishery revolves around what the government is going to give us. He knows that's absolute bullshit.

You can't talk about the crisis in the fishery in Newfoundland without talking about the mismanagement, the politics, the science and the lack of science, or the inability to be able to project what was happening in the cod fishery. If people are now saying they want some money to live and that becomes a discussion around the subsidies or the TAGS program, that's not a fair discussion.

All of us probably watched The National when these fisher people were going in to take over Revenue Canada, and everyone who was interviewed said “I want to work”. That's what Canadians are saying. They want to work. They want to receive a decent salary.

The background in the document that was sent out—albeit a bit too late, but I did manage to read some of it—is great information for this committee to deal with. It talks about the low pay. Our country has the second-highest incidence of low pay in the world. What's going on out there?

A lot of things link into it. One of the good things that happens for people in this country is that they join unions. That's not a statement to organize the MPs, but it'd be a good idea. You might get a full dental plan, right? But the facts show that if you are in a union you are better off in terms of health benefits, pension plan and salary. Yet—and we have to see these links—many of the provinces have changed labour legislation to make it even more difficult for people to join unions. There is a link to some of these things that we should be looking at.

I'm very concerned about the two-parent families, as I said. I'm concerned about the discussion around devolution and the provinces that pay. Whether we like it or not, we certainly haven't figured out what to do about the have-not provinces. I'd be prepared to try to get into that discussion instead of writing them off or saying they will have to do it on their own.

You might live in Vancouver East, but I don't think you know a thing about what people in outport Newfoundland are trying to go through and how they live. Academic theories might be good, but they don't put bread on the table. The suggestion was made that social advocates go for short term, i.e. UI. We sure did, because that was the plan. UI was based on the principle of a short interruption of work, because the market was going to prepare all these jobs and have all these jobs and folks were going to get them, so we came up with a short-term program.

Let's not talk about UI, the decimation of UI, and where it's left families without talking about why it was decimated. It wasn't decimated to have people work or provide incentive. It was decimated to change the deficit numbers of the federal government. The UI surplus of close to $20 billion is sitting somewhere while people are out there starving to death. It's quite beyond me.

Professor Richards likes to use the term “writ large”, and the only thing I see “writ large” in this country now is the increase in poverty. I might have misunderstood one of the comments he made, but I wrote down something about child poverty and that we are doing the right thing. He might have read the papers this morning, but he should have read yesterday's Globe on the increase in poverty in this country. It's absolutely horrendous. That's what this committee needs to get its arms around. You can do all sorts of academic proposals, but somewhere along the line we have to deal with what's really going on out there. It won't be corrected by increasing the minimum wage—we'll certainly go a bit of a ways to do it if people have a few bucks in their pocket.

But I did agree with one thing, and that's evaluation of programs. I strongly agree we haven't done that, that we have the ability and we can do it. If we're able to be non-partisan and look at some of these programs in an objective way, perhaps we can get some really good stuff happening here.

My last comment, of course, is that Professor Richards was an NDP MLA about a hundred years ago. As an associate president of the party, I don't consider him a member.

• 1730

The Chairman: That's going to be difficult to translate into policy at this point in time, Nancy.

I have a couple of members who want to jump in here too. I'm going to go to Nick and then Claudette.

Mr. Nick Discepola: Thank you, Chair, and I want to thank you especially for the cooling-off period. That went over your head, did it?

I do want to try to be general, but I cannot let some of the things that were said by my colleague Mr. Asselin, and by Mr. Richards in some of the responses, go. So I'll try to do this as delicately as I can.

The first question I'd like answered, and I have to start with Professor Richards, is do you believe the federal government has a role to play in health, education and and social programs, yes or no?

The Chairman: I think that's an interesting question. I'd like to pose it more broadly, not just to John Richards. I'd be interested in hearing more on that question from some of the other people on the labour support attachment issues.

Do you want a response right now?

Mr. Nick Discepola: I'd like to get the broad feeling, because I think that's the fundamental question. If we have no role to play in this, then let's just take some of the initiatives and let's go home. But if we have a role in it, then I'd like to hear the comments.

The Chairman: Okay. I'm going to go to Mr. Richards, but I also want to come back to a few others.

Mr. Nick Discepola: Not just Mr. Richards, because I'd like to hear everybody's, and then I'll focus in on him because he was the one who was a bit—

The Chairman: John, yes.

Prof. John Richards: I came here this afternoon in part intentionally to state a position with fewer qualifications than I would in a 300-page book, but I don't want to avoid your question.

I think the federal role in health, education and social services is much less important than that of the provinces. The basic role of the federal government is income redistribution, which is crucially important, both to individuals via, for example, the child tax benefit and the seniors benefit and—this is in answer to the very first person, Mr. Kostyra—to provinces that are poor.

One of the important social policies that the federal government must maintain is equalization. Equalization is not perfect. We could talk about it in detail, but it is a crucial program in the context of Canada, which is a federation in which the primary responsibility constitutionally, historically and by convention for these programs resides at the provincial level. We must make sure, as the Constitution says in section 36, that with reasonably comparable levels of taxation each province will have reasonably comparable levels of revenue.

The Chairman: Eugene. Serge. Does the federal government have a role?

A voice: The full answer is yes.

The Chairman: Yes, as characterized by Professor Richards?

Mr. Brian Burkett: That's where I'm leading to. As a management-labour lawyer, this is not my area of expertise. As a Canadian citizen, I'll tell you that's what my perception is of what's been happening, that in fact it is the provinces that more and more are responsible for health and education—

A voice: —and labour law.

Mr. Brian Burkett: —and labour law. Well, 90% of our workforce is governed by provincial labour laws and 10% at the federal level.

Ms. Bonnie Brown: Are you satisfied with that, then? What is the reality? In other places we've been, they've said they want the federal government to have more of a role, because they're losing faith and trust in their provincial governments, particularly the more right-wing ones.

Mr. Brian Burkett: As a Canadian citizen, I don't want a Balkanization of Canadian society.

Ms. Bonnie Brown: That's what you'll get with the provinces.

Mr. Brian Burkett: It might be, although I think Professor Richards—and I think I'm just echoing his comments—would say that there's a floor below which no jurisdiction within the Canadian jurisdiction goes, and if that's true, then there isn't the Balkanization that you're thinking of.

Mr. Nick Discepola: Let me give you just two examples. Can I, Chair, or do you want to continue?

The Chairman: Nick, I think Mr. Burkett's agreement on the question, does the federal government have a role, is different from Mr. Kostyra's agreement to that question. Is it not, Eugene?

• 1735

Mr. Eugene Kostyra: I think so, yes. In fact, I don't know how it can't have a role. If we go to the core of the subject, we're supposed to be talking here today about the changing nature of work and what has happened to people in there. If there's this artificial line cut between different government responsibilities and programs, and there isn't some kind of integration, I don't know how we'll deal with the changing nature of work. It doesn't just cut through social lines very neatly; and the areas of training, social policy and social assistance, the whole range, have to be integrated if we're going to tackle some of these problems. And what I fear is that this is going to move them farther apart and we'll have less integration.

The Chairman: Serge.

Mr. Serge Brault: I'll make a very brief comment, and it is that the kinds of change we are witnessing are so broad that there is indeed a role for the state; there's a role for government. And I wouldn't personally characterize it as being a role for the federal or provincial level; that's probably still open for debate. But one of the main questions that need to be addressed, because this is fundamental, is whether or not there is a role for the state in view of the fact that we are witnessing this kind of fundamental change that I referred to earlier.

So my answer to that question is, indeed, there is a genuine role for the state. And if we try to refine it, we can also look at it from a status quo point of view and say, looking at things as they stand now, we can define a role for both levels of government. We're faced with a train coming at high speed, and we can sit on the track and say “Someday something is going to be done about it”, or we can be proactive about it and say, “There's a big train coming, and what should we do to take the curve it's about to take when it reaches us?” This is a fast-coming train. Of course, the state definitely has a role to play, and a major one, too.

The Chairman: Nick, do you want to comment?

Mr. Nick Discepola: Yes, I'd like to continue on that line, then, because I firmly believe that we do have a strong role. If I listen to my colleagues from other parts of the country, they would say that we have a very strong role and we should enforce that role. I'm relieved to hear that, because I believe, Professor Richards, if you do studies of other federations, you'll see that other federations do have a very strong role in health care, education and social policies. The only difference between those federations and our country is that unfortunately, in my opinion, we're the only ones who have given the provinces an opting-out with full compensation, and that is where our mistake has been.

Ms. Bonnie Brown: Exactly.

Mr. Nick Discepola: If you take your analyses—and, again, please correct me if I've misinterpreted—everyone, including not just the Bloc Québécois, Reg, but the Reform Party too, believes the way to go is that we should decentralize and transfer the powers to the provinces. That's part of the Reform Party platform also.

If you take a look, Professor Richards, at the percentage of government spending at the municipal and provincial versus federal levels, you seem to indicate that this percentage is about right and should not go any lower. If my measure of the value and the amount of decentralization is exact, you will see that if you compare the amount of federal spending 10 or 15 years ago to now, we have decentralized a hell of a lot.

I would like you to answer one other question. I don't know how much time you're going to give me, Reg. I could go on for a long time.

If we do have a role in education, then I'd like you to qualify your exact comment, because I believe the Canada student loans program has been in effect for a long time, and, again, my home province decided to opt out and establish their own program. Therefore, I took an awful lot of exception to your comment that the millennium program was “an affront to Quebec”. Why just the province of Quebec, if you believe that education is provincial? Why wasn't it an affront to all the provinces? I caution you not to fall for the trap of the separatists.

• 1740

Prof. John Richards: May I very briefly respond, sir.

The Chairman: Actually no, not just yet. I have a quite a few... Jocelyne.

Ms. Jocelyne Côté-O'Hara: I want to say that we're very lucky, first, to have the professor because he is a good target, and he has been sufficiently provocative. He has got us all going a bit, and there is nothing better than the blood pumping.

But I want to say that really every time Mr. Brault talks, I come after him and I say, that's what I wanted to say. However, it reminds me of my days in school. I said, God, I never got a chance.

I do know a little why I'm here. I'm here because I began my career in the sixties in federal-provincial affairs with Robarts in Ontario. I was 23, and I got a baptism of fire. I've never left it, because it's been there all the time.

On what Mr. Discepola said, I would like to say that you cannot have a country that expects its people to move about without having national policies. And while I have questions, I will really question programs. I may well agree with some comments about the fact that there should be fewer federal programs.

There has to be national leadership in policy. However you break that down, there are people in this country... Canadians want to be able to move and work in different places without being in a very complex environment. The complexities are there, and this level of government has a responsibility to help simplify or make easier, ease, create the ease necessary for a mobile work force, an educated one that can move, too.

Excuse me, if universities have been controlled by provinces, how many of you can tell stories about your children or your nieces who've tried to move from university to university? It's a nightmare. This country is not creating the type of standards... We have no testing.

I recently did a study of telelearning, on the feasibility of network-based learning. The biggest hurdle is the provinces. Well, excuse me, I want to give them more? I don't. I have a strong belief in the ability of this country to be breaking ground, but it's going to have to create leadership. So I believe in not giving away anything until we set some national standards, and some damn good ones.

The Chairman: Okay, Nancy, would you like to speak to the other side of that?

Voices: Oh, oh!

Ms. Nancy Riche: No. I agree with my sister here.

I want to say, though, that to have a discussion about decentralization when it is here is almost academic. And I believe that what's happening now out there with the provinces... I mean, we've based our equality on he who pays the piper calls the tune.

Quite often the federal state was able to withhold money if the people in the provinces didn't hold up their end of the bargain, or didn't follow the Canada Health Act, and all that sort of stuff. The more we've reduced the transfers, the more we're hearing the provinces saying with quite a human reaction, if I'm paying, then I want to be the piper.

So we're well into this. I disagree with it, obviously, and my answer to your question would be a clear yes.

I'm also concerned when I hear that there's a floor under which we cannot go, because I think our have-not provinces will always be at that floor. It's like affirmative action for women; what was supposed to be the floor becomes the ceiling. When we set these rigid things...it's got to be broader than that.

Alberta is ready with a piece of legislation to privatize health care. They've deferred it to the fall, but they have a piece of legislation. The only thing that's kept it off the books is some of the transfer money. So we know how these things happen, and we have to be very careful.

I also want to respond to “the train is coming”. I think the train is here. If you look at this again, the materials that have been prepared for today, where people are working, what the jobs are in this country, what people are earning, and what's happening, when you have people out there one after the other who are on call 24 hours a day in order to feed their families... They have three jobs, nurses particularly, and we all have loads of anecdotal evidence.

• 1745

One that really shocked me was about the university professor who goes across to two universities, part time in each. She's making less than $20,000 a year, and she's racing from one end of the city to the other.

This train is here, and nobody seems to be addressing that. What we have, and I'll go back to it again, is to try to get rid of solid labour legislation.

The interesting thing about the debate that's gone on in this country, in fact, has been “get rid of regulations”. I mean, the free market... We all know that, and I'm not going to go into that debate.

Somehow or other that argument doesn't apply to labour legislation. We've been more restrictive. We've done all sorts of things where we need regulations. We've dismantled workers' compensation, we've not allowed...

Yet we have not got to the point, which I can't figure out from the right wing...that all this money used for programs, UI particularly, paid for by both the employer and the employee—which is to say, the employee—puts money into the businesses that these parties are supporting. Who do you think is spending the money in the communities if it's not the workers?

So I think the train is here, and we're heading down a very bad road, even for the right wing at the end of the day, if we don't sort of pull it back together.

The answer to your question is yes.

[Translation]

The Chairman: Mr. Verge.

Mr. Pierre Verge: The reality is that Canada is a federal state. As far as labour legislation is concerned, I heard the word “balkanisation” used earlier. I believe Professor Frank Scott was the first person to use that expression. There is nothing we can do about it: balkanisation is indeed a reality when it comes to labour laws in Canada. It was also mentioned that approximately 90% of the workforce comes under the jurisdiction of provincial legislators.

Earlier we were talking about the government's role with respect to work. This is one aspect that is an inevitable result of the fact that Canada is a federation. But it is only one dimension of the government's role, and I would like to refer to another one.

Quite apart from the issue of the division of powers between the federal government and the provinces, and even if Canada is a unitary state, who actually exercises power in the area of labour relations or labour-related measures? Do Canada and other states still exercise their traditional government powers when it comes to transnational and multinational corporations?

This is a problem that has been studied by both economists and sociologists. Much has been written about this. Where does that power actually lie? Does Canada still possess all its traditional powers in relation to work or is it not more accurate to say that transnational corporations are where the real power lies in some cases, given their enormous means?

Let us just look for a moment at things such as closing an establishment in a given country. Technically, that establishment is under a Canadian subsidiary, whether it is provincial or federal, but the decision-making centre is very often located, not within that Canadian subsidiary, but abroad—in the United States most of the time, and occasionally in Europe. And from a legal standpoint at least, Canadian laws, be they provincial or federal, do not reach that decision-making centre, which is located within that transnational corporation's headquarters.

I think that is an important aspect to bear in mind when looking at the workplace and the problems associated with it. Perhaps that suggests a single general process of reflection. The theme of this round table, as is clearly stated in the material, is not so much the present, but the future. As enormous as the problems may already be, they cannot be seen in isolation, or from the perspective of Canada alone. They must be seen from the standpoint of Canada's relations with other countries and other international organizations. Solutions for the future must partially reflect that.

• 1750

One has only to think of Canada's participation in the International Labour Organization. Canada is also a signatory of the NAFTA and certain work-related issues are covered in that agreement.

As far as the role of the states is concerned, I think it's important to consider how its role compares to that of multinational corporations. Also, Canadian legislators must bear in mind Canada's relations with countries with which it maintains close economic ties.

[English]

The Chairman: Thank you, Professor Verge.

Let me just make an organizational comment here. It is 6.50 p.m. Claudette has a question, and I think, Claudette, you have to leave at some point. Then I have Mr. Wilfert, Jean Dubé, Mr. Godin, Mr. Antoine Dubé, and Diane Ablonczy, all of whom are patiently waiting here to pose questions.

Mr. Richards, I want to give you an opportunity to jump in after this last exchange, and supper is arriving.

Now I would propose to let Claudette pose her question. Then I would propose that we take a break, get our meal, which will be laid out in the other room, and bring it back in. You can walk around, go to the bathroom, but bring your food back into this room. Then we'll get back at it.

Yes, Mr. Godin.

[Translation]

Mr. Yvon Godin (Acadie—Bathurst, NDP): You see, I have to be in the House for the late show at 6:30. That's my problem.

[English]

The Chairman: So you also...? Okay, Yvon, could you pose your question, then?

Mr. Yvon Godin: Yes.

[Translation]

The Chairman: A brief question.

[English]

Okay. I'll let Claudette go. Then I'll come to you and let you get in. Claudette.

Mrs. Claudette Bradshaw: First of all, Reg, I'm going to have a comment pertaining to the responsibility of the federal government.

I thought long and hard about getting into politics and it was: was it municipal, provincial or federal? It didn't take me long to realize that it was going to be federal. I felt that we really needed to work together as a country. It's important for me as a federal politician to listen to and understand what's going on across my country, and to make sure that all provinces will be equal.

One of the reasons I hate to visit in the States is that I don't always see equality when I visit the States. I see parts that are very poor, and parts that are very rich.

And I don't want to hear, well, you can see that in Canada too, because I travel across Canada. I have not seen in Canada what I've seen in the United States. So I didn't have a problem seeing that I wanted to be a federal politician.

Arlene and Jocelyne, if you're going to sit on the HRDC committee and look at employment and labour, yes, I think the train is here. Your comments were very well taken. I hope you will come back, and that we can really look at what you were saying.

Jocelyne, you're there, you're in technology, you know what the needs are. I hope you'll come back too, because I believe, as you believe, in the educational aspect. We're going to have to do something to meet the need, and it's not all going to be through university.

Monsieur Richards, you need to know that I've had a challenge in my life for 30 years. Every day of my life I've worked with kids who were abused, kids who were hungry.

The last year that I worked at my job I worked with the parents of these children, because I believed that they would stop abusing their children if we had them in long-term programs. Well, 92% of the parents with whom I worked in that last year had been abused as children, and for all of them, without exception, it was anal sex.

These parents don't want to abuse their children. These parents have to be integrated into the work market.

• 1755

What I find difficult sometimes on the HRD committee is that when you bring somebody in who has done studies and books, very seldom have they done research on what we are going to do for that adult who wants to be in the labour market but who was never accepted in school as a result of being abused or having FAS. We don't look at them. And because the mom now is a single mom and the dad may be in prison, we don't look at them for the work market.

So what I seek on the HRD committee—this is why I came to Ottawa—is to see how we can reintegrate into the workplace the parents who are single and the parents who live in poverty with their children.

I've seen for 30 years that they want to be in the workplace. They're running a business now in Moncton in which some of them are hired full time. As for the FAS people, we've put them on cutters. They cut cotton all day long, and they're the biggest rag dealers in the Atlantic provinces.

And do you know what? I'm really proud of them. They're doing something. It's the first time in their lives they haven't failed, because we've shown them a job that they're able to do.

So when you were doing your presentation, you started out not badly at all with me. I thought it was pretty good, and yet at one point, I would have got upset.

I'll tell you what also upset me. This is a little personal. I was co-chair of the National Crime Prevention Council for those who were prenatal to six years old. I told that council for two and a half years that we should have gone and made a presentation to the C.D. Howe Institute. I figured that if we could sell the C.D. Howe Institute on prevention then, honest to God, we would build a vision and be the first country to close our prisons by 2020 because we would be doing it right.

I know that if we can't convince people like you and the C.D. Howe Institute to start researching how you bring parents and children to integrate in the labour market... If you're not saying the right words and if you don't sell that, they're never going to make it. They've got to hear it from you.

So my question to you is this. I'm a little upset here. When you write books and when you do your studies for the C.D. Howe Institute, do you ever look at how to reintegrate the long-term welfare families into the workforce? Have you done any research on that at all? Have you done any research on fetal alcohol syndrome, the fetal alcohol child, in the workforce?

The Chairman: Thank you, Claudette.

Yvon Godin has to go. Yvon, I'll let you make your comment, then we're going to break.

[Translation]

Mr. Yvon Godin: It seems as though I missed much of the discussion, which had to do with Mr. John Richard's opening remarks. But after listening to people's comments, I picked up quite a bit of it. Everyone is upset. It's too bad I wasn't here right at the beginning, I might have got upset too. But in spite of other people's comments, I didn't get upset.

I would like to make some comments and then ask a couple of questions. The problem in Canada is that in the past, there were farms and there was fishing. It's humans who ruined Canada. Now it's industry, big bosses and people with money that count, and the human side has completely disappeared. Nowadays everything is driven by money. Human beings don't matter anymore.

I am really concerned that we are in the process of completing destroying our country. I would like to ask one very quick question. How many people here are from New Brunswick, Halifax, Nova Scotia, Prince Edward Island or Newfoundland? I think there's only one, other than Nancy.

Everyone is upset with the Atlantic provinces. They say that the people who live there are a bunch of lazy slobs and cowards who just don't want to work. Some studies just published even say that we should lower welfare rates and employment insurance benefits and force people to leave the Atlantic provinces.

• 1800

They want to force them to relocate to western or central Canada. I'm telling you we won't go. We're going to stay put. Anyway, maybe four provinces will join Quebec and separate from Canada, if Canada doesn't need them anymore.

Where I'm from, we've always made a living from the fishery. Some people have lived off forestry. Others have made a living from mining or natural resources. We're talking about fishing, forestry, peat bogs. But you can't catch fish on ice. And have you ever tried to collect peat moss in the snow?

Fish is good when you go to a banker's house and eat lobster. And peat bogs are good if you want a nice green lawn. Forests are also pretty useful, but where I'm from, you can't log in the winter when the snow is five or six feet deep. We don't live in Vancouver. But people seem to be pretty fond of two-by-fours in Canada. Those are the kinds of natural resources we have in the Atlantic region and Canada is just going to have to live with that.

We've had problems in the fishery lately because of the federal government's mismanagement. Recently politicians representing each of the parties toured the Atlantic region. They unanimously signed a report stating that the fishery has been poorly managed and that we now have certain responsibilities towards those people.

I receive between 50 and 60 calls a day from people on welfare. That's how desperate they are. There's no more food to put on the table, and the children are suffering. That's why I'm saying people are no longer treated like human beings.

What is going on? Well, we allowed company owners or presidents to take away bonuses when the company stopped making money. They would lay people off, so that they could make money. Fewer people are working. That is the direction we're heading in, with company presidents being paid 10 million dollars, 3 million dollars or a million dollars a year. That's the problem here in Canada.

The government has a responsibility to invest in people and not let them suffer in the meantime. The government's role is not to create jobs. I don't know whether you agree with me, but that is what the government says. The government's role is not to create jobs. But it was only after the election that the government said it's role was not to create jobs. For the 35 days preceding the election, it said it was going to create jobs. I agree with the government on that point, but the government is responsible for putting in place the infrastructure that will make it possible to create jobs. That is my question to you. Is it not the government's responsibility to develop the infrastructure needed in the region to foster job creation?

In the Atlantic provinces, we don't have money to spend on our infrastructure. Instead, we're giving that money to people who shouldn't be allowed to get their hands on it. That is what's happening in our area. I'm from there and I know that people are going through this on a daily basis.

Also, I have proof that the guys on Bay Street in Toronto tell investors: “Don't go and invest any money in the Atlantic region, because you're going to lose it. Invest it here, in Toronto.” As long as we have people managing businesses here in Canada in that fashion, we are going to be missing the boat. We have lost the human dimension. Don't you agree? Even here, today, there is no one from the Atlantic, other than Nancy, who represents the CLC, to express the views of people living in that region of the country. Thank you.

[English]

The Chairman: Thank you, Yvon.

It's 6.05 p.m. Let's break and be back at the table by 6.20 p.m.

• 1805

• 1836

The Chairman: Let's resume.

I note that the time we have left is going to shrink rapidly as various people have to make planes and the like over the next hour and a half. What I would propose is I'm going to start to put a little time pressure on people and try to tighten up most of the questions and the answers.

I'm going to start off by letting Mr. Richards respond to some of the comments that were made, and then I have Jean Dubé, who is out in the hallway; Antoine Dubé, who will stand in for him; then Diane; and then Bryon Wilfert.

Mr. Bryon Wilfert (Oak Ridges, Lib.): Actually you had them in reverse order.

The Chairman: Did I?

The Clerk: Well, Mr. Wilfert was here, but he left, so you could put him at the top.

The Chairman: Oh, I see; that's right. Our esteemed clerk noticed that you left for a period of time, so she dropped you to the bottom of the list.

Mr. Bryon Wilfert: Well, she can't be an esteemed clerk, then, if she did that.

Some hon. members: Oh, oh!

Mr. Bryon Wilfert: She's still a clerk, but I'll drop the “esteemed”.

The Chairman: Anyway, okay.

So be short, pithy, informative, and responsive, and we will see where that takes us.

Mr. Richards.

Prof. John Richards: What I would like to do is, in one or two minutes, respond in a very general fashion, and then I will take, if I may, another one or two minutes to respond to a few matters in detail.

[Translation]

You have certainly been quite eloquent, and even emotional—which is perfectly legitimate—in the past two hours in expressing your criticisms of what I've presented. The problems you raised—the difficult circumstances of children who are abused and women who have to leave abusive husbands, and of the unemployed, poverty—all of those are very real, difficult problems. Now it's my turn to be a little emotional.

Yesterday, I spent the whole day in Quebec City, at Laval University, at a symposium on national unity, where I defended the federalist position against the sovereignists, saying that there are serious problems in Canada, socially and culturally and with the country's institutions. If—and it is a big IF—we can save the federation, there will have to be a lot of compromise and a lot of respect. Indeed, compromise between Anglophones and Francophones is the very foundation of the federation we established in the 19th century.

• 1840

What is absolutely essential in a federation? The very first thing you're taught in a political science course, in an university, is that “federation” means “division of powers”.

There are many acute problems associated with the labour market, health care and education. The government has a role to play, but that doesn't mean you, acting at the federal level, should be taking care of all of those problems.

Only Mr. Verge mentioned that Canada is a federation. And I don't think it's a coincidence that it was a Francophone who raised that point. All the others spoke of very real problems. I am not denying that those problems exist, but other than Mr. Verge, no one raised the point that Canada is a federation predicated on a division of powers that must be respected. If we don't respect that, the country will break up.

I say that as a western Canadian who is bilingual, and who appreciates living in a bilingual country. As I see it, the problems we're facing in this country are the result of a refusal on the part of hard line sovereignists to accept any kind of compromise and, on the other side, a refusal on the part of some people here in Ottawa to recognize the limitations on a central government's powers within a federation.

I think that collectively, you have shown a certain lack of awareness of what a federation is all about. Anyway, enough of that. Let's get back to more practical matters.

Mr. Kostyra's first comment was: we have to be aware of the fiscal constraints of the poor provinces. I completely agree. I repeat: equalization is a crucial part of a social policy aimed at meeting needs all across the country.

My second comment has to do with devolution.

[English]

Will it result in a Balkanizing, a weakening, of social programs? It may. Nothing is certain in life except taxes and death. But I submit that all of us around this table were in agreement that training programs for those who don't pursue professional training are inadequate. Welfare people are condemned to continue on welfare in many cases.

I submit that 10 years from now we will probably be grateful that we have devolved from Ottawa the primary responsibility for devising new training programs. It should be a firm concept in our public discourse that training is closely related to education, which is primarily a provincial jurisdiction, and the federal government's role should primarily be one of evaluation. I'm not trying to be pure on this. There's a role for a certain number of pilot projects that the federal government should undertake, and I can cite some in the area of welfare reform that interest me.

Enough on that thesis.

The Chairman: Mr. Richards—

Prof. John Richards: My one final comment is to reiterate Mr. Burkett's point. There is a painful tradeoff between preserving the existing labour market conventions, as has happened in continental Europe, and being prepared to accept thereby unemployment rates above 10%, and on the other hand an excessive liberalization of labour markets, as in the United States, which has the great virtue of unemployment rates below 5%. But we cannot think about either of these as the satisfactory solution.

The Chairman: Thank you, Mr. Richards.

We'll now go to Jean Dubé. He's not here.

Mr. Wilfert.

Mr. Bryon Wilfert: I was going to say the same thing would apply to the chairman as well as to the clerk.

The Chairman: Notice how quickly I recovered.

Mr. Bryon Wilfert: You did. I'm very impressed, Mr. Chairman. That's why you're still my favourite chairman.

I would like to throw out something we haven't talked about, something very dear to my heart. All of these issues take place in cities, towns, and villages. I don't know if any of you are familiar with the Federation of Canadian Municipalities' quality of life reporting system. The FCM established in 1996 the quality of life reporting system to develop an interrelated quality of life monitoring system, basically to look at the fact that municipal governments, because of various offloadings from federal-provincial jurisdictions, have to set priorities for local needs and growth in this country. They would monitor policies and services designed to sustain and certainly to improve the quality of life.

• 1845

We would, for example, look at such template indicators as community affordable measures, to examine the relative attractiveness of a place to live. We would look at employment measures, the labour market statistics, the needs in communities, health-related issues in communities, the ability to deliver services in those communities, social infrastructure, and the delivery of programs or lack thereof. There are other issues, and I won't go through them all.

Cities from Vancouver to Halifax have signed on for one or more of these indicators to try to look at the impact of both the social changes and the changing demographics in our cities. We know, for example, the City of Toronto is struggling with this issue of the homeless and have a task force on homelessness to look at the fact that significant numbers of people do not have permanent shelter and to study the implications.

When we talk about the federal system, we should also point out that although the cities are not recognized constitutionally, which I think is a gross error, the fact is the cities are the ones who deal with a lot of the other problems, whether they're immigration problems, which they cannot handle necessarily, or social implications because of dislocation from other areas.

My bias is as a former president of the FCM and a chair of a municipal affairs caucus. What we are looking at and trying to promote is the fact that if we're going to talk about these kinds of issues, we have to look at how all governments need to work much more cooperatively and not simply pass the buck to somebody else. After all, it's in the cities where we are dealing with these issues and with the agencies and others who either have or need those tools.

I field those comments now and would certainly be interested in any feedback.

The Chairman: Thank you, Mr. Wilfert. I'm going to Antoine and then Diane Ablonczy.

[Translation]

Mr. Antoine Dubé (Lévis, BQ): We're sort of keeping it in the family. Mr. Jean Dubé is from New Brunswick, and I am from Quebec City. So, it's Dubé and Dubé.

We occasionally have a chance to hear or read Mr. Richards' views. I'm not surprised at the reaction to his presentation. In any case, I think his approach is appropriate, under the circumstances. I am a sovereignist. I am a member of the Bloc Québécois, but I really liked hearing you say that in order for change to occur, some people have to change their approach.

When you're having a discussion, if all you want to do is convince the other person that you're right but you refuse to listen to his arguments, there is no point in having a discussion. When different, even opposing views are debated, it is enriching. I think it's important to always remember that. I know the Chairman and I know how open he is to that sort of thing.

I am not currently a permanent member of the Standing Committee on Human Resources Development and the Status of Persons with Disabilities. However, during my first mandate, I took part in the consultations on social program reform, and I do come from time to time to talk about labour relations problems, and so on. One of my colleagues, a young fellow, caused quite a stir. I'm not saying he should be applauded for what he did. He took his chair out of the House of Commons to draw attention to the following problem: can members of parliament, from all parties, really help to bring about change?

• 1850

Earlier, Mr. Verge from Laval University was right to remind us about transnational corporations. We are currently witnessing the phenomenon of globalization.

As regards national standards in education, during the Committee's travels, since I'm not deaf, I had heard most people in provinces other than Quebec saying: “The government has to show more leadership with respect to standards, given the changes that are occurring, and relations with other countries.” After all, Canada is a member of the OECD, and because of globalization, we have no choice but to do that.

It is on that point that I would be interested in hearing the reactions of any participants who may wish to comment. Mr. Richards, as well as Mr. Verge, were reminding us that we are part of a federation, and that's true. The Constitution says that's the way it is, although the Constitution has been in place for more than 100 years. It's possible that things have changed.

The question we have to ask ourselves is this: how should current structures be adapted to meet emerging needs? I refer here to education and work only. As for standards, if people really wanted them, particularly the provinces... We do have forums on education, health and in other areas as well. If people voluntarily agreed to work together on so-called national standards—the federal government could also give its views on the subject—then we would be talking about voluntary acceptance of standards.

I don't see that as such a strange process. What do OECD member countries do when they talk about standards? What do countries that are members of the European Union do? They have these kinds of discussions. They try to develop standards together.

Earlier we were talking about labour codes. The fact is that labour codes are not that different from one province to the next. That brings me back to globalization. If the countries that sign the MAI, which will facilitate access to international trade, adopt common standards in the areas of education and work, then I guess that's the way of the future. So, we need to spend some time—but not too much—talking about this.

[English]

The Chairman: Thank you, Antoine.

Mrs. Diane Ablonczy: This has been interesting.

I appreciate Professor Richards coming. When I saw his book and his résumé, I expected that there would be a good deal of thoughtful content to the book, but with respect, I wasn't entirely sure whether there would be fresh thinking.

What interested me about the analysis you've done is that you have reached precisely the same conclusions—I don't want to insult you—as the Reform Party. Each of your five conclusions are precisely in line with the policy we had put together in analysing where we need to go with our social programs.

I became active in building Reform simply because it was my considered opinion that our present systems and our present approaches to social security no longer served our interests. I was therefore quite interested in the conclusions you reached, and I'm also interested in the response that has been demonstrated today to those conclusions. I think it's good to have different perspectives, but there does seem to be a degree of hostility towards your conclusions. Quite frankly, I've experienced that myself as someone who's worked in Reform.

• 1855

One thing I would like to clarify—and this was a comment made earlier by another member—is that Reform has never, ever advocated decentralization. This is a label that has been placed on our policies. It is not a correct label.

What we do advocate is precisely what Professor Richards said, and that is a proper division of powers respecting jurisdictions—strong jurisdiction by the federal government, but equally free and strong jurisdictions where appropriate by the provinces. Now I think we can have a fruitful and a proper debate on where those jurisdictional splits should be made. That is the debate I would like to see, and I do want to clarify it.

I think we all agree that the state has a role to play in the labour force in work, in our social stability. I don't think anyone around this table, certainly not me, would dispute it for one minute. One of the concerns I had in getting politically active was that the approach that had been taken in the past, particularly in destabilizing our ability to maintain social programs because of high levels of debt and deficit, was going to lead to some very unpleasant consequences. By the way, we are already seeing it.

I think Reform members have been poor communicators in the sense we have made it sound as though all we care about are the bottom line, balanced budgets, and fiscal responsibility, without going the next step in saying the reason for this is if we don't, our cherished social stability and the programs we all value are going to be imperilled. In fact, that is exactly where we are today.

I want to go back to my original question. Given that there is a shift, for better or for worse, brought about by the fact that there's a finite amount of money available, a decreasing amount of money available for the kinds of welfare state programs we've had in the past—and I'm not being pejorative about that. It's not a term I'm using in a pejorative sense.

I think we all value health care. All of us get sick. We value having strong public pensions because all of us hope to retire. But if we are changing our approach to those problems and how we deliver those results, as are other countries that are grappling with the same thing I mentioned, what is the extent of the changing expectations on the state?

In the past the state was nanny: from cradle to grave the state would deliver whatever your needs were. We've had impassioned pleas around this table, saying for God's sake, there are people in need in a whole variety of areas that have been mentioned, let's do something about it. But given the whole macro-picture, which Professor Richards has spent some time studying, how do we make the shift? What shift do we make?

I don't think we should come to this, and I don't come to this, with any preconceived notions. I think we can pretty well all agree that we want a safe and secure society, where our health care needs are looked after and where we are a well-educated workforce and all the things we've talked about. But we need to talk about the role of government and how it should change.

If we keep doing the same old thing, clearly we're going to continue to get the results that worry all of us to varying extents today. For example, Serge mentioned that higher-income people are working longer and longer for the same money or even less money, but lower-income people are working less. I don't know why that is. I don't know if there's some structural problem we should be addressing.

It seems to me that rather than argue about the things that should be done and the things that aren't being done, the more productive debate would be how we address the changes we need to make as political decision-makers in order to deliver the results. That, I think basically, all of us agree on.

Mr. Chairman, my comments would be directed to an appeal to focus our discussion on some pretty specific things. Arlene mentioned a number of them that government can and should be doing in this regard.

The Chairman: Thank you very much, Ms. Ablonczy.

Eugene.

• 1900

Mr. Eugene Kostyra: I want to bring this discussion to a different level for a few minutes.

Diane just mentioned some of the comments that Arlene made earlier. I want to pick up on a couple of them and then get into a little bit more detail if I can.

I think the area of labour legislation is an important one, and other speakers have talked to it. Maybe it's an area in federal-provincial jurisdiction that needs to be looked at again in the context of some of the changes that have to take place to be able to meet the needs of the changing workplace. On one level we're working with international bodies, and on another level we have this patchwork quilt of a variety of workplace legislation. It's not an easy issue to get into, but it seems to me it's one on which we perhaps should have some leadership from a body like this.

The other area is the area of benefits and what it means to the changing workplace. Again, there are things, such as the Canada Pension Plan and EI, the federal government has the levers on.

To me one of the most important areas is the area of training, and I want to spend a couple of minutes on that to pass on some of my own experiences.

I'll go back to the opening comment that was in the facts I got about this session, this round table, in terms of the various organizational experiences in this area and how we as organizations are coping. I have to say honestly that as a union we're having a lot of difficulty in dealing with the changes that are taking place in the workplace.

We're not well equipped to deal with a lot of the dramatic changes and to meet the needs of our members. The demands for training and retraining are high, and we're not well equipped to do it. Our employers are not well equipped to do it.

There are some good examples. Under tab 5 in the innovation section, there are some examples of some good workplace training programs that are going on across the country, but they are small things. That's an area in which I think there can be greater leadership.

Frankly, I'm concerned about the devolution of training more to the provinces, because I think they're providing fewer cross-opportunities in training. At least in my experience in Manitoba it's becoming that way, so I worry about that kind of trend.

We're going through some profound changes in health care in Manitoba, and I'll give you an example of a situation we just dealt with.

We now have a joint adjustment committee dealing with changes in health care in Manitoba. A centralized body was being set up for the delivery of food services for hospitals in Winnipeg.

Reg, you're probably aware of it. Our union was involved in fighting some aspects of it.

The Chairman: Microwave toast from Toronto.

Mr. Eugene Kostyra: Yes, microwave toast from Toronto. Not that there's anything wrong with toast from Toronto, but we'd rather it stay there.

We got into some detailed discussions as this thing evolved about having truck drivers delivering it. It was something that was going to be outsourced, but in the end they agreed to keep it in-house. We couldn't find a training program for truck drivers. Finally we got the City of Winnipeg, another employer, to provide their resources to run a training program for truck drivers for this new centralized health facility.

There is no centralized body, there's no organization dealing with these kinds of issues. They're just out there, and you're trying to cobble them together. I think this is an area in which there should be a major role.

In terms of bringing about a true partnership between labour and business and government, there's an agency in that field already—Arlene works for it—and I think it has shown some leadership. Maybe it needs to be given a greater role in working in that area. If we're going to come to some solutions, it's going to be through a joint realization at all three levels, including people outside the workforce. Again, I think there is where a leadership role can be taken by the committee and ultimately by the government.

The Chairman: Arlene, I have you and I have Jean Dubé and Rob Anders, but I'm going to briefly abuse my position just to try to go a little further with what Eugene is saying.

• 1905

I picked up on something Mr. Brault said earlier, when we asked whether there is a role for the federal government. What he said was there is a role for the state. The issue we're confronted with here is we're the federal human resource development committee, and I think when a lot of us look at the union, when we say let the provinces sort it out, we don't have a lot of examples of their being able to do it successfully. International trade is a classic example.

When we look at the question of devolution—and fundamentally I have some appreciation for that. I think certain services are best delivered closest to the people who are consuming them. I don't have a philosophical conflict with it, except all the change and the re-organizing of this federation has been one way. It's been from any kind of central concept of Canada to the various provinces and the regions. The only passing of the buck I hear is “Give us the money.” It's “Don't talk to us about national standards or health care; just give us the money.”

So it worries us. We hear all this stuff on the changing nature of the workplace. We have a national instrument—I prefer unemployment insurance—which workers and employers can buy into and it provides something to workers. We've diminished the role of that substantially.

When I hear all of this stuff coming out of the collective reflections and such, I think there is a question here about whether there is a need to replace the role or to enlarge the role to allow workers to begin to purchase some of those services, some of those protections, if you like. I wonder whether we should allow it to evolve into a role that provides some of the ongoing training, or the opportunity to step out of the labour market for a while and retrain, or however you might design it.

As soon as I'm confronted with trying to think about that—and a lot of us here have had those kinds of conversations back in the caucus room or over coffee—as soon as you start to try to confront the design of any federal system, you run smack up against the position that Mr. Richards and Diane, and the Reform Party, take. I absolutely agree with what Diane said. The Bloc has a different reason, which is why I singled out the Bloc before. The Bloc has a political-philosophical reason for exacerbating that separation. But that move to the provinces is something we confront all the time.

We can't even get to first base in having the discussion about how much you enlarge this, because it's not just Reform or the Bloc. We're doing it. We, the Liberals, are doing it.

It sounds kind of esoteric, but this issue of devolution and role is critical.

Having unburdened myself, I will go to Arlene, then to Jean Dubé, and then to Rob Anders.

I will add you, Libby. I'm maintaining two lists, one for our guests and one for the members. I'm going to try to jump back and forth between the two.

Arlene, please.

Ms. Arlene Wortsman: Unfortunately I have to leave, but we've now moved into the area I thought we were going to talk about.

I have a couple of comments.

One is that training is not just the responsibility of the federal or the provincial government. The organization called Sectoral Councils does a very fine job. The federal government has provided the resources—funding, assistance.

Those are usually business labour organizations that formed around a particular sector. They deal with the needs of the sector, whether it be the adjustment, the upgrading of skills, or people having to find new kinds of professions. They have been very successful.

There are issues around the stability of the funding for those organizations, but they have developed programs that have met the needs of the people in those industries. When you go into a workplace and meet a 40-year-old worker who has a low level of education but is confronted with rising technology and needs new skills to deal with it, sending that person to a community college or high school isn't going to do it. He needs workplace training, and the best way is peer training.

A program the CLC has started to adapt is having peers train their peers to develop the skills they need. We have found it tends to be much more successful and the retention rate of the students within those programs is far better. How the federal government helps to facilitate that is something you should look at, because it has a good track record in this country.

• 1910

The other issue is the involvement of what in Europe are called the social partners, which are business and labour. How do they feed in? This is not just government to government. These are people who have expertise, who understand what's actually happening on the ground. Where do they come in? How do you feed their expertise in?

Governments are more than just a bankroll. They can be facilitators. They can provide information. There is great information on what best practices are. How do you provide assistance to the unions to allow them to meet with the kinds of changes that are going on? How do you allow employers to adjust, particularly where you have the fastest rate of growth, which is in companies of 20 or fewer? Those people don't have the resources internally to develop the kinds of training programs that companies of over 500 have developed. So a whole series of programs and resources need to be geared to that, because that's where the growth area is.

I have to go. I'm sorry.

The Chairman: Thank you very much.

I'm going to go to Jean Dubé.

[Translation]

Mr. Jean Dubé: I missed part of the discussion since supper, so I hope I won't change the focus of the discussion too much.

I fully agree with what Ms. Jocelyne Côté-O'Hara said with respect to Mr. Brault's comments. He seems to know a lot about what is occurring these days.

We have talked about the problems facing our society, but perhaps we should also start talking about solutions. I want to comment on the remarks made by my colleague from New Brunswick. Contrary to what he said, we will not join Quebec—definitely not. But there is no doubt that some provinces in Canada are having problems and that the federal government has a role to play.

For a number of years, the federal government tried to find solutions to the problems, but they were short-term solutions. They simply resorted to bandaids. So, now we have the bandaids but no real solutions. Some regions in Canada, including the Atlantic and Quebec, have a high unemployment rate. That is a problem all across Canada; it doesn't only affect the Atlantic region. And it is an urgent problem.

You said earlier that you thought today's discussion should focus on the future. I think we are now facing an urgent problem: there are people without jobs out there and Canadians are suffering. We have to find the tools that will allow us to deal with such issues as training and the transfer to the provinces of the responsibility for education. I'm telling you, Mr. Chairman, that has been transferred to New Brunswick.

The Department of Human Resources Development transferred responsibility for education to the provincial level, as it did in Quebec. There are still quite a few question marks, but it seems to be working well. So maybe we should be looking at regional solutions, even though the federal government has to continue to fulfill its own responsibilities.

So I fully agree that our federation has an important role to play, but we have to find solutions now, on an urgent basis. That is what stands out for me.

[English]

The Chairman: Thank you, Jean.

I'm going to go to Rob Anders and then to Nancy Riche.

Rob.

Mr. Rob Anders (Calgary West, Ref.): Well, in the spirit of caring and sharing, Mr. Chairman, I'm going to put forward an idea I've been working over and massaging in my own mind, and I'll invite people to comment on it as they will.

It would be an interesting experiment—I'll word it that way—if MP pay were to have as a base salary the median wage in the country, what the average worker makes, and then have some sort of wage ceiling that's a fixed multiple of that median wage. I don't know whether that would be triple or double or quadruple, but a fixed ceiling.

• 1915

Then, when calculating how much they get above the median wage—whether it's some portion of double or some portion of triple or some portion of quadruple, whatever it happens to be—we'd factor in things such as the infant mortality rate, the literacy rate, the homicide or crime rate, taxes as a percentage of income, the unemployment rate, suicides possibly, GDP growth rate, work stoppages due to labour unrest, waiting lists for health care, inflation, etc.

I think if we had something like that, a lot more members of Parliament would be more directly concerned with real solutions. That would be a fascinating experiment.

A voice: An incentive.

Mr. Rob Anders: Yes, that's right: an incentive structure for members of Parliament.

I think you would see around the table people willing to embrace new ideas and workable solutions for changing some of these things and how we look at them. And I would even guess they would overlook some of the jurisdictional problems between federal, provincial, etc. It would be a fascinating experiment, Mr. Chairman.

I'll leave it at that and have it open to comment.

The Chairman: Thank you, Rob. We look forward to the private member's bill.

Some hon. members: Oh, oh!

The Chairman: Ms. Riche.

Ms. Nancy Riche: I'd like to add a little bit to what Eugene was saying.

This committee has an opportunity... I suspect in the fall we'll be looking at part III of the Canada Labour Code, which is minimum standards. It's been postponed again. This committee would know that part I of the code was developed with an employer-labour-government tripartite preparation. We can do that, so...

But part III is for the unorganized, and it's a really clear opportunity for all of us to look at minimum standards and to even make some effort to think about it in terms of model legislation, as Eugene talked about, that could somehow or other get discussed as a federal-provincial...

But I'm more concerned about trying to get anywhere while we're so fragmented. We have five parties in the House with pretty diverse views. It seems to me we have to come at this from a different place.

The problems in Quebec are the same as the problems in Canada on this issue. Everybody has the same problems. Quebec is not different in the changing world of work, nor is the rest of the country. If somehow or other the members of Parliament could rise above that and speak to the issue of an industrial revolution in the 1990s or the year 2000, and get beyond the other discussion...

It really is imperative. It makes no difference whether we stay together or fall apart; women are still going to be making 70¢ for every $1 men make, women are still going to be concentrated in low-paying jobs, and the industrial and service sectors are going down.

We're getting very dangerously close to pre-French Revolution times, when you had a small group at the top making big bucks. Regardless of the suicide rate in Toronto, the Bank of Montreal executive vice-president is making big, big money compared to... So we're going to have a few small people at the top and a whole bunch doing services for them. That's in your document. It doesn't say it that way, but it's personal services: drycleaning, hotels, restaurants, food service, etc. We're all going to be there. It makes no difference what our position is on separatism or sovereignty.

There's a difference between national standards and delivery. Standards can be developed at a federal level and delivered at a provincial level.

In this country we used to spend billions of dollars on training. Again, I agree with John Richards: I don't think we properly evaluated one program we did. No wonder they're in disrepute. At least three times the population of Newfoundland was trained to be welders in the province of Newfoundland. It was just bizarre.

• 1920

I came out of the community college system. I'm a strong supporter of the parliamentary system and the federal state, but let me tell you, years ago you went to community college because they paid you about $200 a week to do it. It made no difference if you didn't have any career plans; nobody cared. That was the old manpower.

Now, instead of doing a clear evaluation and fixing that, we just took all the money out of training—billions of dollars out of training. The Canadian jobs strategy is gone. Arlene talks about the sector councils, and depending on the sector they've done incredible things. They're going. The government has pulled the bucks out of that and they're going.

CSTEC and that kind of round table should be held again. As I said to the chair, I'd like to put some stuff on paper. What the steel workers union and the steel industry together have done under the Canadian Steel Trade and Employment Conference—and Yvon would know about it—in terms of retraining, not retraining, or getting people out of the industry has just been amazing.

Some good stuff is out there too, so when we evaluate we have to look at the good stuff. I think we have to start there. Nobody is saying there's not profound change any more. Maybe we fought it for a while.

A voice: You fought it.

Ms. Nancy Riche: And we fought it in time. This book talks about the innovations—work the Canadian Labour Market Productivity Centre has done on best practices around and the kind of workplace change. How workers, their union and the workers—because where it was tried without involving the workers it was a disaster. The telephone company of Prince Edward Island is an example. It had to back up and say “Oh, hold on, we'd better include the folks this concerns”, and all of a sudden some things happened. There are some things out there happening in terms of innovation. That's one part.

The other part is the bigger profound change that's going on out there. It's almost too big for us to take on. It's a hell of a lot easier to fight about sovereignty. It's a hell of a lot easier to attack the right and the left and have foolish nonsense on the table. All these things are easier because this change that's occurring is far greater than the industrial revolution. We may have to decide at some point a whole lot of folks will never work again. What do we do about them? Is there a guaranteed income supplement? What is going on out there? That's what I'd like to see this committee get its hands around.

The labour movement would be more than happy to participate in that kind of thing, and hopefully non-confrontationally. We would disagree, but I'm the labour coach of the Canadian Labour Market Productivity Centre. We sit with the business community. We agree on more than any of you think we do. We had a joint position on unemployment insurance. The committee ignored us completely.

I don't think any part of the country thought labour and business would come together on positions on UI. There is some coming together. It's not done in big meetings; there's too much posturing there. They're going to do all-partisan stuff—it's going to happen there. But when people lay aside these things, all sorts of exciting things happen across the world.

Arlene continues to say to us “We can't measure everything by the United States.” God help us. Let's measure nothing in the workplace with the United States. The rate of poverty, the minimum wage, and what the hell's going on down there are unbelievable.

But this is a basis. There is loads of material out there that people have been working on.

I don't want to go on too long. I just want to say we have to get at it from there. Then you'll get back to devolution, who's responsible and who pays. But the first thing we have to decide is what.

The Chairman: Okay, I'm going to go to Libby and then to Jocelyne.

Ms. Libby Davies: First of all, I'm sorry I missed a lot of the discussion, but we had to go back into the House.

I just want to pick up on something Nancy said, and also Eugene and Arlene, around the whole training question and what's happened there.

Over the past few months I've been holding some round table discussions in my riding around youth unemployment that include youth participants. A lot of them are kids who are street-involved youth and are involved in different kinds of programs. Some of them are in school and some of them are going through various kinds of training programs.

The discussions I've had with them have been really interesting, because the thing that keeps coming out again and again is there's no continuity. Young people may get into one program for six weeks and then they're out of it. Then they may get enrolled in something in school, then they're out of it. Then they may be in some apprenticeship program, then they're out of it. The lack of continuity they raised is a significant issue and problem.

• 1925

Nancy was talking about community colleges 20 years ago, with manpower, and not having a sense of direction. It's still with us today. It was really disturbing to hear these young kids, because they had a sense of cynicism and hopelessness that they didn't have a future and couldn't see that there was some kind of job there. It was really just shocking to hear them talk about that. I really think it's just a very important issue that we have some kind of debate, not only about what work is but that there has to be some sense of a national standard.

I get very afraid thinking about how right across Canada we'll have a patchwork of this bit here and that bit there, and depending on where you live you may have some accessibility to training; you may have some good programs to go to and you may not. It seems to me it's a federal role to set those kinds of standards. I just want to throw that out as one part of this discussion we should get into.

The Chairman: Thank you, Libby.

Ms. Jocelyne Côté-O'Hara: Merci. I think as a committee somebody did a fine job for you because of some of the other people you have spoken of. If you read the piece under tab 4, it is quite an exceptional summary of the situation. It's a diagnosis that's very compelling. From that you can draw a lot of what could be the real work plan you should work toward.

Just to build on some of the other things, the knowledge worker of today is really yesterday's assembly line worker. In this committee, if I may suggest, you must dovetail with the rest of what this government is doing, quite apart from the constitutional issue, the devolution issues, and so on.

If I've heard right—I'm sitting in Toronto and I travel the country—you have a major platform, and while it may be a Liberal one, it is shared by others. And no one is disputing it. The connectiveness stuff is the whole question of knowledge workers and Canada being at the forefront of creating them.

Let's be clear here that we're in a crisis in that whole field. We do not have the workers. We have to import them from Asia. In the United States, the last figure I looked at this week was they're short two million workers. You can be darned sure the drain is happening. We just graduate them out of our universities and they leave. The American industry has come into this country and made sure it has special deals with our universities for the top people, and they're out of here.

I don't want to send a big dark cloud, but I think you need a strategy. If this committee doesn't address itself, saying “You over here, part of government, you're saying you want to connect everybody in this country. You over here say we're going to really be a smart delivery operation. The government itself is going to be a very rich information exchange. It will have a new role and be open to the public.” Then I think you need to have a labour strategy associated with that.

What are the elements of the tool kits you carry—the legislative changes, the promotion, the policy areas you think need to be debated? Just to follow, there has been no debate. There's been no Davos of the future of a knowledge person. They talk economics and it worries me that the human dimension Yvon spoke about has really not been dealt with.

There are big merger discussions going on now. If any of you look at past mergers and do an assessment of the successful large-scale mergers, the successful ones have had a very good strong view about the human dimension. You will see a huge transformation, because not only are mergers happening now in the financial institutions, where consolidation is really significant, but they will happen in all the communications fields. Expect the same thing in all the other utility fields. That will make a whole different change in work.

• 1930

Do you understand the knowledge worker? That's my question to you as a committee. As people who suggest legislation, have you understood what the needs of that...? Have you asked the questions?

I'm disturbed. I'm here because I have these connections to people here, but my colleagues, the people I know in my industry, did not come here. You must ask yourself, why were they not attracted to come here?

I'm sorry. I'm going to be bold here. I know that as a former lobbyist for the phone industry I would not miss an opportunity to sit down with you people, who are the legislators, who are the creators of the acts, of the legislation, of the framework that's going to affect my business. So you must ask yourselves, what would it take to attract the people in the partnership that she discussed here?

Anyway, I hope that's helpful. It's some of the ideas. I'd be happy to be a catalyst to some of that, or helpful, notwithstanding my changed role in life, which is always changing, just as yours is.

The Chairman: Although I'm interested, this conundrum with the knowledge workers, Nancy's comments about the welders in Newfoundland—when we did the SSR, it was hairdressers and... The list was endless, depending on the part of the country and who was available to teach it, but it had nothing to do with the need of anybody for anything.

I'm going to go to Yvon and then back to John.

[Translation]

Mr. Yvon Godin: I would have liked to get an answer to the first question.

I don't know whether you agree with me on this, but I sat on a national training committee in the mining sector, a committee made up of both employers and unions. We got together to develop training programs for people working in the mining sector. I was a member of that committee.

I was also a member of the a training committee dealing with the Pacific and Atlantic fisheries. That committee had people from Newfoundland, Nova Scotia, New Brunswick, Prince Edward Island, the Gaspé and Vancouver.

It was a really interesting experience. That's where I saw what the federal government's role is. The federal government can sit down with people from all the provinces and develop training programs, and then sit down with the provinces to try and improve what they have, depending on their specific needs. It would be a lot less expense.

Let me give you an example. You drive a forklift exactly the same way, whether you're in Vancouver or Newfoundland. So why develop a program to teach people to drive a forklift in Newfoundland, and another one in Vancouver, and yet another in Sudbury? It's just a waste of money.

Finally, employers and unions sat down together and said: “This is what we want to do and we want to do it in the regions.” I see some positive participation on the part of the federal government. We should be able to do that. As a federal government, we could get together with all the provinces to develop these kinds of programs.

And I can't help but agree with Jocelyne, when she says that we are behind in our programs. Let me give you an example.

There have been changes to employment insurance. People in my area who work in fish plants have trouble making their 420 hours. They receive employment insurance benefits for about 26 weeks. Then EI benefits stop in January, and only start again in May. But as I said, you can't get the fish out from under the ice. It's not like on Lake Ontario, with little lines and a hole this big to try and get the fish out. We have to take boats out on the water. In the Atlantic region, you have to go out and catch the fish.

The government knows that since changes were made to the EI program, we have been experiencing a problem in our area called the black hole. And it is a very black hole indeed. Quite a few people haven't had anything to eat throughout that whole period.

The federal government comes along at the last minute and says: “Yeah, yeah, we're going to help you. We're going to give you $5 million. Take care of these people.” When I talk to people at the colleges in my area, they said: “"Why didn't they tell us in advance they were going to be here next year? We could have prepared our teaching staff, our colleges and our training programs.

• 1935

In New Brunswick, as everybody knows, we are starting to see more and more call centres. We could take those people for that period of 8 to 12 weeks, and give them training so that they could go and find jobs in those industries. And that would attract other industries. We could say to them: “Come to New Brunswick. You are bilingual, you speak English and French, and there is good potential here for those kinds of jobs”. We could attract companies to our area and give people jobs.

But, as my colleague said, the money always comes at the last minute and also, there are no programs. The people come to the college, they're given a room and they sit down.

I have to tell you one story, although you may not even believe me. It's awful. You may laugh and say I'm a liar, but I can assure you that it's absolutely true.

In some of these courses, they are taking people and getting them to make airplanes. They're asking women who are 54 or 60 years old to do this, just because these people have to be able to live. They get them to make little airplanes and the person whose airplane flies the farthest gets a candy. Do you think a person who is 54 years old really wants to play those kinds of games? But if they don't, they won't have any money to live on.

I think the federal government is completely missing the boat. The government is going to have to get it through its head that the problem is that between January and May, people have to have something to live on and they need money. This is a great opportunity to put some programs in place that will create real jobs for these people. It's time to stop playing games at their expense.

I don't know whether you agree with my comments and I don't know whether this makes sense, but it is one option. And there's another one: the federal government could bring people together from all the provinces to develop programs so that it would cost the country and the provinces less money. There's no point in reinventing the wheel. Thank you.

[English]

The Chairman: Thank you.

I'm cognizant of the fact that we are growing near the time limit, given people's needs to catch planes, and other pressures.

Mr. Richards, I'm going to go to you right now, and I'll pick up on a final comment or two, and then we'll call it a night.

Prof. John Richards: Four points, very quickly.

Mr. Godin, I accept my ignorance with respect to many of the problems of Atlantic Canada. I trust the committee in details. It spends time at it. It's not tonight that I can add anything substantial.

Point number two: since Nancy and I agree on something, it's important not to let the occasion slip. Evaluating social programs has been something that is motherhood to this... I may be accused of traditional family values as I use the word. Motherhood is important and evaluating programs is important, and it is not something done easily. It simultaneously requires the skills of university research and the skills of a good communicator. You must involve community groups, academics, program evaluators, and officials. You must communicate this within an academic community and within a popular community. Doing it well requires a lot of thought about organizations that have done it successfully. This is another good subject for your committee to get its teeth into and think how it might be done better.

The third point: When I hear somebody start a speech with, “Patchwork; national standards are necessary”, I instinctively bristle, because I know what is going to come is some accusation that provincial governments manage these badly and we need in some way or another to shake them up.

A voice: We know your position on that.

Prof. John Richards: Let me just give you one optimistic example. You should think of the alternative, that competition among provinces often produces good social policy, precisely because there are not national standards and there is the capacity to experiment. Often national standards mean conformity, staying with standards that have been defined in a previous generation, and preventing innovation.

The final point, point number four, is to bring to the fore what is important, what is going on at this very moment: the interprovincial negotiations on a framework agreement for the social union. Like it or not, the federal government does not have the cash to play as aggressive a role in social policy as it did a generation ago. Like it or not—and I do like it—the provinces are going to take the initiative.

• 1940

On the other hand, if this is the case, most of the provinces are sufficient statesmen to realize that they must do it while giving Canadians confidence that this is not going to result in a patchwork Canada that is unliveable.

Given your interests, all of you, in good social policy, I think it would be highly appropriate that you state forthrightly in the next several months what should be some crucial elements with respect to, for example, portability of credentials and better interprovincial mobility.

If there are two phantoms in this process that have not engaged properly, one has been the Quebec government. This is because of its interests in sovereignty and not engaging itself in what is inherently a federalist exercise. The other has been Ottawa, because, to be blunt, Ottawa would kind of like to keep its hands free. If something turns up to be popular within the social domain, and it happens to be within the provincial jurisdiction, the feds would like to get in on it.

I think that is a kind of political opportunism. It is unfortunate that it hasn't been dispelled to this point. It has resulted in provincial governments of all stripes—left, right and centre, sovereignists in Quebec and elsewhere—having a certain misgiving that there is a cynical exercise to be played out in this Parliament, that with greater fiscal freedom there will be opportunistic federal interventions in social policy. These will potentially repeat the errors of the past generation and get us back into federal unilateralism with respect to spending and withdrawing the spending, which is not good for social policy.

Since this may well be my final intervention, Mr. Chairman, I do thank you all for having invited me. I hope I haven't entirely bored you, and I kept you awake. Once again, thank you very much. I shall very shortly have to depart if I'm going to catch a plane and report to corporate headquarters at the C.D. Howe Institute.

The Chairman: I think it's fair to say that you did not bore the committee. There may be other adjectives that certain people will want to use at different times, but boredom is not one.

John, you have one final comment, and I will—

Mr. Jean Dubé: I just have a quick comment on the evaluation of programs before you wrap up. Now, we saw the effect on Canadians of the reform to employment insurance. We must be careful before we make changes to programs, that they will not affect Canadians as it's affecting them today. We're evaluating the reform to EI right now, and we just saw the first report come out with no answers. In the meantime, these people are suffering big time. So before we make changes to existing programs, let's make sure they're okay for the Canadian society.

Ms. Nancy Riche: Could I just jump in on that evaluation. First, some of the programs weren't anywhere near the point where an evaluation could be done.

It has to be done for the next five years, if we're not locking up the change...we could change it between now and then. I've already talked to the deputy minister, and one of the things we will be advocating is that we'd be happy to participate.

I mean, the stakeholders, shareholders, whatever you want to call these folks, were not consulted, not talked to, not anything in that evaluation. We are doing a bit of our own right now in Atlantic Canada only. We will certainly be happy to share it with you.

I don't even want to say this, but people are pleased with some of it. But I think it's the pilot stuff that Yvon talked about, some of the short-week stuff, the pilot stuff that was done... We'll certainly be happy to share that with you. But we have to pull people into those evaluations that are going to go on for the next four years.

It was actually a pretty honest report.

The Chairman: Can I just add something. When you say you have material from the Atlantic provinces that you can share with us, are you at a point where you could do that soon?

Ms. Nancy Riche: No, they're not finished yet, but we have a meeting at the end of June. I'm expecting a report then, and I'll make sure it gets to you.

The Chairman: We've agreed to do another day specifically on the UI program and the UI report before the House rises in June. But we could pick it up again in the fall.

Ms. Nancy Riche: Well, if it's done before, I'll double-check. They've been actually going around, our staff, the CLC staff, meeting—

The Chairman: Could you check on that and let us know?

• 1945

Let me simply close then by thanking all of you. I appreciate the fact that you'd take the time to come here and spend some time with us. God knows where we're going to end up with this, but maybe He'll tell us some day.

An hon. member: This has been a good discussion. In the interests of being fair to people about where it's going to go... I mean, it would be awful just to leave this hanging.

So one thing I'd like to know as one member of the committee is what we intend to do now to make sure we don't lose the content we have, in terms of continuing a discussion as we go through our process. It would be very good if the committee could get back to the folks who've taken the time to come here today to let them know what we do as we progress further.

The Chairman: Absolutely. Extensive notes were taken. They will go back to the group of researchers from all the parties as we try to forge a document of which we can all feel some ownership.

That's the purpose. This process is to try to move forward in a consensual way on some of these issues. So it will go back to our group of researchers, and as that gets shaped to a point where all the members of this committee can feel comfortable with it, we'll circulate it to everybody else.

An hon. member: Is there going to be any kind of discussion?

The Chairman: The chair of the committee is entirely in the hands of the members of the committee. So at steering committee we will have that discussion, and I look forward to your guidance.

An hon. member: I thought you had your agenda already made up.

The Chairman: Are you accusing me of having an agenda?

Some hon. members: Oh, oh!

The Chairman: Actually, though, it raises one point, and I don't know if I made this as explicit as I should have. What we are trying to do, with great pain at times, is to take the five parties forward into the areas where we think we can indeed agree. As you heard, there is substantial agreement on some of the issues. So we'll see.

Thank you very much. We're done.