[Recorded by Electronic Apparatus]
Wednesday, May 3, 1995
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[English]
The Chair: I now call the meeting to order.
Before we start, I would like to thank members of the staff of Parliament who are involved in the translation because they're working under very adverse conditions, and I think the record should show it.
Somebody was smoking in their booth and it has created a very bad odour and stench. They have agreed to go on for the moment. The moment they feel they cannot support that condition any longer, I would expect to be notified and we will then cancel these hearings. In the meantime, we're very grateful to you for continuing to work under these very adverse conditions. We apologize to you.
Our first witness this afternoon is the National Union of Public and General Employees, Mr. Larry Brown, national secretary-treasurer; and Derek Fudge, national representative. Welcome, gentlemen. Sorry for the delay.
Mr. Larry Brown (National Secretary-Treasurer, National Union of Public and General Employees): Not at all. Thank you to the committee.
We apologize to the members for our linguistic limitations. Certainly for us, not having translation would have been a problem.
We do thank the members of the committee for this opportunity to be here and provide you with our views on Bill C-76.
We've been before this committee in other forums, so let me just talk for a couple of seconds about our national union. We represent over 310,000 working Canadians across the country. Our origin was as a provincial government employees' union, but we've broadened our scope beyond that. About 59% of our members now work directly for provincial governments, and 41% work in a wide variety of other sectors of the economy making candy and beer and working in hotels and banks. We represent people in a broad scope of operations.
About 85,000 of our members work directly under the aegis of what is now CAP, delivering social services in Canada, and 70,000 of our members are directly involved in the provision of health care at some level or other for provincial governments, or working in hospitals and other places. About 35,000 of our members work directly in delivering post-secondary education.
We put those credentials forward to show that we're not only speaking on behalf of a wide range of Canadians but also a huge number of Canadians who are directly affected by the proposed legislation.
We want to express two concerns to you before we get to the meat of the submission. We appreciate the fact that your committee is at least holding hearings. We don't want to come before you and be simply whining about it. However, there is a concern we have that I'm sure you've heard before, which is the compartmentalization you were requiring that I think was based on your need for speedy deliberations.
It does make it a little awkward for an organization like ours that represents public sector workers and could very clearly speak about cut-backs in the federal public sector to have to choose one or the other of the topics. In fact, we represent a huge number of members in western Canada so that the impact on agriculture and the Crow rate would have been something that we would have liked to have paid some passing attention to as well.
The Chair: Please feel free to comment on any aspects of the budget.
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Mr. Brown: Thank you
It's difficult to criticize those people who are holding public hearings for the fact that the amount of time you've been given by the government is so limited. However, there is a concern right across the country about the huge impact of Bill C-76, and the speed with which you are being asked to conduct your deliberations will make it very difficult.
In fact, if you think about Canada's history and look at the impact of the changes that have been proposed as a result of this budget and at the number of royal commissions, huge reports, and research studies that have been done by Newton Rowell, Leonard Marsh, Emmett Hall, Erik Neilsen, and Keith Spicer, and at the work those folks did to build the systems that are now being changed markedly by one stroke of a budget pen and in a very short period of time for hearings by a committee, it strikes us that there's an imbalance there. It strikes us that the amount and significance of the changes in the way the Canadian system works and the amount of work that has been done leading up to our present system are not in balance with the rush to dismantle some of those and the rush to change the way the system works.
We would be much happier with a process that involved much broader consultation with Canadians, not hugely unlike the consultation process that went into the last federal budget. We had some difficulties even with that process, but at least it involved consultation before the fact instead of a very limited time frame after the proposal had already been made to kind of telescope all of the concerns and thoughts into one short submission.
At the risk of being argumentative, we would note that there were two huge consultations with the Canadian people in the last few years, neither of which endorsed the kind of direction that's expressed in Bill C-76. One was the last federal election, which is the most profound form of consultation in a democracy. In that election there was no platform by any political party that resembled what Bill C-76 now is. When the Canadian people were asked to express themselves on the future of their country, they didn't choose this direction.
The other thing that involved a very extensive form of consultation was the Charlottetown accord. In that, the people of Canada did get a chance to vote on massive decentralization and a massive change from a federal system to a much more provincial one. Our recollection of what happened with the Charlottetown accord is that the direction proposed by the powers that be was turned down by the Canadian public, yet what we have in this bill is the same essential direction. Instead of being done by way of constitutional language and a constitutional referendum, it's being done by financial language and financial management. We see it as being very much the same sort of direction that the Canadian people rejected when they had a chance to vote on the Charlottetown accord.
Specifically with regard to the legislation, we have circulated by way of the staff a document we produced called ``Divided We Fall'', which perhaps gives some hint of the feelings we have about Bill C-76. That title was certainly intended to do that.
We think that what's going to result is much more fragmented and disparate provincial social programs, including the area of health care. We're very concerned about that direction. We think that on top of that there's going to be insufficient federal funding to allow those programs to work correctly. The amount of money being taken out of the federal-provincial transfers by this bill, which amounts to $7 billion, an amount of money that most people can't fully grasp, is really quite amazing when you add that on top of cut-back after cut-back during the nine years the federal Tories were in office.
We think back to the number of times the opposition parties at that point criticized the federal Tories for the direction in which they were going in terms of cutting back on the ability of provincial governments to deliver those services. On top of all those cuts, which were roundly criticized in their day, we now have another $7 billion in cuts that the provincial governments have to absorb.
Our members work for those provincial governments, and we can tell you as a matter of absolute fact that the ability of those provincial governments to continue to deliver those programs will be jeopardized. We don't think that is a matter of legitimate debate. We don't see how anybody can argue that point. The question is how much it will be jeopardized. Whether or not it will be jeopardized is not really at issue.
The difficulty we will face, of course, is that some governments will exercise that limited choice rather more vigorously than others. There will a huge impact at the provincial level in the ability of governments to deliver what Canadians have come to take for granted as social services.
We would be very concerned about the major question of enforceability of what national standards will result from the new bill. We note that in the legislation there is specific flagging of the importance of provincial flexibility and innovation and then some recapturing of the possibility of national standards. However, that recapturing of national standards is much weaker than the commitment to provincial flexibility.
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We have two different areas, it seems to us. One is in the medicare field where the legislation captures the seven points. When it comes to medicare, though, we would argue that the enforceability of the national standards is absolutely at risk. While we were preparing this, we did a fair amount of research to prove it to ourselves.
This morning when I was reading my Globe and Mail before I headed off to the office, I found Keith Banting, the director of policy studies at Queen's University, basically saying that the federal government is in fact quietly repealing the medicare act by bits and pieces. That's exactly the analysis we share.
The federal government claims in the legislation that it will still be able to enforce medicare across the country. We would argue that if you examine rigorously the actual claim of enforceability, it really doesn't stand up because, first of all, there is one global amount of money for health, education, and welfare. If a provincial government does not live up to the national medicare standards under the Canada Health Act, that global amount of money theoretically can be cut. This means that the provinces can cut the amount they give to education and in some provinces they can cut the amount they give to welfare, which is a much more politically popular thing to do sometimes, and absorb those cuts without having any impact on the medicare system at all.
Second, we've already seen, those of us who aren't charged with the direct responsibility of enforcing medicare, that the political will to enforce medicare even under the current system is not always easy to muster. We've seen the current Minister of Health threaten for, I think, almost two years to do something about Alberta. If it was very easy to do under the current system, it seems to us from the outside looking in that it would have been done by now. After two years the threat that action is imminent tends to wear off.
If the current system is very difficult to enforce, the new system is going to be that much more difficult because the federal government will be looking at a marginal problem with medicare and asking whether it should cut the amount of money that provinces can then turn around and say is going to be coming off the welfare cheques and out of the universities and run that sort of political gamut. Our suggestion is that on paper it may be enforceable; in practice it very rarely will be.
Finally, of course, the problem is that amount of money is going down on a graduated basis anyway and at some point there is going to be no tool with which to enforce the medicare standards. That is an argument we've never heard a satisfactory reply to, quite frankly.
The one hammer the federal government does have to say that medicare will be enforced is cash. We've gone back and read the Constitution. The provincial rights include health care. The only enforceability the federal government has is cash, and when that's gone we want to know how it can be enforced. We've never heard an answer to that.
So it seems to us right off the bat that it's going to be less enforceable in practice. In practice, the provinces are going to hide behind education and welfare. They're going to say that a cut to their provincial treasury is going to come out of a welfare cheque or education. At the end of the day we just don't see how anybody can claim that it's still enforceable when there's no more cash with which to wield the hammer.
On social programs it's much clearer to us that there is no real intention to have new national standards. We had come to that conclusion before we saw Mr. Martin commenting yesterday in the House that he was going to amend the bill to make that even clearer. However, it didn't need to be amended particularly from our point of view because we read it as saying there is one standard for everything other than medicare, and that's residency. There's one standard, period, and the possibility of other standards when there is unanimity among 11 jurisdictions, unanimity between Quebec and P.E.I. and between Alberta and B.C. I'm getting old enough that I don't expect to live to see the day when the federal government and the 10 provinces come to unanimity on that point.
Without unanimity on new standards, under Bill C-76 there can be no new standards. The bill says: ``With the mutual agreement of the provinces''. The legal interpretation of that is unanimity.
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I'm sorry, but it seems to us that the possibility of the governments we have - ten provincial and one federal - agreeing on anything of any substance on a new national standard in our lifetime is a tad slim.
The Chair: We already have the agreement of Quebec. We just have to get the others on-side.
Mr. Brown: There you go. Ten more to go.
I suspect that there will be some point at which the Governments of Alberta and B.C. will change, but those are interesting examples right now. Right now, as it currently stands, you'd have to have the Government of B.C. and the Government of Alberta agreeing on a substantial new national standard before it could be invoked. That would be an interesting day to wait for.
We are concerned about the fact that provincial governments will turn around and download their problems. It's interesting to us that what is translated to the Canadian people as a solution to the debt problem is in fact the passing of a hot potato. The federal government doesn't solve the problem; it passes it to the provinces. The provinces don't solve it; they pass it to the municipalities or the universities. The universities then download it on user fees, privatizations and so on.
We are concerned about the fact that the CHST is going to take an automatic stabilizer out of the economy, that the reinflating effect that CAP had on the economy will be taken out. Then we hit the next downturn, which some of our business writers suggest we're virtually into already. When that hits, instead of the federal government money going into the provinces, which goes into the economy to help keep it afloat, we're going to see that money go down automatically, whatever is happening in the economy. This repeats a mistake we last made in the 1930s, as far as we can tell, when in response to a deflation of the economy we deflated it further. We're very concerned about what's going to happen with that.
Finally, we come back to the fact that this really does reflect the kind of decentralized federation that we think people rejected earlier when they had a chance to vote on it directly. We're not sure why it is more acceptable to be done through a very complicated financial formula than it was when it was very straightforward in the Constitution.
We would respectfully ask that this committee take back to the federal government, from us at least, from our Canadians, who we represent and have consulted with across the country, the message that this is not an acceptable way for us to go. We would challenge the federal government and the Minister of Finance that if they're so sure this is right, if they're so sure they're on the right path, then go out and talk to people first. Give themselves the flexibility before they say, this is what we're going to do; what do you think about it; you have three weeks. We don't think this kind of huge, incredible change in the way this country works should be done by springing surprises in a budget, with a very short response time because they're going to go ahead anyway. That just doesn't strike us as satisfactory.
We thank you for listening.
The Chair: Mr. Brown, as always, you are cogent and challenging.
[Translation]
Mr. Loubier, do you agree about the lack of national standards?
Mr. Loubier (Saint-Hyacinthe-Bagot): No, I would agree about the Liberals' lack of standards. But, not about...
Messrs. Brown and Fudge, welcome to the Finance Committee. First I have a small comment to make. Contrary to what you said, we are convinced that there will be national standards. You may recall the recent statements by the Minister of Human Resources Development to the effect that if there was no consensus among the provinces on the implementation of new standards, the future would remain unclear. We did not know what would happen. He himself did not know what would happen.
Just yesterday, when the Minister of Finance tabled, in an unusual manner, some changes he might be making to Bill C-76, in terms of what he introduced as an amendment, it's rubbish. It's phoney. They talk about mutual consent. But how do you define mutual consent? How do you reconcile the fact that the Minister of Finance and the Prime Minister say that there will not be a forced agreement and the fact that Lloyd Axworthy recently said that the future would remain unclear if there were no agreement? So we feel that there will be agreement. And if that were the case, it would be an imposed agreement, national standards imposed in the health sectors and new standards for the other social programs.
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If that were the case, don't you think that we can expect a real confrontation between the federal government, with its centralizing aims, and the provinces, especially Quebec, since it involves imposing national standards in the education sector?
You have attended all the major debates, on Meech Lake and Charlottetown. I think you understand the meaning of my question.
[English]
Mr. Brown: We have a problem I think in defining our objectives here. I should be clear about that. Our union believes, with a number of other organizations, that national standards are in fact key in the areas of health, social policy, and education. We believe this is one country, and to have entirely different educational standards or entirely different social service standards in B.C. as opposed to Newfoundland is unacceptable.
We will have all kinds of things that result from that. We will have, for example, the regionalization of education, where people from another province won't be able to move to get education in a different province from their own. Medicare will be parcelled out on the basis of where you live and you won't be able to move to another province for operations or whatever.
All of those things will take place if we don't have national standards because the people who live in provinces will be saying to their elected governments that those are our tax dollars, not B.C.'s or Alberta's; that's our province and we want to have those tax dollars look after our people. We believe very strongly that when you're in one country you should accept and expect a level of education, health care, and social services that is equal across the country.
This may be a slightly controversial position these days. Our position for three or four years has been that when it comes to Quebec there are sufficient differences in that province. When it comes to Quebec in all of those areas there should be a separate negotiation with the Province of Quebec.
We're saying that as far as we can tell, when the people of Canada rejected the Charlottetown accord they were saying, much like we did, that there should be strong national standards in all these areas. Our position is that has to be treated differently in the province of Quebec. There is a different culture, history and tradition, a different people. From our point of view the requirement for strong national standards meets the Quebec border and is then translated differently, and it's with the approval and permission of the people of Quebec.
[Translation]
Mr. Loubier: You will agree that the content of Bill C-76, at the present time and until further notice, apart form the phoney amendments introduced yesterday by the Minister of Finance, is not what you are proposing. Provinces that didn't meet the national standards imposed could be blackmailed, since the bill does not in any way require the consent of the provinces on the application of new standards. They would be threatened and would be blackmailed every time they decided, especially Quebec, not to apply these national standards.
In education, for example, I will say that I do not share your point of view, even though I respect it, namely the idea that we are a big country and that only one policy ought to apply in the area of education, an area that is one of the pillars of the particular cultural traits of Quebec.
That is why I say that we can expect a terrible confrontation. Quebec would have a very hard time accepting that national standards be imposed in education, in other words, that 75% of Canada's population should decide substantially what education would be provided in Quebec, where education would lead us and what the objectives and standards of education would be.
That would be unacceptable and you know it. We have been meeting for some twelve years on the constitutional debate. Right at the very outset, it would be an extraordinary takeover by force in comparison to the kind of debate we have known in the past.
So I ask you: the bill we have here, not the intentions expressed at every turn, irrespective even of your personal convictions, but the bill as it reads, does it not pave the way for a confrontation by allowing blackmail regarding the payments from the federal government that are already shrinking away, year after year, in the fields of health, post-secondary education and social assistance?
[English]
Mr. Brown: As we read it, sir, the bill is abundantly clear on two things. The bill is abundantly clear on the specific national standards that will apply with respect to medicare. We argue that the enforceability of that is suspect. We don't think there is enforceability built into the bill, but at least the standards are clear.
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We would also argue, though, that with respect to everything else, post-secondary education and social services, there is only one standard that will be imposed, that is residency, and that the chances of anything else other than residency being unanimously agreed to by the provinces is very slim.
We argue that for health there are national standards in the new bill, that for education and social services there aren't and there are very unlikely to be. What we think is obviously conceivable, because in a parliamentary democracy it's always a possibility, is that there will be new legislation after the failure to agree, which will in its turn impose new standards. But short of that this current bill does not have them at all.
The Chair: What are the national standards that now apply in terms of post-secondary education and welfare transfers, except for residents for welfare transfers?
Mr. Brown: With respect to post-secondary education, there are very few. In fact none is probably a better choice of phrase than very few. Our members who work in the education field would argue that there should be more than there are.
The Chair: You're arguing for standards far beyond what we have now. I understand.
Mr. Brown: But, sir, with respect to CAP, I would just add that there are a number of standards.
The Chair: Residents in need.
Mr. Brown: We can provide you with a list. It's slightly more complicated than that under CAP.
The Chair: But do we have any power to force a province to pay welfare to anyone?
Mr. Brown: Not phrased quite that way, but there are a number of standards.
The Chair: But if they don't, if a province chooses not to pay welfare, we have no power to force them. All we do is match what the province contributes for the welfare payments.
Mr. Brown: We've listed the provisions on page 2 of ``Divided We Fall'', and there are a number of them. If the province doesn't meet those conditions then the 50-50 cost sharing from the federal government, or in Alberta, B.C. and Ontario's case the less than 50-50 cost sharing, doesn't have to be forthcoming. So there are a number of standards under CAP.
Mr. Grubel (Capilano - Howe Sound): Mr. Brown, you asserted that in the last election no party was running on the platform that they would make these cuts. I would like to correct you. The primary platform of the Reform Party was that in order to save these programs that you now see under attack, we would have to have a reduction, which we were planning and deliberately doing in the way it is being done now, not adequately.
However, I share your judgment that the Liberal Party is a great disappointment to the people of Canada, and it should be. They made all kinds of promises they did not keep. The question that constantly comes to my mind is whether it was done because they knew these cuts had to be made but kept it from the people, or whether they were simply incompetent and didn't know, when the Reform Party did know. I would suggest that probably the first was more likely.
I was going to ask you the same question Mr. Peterson suggested. You started off, and I listened very carefully, by saying that unless we have education standards there won't be a country. Well, sir, there are no education standards. The provinces would be up in arms if we tried to impose education standards, and I think they're right. This shows how false the myth is that unless we had national standards we wouldn't have a country. Why wouldn't we have a country?
Let me ask you a question. Do you believe that an individual is best able to judge how to spend his or her money? Yes or no.
The Chair: My wife is much better at it than I am.
Mr. Brown: When you've finished your question there are a couple of other things you posited that I'd like to respond to.
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Mr. Grubel: Let me just follow this up. I won't take too much time.
Most people wouldn't have any hesitation to say it's none of the government's business how people spend their money, within certain limits with respect to when they affect others badly.
Mr. Brown: That's an interesting logical trap to answer that yes or no. There are all kinds of conditions, such as taxes for one thing.
Mr. Grubel: No. If I spend my money on a vehicle that is unsafe and dangerous to others then that should be restricted. In that sense, we believe in those kinds of laws. Otherwise, I think it is almost a universally accepted proposition.
Therefore, I want to ask you, if 10 people get together and decide to collect money from each other to buy a good that they all will share, isn't that also an improvement in their welfare from when it was only one?
What is wrong with small communities, with provinces, deciding what health standards they want? If they don't want these health standards that are imposed by their government, they have a chance to re-elect another government. What is there about you or the federal government that the local people who pay for and demand these services can't do themselves?
Mr. Brown: Let me make a tangential point about your first argument, which is that the Liberals either knew what the answer was and didn't tell people or didn't know and should have. There is a third choice, which is that these cuts are not now and never have been necessary and they're a matter of political choice and not economic absolutism. As a matter of logic, you need to add that to your set of options as well.
Mr. Grubel: No, the question is why they are now breaking the promises they made.
Mr. Brown: Yes, but you didn't leave the possibility that they've become mistaken since and that none of this is in fact required at all.
The somewhat more philosophical question you asked at the end is intriguing, but it seems to me, sir, with respect, that it ignores the practical reality.
If you live in Corner Brook, Newfoundland, and you don't have adequate compensation from any place else in Canada that allows you to make the same choice as if you live in a relatively prosperous part of the country like Markham, Ontario, then to argue that somehow it's pure freedom of choice and that national standards aren't relevant becomes an argument in the abstract. Obviously, Corner Brook, Newfoundland, can't afford the same kind of health care Markham, Ontario, can.
The whole point of national money and national standards is to equalize and bring them up to a standard that is acceptable across the country. A Canadian in Ontario and a Canadian in Corner Brook, Newfoundland, may not have exactly the same kind of health care. That would be a bit hard to achieve. BUt they would have equivalent health care. That's what we see being thrown aside by this legislation. We think that's very difficult.
Of course, we can have a country; the question is what kind of country it would be and whether it's the kind of country Canadians want to choose for themselves. That's where the argument lies.
Mr. Grubel: Essentially my argument would be a freer country. People could do with the fruits of their labour what they want to do, not what somebody else tells them. That is a very fundamental property of the good life for a large number of Canadians.
Mr. Brown: Both rich and poor would have the freedom to go hungry and sleep under bridges, sir.
Mrs. Brushett (Cumberland - Colchester): Both yourself and the hon. member from the Reform Party have pre-empted me here. I would make a point that you talk about the Liberal government not keeping its promise. I would like to remind you the fundamental promise that was made was that we would deal with deficit reduction in this country. We have kept the promise in attempting to deal with that.
You brought up the point as well that the standards will be missing in this new Bill C-76. I beg to differ. There were in fact no standards in the first place in terms of social welfare or education. We have the Canada Health Act, the five principles under which it has been originally derived and added to. Those will persist. The only other clause is the residency clause in social assistance.
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I would suggest that many Canadians, at least in my experience of doing town hall meetings and rural community meetings, have suggested it would be almost impossible and certainly hardly acceptable to attempt a national standard in education when we're that removed from the people who need it. I guess I'd like to ask for your thoughts on that.
Mr. Brown: Rather than pursue the argument about broken promises, we've done some analysis of the red book which perhaps we'll just send over. We can perhaps agree to disagree on that.
With respect to national standards, when the federal government was criticized by the United Nations not very long ago for the fact that there was a tremendous amount of poverty in such a rich country as Canada, one of the replies of the federal government was that there was legislation that imposed certain standards on the provinces with respect to welfare. That legislation was CAP.
With respect, we can't have it both ways. If the federal government is going to use that in international fora as a defence, then it can't also be the absence of a standard. When the UN was criticizing Canada, CAP was sufficient to be a defence and Canada said we've legislated the need for standards right across the country; no province can deliver less than this, so how dare you criticize us for having too much poverty.
As soon as this bill comes into effect, CAP is gone. So is that answer. Therefore it seems to us, with respect, that not only does CAP itself say there are standards that have to be met by the provinces, but so did the federal government when it was defending itself in the international fora.
Mrs. Brushett: In reply to that, I guess in the province of Nova Scotia - and I have been experienced in municipal government there as well - it has been a combination of municipal and provincial responsibility and the federal transfer payments under CAP. But again, there is no standard. People would argue, and I have argued in the past myself, that the federal government really cannot impose a standard when the provinces and the municipalities in fact are left to endorse a situation and the policies.
Mr. Derek Fudge (Research Director, National Union of Public and General Employees): Another thing about CAP is that it offers incentive for a government or a municipality to provide a service for them. A small municipal government in Nova Scotia could set up a transition home, knowing they will get money - 50-cent dollars - for that transition home.
Our prediction is that what's going to happen now in a province like Nova Scotia or Newfoundland, where they're experiencing rougher economic times than central Canada, is that they will say they can no longer afford to have transition homes. It's a luxury they can't afford. They might be able to afford to have that in downtown Toronto or in Markham, but they can't have it there, the quality of care and the standards that exist in Digby, Nova Scotia, for example. Those services that are available in downtown Toronto will not be there in Digby, because in an economic downturn governments can no longer afford to provide those types of services.
They know they must provide health care. They must meet the universal standard. The first bit of money from that block funding will go to health care, and health care costs are rising. There will be no money left for community-based services. There will be no incentive there for provinces and municipal governments to create those services.
Thus, we would argue that across Canada you are going to have a patchwork of social service systems that vary tremendously from community to community. That is unfair and, we would argue, un-Canadian. If I cannot be guaranteed the same level of service in one community that I can get in another community, it's going to create more tension and confrontation among people.
The Chair: Thank you, Mrs. Brushett.
Mr. Fudge and Mr. Brown, you have crystallized in a very articulate and forceful manner the debate on the question of transfers to the provinces. Obviously all of us around the table are not necessarily in agreement on this issue. But I thank you again for a very cogent presentation.
Mr. Brown: Thank you for your time.
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The Chair: Our next witnesses are from the Health Action Lobby, which I believe is a permanently incorporated, non-profit corporation under the Canada Corporations Act. We haveDr. Pierre Ritchie, executive director, Canadian Register of Health Service Providers in Psychology; Dr. Leo-Paul Landry, secretary general, Association des médecins du Canada; and Sharon Sholzbert-Gray, executive director, Canadian Long-Term Care Association.
I think the only thing of interest to us will be where Sharon Gray disagrees with her husband.
Dr. Pierre Ritchie (Executive Director, Canadian Register of Health Service Providers in Psychology): Mr. Chairman, we would prefer to think that he will have the wisdom to agree with his wife.
The Chair: Dr. Ritchie, we look forward to your presentation. Thank you for being with us. I'm sorry I missed a couple of people.
[Translation]
Dr. Pierre Ritchie (member, Health Action Lobby; member, Canadian Psychological Association): Mr. Chairman, I will introduce them. First, on behalf of the Health Action Lobby or HEAL, thank you for having allowed us to appear before you this afternoon.
I think you have already introduced Ms Miskell, of the Consumers Association of Canada,Ms Sholzberg-Gray, of the Canadian Long-Term Care Association, and Dr. Léo-Paul Landry, of the Canadian Medical Association. I wish also to introduce to you Mr. Bill Tholl, an econnomist and tax advisor for our group. Also present are representatives of some of the 27 associations affiliated to HEAL. I am Dr. Pierre Ritchie and I represent here today the Canadian Psychological Association.
The Health Action Lobby, or HEAL, is a coalition of national organizations in the area of health and consumer advocacy that is dedicated to the protection and enhancement of the Candadian health care system. It represents over half a million providers and users of health care services.
The Chair: In what year was your group created?
Mr. Ritchie: In 1991. About four years ago.
The Chair: Thank you.
Dr. Ritchie: The Lobby was founded shortly after the 1991 federal budget, which gave the group its raison d'être at that time.
[English]
A few short months ago, in November, HEAL had an opportunity to present a brief to this committee. Our central issue then, and indeed since the inception of HEAL in 1991, was the need to secure a stable and significant long-term federal financial commitment to Canada's medicare programs.
While the bells for a vote on that particular afternoon caused most members to absent themselves from our presentation, we hope most members did have an opportunity to review our written brief. We're glad to come back today without the bells ringing to speak with the committee.
A number of things have transpired since November, most notably of course the federal budget of February 27. Within that budget, our specific focus is the proposed Canada health and social transfer or the CHST. Again, we've prepared a written statement on our views, and indeed, our heightened concerns about future federal health funding and the integrity of national health programs.
What I'll do in these verbal remarks is summarize the main points of our brief in the order in which they were written. We would hope many of you at least might have the interest to read the full brief itself.
Our objective this afternoon is to highlight our concerns and the strategies we would recommend to the committee to address these broadly shared concerns. We also look forward to answering any questions members of the committee may have about our brief and our presentation. Hopefully we have the technical expertise present in the delegation to address any specific points you may wish to raise.
We begin with the following basic premise: medicare now stands as the single most important social and political source of national identity and is a key element of Canada's international competitiveness as a trading nation. The corollary is that the federal government has a special duty to do everything it can to preserve and protect the national integrity of medicare.
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Before they were elected the Liberals stated that their government would have as its priority the preservation and the protection of our universal medicare system and preserving the values underlying it.
The announcement of the Canada health and social transfer in the February 27 budget tabled by Mr. Martin reinforced our group's conviction that the federal government was intending to undertake a significant review of its role in the Canadian health system. We believe the federal government must be financially present in the health system in order to be able to ensure the integrity and the continuous development of this system.
The important reforms undertaken to the provincial and territorial systems are in the process of transforming medicare, reforms that began in 1985 and 1986. It is essential for the federal government to provide sufficient funding to the provinces and territories for them to apply these changes in a rational and coordinated way. If not, the federal government will lose its credibility with respect to the enforceability of national standards.
HEAL considers that any new health financing arrangement must at a minimum address the following specific issues and concerns.
Number one is ensuring fair and stable funding for health. The CHST continues the federal withdrawal of federal funding support for health to the provinces and territories, notwithstanding the equalization program. The poorer provinces will continue to struggle or simply forgo attempts to make up the funding shortfall, and this will lead to further inequities in health services across the country. The CHST, as presently constructed, will only exacerbate the situation. The impact of these reductions will be felt most profoundly on all health care consumers and health care professionals.
Second is the need to safeguard national standards. The government says that it will be able to maintain national standards in health, but this has to go beyond what provincial ministers have called the rhetorical embracing of national principles. With substantially fewer dollars flowing to health insurance plans in the future under CHST, the federal government will have diminished its credibility and clout as it attempts to enforce the principles. Unless the federal government makes a firm, long-term cash commitment to health, the CHST will undermine the federal government's legitimacy in its attempt to maintain national principles.
It is important to note in this context that the government did not need to create the CHST as a means of safeguarding national principles, since it already had a mechanism to withhold funds for violations of the Canada Health Act under Bill C-20. The CHST appears to be fundamentally about deficit reduction. The federal government, if it intends to proceed in this manner, needs to make its intentions clear to Canadians.
Third, we believe that parliamentary accountability needs to be maintained. We believe the proposed CHST suffers from a major weakness with respect to parliamentary accountability and responsibility. Federal taxpayers send dollars to Ottawa with certain expectations regarding how they are to be used. The lump sum transfer, by definition, is non-transparent to federal taxpayers. It does not indicate the federal government's commitment to health in the context of the government's recent program review exercised by Mr. Massé.
[Translation]
Fourth, the Lobby has already indicated that the Canadian health care system should be examined in a long-term perspective.
We have also affirmed the need for a stable, multi-year planning framework. We have given our support to the National Health Forum, called by the Prime Minister.
Unfortunately, the proposed mechanism runs counter to the efforts, undertaken when the Forum began, to design the Canadian health care system in a new way and to define priorities for the future.
It is true that the government gave the provinces a year's advance warning of the planned changes, but there is still great undertainty regarding the funding to be provided in 1997-1998 and beyond.
It will therefore be very difficult for the provinces and territories to prepare and to implement their reform in a rational and effective way.
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Fifth, the Lobby is convinced that federal-provincial negotiations on the future of funding of Canada's social programs should not take place behind closed doors. They should be conducted with all the stakeholders, not only with the federal and provincial ministers of Finance. Canadians have clearly indicated, in recent years, that they would no longer allow a small group of negotiators to take major decisions on the development of their country.
However, the Lobby was pleased to learn that the Standing Committee on Finance had recommended to the Minister of Finance that transfer payments to the provinces for health care not be reduced.
[English]
Turning to our expectations in connection with Bill C-76, we would now urge you to show the same leadership in recommending to the Minister of Finance, in the strongest possible terms, that the following elements be incorporated into any new health system transfer arrangements to ensure a strong ongoing federal presence in health in the future.
One, taxpayers are entitled to know how their money is spent. Without notional allocation of cash for health in the transfer, the Minister of Health cannot be held accountable to Parliament for the way health dollars are spent. HEAL believes it is important that health be treated separately under the CHST.
Two, the debate over the future of medicare will gain considerable momentum over the next 12 months. The federal government's credibility will be on the line without the long-term commitment to cash necessary to lead that debate. The government must declare its commitment to providing the provinces and territories with a significant and sustained cash transfer. The government cannot wait on this matter until the spring of 1997.
Three, HEAL has consistently advocated for a stable planning and funding environment for provincial and territorial health care systems. We strongly believe that a five-year agreement should be established with the provinces and territories, and one that cannot be unilaterally altered.
Finally, over the next several months there will be the need for consultations in several important areas. These areas include the determination of a new funding formula for health and social transfers. HEAL believes that these processes should not be undertaken in isolation one from another and without input from major non-governmental stakeholders. For example, there are a number of important health services presently funded under CAP, such as home support and residential care, that need to be considered as they have an impact on health service delivery and finance.
[Translation]
To sum up, the 1995-1996 Budget and the accompanying Budget Implementation Act represent the beginning of a major change regarding funding of health care in Canada by the federal government. If the federal government does nothing to preserve its role, its contribution to social programs and health care programs will be considerably reduced in the coming years. Its credibility will be seriously compromised if it decides to join in the increasingly animated debate on medicare without first undertaking to provide significant and sustained financial support to the health care system for the future.
While the federal government is firmly committed to keeping its budgetary and fiscal promises, it must act in the same way in preserving and protecting the integrity of our national health care system.
The Minister of Finance has indicated his willingness to study all new ideas for restructuring or rationalizing transfers in order to achieve both the short-term budgetary objectives and, in the long-term, objectives relating to federal government programs in the area of health. The Lobby does have a few new ideas to propose in support of its position, which is that it is imperative to establish, for health as such, a minimum cash contribution that is both secure and lasting. We plan to work together with government and other stakeholders to achieve this.
[English]
Mr. Chairman, this concludes our presentation. We would very much welcome any questions or comments the committee members may have.
The Chair: Thank you very much, Dr. Ritchie.
[Translation]
Mr. Loubier: I have two questions. You seem, throughout your brief, which I have had a chance to read while listening to you... you can do two things at once: walk and chew gum. If I recall correctly, that's what Lyndon Johnson in the United States said... I found it very interesting.
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One thing is clear: Do you care about good relations between the federal government and the provinces? How is it that you supported a national forum on health, when the provinces, the primary stakeholders in terms of distribution of powers, could not be persuaded by the federal government to support this national forum and its objectives? That is my first question.
Dr. Ritchie: First of all, I think it was an election promise by the Liberal Party to call a national forum on health. In that sense, we respect the fact that it is the prerogative of the current government to call this forum, since by doing so it can keep its election promise.
Mr. Loubier: Dr. Ritchie, you agree that, since then, tensions between the provinces and the federal government, with regard to health care management and the new discussions that may arise concerning an allocation of cash or tax points, have worsened?
Dr. Ritchie: I do not know what the question is referring to.
Mr. Loubier: If you are so concerned about stability, good relations and the proper operation of the health care system in Canada, why did you agree to participate in a national forum, when the provinces, which are the primary stakeholders in terms of management and sound management of the sustainability, of the stability of health care, refused to participate because the objectives presented there and the method of operation were not appropriate for them? Finally, the national forum ended in failure and it will not help relations between the federal government and the provincial governments to further the objectives you are pursuing with regard to the health care system.
Dr. Ritchie: My colleague would like to answer.
Dr. Léo-Paul Landry (General Secretary, Canadian Medical Association): First of all, Mr. Chairman, we recognize the very difficult economic situation we have all been experiencing for a number of years now.
Second, we also recognize the importance of the health care system and of the issue of health for all Canadians, for coast to coast, according to all the polls that have been done, regardless of political persuasions. The importance of the health care system for Canadians is a constant that is always evident. When the federal government tells us that it recognizes this importance, so much so that it is committed to taking a cold, objective look, with experts, in consultation with the public, at the very foundation of our health care system, and when Canadians from one end of the country to the other have told us that it is absolutely essential for them to keep their health care system, I feel that the least that can be done, is, to begin with, to support it, to take part in it and to do one's very best to review this question so as to respect the will of citizens from coast to coast. This is the perspective in which we undertook to support this idea of a forum on health. What happened afterward, the way things turned out, is something you, more than we, should answer for.
Mr. Loubier: It doesn't worry you that the primary stakeholder in management of health care was absent and criticized, from one end of the country to the other, the forum, its objectives and the way the federal government went about squeezing it out of the picture?
Mr. Landry: Who is the primary stakeholder?
Mr. Loubier: The provinces. They are the ones who look after management of the health care system.
Mr. Landry: I was wondering whether you meant the patient or the provinces. As I said, the question is the same; we do not intend to go into it. You are concerned with the dynamics. All we are saying is that the importance of the health care system for all Canadians from coast to coast is reflected in all the surveys that have been done.
Second, we have undertaken to preserve the health care system and to respond to the will, to the expectations of the public.
Dr. Ritchie: The only thing I might add to the answer is that we recognize - and this has been the case for decades - that we are once again discussing our constitutional regime. At the present time, we have a constitutional regime.
The government has the power to spend and, within this power, we have decided to advocate as best we can for a better system for all citizens of Canada as it is now constituted. Even if there were a constitutional change based on the assumption that there will always be an economic link across the jurisdictions that now exist, it is important for the economic viability of all regions of the country to maintain the integrity of the health care system.
Mr. Loubier: Dr. Ritchie, that was not what I meant by my question. Quebec was not the only province that refused to take part in the national furum. The governments of the provinces refused.
I will go right on to my second question, because I would like to have a clarification. When you talk about stability in federal government funding and about commitment in the coming years to maintaining this funding, why do you talk about cash funding and not transfers of tax points, which is more secure than cash transfers to the provinces?
[English]
Mr. Bill Tholl (Representative, Health Action Lobby): We do in fact acknowledge the tax transfer. That is revenue forgone by the federal government. In our detailed proposal to Mr. Martin and Finance officials, we explicitly acknowledged the tax transfer.
But in the business of enforcing national health standards, when you look at the Canada Health Act it's the cash contribution that counts. You cannot withhold the value of a tax transfer. There is nothing in this bill that ensures in the longer term a cash contribution under the CHST.
One of our major concerns is the uncertainty past year two that this bill could create. In fact the bill itself acknowledges the eventuality that cash will go to zero in one of its provisions. In proposed section 14 on page 24 of the bill it indicates ``an amount equal to the amount, if any'' that's left over after the crowding out effect of the tax transfer. That crowding out effect will occur at various points in time. The government has indeed bought itself more time. But inevitably, unless something changes, cash will go to zero. At that point with CHST, the national health insurance principles become unenforceable.
Mr. Grubel: I would like to shift gears for a moment. I'd like to take advantage of your expertise to help me assess the merit of the following idea. Health economists almost universally agree that one of the biggest problems we face in Canada, the United States, and other industrial countries is over-consumption of health care services because of the absence of deductibles and co-insurance.
Now, I know what the argument is against deductibles: there will be poor people who don't have the cash to pay for the first $500 of their annual consumption of medical services.
In the United States, if I may use that country as an example, private insurers have altered their system of deductibles by the introduction of what they call medisave accounts. Are you familiar with those? For those people who don't know about this, essentially it means that individuals insured receive $500 or $1,000 cash at the beginning of the year. They are told that any consumption of medical services during the following year has to be offset against the $1,000 which was paid to them so that they would never be able to say, I couldn't go to the doctor because I didn't have the cash. At the end of the year they were able to keep as income whatever money was not used up as the result of a visit to the doctor. After that $1,000, everything was covered just the way it is in Canada.
Now, it is interesting to note that as a result of restoring the market incentives, the normal incentives that are involved in the consumption of every product and service in the country, the demand for medical services dropped dramatically with those companies that introduced it.
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I would suggest it is possible to do something like this in Canada, and we would remove immediately the pressure of the demand for the services that are now so strained.
I wonder what your reaction as experts would be to the possible introduction of this idea into Canada.
Dr. Ritchie: I will ask Mr. Tholl to comment from a technical perspective.
Speaking from a health provider perspective, I think we have to be very, very careful - I say this as one who has worked in both the American and Canadian systems - about making generalizations from one system to another, because we have a very different tradition of health care in this country compared with the United States. It is not a bifurcated system. It is not a poor and rich person's bilateral system.
As a health care provider, I think there is a myth that needs to be dispelled that Canadians are over-consumers of their health care system.
The second thing is that the data I have seen suggests they don't work, that is if the intent is to create a disincentive on inappropriate use, which in itself is a reasonable goal, then those particular mechanisms don't work.
Mr. Grubel: Why don't you let the gentleman who knows something about this answer? You obviously don't know anything about it.
Dr. Ritchie: Well, that's your opinion, sir.
Mr. Grubel: This is the latest evidence on medisave. There are some health economists who share your judgment. It is an empirical, verifiable statement that when you give people money and say, you can keep it unless you consume it through health care, there will be a significant drop in consumption. It has nothing to do with the American system. These are individuals companies that are doing this. It has nothing to do with the overall system.
I would like to hear what the expert has to say.
Dr. Landry: Since you seem to know so much about it, maybe you can address why you believe that reduced demand is good and how that will impact on health.
Mr. Grubel: Because for individuals and society as a whole it is not possible to have everything because it's free.
When the Government of British Columbia introduced the idea that we must fix every nick on every car because otherwise there might be damage to the car and it will be cheaper in the long run for the insurance companies of British Columbia if they allow every nick to be fixed for free without a deductible and co-insurance, within six months the program was abandoned because there was over-consumption.
This is the same story. People know it is not a free good. We have to ration it somehow.
Ms Sharon Sholzberg-Gray (Executive Director, Canadian Long-Term Care Association; Health Action Lobby): Can I just add one more thing certainly not as a health economist but as someone who deals in trying to serve the elderly population of this country.
It seems to me incredible that anyone would propose that elderly people, for instance, who do spend more than $1,000 a year, especially if they are requiring chronic care, somehow be encouraged not to access the care they need and stay alone at home without accessing home care and the kinds of support they need. That's going to happen if you give somebody $1,000. Most elderly people come from a generation that is so conserving and saving that they'll probably try not to spend the money and will give it to their grandchildren. That's a whole other issue.
I don't know if your studies and these studies by all of these experts have analysed how much more money the health care system will have to pay because people have forgone services in order to pocket that $1,000, resulting in more serious illnesses at the end of the day.
I don't want to get drawn into this debate because it's philosophical, and the whole issue is whether or not we're going to save money in the end. However, it seems to me that if your system is going to work, you're going to have to give different amounts of money to different groups in the population based on the level of health they have at a particular age, so it's never going to work in any event.
The Chair: I'm glad you did draw yourself into that debate. Thank you very much.
Mr. Campbell (St. Paul's): Before we run out of time, I want to return to your testimony before us. We can save the research perhaps for another day. In your presentation where you focus not surprisingly on parliamentary accountability, which is why you're here, you talk about a notional allocation of cash for health in the transfer. Could you elaborate on that? Are you saying that you could contemplate a system of a bulk transfer, but you want somehow a break-out within that that you could point to and say that's for health? What would be the repercussions of that, or what would you hope to achieve by that?
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Mr. Tholl: I'll take a cut at that. This committee will know that under the previous EPF arrangement there was a notional allocation that separated health from post-secondary education. In fact, over a number of years and a number of budgets it had been dealt with quite separately. I'm going back as far as the wage and price controls and so forth.
There is a precedent for treating health differently. That's what this group is asking this committee to consider. In fact, we did propose something in detail; we'd be happy to share the nuts and bolts with the committee, the clerk, and the Department of Finance on how that might work.
Essentially what it would involve is an expanded EPF block fund, not a CHST block fund. Instead of a 67.9% allocation to 32.1% allocation, health to post-secondary education, you'd reattribute the tax points and the cash proportionately across the three programs, making them available, incidentally, at whatever cash level you would like. We would argue for a substantial cash contribution, and we haven't set that. But that would work. It would be notional in the sense that there would still be a cheque going to the provinces. That's a red herring that often gets in the way of this. We're not interested in how many cheques cross from one side of Sparks Street to the other, from federal accounts to provincial accounts.
What we are interested in is who stands up in the House of Commons and answers the question, how much is the federal government spending towards our medicare programs? Under this bill, the answer is nothing or everything. You'll get the full gamut as people try to fight over the $10.3 billion in cash that's left after all the dust settles.
Mr. Campbell: The flip side would be to take a province to task, I suppose, for not spending that same amount of money on health.
Ms Scholzberg-Gray: We all know the provinces spend a lot more on health than the federal government transfers in any event. In fact, that's one of the problems: the percentage of the federal government contribution has been going down. If you recall, when the federal government first started medicare - at least I'm old enough to recall it - it was on a 50-50 cost-shared basis. Of course, the federal proportion has been eroding. The real issue is, how much of a player does the federal government have to be in order to assert these national standards?
Number two, shouldn't the federal government be playing a positive role, not a penalty role? It shouldn't say if you don't do this, we're taking this away, and isn't it good we put more money into the pot for the penalty. Rather, it should ask what positively can we do to help fund, design and shape the health care system of the future that Canadians and provinces and the federal government decide they want. It has to be positive, it seems to me. I'm not sure this transfer sounds as positive as it should. On the contrary, it sounds like, see, we made the penalty bigger.
The other point is that the federal government collects tax dollars from the people of Canada at the federal level for a particular reason, because it wants to ensure comparable services in certain areas. It has certain priorities. In fact, this government has been very strict about setting its priorities and being accountable for its priorities and deciding what the federal government should be in and what it should be out of.
In doing that, if it thinks medicare is important for reasons of the health of Canadians, economic competitiveness, and all of these other things then it has to say this is how much we're putting into it. It can't say, we don't know exactly, it's up to the provinces, they divide it, they have to comply with the standards, and we don't care how they divide it.
I agree you can't nickel and dime anyone or account on a dollar by dollar basis. That's not the point. I think the notional attribution that we had in the past is really important for the future.
In fact, if you look at the 1994 budget - not the 1995 budget - there's a total difference in approach. In 1994 education was treated differently from health. The escalator clause in health transfer was going to be restored. The CAP transfer also was treated entirely differently, with the government signalling that it wanted reforms in welfare and social services that resulted in a particular amount of savings.
In one year the government divided up these three elements and said how they wanted them treated. The next year it said putting it into one pot would be better. I think it really has to take another look at it and see whether notional attributions would achieve its goals better.
Mr. Campbell: Thank you.
The Chair: Thank you, Mr. Campbell.
One of the things that struck me most about your report is you have not come here complaining about our deficit reduction need and how we've treated the entire sector. You haven't complained. When I go through your report about how cuts have actually been made to the health care sector, you represent an incredibly comprehensive group of the deliverers of health care services across our country.
Ms Scholzberg-Gray: And consumers.
The Chair: And consumers, and Herb Grubel.
I think you make a very strong point about accountability. We have seen this in the past, where citizens in Willowdale can complain to me about not funding post-secondary education adequately. I can say it's not our fault. They can complain to the province and the province will say it's the federal government's fault. I think this question of where the buck stops politically is going to be one of the coming issues in the evolution of our federalism.
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I think you make a very cogent point. What can be done about it? Personally, I would be interested in seeing the more detailed report you gave to Mr. Martin. I'm sure other members would too.
Dr. Ritchie: We have that available for you. We really, genuinely believe it is a serious, very carefully thought out report. With respect, I would say there is good expertise built into it, because as health care providers we don't pretend to be fiscalists.
But I would note something we have very clearly debated among ourselves. As you might imagine, it has not been with a little animation. One of the other things that really concerns us about this issue is how much we have already taken the cuts. We deliberately have chosen not to come in and say we have already been cut tens of billions of dollars over the last seven years.
The expenditures for health care have been stabilized. We are no longer in that period of unending escalators and exponential spirals. That's now several years beyond us. We are well retrenched. There is no more fat left in the system; that's surely true.
We take our share of the responsibility to enable all of us as citizens to come to terms with the need to have stable budgets and a fiscal system that is healthy. We want to be sure, in the corrections that are made, that we don't throw out the baby with the bath water. I think that's the spirit that brings us here today. It's very much a spirit of trying to be constructive, of how to do this more effectively.
The Chair: Thank you very much for bringing to us that very constructive approach.
We will adjourn for two minutes.
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PAUSE
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The Chair: We have with us now the Building and Construction Trades Office, with Guy Dumoulin, executive secretary; Phil Benson, director of research and legislative affairs; and Joseph Maloney, assistant to the executive secretary.
Gentlemen, you're no strangers to this committee. We've probably seen more of you than any other people. Once again, we are grateful to you for taking time to appear. We welcome you.
Mr. Guy Dumoulin (Executive Secretary, Building and Construction Trades Office): Mr. Chairman, we really appreciate this. We will have a very short presentation tonight. It doesn't mean it doesn't have things in it. We will answer your questions afterwards if you have any.
The Building and Construction Trades Office is a labour organization formed by the following 14 affiliated international unions representing over 400,000 highly skilled craftspeople working in the building and construction industry. I'm not going to read it; you're capable of reading it.
We thank the Standing Committee on Finance for the opportunity to make this submission.
We made four main suggestions in our submission to the committee during the pre-budget consultation. We suggested a minimum tax on corporate profits. The government did increase corporate taxation, and this is a good start. We still support a minimum tax on corporate profits. We also feel loopholes and deductions should be carefully examined and gradually eliminated.
We asked the government to leave the reform of UI to the ongoing process undertaken by Minister Axworthy and to decline making any specific cuts to UI in the budget. We asked the government not to impose any taxes on health and benefit plans. Finally, we asked the government to take action on the underground economy in the construction industry.
In the past years we have been coming in front of these committees, this is truly a first. Overall, we wish to express our thanks to the committee and to the minister for listening to us and other Canadians who share our common interests. It is nice to see the consultation process validated by real results.
As you are probably aware, the building trades are very involved in the UI reform process. We are working with Minister Axworthy and departmental officials to create new solutions to old problems. The budget may have set some fiscal guidelines, but it appears to have left the process of reform where it belongs.
In the future, we hope a new tripartite management of UI will mean we will no longer need to discuss UI before this committee. Though we do not oppose letting the UI fund run a surplus, we remind you that UI is paid for totally by workers and employers. It is not government money.
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We do appreciate the concern the government has with the deficit. We and our members are also concerned that taxing health and benefit plans could look like a lucrative source of new tax revenue, but the consequences of a weakening plan and diminished health care aren't worth it. We are very pleased that this committee supported us and other Canadians by rejecting that concept. Perhaps, unlike other groups that may come before you, we did offer to find new sources of revenue for the government. We asked that you collect every dollar that is owed before making any cuts. We asked the government to deal with the underground economy in the construction industry, and it is going to.
The building trades have been working with the government since the beginning of its mandate to find solutions to the underground economy. We are pleased that the ways and means motion contains the substance of one of our recommendations. It would deal with those who use the subcontracting route to enter or support the underground economy in the construction industry.
We have been asked to participate in the consultation process prior to the introduction of legislation expected later this year. We will participate. We offer our assistance to this committee, and we will do whatever it takes from our end to stop the underground economy in our industry.
We have shared our suggestions and recommendations with this committee in the past, and we do so again today. The following table contains several methods of creating a paper trail to help Revenue Canada ferret out tax cheaters. We think it would work without imposing costs, or by creating a burden on legitimate taxpaying Canadians.
At this point I will let Joe Maloney explain our plan of action, since he's the one who goes around the country explaining it to our membership.
Mr. Joseph Maloney (Assistant to the Executive Secretary, Building and Construction Trades Office): Thank you. As explained to you, we don't want to put a further burden on any fair employers out there who are working within the system. We talked in the past about a possible withholding tax and that type of thing. That was rejected by the industry because it ties up their cashflow. So we're constantly trying to come up with new ways that we think could put roadblocks in front of people who are operating in the underground economy in the construction industry.
One thing we'd like to put forward is that we'd like to create a paper trail of some sort. Anybody who works in the construction industry works as a contractor, whether they be trade specific, an independent contractor, or a self-employed contractor. We're saying anybody who's a contractor in the construction industry should be registered to work in the industry, either with a general or trade-specific contractor association. The contractor associations are all over the country and in every town. That contractor association would be responsible for registering the contractors and issuing ID numbers, ID cards of some sort. This could be done through a SIN number or a GST number or something of that nature.
At that point we'd like to see the government pass a law that would say purchasers of construction could only tender to contractors registered to work in the construction industry. Only registered contractors would be able to buy building materials for construction work purposes. What we mean by that is that when anybody goes down to the lumber store or the building supply store to buy construction materials, when they get the invoice they would have to make an election on it as to whether this is for business use or personal use. If it is for business use they would have to show their ID card and the location where that material was going to be installed, and they would have to sign it, thus creating a paper trail. If it is for personal use then you just make that election, sign your name, again making a paper trail.
On the invoice we'd like to see a qualifier for the consequences of operating in the underground economy. We do believe that the vast majority of Canadians are honest people and when they see those qualifiers and the like on invoices they'll think twice about doing it. We're not saying this is the be-all and end-all to the underground economy, but we're saying it's another avenue to look at in putting roadblocks in front of people who are operating in the underground economy. It doesn't cost any money to anybody; it's just a matter of setting up an administration to do this, to cross-check.
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We're saying that if the government follows this path, we'll be your eyes and ears out there in the construction industry. If there's a 1-800 number for complaints set up out there, we'll tell you who is operating in the underground economy because we want them out of the industry just as much as you do. They're driving all our plans into chaos; they're affecting unemployment insurance and everything else.
This is just another avenue we're putting forward to be considered by this committee and possibly handed to Revenue, to get more ideas out there, and we're going to come forward with more. If we can fine-tune something, we'd be more than happy to help.
Mr. Dumoulin: We do have one major concern about the budget, and we are sure it is one the committee is hearing loud and clear. To move to block funding for social programs is unsettling. We are very concerned that block funding will lead to a patchwork quilt of social services across this country. That will not serve Canadians well.
We are worried that a move to block funding could seriously erode our efforts to create national training standards for training and apprenticeship in the construction industry. National training standards are an important part of UI reform and are supported by the industry. We would not want to see training fragmented and these proposed standards threatened by block funding. We ask this committee to examine the issue and tell us if block funding could remove federal government participation in this area.
We are especially concerned about medicare. Medicare is treasured by all Canadians. The red book stated that medicare is an affirmation of Canada's commitment to human dignity. Further, the federal government alone cannot and should not dictate all the answers and solutions. However, the Liberal Party believes the federal government must ensure that the national priorities of Canadians are identified and that concerted efforts and attention are directed to meeting them. It also calls for a national forum on health to examine the delivery of medicare.
To move to block funding may set the fiscal limits of social policy reform, but it could also set the direction those reforms will have to go in. Privatizing or a two-tier system is unthinkable. If the federal government loses its hammer by moving to block funding, it could happen. This would be unfortunate given the commitments made in the red book, and also, if our fears are correct, any threat to universal health coverage must be condemned.
For our part we have made our concerns very clear to this committee and the government. The building trades will be monitoring the situation very closely on behalf of our affiliated organizations and members.
We would like to thank the committee for inviting us to appear before it. We sincerely hope you will take our recommendations and concerns into account when you make your report to Parliament. Thank you, Mr. Chairman.
The Chair: Thank you, Mr. Dumoulin. Mr. Grubel.
Mr. Grubel: Mr. Maloney, I just heard recently and I don't know the details, but in Australia, in order to deal with the problem of the underground economy, they have made it a legal requirement that people who buy home repairs and things like these have to transmit the GST equivalent on their purchases to the government.
In other words, the reason why there is so much getting away with it is because the people who buy the underground economy services are not involved. They let you take all the risks and so on. By putting it this way, apparently that was one way of getting at it. Did you know about this?
Mr. Maloney: Not that exact case, but when people buy building materials they pay the GST at the point of purchase. The underground economy operates in a cash world. If you want to get your home renovated or an addition put on, you will ask how much to do the job for cash. The person who does the job will purchase the material, pay the GST on that material, but the actual work involved -
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The Chair: On a point of order, Mr. Maloney, I wish you wouldn't tell Herb how he can avoid the GST.
Mr. Maloney: Okay.
The Chair: I notice he's taking very rapt notes.
Mr. Grubel: As the finance committee, we know all about this from the GST hearings.
I wondered whether you knew about this new approach that has been developed in some countries with the same problem.
Mr. Dumoulin: We are aware of some of the approaches that have been taken by other countries. When Mr. Maloney talked about a withholding tax, this is one of the approaches that is used in some of these countries.
We seem to have problems with our counterparts in convincing them that this might be a route to take. That's why we're looking at other avenues.
Mr. Maloney: We don't want to tie up the money for the people who are operating legally in the economy, and that's what a withholding tax might do.
Mr. Dumoulin: I don't know if you are aware, but we're talking about billions of dollars when we are talking about the underground economy. It's totally dishonest to have people in this country who don't pay their fair share. The rest of the population has to pay for these people because they are not paying. That's why we have a major problem.
Mr. Grubel: If you're egging me on, I must tell you that I have attended a conference on the underground economy, and there is a difference between the gross value of the amount of home repair that is always thrown around. In that gross value, you have the drywall, the plumbing fixtures, all of those things, and they all carry a GST. You're not getting a refund on it. The only amount that is really being cheated on is the value added, namely the labour component of those repair services. They represent, for the industries that are most identified with the underground economy car repairs, home repairs, shoe repairs, and a few other services of this sort. When you add them up they add up to a maximum of 2% or 3% of GDP.
It may sound like many billions, but when we're talking about the relevant figure, the value added in the industries where this is taking place, the amount of revenue that the government loses isn't nearly what it seems to be if you take the gross figures.
Mr. Walker (Winnipeg North Centre): But 3% of GDP is about $22 billion, right?
Mr. Grubel: Yes, but it is a relatively small sum given what we are raising.
Mr. Dumoulin: I hope I do not understand you to say that you don't see much of a problem in the underground economy and we should look at something else. I feel that it is a major problem and it's bigger than you think. There are all sorts of figures floating around, all sorts of figures that didn't come from us. It goes from $30 billion to $70 billion to over $100 billion. We're talking about a lot of money.
Mr. Grubel: It's more than that. I've heard all the estimates.
Mr. Dumoulin: I don't find it right that I pay my income tax every week when I get my pay-cheque and these people don't pay.
Mr. Grubel: Absolutely.
Mr. Dumoulin: That's what I don't like.
Mr. Grubel: I was egged on by this gentleman.
There is still enough reason to continue to work against it, and I just gave you a suggestion on how it could be done. That's all I'm saying.
Mr. Walker: I have a quick question on the underground economy. Have you passed this on to Revenue Canada? Have you had discussions with them, or do you want us to pass it on?
Mr. Dumoulin: We met with Revenue Canada about a year ago. They have acted on it. We are working with them. It's a long process; it's not an easy thing to do. We would really appreciate it if you would pass along our message to them once again. You can never say it too often.
Mr. Walker: The chair will.
Mr. Dumoulin: We've learned that the more you talk about it, the better chance for results.
Mr. Walker: Exactly.
On page 5 you deal with some of your concerns. We've had several witnesses concerned about the block funding so we will take them as part of the concern. I want some clarification on the national training standards. I don't think there is anything that we're doing right now in the health and social transfer that deals with the apprenticeship question. There is nothing that we're doing directly or indirectly, to the best of my knowledge, or in what we're proposing that affects the training moneys distributed by Human Resources. There is a fiscal framework that affects it and it affects the amount of money going to the community colleges, for example, but there is nothing in the way we're restructuring what we're doing, in this legislation.
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There is an ongoing discussion dealing with UI and what I call the unholy triangle between building up a surplus and using it for training and reducing premiums. That's an ongoing debate, and we obviously haven't resolved what we consider to be the perfect matrix. We're are open to discussion. You will find Mr. Axworthy in particular is very keen that a large training component stay within the fund. There are other people who would disagree, and that's the nature of politics, but that's what we're trying to maintain. Whether we have enough of a surplus is a matter of confidence as to where you see the cyclical economy going. We went through a very terrible one the last time, which almost bankrupted the credibility of the program unfortunately, and now we're re-establishing that.
Your points are well taken. I just wanted to assure you that we're not doing anything directly. If you hear, let us know. I checked it with officials before I put it on the record, that we're not doing anything on this particular one.
Mr. Dumoulin: We're glad to hear that, if that's the case. That was a concern we had. We raised a question and you are giving us an answer, so we are quite pleased to hear that it would not disrupt the training. We are also aware that Mr. Axworthy is working very hard with regard to training. As a matter of fact, we're part of a committee working with him, so we are quite aware of this.
The Chair: It's always good to have the parliamentary secretary here with us.
Mrs. Brushett: I really appreciate your presentation this afternoon because I've had multiple letters from constituents on some of these issues. I would like to deal with the underground economy.
The first type of complaint I have is, for example, a tradesperson who puts up a shingle advertising that they can do plumbing. The certified plumbers next door, who hire three or four regular certified licensed plumbers who are properly trained, are losing business to this person who is undercutting them. What is your best approach to deal with that? Will the apprenticeship program lead to saving us there?
Second, I receive many letters dealing with the construction trade and how to prevent the consumer from going to the cash project. Some of the suggestions that my construction people have made are that perhaps we should take out a big ad in the newspaper indicating that we're going to start squealing on you, etc. The second suggestion is that perhaps we should charge the customer who uses the service of the underground economy. I believe we're all in favour of trying to solve this problem so that everyone is paying their fair share. I'm looking for your input.
Mr. Dumoulin: On your second question, we're getting involved in the national standards committee for the construction industry. Hopefully, this committee will be able to find some solutions. If you had compulsory certification for each trade, at least you would have a qualified person to do your work instead of having what we call the fly-by-nights. They pick up a hammer and become carpenters. You deserve to have a qualified person do your work.
Mr. Maloney is always saying that it's amazing that you need to have a licence to cut hair, but you don't need to have a licence to weld in a nuclear plant, which could kill millions of people if it's not properly done. This is one thing that has to be looked at very seriously.
With regard to the underground economy, this is what we're trying to do with the paper trail. The paper trail is not the best solution in the world. We feel if we had a withholding tax it would be better. We have to make somebody responsible. Somebody has to be responsible for these taxes. If the person gives the work to somebody else, he has to make sure these people pay the taxes that they would normally pay and pay their pension plan, their unemployment insurance, and everything else that needs to be paid. This is what we're trying to find a solution for within the committee with respect to the underground economy.
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We have a committee on UI and we have another committee on the underground economy. It is a big task, but it is a major problem too.
I will let Mr. Maloney explain more. He might have something else to add.
Mr. Maloney: With regard to mandatory registration of contractors, if you work in the construction industry as a contractor, it doesn't matter how small or how large, you must be registered with a local construction association. When you purchase construction materials, you should make an election at the point of purchase and say what that material is used for and create a paper trail. That paper trail can be used by Revenue Canada when they do audits and cross-checking and random checking and this sort of thing. If A, B, or C contractor has purchased this amount of material, they now have something to start tracking that person on: where the material was installed, what it was installed for, and how much they were reimbursed for the instalment.
It's a matter of trying to put up more roadblocks. You are never going to wipe out the underground economy in the construction industry 100%. You are never going to wipe out the fellow who comes over and changes a chandelier in your living room, or the barter system and that sort of thing. There are literally entire homes being built, brand-new homes, for cash, that is cash under the table. That has to stop. A small extension on the side of a house or a deck in the backyard, you will never conquer that stuff, but you can certainly conquer a brand-new home or a small apartment building being built by cash. Those are the things we want to topple first.
The other one is the tradesperson who is not qualified. We are seeking, through our national industry standards committee being formed with industry and government, that every person who is trained to work in the construction industry should be trained to a national standard. What you learn in British Columbia or Nova Scotia would be the same training. At that point you would be compulsory certified to work in the industry; you would be licensed to work in the industry.
As Guy has explained, there is a situation now in Ontario where you have to have a licence to cut hair as a barber or a hair stylist, but for some trades you don't have to be licensed to weld in a nuclear power plant. This has to stop.
Mrs. Brushett: I agree. I am very much on the same wavelength, but are we going to wait until the ISO 9000 standards are fully in place and the apprenticeship programs are well established to get this registry? Would it be a national registry under your recommendations?
Mr. Maloney: The problem you have is there is a patchwork quilt going on right now. It's all under provincial jurisdiction. Every time you go to a province and say you want to go to a national standard they say no problem, here's mine. Alberta is very bad for trying to encroach upon their training jurisdiction. Ontario is also bad. The directors of apprenticeship don't want to do anything when it comes to national standards.
First, we have to develop a national standard per occupation in the construction industry. Then we have to go the provinces and have the provinces adopt it. We have to do that in conjunction with the federal government. It's going to take a few years before we can get that far. Some trades are more advanced than others, but we have to get everybody on board to make it happen. There is a lot of work ahead of us, but at the end of the day we should have a national standard per occupation in the construction industry for the apprenticeable trades.
Mr. Fewchuk (Selkirk - Red River): Some of the municipalities have this protection in place that we started with the planning board. You have to have a journeyman or you can't build a home, because you cannot get a loan from CMHC. I was on the board. It started 1974, and in 1987 we brought that in.
When he walks in he has to produce his licence which he bought from whatever municipality he was in. He has to show on his licence that he's a qualified journeyman. Then the bank does not give a loan. If it's cash, when an inspector comes in - he doesn't care how it's paid for - the inspector does not approve it because he wants to see the certificate. It's there in my municipality. We had a lot of arguments over this. We had to control these people. You can't have a fly-by-night guy come in and do the plumbing or the heating. We're still fighting that today.
Some of the answers are already there. They were dealt with by the local municipalities. The protection is there, the paper trail.
Mr. Dumoulin: There is also another way. We have to wait for all this. I've said it before and I'm going to repeat it: the federal government should set the example, with all its repairs and the work it gives. You are talking about billions of dollars.
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The underground economy is going on right now in the city of Ottawa with the repair of government buildings. We've given some proof; we've brought some documents to government people about this. That's what we're saying. You should set some sort of a rule so that at least it doesn't happen where we spend our own money, because it's the population's money we're talking about. We're not talking about buying construction. Maybe you should try to set the example at the federal level.
Mr. Fewchuk: Not only that, but we also took the recent situation where a guy had about 10 years experience. He doesn't have to have a ticket; he should know enough to honour that. We have to be careful. If you're willing to bend to a certain degree, not just have a piece of paper, he has to go to...
Mr. Dumoulin: I'm from the province of Quebec. We did this because everybody needs to have a licence to work in the province of Quebec. You called that the grandfather clause; you gave them a grandfather clause if somebody worked for 13 years in the construction industry.
The Chair: You have been before our committee many times. You've always presented us with very constructive ideas, not necessarily to help only your trade and members, but to improve the overall system. The constructive way you've gone out, canvassed your members, and spent a lot of time and effort in coming up with the program Mr. Maloney outlined to us, as well as your willingness to work with Revenue officials in the future, is just commendable. We can learn a lot from you; you're the people on the ground who know how to do it.
On behalf of all members, may I say thank you for not only today, but for this ongoing participation in the process of making the system really work. We appreciate you being with us.
Mr. Dumoulin: Thank you very much.
The Chair: All of our next witnesses are with us, so we'll go right on. Our next group is the Canadian Health Coalition, with Stephen Learey, executive coordinator; Edith Johnston, board member; Sandy Scott, board member; Laurienne Ring, board member.
Mr. Stephen Learey (Executive Coordinator, Canadian Health Coalition): The Canadian Health Coalition is a coalition of some 600 groups across the country, 10 provincial health coalitions, and 3 regional coalitions. We bring a very broad perspective to health. We were formed in 1979 and have been working continuously to preserve medicare.
Thank you very much for inviting us here today to present before the committee. I am joined by three of the board members who will make presentations after I give a general introduction to our brief on Bill C-76. I would like to apologize that our brief is only in English. The limited resources of the organization make it prohibitive to translate all our documents.
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Obviously, our view is that medicare is critical to us as a country. For many people the idea of medicare epitomizes what we are as Canadians. The compassion and caring that is shown in medicare is seen as an essential part of our character.
Unfortunately, we see Bill C-76 as being very detrimental to the future of medicare. We see the cuts in federal transfers as being devastating to a system that has had cuts for the last 10 or more years.
We also believe the Canada Health Act and its enforcement will be jeopardized by the combining of health, education and welfare - social services transfers - into one block. It'll be harder to enforce the act because it has always been enforced by cash transfers to the provinces.
We're also very concerned about the cuts to social programs, particularly welfare and education, that are combined in this transfer. We feel the elimination of standards for CAP and the cuts embodied in the transfers will have detrimental effects on health care. We view welfare as a preventative health program, and an investment in welfare prevents the costs coming back to the health care system later on.
The removal of the standards and the cuts in the funding will send more people into the health care system. It will be much more costly than investing in those programs in the beginning.
The federal-provincial-territorial ministers of health endorsed a report last September in Halifax. In that report it states that key factors such as income, social status, social support networks, education, employment and working conditions influence a person's health. This document was signed, with an opening letter, by the Minister of Health and endorsed by every provincial minister of health in the country.
There are clear indicators between income and social status and one's health. I don't think there's any question about that. Yet in Bill C-76, as I mentioned before, the cuts will certainly hurt that.
I would also like to address Canada versus other countries in social spending. Canada spends approximately 10% of its gross domestic product on health care. Of that, 5.8% is public spending on health care. The rest is the private portion we spend on health care. The information, based on Statistics Canada and the FMS data, indicates that for 1995 we will spend approximately 5.8% on the public portion of health care. That is equivalent to the 1987 spending level.
The public portion has remained steady in its funding and has actually gone down, whereas the private portion, which we believe will be increased by the continued cut-backs in funding, is increasing and is uncontrollable because it's dependent on market forces. We believe a strong public system will control costs and keep general costs down for the government and for the public.
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Now I'd like to present Edith Johnston, a board member from the seniors movement, who brings a perspective of seniors.
Ms Edith Johnston (Board Member, Canadian Health Coalition): I'd like to start by saying seniors of today were there and can remember when there was no health care coverage. I think it's important for us today to try to visualize how we would look after ourselves if there was no health care.
In bygone days, the farmers bartered bags of vegetables with the family physician in order to have a visit to the child or take the child to the family doctor, as he was called in those days. Many people didn't pay the family doctor; he said he understood what the situation was and asked for a few dollars here and there.
Seniors are really very concerned about what will happen as this whole system begins to deteriorate through the cuts that are being made. What is going to happen to the health of Canadians?
Seniors were also there when this whole legislation was put in place. They were young people then with families who knew their families needed to have a health care system that was going to keep them healthy. Seniors understand that if we're kept healthy and are able to have care in the very beginning when something begins to go wrong with our health, the cost factor is much less than having to keep going back for another visit to the hospital because you've been discharged too soon. That's what's happening right now with the health care system.
The Ontario Council of Hospital Unions has just done a study in Ontario of over 500 calls that came into their hotline, telling horror stories that are happening in the hospitals. There are not enough nurses to give care and not enough attendants to give people water to drink. If they don't have a family member nearby or a friend coming in, the care just isn't there.
Seniors are really very concerned about that. With the transfers, Bill C-76 is going to allow all this deterioration to take place, because seniors don't feel there are any teeth in this legislation to ensure the provinces are going to spend money on health care.
Seniors are also concerned not only for themselves. Seniors also feel they're being blamed for the so-called cost of health care when they are really not to blame for it. There are other ways of looking at costs, not on the backs of seniors. Seniors are also very concerned about what kind of health care system there will be for their children, who are in their forties and their fifties, and particularly their grandchildren.
Seniors know that the health care system has worked well. Although I'm only talking about health care with seniors, seniors are also concerned about all the other aspects of what's going on in Bill C-76, but particularly what it's going to do for our families, our children and our grandchildren.
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Mr. Learey: Now we'll hear from Sandy Scott, representing a faith perspective.
Mr. Sandy Scott (Board Member, Canadian Health Coalition): The Christian vision of the world, contrary to popular belief, is fundamentally relational. When Jesus was hanging around the temple in Jerusalem, which is basically like Parliament Hill, a lawyer or scribe came out -
The Chair: Are you here to throw out the money-lenders?
Some hon. members: Oh, oh!
Mr. Scott: I'm not Jesus, so I wouldn't pretend to re-enact that.
But the scribe or lawyer was very concerned about the law, so he asked Jesus, which is the greatest law of all. And Jesus said, hear, O Israel, listen up people, you shall love the Lord your God with all your heart, with all your soul, with all your mind, and with all your strength. And the second is, you shall love your neighbour as yourself. So within the Christian vision of reality, we are to love God with all we have, and our measure of that love is seen in our relationships with others.
The Canada Health Act and our medical care programs are our community's way of collectively loving our neighbour. The church I work in believes that very strongly. We have consistently supported the five pillars of medicare embodied in the act. We have consistently called on the government, communities, unions, and other agencies and secular bodies to see health from a holistic perspective. Health includes the health of the individual, the health of the community, justice, and the health of government.
It seems to us that these days we are not the main forum in which discussion around morals and values takes place; neither is government. We have suffered like government in the public perception. Values these days are driven fundamentally, we believe, by business, and business's spokesperson or forum in which that is driven is the media. It's time for government, the church, and other faith communities to reclaim our discussion and our right to talk about values. The Christian perspective, as I said, is relational. That's why the Canada Health Act is important to us.
In a letter that major religious leaders wrote to the Prime Minister on January 5, they said that economic insecurity has created an angry and resentful mood in this country toward those who rely on Canada's social programs. In this atmosphere half-truths, misinformation, unsubstantiated claims, and false perceptions about the poor can exacerbate this feeling of growing resentment. We are deeply troubled by divisions that this angry atmosphere causes across our communities. It is an atmosphere that divides young and old, pits workers against the unemployed, and places the needs of single people against those of families. These divisions can only serve to tear apart the very communal fabric that sustains the Canadian community.
We need to be clear that social programs, as a number of studies have consistently indicated, are not the cause of the federal deficit. People are poor in Canada not because they want or deserve to be poor, and people are unemployed in Canada not because they do not want to work or because they do not necessarily have the skills but rather because there are not enough adequate paying jobs.
As Canadians consider reforms, we need to continually ask ourselves for whose benefit the specific changes are being made. What values are embodied in the legislation that is being considered? What is most important to this country? We need to ask ourselves those questions. If you turn to scripture or your faith tradition, I'm sure you will find wisdom that can guide you in your decisions.
The prophet Isaiah in the first eight verses of chapter 32 reflects on what good government is.
In verses 7 and 8 of chapter 32 Isaiah says: ``The crimes or villainies of the villains are evil. They devise wicked devices to ruin the poor with lying words even when the plea of the needy is right.'' This is where you might want to be. ``But those who are noble plan noble things and by noble things they stand.''
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I ask you as you consider this legislation and its impact on the Canada Health Act to do the noble thing.
Mr. Learey: Now I'd like to introduce Laurienne Ring, who brings the perspective of women and the community health movement.
Ms Laurienne Ring (Board Member, Canadian Health Coalition): Thank you for the opportunity to address you today. I'd like to share with you some thoughts and concerns that I have. There are three main areas of concern where I think changes to medicare will affect women, and I have a more general comment.
The three areas that I think are most impacted when we look at a gender approach to cut-backs, which I certainly think this planned legislation represents, are women as recipients and consumers of health care, workers in the sector, and care providers to their families.
Women as recipients are, I think, impacted in a number of ways. We know that women are users of health services disproportionate to men in that women are the larger users of the service. That is for a number of reasons. It ranges from things such as women's reproductive health concerns bringing them into contact for annual care and preventive care that are different from the needs that men have; the whole experience of childbirth during the child-bearing years; the role of women as gatekeepers for their families in the sense that it's still women who primarily take children and older family members for check-ups, managing that aspect of their family's health and mental health concerns.
The incredible stresses that women and families are under these days are often acted out in women's health by creating various aspects of stress-related illnesses that bring them again into contact with the medical system. Unfortunately, that's often dealt with in the medical system we currently have by a higher number of prescriptions for psychotropic drugs for women and so on. This is an area I would rather you turn your attention to in terms of cost control and looking at the pharmaceutical industry and some of the concerns that have already been expressed around that industry, rather than through cut-backs to the core of the Canada Health Act.
The final point about women as recipients or consumers is a concern about more women in general being poor. We've already pointed out the connection between equity all our lives and the health outcome at the end of life, the longevity that is engendered and the good health. I think some of Health Canada's statistics point out that Canadians who have an adequate income throughout their lives not only live longer but have eight more disease-free or injury-free years at the end of their lives. People live healthier lives at the longer end. We feel that the equity piece is a really important thing to protect and to continue to address yourselves to when you consider this legislation.
About women as workers in the sector, if the effect of this legislation is to have to cut back more and more services that have been provided by hospital workers, we're talking about workers who have an incredible public investment in their skills and who are very skilled workers.
We point out in our package that one of the ways we feel some attention could be given to cost containment would be to look at other providers of care, for example, nurse practitioners, nurse clinicians of various kinds, midwives, and so on. One route might be to expand their role in providing services and to look at fee for service for physicians, which is a place where we're concerned that costs are out of control.
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The whole area of nursing and the provision of other health care services is one where women who are highly skilled are employed to a great degree, having been until recently a very traditional sector for women to be trained for and to work in. If the effect of this legislation is more and more bed closures, we feel that is a real harm to the people who are currently employed in that sector.
This leads to my final point about women as unpaid care providers. We're not seeing in any of the provincial discussions the transfer of money to the community to the extent we would like or what we had been led to believe would occur. The provinces seem to be behind in any targets they had about opening more CLSCs in community health centres or expanding the role of the VON, visiting nursing, or home care kinds of services. Where we are seeing increases in home care, they are not adequate to meet the demand that is out there.
As women are laid off or as bed closures occur in the hospital sector, you're then seeing families expected to pitch in and fill in the gap. I have a couple of points I'd like to make about that. I would like to say that in terms of early discharge and day surgery arrangements, that's an area I don't have a concern about in terms of things we can do there, but - and it's a huge ``but'', there are the services in place in the communities to make up for that?
We're seeing people being discharged earlier and earlier and going home the same day after various kinds of surgery. I recently had a conversation with a nurse at a local hospital here in Ottawa who told me that her hospital as a community hospital is trying to position itself for more cut-backs in a few years. Right now, 76% of their surgery is being done as day patients, and they expect that to be 90% within the next couple of years. That's an incredible change over the last decade from what most of us are accustomed to seeing and from what you expect to be in place. You expect to be in hospital until you are well able to manage on your own or to have someone who can assist you when you return to the community.
We don't have the leave arrangements in place in most workplaces for men or women to leave their workplace and be able to stay home for several days at a time with someone who's recovering from day surgery. We don't have the capability and the willingness. I recently laughingly made a comment to a colleague that if we all had wanted to care for the sick, we all would have taken nursing. I think I'm the only person in this room who has that background. People don't necessarily have an inclination to care for people.
What we're seeing with these early discharge programs is that it's not just someone who needs someone to be home for a few hours and to be watched but people who need intravenous medications administered at home or people who need dialysis at home, very acute kinds of things that the traditional family member is not accustomed to providing in a home setting.
I really think that the two issues of women working at home above and beyond the work they already have to do and seeing workers displaced from the hospital setting to the community setting are really very problematic.
With those three kinds of concerns in mind, I also wanted to remind you of some of the work that Health Canada has already done. We were concerned about not addressing a health group. We're addressing a finance group. We wanted to talk with you a bit about the Epp paper, Achieving Health for All: A Framework for Health Promotion in Canada. He had goals of achieving health for all in Canada by the year 2000. This is a major initiative, and Canada has been in the forefront around the world in talking about health and its determinants.
These are real working documents to those of us who work in community health. We refer to these very often. We tried to use this theory and put it into practice in a lot of different ways. They have many, many applications in community work. They're really seen as quite foundational and forward thinking for their time. I would really encourage you not to back down from that forward thinking that has been part of Canada's approach to health throughout the last few decades.
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The health challenges that were identified in that paper were reducing inequities, increasing prevention, and enhancing coping. The health promotion mechanisms were seen to be self-care, mutual aid, and healthy environments.
The implication strategies were seen to be fostering public participation, which we expect to get through the National Health Forum, for example, in this era, but to date they have not indicated what their mechanism will be for input from the public; strengthening community health services, yet we see with the cut-backs in finances that provinces are not following through on that kind of thing, and we look to the federal government for guidance in that area; and coordinating healthy public policy.
One of the keystones of the healthy communities movement, which many of you may have heard about in your home communities, is that we start planning for healthy communities by looking at everything that goes on in a community. You cannot talk about health in a community if you're talking about socio-environmental determinants of health without thinking about how all kinds of public policy get played out.
We wanted to address you today and bring these back to your attention because we feel that this particular bill has the capacity to do a lot of damage to a lot of really excellent work that Canada has done in this field.
Mr. Learey: Since the budget came down, I don't think anyone can deny there has been a steady discourse from different perspectives on what this bill means. It's certainly a very important move by the federal government. It seems to be, certainly from our perspective, a very radical move that will change medicare.
I don't think a day goes by when we don't have in the media or some forum a discussion about health care and what this bill means. Today there are two articles in The Globe and Mail, which you've probably been made aware of: one by a health expert saying that Ottawa is quietly repealing the Canada Health Act and the other one in the business section by a deputy minister of finance and a vice-president of Moody's saying there are going to be ongoing cuts, that this is going to go on year after year.
We really feel that this committee should go across Canada to hear from other people because of the critical nature of this discussion. This coalition, which has been around since 1979, feels that this legislation is second only to the Canada Health Act in the direction in which it's taking our health care system.
Last year we entered our own discussion around what we wanted for health care. I've included it in the paper. It's called 10 Goals for Improving Health Care for Canadians. That document took us 10 months to do and had input from every part of the country. It creates what we believe to be a very comprehensive plan for health for Canadians. It includes areas of cost saving, but it also fills in some of the areas, such as being moved to the community, which many believe has just been in rhetoric form. The infrastructure hasn't been put into place for that really to take hold and be a part of the health care system.
I would urge you to look at it. As I mentioned, a lot of work and discussion went into it, and it has been endorsed by groups from across this country.
We'll be glad to take any questions you might have.
[Translation]
The Chair: I thank all four of you.
Let us begin with Mr. Crête.
Mr. Crête (Kamouraska - Rivière-du-Loup): Thank you, Mr. Chairman.
Thank you for your brief. If I am not mistaken, you have already made a presentation to the Human Resources Development Committee, in connection with the study of the Axworthy reform. I think I saw you there, anyway.
You have given us a number of examples showing the danger to Canada's health care system, past and present, posed by the forthcoming measures. We are talking about several millions of dollars and other things of that kind. I would, however, like you to set out for us the scenario you foresee in the coming years and the real effects it will have on the public.
There is much talk of cuts for 1996-97 and for 1997-98. But the public will not really see the impact until the province is forced to make cuts in services.
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I would like you to give us concrete examples. I feel this would be useful in terms of the idea that citizens may have of what the situation will be and the explanation they can be given, rather than talking to them only in terms of billions of dollars.
[English]
Mr. Learey: These effects are already occurring, and this obviously is before this legislation and its funding proposals. I give some examples in the summary. Hospitals are being closed at a time when increases to ambulance services - the user fees on ambulances - are being increased.
In Newfoundland, the air ambulance costs $550 to use. If the hospital is closed in your community, that becomes a very important fee which must be taken into consideration if you're going to use the health care system.
On fees for drug plans, the Nova Scotia budget, which was brought down in the last two weeks, has now implemented what it has called premiums for its drug plan for seniors. The seniors have a co-payment plan which could cost them up to $450 a year for their drugs.
On doctors' services, in a number of provinces there are block fees or administration fees for doctors' services. If you phone a doctor to get your prescription renewed, quite often he or she will bill you for that. The doctor can't bill the government unless you physically come into the office. Doctors are feeling the crunch and they're looking for other ways of making money.
Ms Ring: We have some scenarios from different provinces that have been compiled by the CUPE research department. They've tried to indicate how much these might amount to, if their understanding is correct of how the growth or the lack of growth will be implemented. They're talking about the 1996-97 year alone. In Ontario, it's 44 hospitals, or 1 out of every 5 hospitals across the province. That's the magnitude they're seeing.
In Quebec, it's one and a half times the budget for a local community health centre, just in that year. There are a number of ways they've tried to give examples of what that cut might be equal to for every province in the country. They're incredible. There are 77,000 staff who work at homes for seniors, and this would equal 78,400 beds closing. These are huge cuts; they're not in the magnitude that provinces can absorb. Tax credits do not make up for what is going to have to be in place to provide these kinds of services.
Mr. Learey: I have other examples. There are stories of nurses wearing whistles. Because of the staffing levels, their hospitals have them so far apart that they need a whistle so if an emergency happens. They can call their co-workers.
There's a hospital outside Edmonton that has what's called a 24-hour care by parent plan. This sounds very inviting, except that means staying in the hospital overnight to take care of your child and record the vital signs. The health care system is under incredible pressure right now. We believe these cuts embodied in this new block transfer will only exacerbate that.
Mrs. Stewart (Brant): Thank you all for such a comprehensive presentation. From so many aspects, from a coalition point of view, it's great to have those perspectives brought to us.
When I think of the Canada Health Act that we're so proud of, it's done a heck of a job for us in this country. When I hear your presentation and so many representations that we've had today talking about the importance of health care and the comments that are made that these changes are going to do damage to health care and change medicare, I'm just wondering if in fact the role of the federal government in this can be looked at chronologically.
We implemented the Canada Health Act, and it has created a significant change in society. It's so significant that you're here saying Canadians won't stand to have it different.
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This maybe follows Mr. Crête's questioning. I'm wondering, if that's such a strong feeling, why isn't the voter as likely to turf a provincial government that doesn't accommodate those things we have come to know and accept? From an accountability point of view, if it's so important to us, and the threat to a provincial government to be axed out if they don't accommodate these things is so important, what is the fear here? What is the fear?
If that's possible, would that allow us at the federal level to do some of these more forward-thinking, pro-active things that take us into the next generation of understanding health care and health servicing?
There's a logic here that is befuddling me. The examples you're giving to me right now are interesting examples. But we have no real jurisdiction over those events. They're happening regardless. Your logic is fuzzy to me. I just need some clarification on why you think this legislation is going to do such critical damage.
We talk about the amounts of money; yet even in the presentation we're saying there are some ways we can be more efficient. Broadly, we understand we spend a lot of money on health care and we probably can be more efficient. I just have a hard time with these pronouncements that it's going to do damage, when in fact I know the seniors are very strong and will fight until the last breath with the provincial government not to have changes to their health care system.
I know the Christian community is big and feels as strongly as it does about the value of this as a mechanism to present our Christian and humanistic views. There's something there I'm missing. I'd like to know how you'd respond to that.
Ms Edith Johnston (Board Member, Canadian Health Coalition): This is probably because you've never lived without medicare and you just can't visualize it.
Mrs. Stewart: I don't think we will, though. I think we have the standard with the Canada Health Act.
Ms Johnston: You're probably not in touch with the grass roots, where grown-up children take an aging parent to the hospital. They don't sit right there in that hospital and make sure that 82-year old person is cared for. The nurses are so overworked and understaffed that, if there is someone who has identified himself or herself as a family member, they phone that family member and say, does this 82-year old father of yours have a quality of life when he's not ill with this attack he's had. Should we send him back to the ward and let him quietly slip away? Should we give him treatment while he's in the hospital? There are all kinds of stories like that going on because of the cutbacks.
An 18-year old young woman who's looking after a handicapped child, a brain-damaged child who is integrated in the school and who has to have a clot removed from his head, goes with him to the hospital. She moves right in there for three days because why would anyone worry about this kid? He's brain damaged so he doesn't get any care.
This 18-year old girl gives him the care. She sits right there, feeds him, gets him the water and goes home and says to her mother that if she hadn't been there Matty would have died because there were no nurses around.
There are all kinds of those stories out there. Politicians are not in touch with them. You cannot visualize what it's like for those people at the grass-roots level.
Ms Ring: I think I'd like to go to the heart of it. Why are we addressing a finance committee and not the human resources committee or the health committee? We're here because this is the mechanism by which you enforce those standards. That's the only conclusion we can come to. That is the link between these personal scenarios and these situations.
We know all of you have family members and constituents who are running into these same kinds of concerns. How is it that Canada has been able to enforce these forward-looking strategies over the years? It is because there has been a strong federal presence. Money is power; we know that. That's why we're all doing what we're doing. I think that's fair to state.
Mrs. Stewart: Don't you think three is the same understanding at the provincial level? Is it only understood at the federal level?
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Ms Ring: No, of course it's understood at the provincial level. You can see the implications of the chart that Stephen has put together for you in your package. It looks to us as if the federal presence is going to diminish very quickly, within a decade in every province. There won't be the federal presence you need in order to keep the provinces accountable to you for enforcing the standards.
Mrs. Stewart: You don't think at the provincial level politicians understand the importance of health care to their constituents. That's how I translate it; that's the confusion I have.
Ms Ring: Of course I think they do, but I have a problem with some of the fighting to the nth degree. I don't think seniors should have to organize and fight to the nth degree to maintain a standard we have set. I don't feel we should be back year after year. There's a certain amount of, if it ain't broke, don't fix it. It doesn't mean that as a coalition we're not willing to look at efficiencies and ways that health care has to evolve and change.
But I don't see people should have to go back and fight for something that is already theirs. I really think provincial politicians can only work with what they have. What we're doing is taking the means by which a lot of this will come to pass. If it isn't health, what would it be? Would it be welfare or some other kind of thing? I think this is really playing into the hands of a very populist approach of whatever wins the day, as opposed to what is really right for Canadians.
Mr. Scott: Personally, I think English Canadians - I think it's different in Quebec - believe Mr. Martin. Many English Canadians want to believe Mr. Martin when he stood up in the House as he delivered the budget and gave us real guarantees around the Canada Health Act. Yet if we look at the enabling legislation for the budget, and as we look at this decrease in federal cash transfers, one has to ask what is really going on. Generally, I think those who are concerned want to believe Mr. Martin.
This Liberal federal government has a history of intrusive actions in provincial activities - the National Energy Policy, the repatriation of the Constitution, the establishment of the Canada Health Act. You come from a party that has consistently acted in a way that encourages or makes the provinces do things. I think people think you're going to continue to do that. What we see is exactly the opposite in this legislation. You're not going to continue to do that.
The other side of it is, I think generally there is a large minority of people who have bought Ralph Klein's and other people's interpretation: we have to swallow some pretty hard medicine, even if that means sacrificing the best health care system in the world. Some people are prepared to do that. Some people believe the federal government won't let that happen. We wonder. The indication to us is that you are going to let that happen.
Mr. Fewchuk: Ms Johnston, I recall back in the 1970s when I was on council what we did with some of the people. We paid the bills and then, terribly, the municipalities put it on their tax bills. This was passed down to their kids.
I have lived long enough to see when medicare came. I was very proud to lift the bills and tell the secretary-treasurer there's no use in us carrying these thousands of dollars; people have no money; we will spend a bit out of our budget once and for all.
To the other questions, I don't hear people saying anything I don't hear from the people in my riding. They say they think we should start with some of the doctors; they're to blame; they are actually over-billing and they're telling me to come back and I'm not sick.
I walked in the other day. I was having a fever, but he told me to come back in 30 days or 18 days. I had the seniors calling me. They say, Ron, it's not only every three months; now he's down to telling me to come back in two months, and I'm okay. I told him I don't want to come, but he insisted. He said I should come for my own good because I might die within that time period.
The Chair: Ron, you didn't go to the doctor; you went to the veterinarian.
Mr. Fewchuk: No, this is true; this is what I'm hearing on the street.
Plus, I was on all three levels of government, municipal, federal and the board level. At the municipal level we'd say to the province we wanted more money. The province said no; and I think the province is partly to blame here. I sat on the board and the province would give us the money for the year to pay the staff and operate the hospital. Then they'd turn around and say, let's buy this equipment, but there were no funds to operate the equipment. I never hear anybody here saying the province is to blame. It's always the federal level.
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I think some of these groups that come before us should recognize what they're hearing in the field and tell us. Don't be too proud to say that what we're hearing is a doctor problem or a provincial problem. The federal government is not God. We can't do everything.
The Chair: Thank you, Mr. Fewchuk. We appreciate your comments.
We've just about run out of time. This has been a very comprehensive presentation, as Mrs. Stewart said, from people who are very directly affected in many ways and who are involved in the health care system.
Ms Johnston, I do remember pre-medicare days. My father went into the hospital. He could not move because of his bad back and could not pay for the operation. He had to read the ads, buy a house over the telephone from the hospital room, and sell it from the hospital room, so he could get enough money for his operation.
I think all of you through your involvement in the health care process have touched us. It will be very difficult to forget this presentation as we make our decisions. Thank you all very much.
Ms Ring: Thank you.
The Chair: Do members want to take a two-minute pause, or would you like to carry on?
Mr. Crête, would you like to continue?
[Translation]
Mr. Crête: I am ready to continue. I have just arrived.
[English]
The Chair: The next witness is the Child Care Advocacy of Canada and CAW Childcare and Developmental Services.
The Vice-Chair (Mr. Campbell): Welcome. The chairperson is Sue Wolstenholme. Perhaps you could introduce your colleagues and then proceed.
Ms Sue Wolstenholme (Co-chairperson, Child Care Advocacy Association of Canada): I'm Sue Wolstenholme, and I'm the co-chairperson of the Child Care Advocacy Association of Canada. I'm from Halifax, Nova Scotia. I'll ask my colleagues to introduce themselves.
Ms Laurel Rothman (Director, Child Care Services, CAW): I'm Laurel Rothman. I'm the director of child care services for CAW, and I'm one of Mr. Campbell's constituents.
[Translation]
Ms Jocelyne Tougas (Director General, Child Care Advocacy Association of Canada): Good evening. My name is Jocelyne Tougas. I am the Director General of the Child Care Advocacy Association of Canada.
The Vice-Chair (Mr. Campbell): Welcome to the committee.
Ms Tougas: Thank you.
[English]
The Vice-Chair (Mr. Campbell): I believe you have a presentation you'd like to make to the committee, and then we'll follow with questions.
Ms Wolstenholme: I'll start out by saying that we had only two days to prepare for this presentation, and we were in three different parts of the country. We don't have a written brief to present to you at this point in time, but we were thinking of putting our presentation in writing for you.
We want to start out by saying that we're opposed to the Canada health and social tranfer for a number of reasons that I will review for you.
First of all, we're opposed because the government doesn't have a mandate for this devolution of spending powers to the provinces. Second, the budget and Bill C-76, we believe, make a mockery of the consultation process for the social security review.
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There is a litany of reports produced by this government that position child care as an essential component of economic and social renewal. These reports go from the Liberal Party's own red book to the report of the Standing Committee on Human Resources Development.
We're also opposed because we see national standards that already exist, being specifically health care, will eventually be eroded as the federal spending power declines and disappears. We're opposed because the rights and entitlements of Canadian citizens to social and economic security will be eroded and become inconsistent across the country, at best.
We're opposed because ultimately the social programs, which are a part of the fibre of this country, will be eroded to the point of being unrecognizable. These include medicare and post-secondary education, and I just want to add a personal note here. I remember the days before accessible post-secondary education. I was not able to begin studying for my university degrees until I was in my thirties. I worked full time and studied part time for 14 years to obtain my master's degree. I would not want to see the devolution of social programming have an effect like that on my grandchildren.
Even the limited affordable child care that currently exists will no doubt be eroded.
We're opposed because provincial records on social spending are highly varied. There is no guarantee in the Canada health and social transfer that funds transferred to social programs will actually be spent on social programs. I can only refer you to the current controversy in my own province regarding the handling of funds with a certain designation, which was discussed yesterday in the House of Commons, I do believe. I'm speaking about the highway funds. These funds were delivered to Nova Scotia and were designated to build a particular road but, lo and behold, they built a different road.
In answer to the question that somebody asked the previous group, I don't have a lot of confidence that provincial governments indeed will be concerned in a consistent way across the country about the maintenance of social programs. No, I don't.
In fact, the inclusion in Bill C-76 of the clause to require provinces to advertise their federal dollar spending strongly suggests that the federal government is also concerned about this lack of accountability.
How unlike our own social spending is that of other industrialized nations, for example nations of the European community and the OECD, where 38% to 40% of gross domestic product is spent on social programs, compared to 34% of Canadian gross domestic product. The trend of spending by this government and by previous governments will see the Canadian percentage reduced to 17% by the year 2000. It's predicted that the OECD and European Community countries will still be spending double that amount.
If we lived next door to Norway and Sweden, we wouldn't feel the need to cut spending. Nor would we be so possessed with the deficit.
For the reasons I've just outlined, we are opposed to the Canada health and social transfer.
That being said, we want to propose a way the federal government can handle funding for child care because, as I said earlier, we do see that the child care funding is likely to be eroded under the new system where funds are going to be reduced, and there will be no accountability and no requirement for funds to be spent on child care.
We're proposing, as we recommended in our brief on the social security review, that the federal government establish a special national fund to finance child care. I believe you have a copy of the executive summary of our brief entitled ``Taking the First Steps''.
To use the funds, the provinces would have to cost share and abide by the principles, which we've outlined in our brief, of comprehensiveness, high quality, affordability, accessibility and accountability.
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We can't rely on provincial governments to provide the resources or in some cases even to support funded child care. Although through CAP we finally have public funding for child care in all provinces and territories, it is still highly variable. In Newfoundland there is no funding for infant care.
It has been a long struggle over the last 27 years since CAP came into being. I have to tell you that I've been there for every year of it because I started working in child care the year CAP came into being.
There is a great deal of variability in affordability from province to province across the country and even variability in supply. Therefore, many Canadian parents are forced to choose from the best of a poor lot of services either because anything better is unaffordable or anything better is non-existent.
There is no provision for child care funding in the CHST. We're told that the federal funds for child care, as promised in many documents and books, have been included in the HRIF, but we see no evidence that any of these funds will be required to be spent on child care. We also see that the HRIF fund will be cut by 40% over the next three years. In fact, child care has ever been the poor cousin of social programs.
Provinces will be even less likely to initiate new child care spending. They may even reduce child care spending to free up money for other political priorities. We see this happening already. We've seen it happen in Alberta, Newfoundland and New Brunswick.
Saving money today by limiting or reducing spending on child care is an utterly false economy. The lack of accessible, affordable, quality child care seriously compromises the development of many Canadian children. This situation has been growing since the mid-1960s when the number of mothers of young children joining the labour market began rising. Today the number stands at 69% of mothers with children under the age of six.
In our brief to the HRD committee we proposed that a national child care program could even assist in reducing the national and provincial debts by creating sustainable new jobs, thereby enabling more parents to join the labour force and contribute taxes to government coffers.
It seems that this government's approach to debt reduction is reactive and regressive rather than proactive and progressive, i.e. cutting funding to child care programs thereby discouraging parents from entering the labour force or, in the case of some provinces, requiring parents to enter the labour force but doing nothing to ensure that quality care is available for their children.
If we invest in child care, the social and economic benefits will be such that ultimately the program will pay for itself and would not require cuts to the CHST.
I want to end by referring you to page 2 of our summary, the top left-hand corner which outlines our vision for child care in Canada. I'm not going to read it because I assume you all can read, but I do want to reiterate the first line in which we say: ``The well-being of all children is a shared societal responsibility''. We don't mean by that the well-being of all Nova Scotian children is a shared responsibility of only Nova Scotians. We believe all Canadian children are the shared responsibility of all Canadians. The only way that can be adequately and appropriately addressed is that there be a federal presence in the provision of child care services for them.
Thank you very much.
Ms Rothman: If it's okay with you, I'd like to make a few remarks and then have questions after that. Is that okay?
The Chair: As you wish.
Ms Rothman: For those of you who may not be familiar with it, the Canadian Auto Workers Community Child Care and Developmental Services is a separate, non-profit organization that actually delivers child care services to CAW members and to the community, mostly at this point in Ontario. We've been around since 1989. We currently operate programs in Windsor and Port Elgin, and we'll be opening in Oshawa and Oakville, the obvious places where the big three auto-makers have large factories.
I'm the director of the child care organization, which is separate, and I know that next week Buzz Hargrove, president of CAW, will be addressing you on a wider range of issues. I'm just going to deal with child care in relation to the CHST.
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The Chair: We're awfully glad you're here because it's going to be awfully boring with Buzz. He agrees with all our budget.
Ms Rothman: I don't know about that.
Some hon. members: Oh, oh!
Ms Rothman: Anyway, what I did want to say is that CAW has, however, long advocated for a high quality, universally accessible system not just for its workers and not just to be bargained through the private sector. In conjunction with the Canadian Labour Congress, Child Care Advocacy, women's groups and church groups, CAW has been active in pushing for high quality child care. Through collective bargaining with the big three manufacturers we've achieved significant monetary gains to help to provide - and I underline ``help to provide'' - affordable, high-quality child care.
What is interesting is the notion of a shared responsibility among a group of workers that when parlayed into a public-private partnership has really helped broader communities. Every worker in the big three and CAW contributes at this point 4.5¢ per hour. That significantly allows us to provide high-quality child care while paying good salaries and providing good working conditions. By that I mean the types of salaries and working conditions that workers in community colleges and the municipal programs in Ontario have while having fees, let's say, more affordable for parents. However, without the joint public-private nature of it, we couldn't do it. I would want to say that in no way does CAW see its individual initiatives as replacing a publicly funded program that would be able to service a wider number of people in all communities.
Some of what I'm going to say is the same, so I'm going to try to cut it down.
For CAW child care is a key economic issue. Interestingly enough, as has been stated, it is for your government. In the red book it was identified as a support to employment and job creation. It's also investing in the future, as you've also identified. Interestingly enough, in the last five years it's not only the traditional partners in child care in terms of labour organizations, women's organizations, a number of the social policy groups, and progressive church organizations that have been pushing for high-quality child care, but we even have the national transportation workers and the Canadian Institute for Advanced Research acknowledging the value of high-quality early childhood education, which is what high-quality child care is.
Of course child care is a key component and also fighting child poverty. Most poor children in our country wouldn't be that way if their parents were able to obtain adequate training and/or employment.
Certainly for women, child care remains the central issue in daily life.
I just have to say to Mrs. Stewart before she leaves, we're counting on your help. We have lobbied your father long and hard for many years, and he always used to say, my daughters have educated me well on child care. I just wanted to mention that.
Mrs. Stewart: My colleagues will ask you about the provincial connection there. I apologize for having to leave. I have to be next door.
Ms Rothman: That's okay. We understand.
It was Rosalie Abella who said 10 or 12 years ago that child care is the ramp that provides equal access to the workforce for mothers. That hasn't changed a bit. It has just gotten tougher, and Bill C-76 isn't going to make it any better.
Actually, listening to the Canadian Health Coalition people made me realize that we're a pre-program. We're not even really a program. We are embryonic. Child care doesn't exist in many parts of Canada.
I'm jumping around here.
So despite all these studies, commissions and task forces, including the first federal task force that you struck in 1984 under Katie Cooke, which produced the first decent research on child care, for most Canadian children and families access to high-quality child care is still elusive.
I should add that we don't have any comprehensive plan or a federal framework that sets out principles and establishes a funding mechanism that would encourage the provinces to provide high-quality, universally accessible care.
The Canada Assistance Plan has provided - I don't really see it as an alternative but just state it as the obvious status quo - an alternative albeit limited route where cross-share funds could assist in the development of child care services for low-income families. But it's primarily a narrow funding mechanism. It doesn't address the issues of quality or availability, things I presume you probably have heard about in other forums, and certainly in contrast to what the Canada Health Act sets out for health care services.
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I guess what we really want to say is in the reality of the mid-1990s, Canadian families are facing the proverbial patchwork that's more tattered and torn than it's been, specifically as a result of the reduction in federal transfers. The cap on CAP has taken its toll on the growth in child care.
Most families don't notice the modest growth that was achieved during the 1980s. I don't have a chart with me, but I know one of the presenters next week will show you. Increases went up and they have fallen off. I'm not even sure if we're serving one in twelve of the child population with high-quality child care in Canada.
I could give some of the same examples Sue gave around limited services. I'll add a couple more that are certainly relevant to the CAW working population.
There are very limited services for parents who work what are called irregular hours - anything before 7 a.m. and after 6 p.m. or even 7:30 a.m., I'd say - although 60% of parents of children under 6 are in that category. That comes from the national day care study, which is one of the most comprehensive studies of parental preferences and needs.
What I would like to emphasize is that in child care we really have a devolved service already. We have inconsistencies, which some might describe as flexibility. We don't think it's flexibility that reflects a conscious policy of responding to regional differences and needs.
We know from our many long, hard years of talking, working and struggling that the inconsistencies across the country reflect instead the inability and in many cases the unwillingness of provinces to meet the wide range of needs of families.
I know you'll probably want to ask what we're doing with the provinces. Each of us certainly has taken that up and continues to take it up at the appropriate provincial level.
We, as advocates of a national child care system, were hopeful that the commitments in the red book, which included, as you probably know, new cumulative expenditures of $120 million that turned out to be in each of 1995, 1996 and 1997, totalling $720 million, and the objective that was clearly stated to create genuine choices for parents through the development of regulated child care alternatives would begin to improve the situation for Canadian families.
I should point out that these were definitely different directions from those of the previous Mulroney government, which I would say further entrenched a market system by significantly increasing the child care expense deduction, which primarily benefits high-income Canadians, and by multiplying the dependant care allowance paid to participants in federal training programs, which is virtually a voucher. It has no accountability.
In fact there is not reporting on that money, and the rumour mill has it that much of that money is in income transfer and isn't even spent on child care.
We were hopeful and then went on to see some of the statements in Improving Social Security in Canada and the supplementary paper on child care and development. I think when we come to review Bill C-76, our interpretation is it virtually precludes the ability of this government to live up to those commitments and provides no safeguards against a total unravelling of the fragile network of services that exists.
We don't need more flexibility. We need strength. We need national leadership in establishing the principles, and we support the principles of the Child Care Advocacy Association and many other groups.
We're not a well-established service. We don't have alumni like post-secondary education. We don't have people who can pay more fees. At the beginning, if they're fortunate, they have jobs and careers, and if they're lucky, training.
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Then there's a wide range of children with special needs and of course parents who are not currently in the paid labour force and want to make some use of the child care services. Nor of course is child care mandatory in any of the provinces.
The devolved scenario that the Canada health and social transfer would lead to if enacted could, as Sue said, be a situation where no funds are spent on child care, with no apparent financial consequence. Without that requirement to match the funds, we don't know what will happen to the current $850 million the provinces are spending on child care.
We need that creative tension, for lack of a better word, between the provinces and the federal government to keep it going.
The other serious concern we have is that in a very open-ended mechanism, as the CHST has described, it would appear the door would be wide open for the use of vouchers, which are a totally unaccountable use of public funds. It doesn't create choices for parents.
Our research tells us that high-quality, regulated child care services enhance the development of all children and poor quality services - I wouldn't say all unlicensed services are of poor quality, but they're certainly of unknown quality - have a detrimental effect on child development.
In conclusion, what I'd like to say is we do oppose the Canada health and social transfer. With regard to child care, we urge you to shift your orientation away from the market system, which resembles much more that of the previous government; to exercise federal leadership in working with the provinces; to implement your commitments outlined in the red book and the other publications; to amalgamate your current spending, including the dependant care allowance and a phasing out of the child care expense deduction as services increase; and gradually, and I said ``gradually'', to acknowledge the fiscal realities: begin to build a system that meets the needs of Canada's families.
Sorry I took so long.
The Chair: Thank you very much.
[Translation]
I will begin with Mr. Crête.
Mr. Crête: Thank you, Mr. Chairman.
My spouse operates a child care service in a family environment where, for $18,000 a year, she has influence on seven or eight children - I will probably never have as much influence in Parliament by and large - so I understand very well your arguments.
I would like to ask you a question that is not necessarily directly linked to the Bill C-76, but that seems to me very pertinent. Considering the commitments that since ten years the national parties have made concerning a national child care service in forms of all kinds, what would be now the best way to have those commitments respected? I would even say facetiously that the only way maybe would be asking each of the 295 MPs to go and work one day in a day care centre. This might be a very good way to get them to appreciate what people are doing.
On the matter of national child care, however, going by what I saw during the tour we made with the Human Resources Development Committee, the situation is very different from one province to another. From what I have been able to see, there are some provinces, like Quebec and British Columbia, where services seem to be far better developed than in the other provinces.
In a national program, how would you ensure that the money does not become a bonus for non-performance, that is, that far more money is spent in the areas where the provinces have not yet assumed their responsibilities than in the provinces that have already significantly assumed their responsibilities? What would be the incentive to ensure that there is more of an incentive for efficiency than an incentive for inefficiency?
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Ms Tougas: You spoke about a number of things. I would like to go back to the reason why previous governments did not fulfil their commitment. I am inclined to say that it may be because there were too many men in previous governments and that they were past the time when their children were in child care, or else that they had the benefit of having a spouse who agreed to stay home and look after the children. I'm kidding. I do not think that this is the case for everyone, but it is still what people sometimes think.
I also think that we forget. We see child care as a mere expenditure, as if we took money, from the public purse, and spent it. We forget that investing in early childhood education services - and this includes child care services - is an investment in the future.
Our association is doing a study to establish the benefits, not only the social benefits - because those, we feel them - but also the economic benefits from investing in early childhood services. This study will be coming out soon and I think it will be very significant. We see that in a very few years there will be an ample return on the initial investment. Unfortunately, I think that only arguments of a strictly economic nature can convince the Department of Finance to change, convince them that there are benefits in investing in child care services. So we will add that argument to the social and educational arguments.
Now, I will return to your question. How do we ensure that in the provinces, since there is inequity... It is true that each province is at a different level of development. Some provinces - I will take the example of Quebec, with which I am very familiar - have quite a well developed child care system. In recent years, things have fluctuated, but it is nevertheless relatively well developed. There is training for staff. There are requirements regarding regulations for infants. So in a frame of reference where quality child care services would be required in order for public monies to be invested, Quebec would have to sit down with the federal government and see which levels of quality would need improvement. This might not be its priority. Perhaps accessibility should be developed, in Quebec. Quebec, like the other provinces, does not have a lot of child care services. There is no greater flexibility of child care services in Quebec than there is elsewhere. So efforts could maybe be focussed in that area.
Discussions could be held with each of the provinces. For example, in Newfoundland, where there are no child care services for infants or regulated child care services, that could be the first priority. So there would be different levels, but we would all be going in the same direction. We cannot define quality, but we know what it is. This would be done gradually, respecting the various communities, since developments take place at the local level as well. Native people have a concept of quality and a way of achieving it that are very different from our own. So we would be respecting these differences, but still pursuing objectives.
I know that this whole question of national standards and national objectives is creating a problem. That is not what we are to talk about here, but the fact remains that right now, in Quebec, as much as in the other provinces, we have certain principles and certain objectives for the development of child care services. With the goodwill and the good intentions of governments, I think there could be an agreement to begin these discussions and even start putting services in place.
The Chair: Thank you, Mr. Crête.
[English]
Mr. Campbell, please.
Mr. Campbell: Thank you for your presentation and for making the effort to be here from various parts of the country.
One of our members, Ms Brushett, couldn't be with us, but wondered if Ms Wolstenholme is from her riding.
Ms Wolstenholme: I'm from Halifax.
Mr. Campbell: Ms Brushett's riding is Colchester.
Ms Wolstenholme: I grew up very close to her riding.
Mr. Campbell: I think she recognized the name and wanted me to ask.
I thank you for speaking to us about child care and for reminding us of things we've said we intend to do and have made commitments about with respect to child care.
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I want to pick up on something Ms Stewart was saying earlier. You were here in the room when the earlier group was at the table. I think in fact Ms Tougas made the point about standards and the role of the federal government, but I want to pick up on what Ms Stewart said and ask why the provincial governments would not do more for the very same reasons, the very compelling reasons you've given for child care.
It's heartening to hear from witnesses from across the country - and not just when they speak about child care but when they speak about a whole bunch of things - about the important role of the federal government and how we need to be there to get these big, bad provinces to do the right thing. It's quite fascinating, to me, the extent to which it is a pervasive feeling across the country that the feds have to be there with standards in every case or the provinces won't do it.
I remember that in the case of medicare, which we were discussing earlier, of course it started as a provincial program. It's something Saskatchewan accuses the feds of stealing from them. It was a provincial program.
I don't know if you'd care to comment on that issue. It is an interesting one that is in your presentation and cuts across all of them. It makes our job much more important.
Ms Rothman: I have to start by saying after all it is a Liberal government, and I think people thought they were getting what they had before. It ain't looking that way right now, from my perspective.
However, on another note, I would say it's not only that the federal government has to be there and encourage or hit the provinces on the head to do it. They also have to spend.
Mr. Campbell: That I heard loud and clear.
Ms Rothman: We've focused on the structural problems of the Canada health and social transfer, but obviously the reduction of about $4 billion in the next couple of years is going to make a major difference.
Mr. Campbell: Let me bring the two together this way. We've had many people appear before us over the last few days and we'll have many more, and everyone has said: ``If you leave it to the provinces, the area we work in or the area we care about will lose out''.
They're not all right. Not everybody's going to lose out. They're complaining that there will be some winners and some losers. Is your position that child care will lose out when the province divvies up the pie?
Ms Rothman: Yes, though I have to say I'm from Ontario and, to be fair, even with the cap on CAP, under pressure the current provincial government did increase expenditures.
There are problems, but quite frankly I think we have been the poor cousins. Kids don't vote and young parents - they're not all young, but many are - tend to be vulnerable and go in and out of child care in two to four years.
As I said, we don't have alumni associations and power.
Mr. Campbell: But in spite of all that and in spite of the constraints the Ontario government says it functions under financially and blames us for, they have increased the budget for child care.
Ms Rothman: I have to say yes, they have. That's not a lie. Let me tell you, I spent lots of energy encouraging them to.
Of the three with the cap on CAP, probably British Columbia has increased it somewhat as well, but we need you both.
[Translation]
Ms Tougas: You may find it odd to hear someone from Quebec react. I have been here in English Canada for two years now, and there is a concept I hear a lot about and that surprises me because I did not know that this concept existed so strongly among English Canadians. That is the concept of nation.
My friends in English Canada tell me they feel that a child from Manitoba or Newfoundland or Saskatchewan is first of all a Canadian. They have a solidarity with these children. This solidarity means that they expect the federal government to have principles and standards so that the provinces which are perceived by English Canada, and no doubt by the people who have come to speak to you, as regional governments... Of course, this is a way English Canadians have of seeing this country and I think that is one of the reasons. You will have all these people coming here and saying: ``Yes, the federal government must trespass on provincial jurisdiction.'' That is what you seem to be saying. People feel that there is a federal role and that it is the only way of keeping this connecting thread from one province to another.
Mr. Campbell: And in Quebec, what is your story?
Ms Tougas: Our association feels that Quebec will have to determine the position it will be taking in that debate.
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In terms of the Association, we are making our presentations with respect for what Quebeckers and native peoples will decide in terms of national standards.
The Chair: Thank you, Mr. Campbell.
[English]
Mr. St. Denis (Algoma): Thank you, ladies, for being here.
Mr. Crête challenged us to go to a day care centre and experience what it's like. I'm pleased to put on the record that I was a founding parent of the U of T co-op day care centre.
Ms Rothman: Oh, that was one of the early ones in the country.
Mr. St. Denis: It was 1971.
Ms Rothman: Okay.
Mr. St. Denis: That was an interesting story. I changed thousands of diapers in those years.
My question is based on an experience we had as parents at that time, and I think it goes to the core of the issue, at least for me. I'll first acknowledge that day care workers are highly underpaid typically, but we found tremendous pressure from the bureaucracy and, I would say, the professional class within the early childhood profession that almost drove us parents out of business, because we had a parent co-op.
If it's the philosophy, as I see in this budget, to empower provinces and ultimately empower individuals, isn't the emphasis of your approach going to take away the individual's freedom to choose in-family care, co-op care or professional care? If the money goes to individuals through tax credits or subsidies, they have choice. If the money goes to the publicly funded day care centre, would it not limit the choice for individuals and would it not also create a problem in rural Canada, where the infrastructure is by its nature very different?
Ms Rothman: Let me make a couple of comments and then I know Sue from Nova Scotia probably will want to comment.
First of all, I have to tell you I too was a co-op parent at York University's day care. I changed many diapers and am aware of -
Mr. St. Denis: You're younger than I am. It was probably in the 1980s or something.
Ms Rothman: No, not quite. But at any rate, that's nice.
The Chair: She sure looks it, I'll tell you that.
Ms Rothman: On the issue of bureaucracy, I think in the last 20 years many of us involved in child care who have come at it from many perspectives have come to learn more about what high-quality child care means. It does mean some flexibility, not inappropriate rules and regulations, but it means certain principles on what raises healthy kids.
To get to your issue of giving people tax deductions and vouchers, you didn't say vouchers; you said tax measures.
Mr. St. Denis: Assistance, yes.
Ms Rothman: You suggested that would allow people to choose.
The reality is there's nothing for them to choose at that point. They're totally on their own in a market system where they have to go to the bulletin board and take a name. There's no reliability; there's no predictability; there's no accountability.
The system we've talked about is meant to be diverse. In Mr. Peterson's riding I know there are day care centres that have kosher food, observe strict Jewish dietary laws, and do all kinds of things to meet local needs. In other ridings we have one program specifically set up to meet the needs of inner city native children. In rural areas they have a combination. There aren't very many, but there's at least one program serving the seasonal needs of workers around Collingwood in Ontario.
It's possible to do it, but it's not possible to do it without commitment and planning. None of those things continues without it.
Ms Wolstenholme: Another point is of the many studies that have been done regarding parents' preferences for child care, licensed group child care has been the care of choice for the majority of people, even though many of them didn't have the possibility of accessing that kind of care.
As Laurel said, what we're looking at is a diverse system that would provide for a range of services that would meet the needs of very many diverse groups in terms of the nature of the program, the hours of the program, the way it's organized, the place it would be operating in and so on.
As she said, there's really a lack of choice at the present time. Many people would use and have indicated their preference to use licensed group care where it's not available.
Mr. St. Denis: Thank you.
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The Chair: Thank you, Mr. St. Denis.
[Translation]
I would like to say to the witnesses that they have presented us with a very good study.
[English]
``Taking the First Steps'' is very well put together. It presents to us the ideal of what we should be striving for: a universally accessible, comprehensive, high-quality, publicly funded and accountable child care system.
[Translation]
You have presented the principle that one of the most important things for our future is the investment we can make today in our children's welfare. No matter what party we belong to, we cannot dispute the goal you have put forward to us.
[English]
It's going to be very important for us in the days ahead to look at the issue of the terrible budget constraints and to set our priorities.
I didn't think a group such as yours would be coming before us today or during these hearings, because I think a lot of us have relegated child care to the back burner. The fact that you have come here again I think has rekindled an interest in all of us that we have had for a long time in this very neglected area of social policy. It's one that I think you've pointed out can pay great dividends if we're prepared to make maybe a modest investment today.
On behalf of all of us, may I thank you very much for being with us.
Before I close off for today, I would also thank the translators, who have worked for the last four hours in a very intolerable condition, one they didn't have to subject themselves to, but without their cooperation we would not have been able to hold all of these hearings this afternoon.
We adjourn until tomorrow at 9:30.