EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, May 18, 1995

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[English]

The Chairman: Good afternoon, everyone. I would like to call this meeting of the Standing Committee on Human Resources Development to order.

We're pleased to have before us this afternoon the Hon. Lloyd Axworthy, Minister of Human Resources Development. Mr. Axworthy is here in the context of the committee's review of the estimates for the Department of Human Resources Development. We'd like to welcome the minister before us today along with senior members of the department, who I would ask that he introduce for the record before beginning his opening remarks.

If the minister is ready to make his opening statement, he's free to do so. I understand we have the minister until 5 p.m.

Hon. Lloyd Axworthy (Minister of Human Resources Development and Minister of Western Economic Diversification): Yes, sir.

The Chairman: Okay. We'll guide our questioning accordingly.

Mrs. Ablonczy (Calgary North): Mr. Chairman, I have a point of order before we begin, please. I hesitate to bring this up with our distinguished guest here with us, but as you know, there has been some concern about the operations of the committees arising out of events in another committee. We have never had these kinds of difficulties in this committee.

I believe it would be in order to move the following motion: that the committee ensure that the chairman uphold all rules and practices of this committee and, in particular, a member's privileges to debate each issue before committee as provided for in the Standing Orders, a member's right to question witnesses, a member's right to seek advice from legal counsel, a member's right to request input from committee research staff, and a member's right to move motions in his or her language pursuant to Standing Order 65.

I would like to move that motion and would ask that it be affirmed by this committee, so that we all know that some of the difficulties that have unfortunately arisen in other committees are not going to plague our deliberations today or in the future. Thank you, Mr. Chairman.

The Chairman: The motion has been heard by members of the committee. Is there anyone who would like to debate that motion?

Mr. Knutson (Elgin - Norfolk): My understanding of what the member is asking is that we pass a motion that we're not going to break the rules. That seems a little redundant. She's indicated those are the rules, and those are the rules. Why do we need to pass a motion?

The Chairman: Any other questions related to the motion?

Motion negatived

Mrs. Ablonczy: Mr. Chairman, I assume, then, that this committee will not be following the rules.

Ms Cohen (Windsor - St. Clair): Do you still beat your wife?

The Chairman: To my knowledge, the committee has always followed the rules. If we ever break the rules, I would invite you to call the attention of the chair to the fact that the rules have been broken.

Mrs. Ablonczy: Mr. Chairman, unfortunately in another committee the rules were flagrantly violated just last evening, and I think we need to know where we stand on these things.

The Chairman: Are you saying the rules have been broken in this committee? I'm not aware of what's been taking place in other committees.

Mrs. Ablonczy: What I'm proposing here is that we affirm that we can be assured that the rules will not be broken.

The Chairman: Well, I give you the undertaking as chair that as far as I am able, I will attempt to maintain the rules of decorum that are provided by the House, and that if I inadvertently break any of the rules of debate or deny members reasonable opportunity to pose their questions in a manner that is consistent with parliamentary practice, the member who has been so offended will let me know.

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Mrs. Ablonczy: I appreciate that, Mr. Chairman. I must say I've always found you to be a very fair and proper chairman. I am disappointed, however, that this committee was not prepared to give that affirmation to the motion.

The Chairman: I think we recognize that we are abiding by the rules of this committee, and I think the interpretation given by the results of the motion is that it was seen by the committee to be unnecessary.

Miss Grey.

Miss Grey (Beaver River): Mr. Chair, I would just like to -

The Chairman: Is this on a point of order?

Miss Grey: Yes, it's on the same point of order. With the motion that my colleague brought before, which was just defeated, I would like to ask Mrs. Cohen in what context her -

The Chairman: Would you address your remarks to the chair, please?

Miss Grey: Excuse me. Through you, Mrs. Cohen's remark was, do you still beat your wife? I just don't see exactly how that relates to this motion. Perhaps she could clarify that for me.

The Chairman: I don't want to get into a debate. We're here to hear the Minister of Human Resources Development.

Mrs. Ablonczy: Mr. Chairman, I appreciate your hearing my point of order and my motion.

The Chairman: Thank you.

Mrs. Ablonczy: I'm prepared to let this meeting continue.

The Chairman: As far as I'm concerned, to my knowledge we've maintained the rules in this committee. We intend to do so, and as I've mentioned earlier, if I inadvertently break the rules or if any members of the committee do so, I would like that called to my attention. We'll do our best to ensure that parliamentary practice is rigorously applied and that we get our work done in the most efficient way possible.

Mrs. Ablonczy: I would have appreciated that reassurance from the rest of the committee, but I certainly accept yours, Mr. Chairman.

The Chairman: I don't know that we should interpret anything that has been said by any other members as being a failure to reassure you.

[Translation]

Mrs. Lalonde (Mercier): On a Point of Order. Before the Minister takes the floor, I would like to ask you, Mr. Chairman, and the other members of the Committee, if we are going to meet the Minister again. The research service of the Library has prepared a guide that includes 85 questions. It starts, quite rightly, by saying that the programs that come under the Department of Human Resources Development represent close to 60% of the total program expenses of the federal government.

I know that we have time constraints and that we will have to establish priorities, but it seems to me that it would be important for us to have all the necessary information.

The Chairman: Mrs. Lalonde, I will contact the Office of the Minister to see if he could come back with his team another time, since it is my role as chairperson.

I would like us now to start with the first item on the agenda, which is the testimony of the Minister of Human Resources Development.

Mr. Minister, you may start.

[English]

Mr. Axworthy: Thank you very much, Mr. Chairman. I appreciate the brief respite in order to get my notes together.

As you've noted, I'm joined this afternoon by the Secretary of State, Training and Youth, the Hon. Ethel Blondin-Andrew; by the Deputy Minister for Human Resources Development, Jean-Jacques Noreau; by Mr. Hy Braiter, Executive Director, Insurance; and by David Good, who is the Assistant Deputy Minister for Financial and Administrative Services. Mr. Good is a new member of the department, and we welcome him to his first round of estimates. This is his first blooding on this portfolio.

Mr. Chairman, I would like to begin by first expressing my real thanks to the members of the committee for the very extensive work they've undertaken. I haven't had a full opportunity, other than individually from time to time, to say how much I appreciated the incredible effort undertaken by members of the committee and by all parties during the public consultation phase of the social policy review. As you know, it was probably the largest undertaking of public discussion on a public policy matter in the history of this country, and we have ended up with over 100,000 different submissions, presentations and representations.

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The committee report has been a very important guiding stone for us in developing our approaches to the various initiatives in social reform. I found the report was written with a number of very important insights.

As you have probably noticed, we have already incorporated many of the recommendations into government policy. In fact, we are seriously considering them as part of the initiatives we are now developing for reform of the insurance system, and initiatives in the employment development parts of the program. So I want to express my real gratitude to members of the committee in that respect.

In my opening remarks I would just like to give members of the committee a brief report of things we have initiated, based on the committee's report. In a sense, this is one of my responses to the tabling of the report.

As you well know, we have taken the recommendation about the block funding initiative, which has translated into the new Canadian social and health transfer. It was based on many of the findings of this committee resulting from the necessity to look at a way of developing more flexible approaches and find a way of consolidating some of the existing programs.

The initiatives and proposals contained in the report, along with others dealing with several aspects of the unemployment insurance system, provide us with very useful evidence about the need for changes.

I announced recently that we would not be proceeding with the two-tier system because I think, as the report pointed out, while the objectives of reducing dependency and giving a much better set of work incentives inside the unemployment insurance system is still very important, there are more effective ways of doing it.

I do want to comment that certain parties represented here interpret that change as an indication that the reform is over. Well, it isn't, and in fact it's a better reform as a result of that. I am reminded of Winston Churchill's comment when asked in the House of Commons one time why he had changed his mind. He said ``because I have new information''. I would say that's a proper adage for any politician to take, especially in the area of public policy. When you get better information from good dialogue with people and hear their points of view, you can often come up with a much better result. I think we can report to the committee that this is the case.

During the course of my remarks, if it's appropriate, I will be ticking off where we have undertaken specific responses to the committee's recommendations, to demonstrate the kind of activities we are presently engaged in.

I would like to turn for a moment to the public consultation exercise. I don't have to describe to you the activity you are engaged in, but I do want to table, if I might - I have given copies to the clerk - a full report that has now been prepared on public consultations, which we will make available to members of the committee. It shows some of the broad-based support for reform initiatives, but at the same time it shows where Canadians, in very large numbers, indicated the kind of options and initiatives they would like to see to bring about change.

As part of this, they want to give people more responsibility for helping themselves. There's a very strong indication of a notion of what you would call mutual responsibility or personal responsibility in terms of people securing better employment initiatives.

There's a very strong case being made by those public consultations for the need to take on the really serious job of cutting down waste and abuse. They want the unemployment insurance to be a fair system. I think they recognize that over the years a number of problems have gone up in the system, but they want to make sure it retains it's capacity to deal with people fairly, provide proper benefits, and focus support on those who really need it.

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So I would recommend, Mr. Chairman, that this report on the public consultations, based on the work the committee did, based on the over 50,000 responses we received from public questionnaires, based upon well over 200 public townhalls that were initiated by members of Parliament, based upon a number of very specific briefs that were prepared by community interest groups across this country, based upon a number of special consultative arrangements we had with people in the construction trade, the automotive trades, social organizations.... I think you will find within that report a compilation of where they are going, and now the question is how do we synthesize it into a reform package?

I want to assure members that we are now well under way in actually developing the reform initiatives. I am now preparing legislation for Parliament that will be presented this fall, and I can give you a preview of some of the things we intend to do, and I would like to do that during the course of my remarks here today.

Mr. Chairman, I thought it would also be useful to provide a report to the committee on some of the initiatives associated with the social reform, but also part of the red book commitments we made as a government as part of the new look or the new developments within the department.

Members will recall that in May 1994 we announced a strategic initiatives program that would be undertaken in cooperation with the provinces and territories. We now have 16 strategic initiatives with 8 provinces and the Northwest Territories. These initiatives, which have now been under way for over a year, affect more than 30,000 people, including 5,000 young people, 4,000 single mothers, and 1,000 older displaced workers.

They involve a number of very highly successful, community-based pilot projects, an example being the student work and service program implemented in Newfoundland and Labrador, which has assisted 2,700 students, nearly 1,000 of whom were on social assistance, to go back to school.

It was basically a voucher-style program in which we provided a very simple incentive for young people to restart or re-begin their education. Within this program, approximately 97% of social assistance recipients have used their tuition vouchers, and we have a very large number who have now continued their education for a long period of time. The Secretary of State for Training and Youth is available to answer further questions.

Let me give you a related example that takes place in what is called the Sydney Mines Learning Centre in Cape Breton. The learning centre is providing fish plant workers and people who have already made their living from the sea with a second chance at education. Already some 420 students have passed through the program and are now obtaining employment in alternative ways.

There's a project in Brandon, Manitoba, which we call the training rural youth program, which helps rural unemployed young people get jobs by providing them with a broad base of business skills that are initiated in the small local communities. Rather than having young people go to community colleges several hundred miles away, these programs are actually taking place in the local chambers of commerce, local basements, and are organized in partnership with the business community, with the local community colleges and schools, and with our own employment counsellors.

We have an agreement with Brandon University, which is doing probably one of the most interesting evaluation techniques, to find out exactly what the progress in each of these programs would be.

Éduplus, a Quebec project, is a

[Translation]

project implemented in Quebec providing an 80% rate of job placement to unemployed people as well as fast and personalized service to clients, including skills training and various job opportunities.

These projects, implemented here and in Montreal East, could serve as a model for the changes that we want to make in the delivery of our services.

[English]

That just gives you a small sampling of the way in which the strategic initiatives are working.

One of the most interesting programs is the one we have initiated in the province of British Columbia, with the cooperation of that province, on the issue of child care. I thought it would be interesting, Mr. Chairman, if I might, because certain members of the committee are asking how we're working with provinces....

This is a letter from the Hon. Penny Priddy, who is the minister responsible for child care in the province of British Columbia. It was a letter I just received today, in fact. She said:

My staff and I are encouraged by the progress we have made thus far in developing the child care demonstration project funded through Strategic Initiatives. Over the next four years, we look forward to a continued positive relationship with you and your staff as we test and evaluate these initiatives.

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I would be glad, Mr. Chairman, if members are interested directly, to provide summary reports of each of these strategic initiatives so members can see exactly where they're working. I think members would find them giving us a brand-new look at how we can provide more direct assistance to Canadians.

In the youth initiatives program, which is a very high priority for myself and my colleague the Secretary of State, I should indicate, as you'll see in the estimates book, that this year we have increased the funding of our program by $43 million. At a time when we have very substantial restraints, we have gone from $193 million in the 1994-95 estimates to $236 million in 1995-96, which I think very clearly indicates the priority we put on young people and getting them back to work.

We have, as members will know, announced once again the student summer job program that provides employment for close to 50,000 students to three or four major streams.

This year we're undertaking some new initiatives. One is to include, as part of the summer youth program, a Youth Service Canada stream, which would draw off our broader national youth service programs, and the youth internship program. We're also engaged in a youth entrepreneurship program, which gives young people start-up money to start their own businesses during the summer. In some ways, it's been one of the most successful programs we have initiated.

The Youth Service Canada, which was launched just about this time last year, in April 1994, has now over 1,100 young people enrolled in 67 sites across Canada. Another 62 projects have been approved or are in the implementation stage, and we are targeting 17,500 young people to be involved in a youth service corps over the next four years.

We also have, as you know, initiated this time last year the youth internship program, which was a strong Liberal commitment to provide young people with a transition from school to work. We now have a budget set aside of $118 million for this program. In the first year of operation we've been able to recruit over 10,000 young people across Canada for youth internship.

That's been done, Mr. Chairman, very much with the cooperation of the private sector. We have established a number of internships through human resource councils in electronics, horticulture, tourism, knowledge industries, where the business-labour partnership sets the criteria, establishes the curriculum, works out the arrangements with the local high schools, community colleges, CEGEPs, and then provides that ongoing, work-based experience so the young persons, whether they're at the high school level or the post-secondary level, have a combination of formal education and work-based training.

It's really exciting to see the way in which the knowledge of the private sector undertakes the management of the program and in fact contributes their own funds towards it, so we get an awful lot more bang for the buck.

We also have within that stream a community-based stream in which local organizations are able to provide internships. I think the youth internship program is one that really demonstrates the value of enabling young people to make that combination. Oftentimes, these kinds of real pioneering initiatives that are taking place in Canada are now being looked at by other countries as a way of bringing in the private sector and the community sector as being the primary vehicle by which the internship program can be delivered.

Again, we would be happy to talk to or give committee members more information.

I mentioned just now sector councils. Let me focus on what is a very unique Canadian experience.

As part of our efforts to encourage the private sector to assume greater responsibility for managing consumer resource needs, we have launched 16 different human resource sector councils. They now cover about 36% of Canada's labour force, and we have about another dozen in the preparation stage. These councils have worked together to develop blueprints and plans for their human resource requirements.

While it's important, and I probably don't have to tell members of this committee, I was quite struck by a Statistics Canada report that was tabled just about four weeks ago, which did a study of innovative export industries and evaluated what factor it is that enables one firm to become an innovative exporter and another firm to flop. The key criterion in every single case was the human resources investment they were putting in: labour-management relations, proper training, new workplace or reorganization. That's what made the difference in terms of a highly successful, innovative, export-driven firm and other firms that were not finding the ability to break into those markets.

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I think using this kind of sector council is a way of introducing workplace training, internships, and new criteria and standards for the industries, as well as of enabling each industry to do its own blueprint of planning, which we think will provide enormous benefits in the development of a more productive workforce and a more competitive workforce.

I'd like to mention two other areas as well, because members of the committee asked me questions about them last year. As you know, last June, with the help of this committee, we passed a new Canada Student Financial Assistance Act. We have already initiated a number of improvements in that area.

At this point in time I think we've reached agreements with eight of the provinces on setting up new needs programs. That doesn't include the province of Quebec, which has its own program; we simply transfer the funding to them in this case. Under this program we have also freed up about $200 million worth of direct grants, which will go up to $4,000 for students with disabilities, women who want to pursue graduate studies, high-need students who come from a depleted income base, often part-time students and single parents.

We think that is the beginning of what we hope to be able to announce this summer, because we're working very closely with financial administrators in the provinces and in student groups to develop a new debt management strategy for students. With the ongoing rising costs, clearly they have to face new issues. That debt management strategy is one we would hope to be able to put in place.

But these initiatives we've already announced - the new grant programs for high-income-need students, the loan forgiveness that will enable students at the completion of their studies to have an eighteen-month period of grace before they have to repay their loans if they are in need - I think are an indication of how we're trying to put the pieces together.

I should indicate as well, Mr. Chairman, that we have now reached agreements in principle with two banks for the shared risk financing of the student loan program. The other financial institutions have until May 26 to come in as part of the program, but they will be the primary funders, so we'll be using their private capital to fund the student loan program beginning this fall.

One final area I think is worth mentioning are the changes we've made to the CPP disability programs. For example, as we've talked about in this committee on many occasions, we have to find a way of changing the rules of benefit programs to give people a greater incentive to go back to work.

We started that under the disability program by making four quite important changes that affect Canadians with disabilities. First, CPP disabilities may now be retained by beneficiaries while in training or in school. In other words, they won't necessarily lose their benefits by going into education. This will help them to acquire new skills and job opportunities.

There will also be opportunity for those with disabilities to work in community-based projects, resource centres and others, and not automatically be disqualified from their benefits. If they can prove that it's work of a certain term, they can maintain their benefits.

A third area we think is quite important is to maintain the disability benefit payment for the first three months of work in order that people don't feel they're going to be cut off right away if they can't make it in the first round.

Fourth, for those who have recurrent diseases, such as multiple sclerosis or AIDS, for example, and who want to go back to work but then find that the disease reoccurs and they have to leave, there'll be an automatic reinstatement of their benefits, so once again they'll have the opportunity to work. I can say to you that we've already received a number of supports, particularly from centres working with HIV-infected Canadians, who now find this is a very substantial incentive.

So those are the ways in which you can provide new work incentives without having to spend a lot of money; let people make their own choices but basically bring down the barriers. Mr. Chairman, those are some of the things we've done during the past year to initiate these programs for young people, disability groups, the business labour sectors, and others.

Now what remains for the coming year? As I mentioned earlier, the reform of the Unemployment Insurance Act will be a priority. We are now working on a proposal, and the key initiative will be to transform the unemployment insurance program into what we call employment insurance. So basically we will focus on jobs, not joblessness.

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Through that reform, we will be able to simplify the system for both workers and employers, to make the system substantially easier to work with and therefore save administrative costs, both in our department and at the same time for the employer and for the employee.

We want to remove the disincentives that hamper job creation and discourage workers from returning from the workforce. That, you will all recognize, was a key recommendation coming from this committee, that we really tackle the work disincentives. I think the proposals contained in the committee's report dealing with new forms of eligibility benefit establishments and graduated benefits were ones that we were looking at very seriously.

I can't give you chapter and verse, because we are just now beginning to discuss it in cabinet. It will be several weeks before we've completed, but I can assure you that the bill will be presented this fall. I think members of the committee will see much of their handiwork reflected in that document.

We also would see very much converting the system into a re-employment program so there would be substantially different ways of individuals getting the tools they need to get back to work. The mission statement for this department is to deal with the problem of poverty and get people back to work quickly and cheaply as we can.

To make this work, it also requires a very substantial reorganization of the department. Over the years we have had a number of programs. At the present time, Mr. Deputy, do we have about 49 programs?

Mr. Jean-Jacques Noreau (Deputy Minister of Human Resources Development): We have 39.

Mr. Axworthy: We have 39 programs that we ask each employment centre to administer. We're looking at reducing those programs down to a stream of about 10 or 12 basic services. That will open up far more space for the provinces themselves to occupy, and we will give a much higher level of decentralization, making the department more horizontal in its view and allowing a lot higher degree of discretion and judgment at the local level to tailor-make the re-employment programs to suit and fit the communities they're in.

So rather than having programs driven from the top down through a program management basis, we will be looking at program results as a basis of accountability, as recommended in your report. Who is back to work and what kind of education they have received - that will be the basis for accountability. To substantially decentralize the system will mean a fundamental reorganization of the department, which the deputy and his officials are now working, that we will be introducing this summer throughout the country.

What's interesting about it, Mr. Chairman...and I know some members here are from rural areas, but I can guarantee you that we will expand, not shrink, the range of service. Even though we are constrained financially through our budget, we will actually be able to provide a broader range of service, particularly for rural and small-town communities across Canada.

It means using a lot of the new technology. It means decentralizing the department. But as I've said in a few speeches, we are moving from the model of General Motors to that of Canadian Tire, which I think is an appropriate way of describing what we want to do.

So the redefinition of the employment programs, a reorganization, and in effect a reinvention of the department itself, will go hand in hand with the changes to the employment insurance fund.

One of the areas that will accommodate that is the human resources investment fund that was established in the last budget. I wanted to underline that it's an integral part of the new employment insurance system we will be introducing. It will be integrated with the various programs we have that are designed to make the most flexible use of our human resources.

Its aim will be to get people back the services they need and will provide the funding for child care, a crucial measure to help unemployed parents find work and get training. This funding is in fulfilment of our red book commitment to co-invest with other provinces in child care spaces.

Thus far, aside from the complimentary letter from Madam Priddy, who by the way is working with provincial ministers and me to set up discussions, we have not yet had any firm indication of provincial interest. What they have said to us is that they want first to look at the impacts of the CHST before they engage in any direct contracts with us on child care. I think that is a fair operation.

But I have been discussing with my British Columbia counterpart the best time to actually organize consultations with the provinces to arrange for joint investments in child care. In the meantime, we are prepared to hold direct bilateral discussions with any interested province.

The government is also now acting upon its commitment to fund the substantial improvement of first nations and Inuit child care. We have committed to the first nations people around 6,000 spaces. We have now undertaken negotiations with a negotiating team from the first nations that I think will bear fruit in, we hope, a program this fall.

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In addition, we have established a modest child care research and development fund called Child Care Visions, which will be funded at a level of $5 million per year.

Finally, as one of the most important features of the new HRIF, the new human investment program, we will be developing an on-line national labour market information system, including an electronic jobs bulletin board, again something this committee recommended as part of its findings. The ADM for insurance is actively working with his colleagues in developing what will be, we think, one of the most important tools to help people get back to work, which is a very effective way of putting the skill and the person where the job is and letting them be able to make those connections themselves for the highly integrated information system that will serve communities.

The key message of the human resources investment fund is that it is not a centralizing endeavour; in fact, it's quite the opposite. We want to work with different partners in the local workforce to work out business plans for each of our employment centres. By narrowing our focus on jobs and streamlining our service delivery, we want to give the provincial governments unimpeded scope to pursue their own labour market activities.

I'd also like to speak for a moment to the new Canada health and social transfer, which is to consolidate federal transfers, as members know, into the areas of health care and post-secondary education into a single service block beginning in 1996-97.

The CHST will provide the provinces with the flexibility needed to manage innovative social programs and to better address the needs of their own citizens. Interim legislation currently in the House of Commons will maintain existing provisions that prohibit minimum residency requirements as well as protecting the current provisions of the Canada Health Act.

As you may know, Mr. Chairman, as it stated in the budget, I've been asked to lead the negotiations with the provinces in this regard to look at where we go from here. I see it very much as a forum in which we can begin to address common problems.

The real issue of child poverty, which no one jurisdiction, no one group, no one region can tackle by itself, has to be a combined, integrated approach. This will be an opportunity to meet with our provincial counterparts, to sit down and see how we work together, integrate, liaison and link our various efforts toward that target. I would hope that out of those discussions we could come up with a common game plan that will affect all Canadians.

Mr. Chairman, that's basically the game plan for the next year. As you can see, it's a very busy agenda. We also will be responsible, I should mention, with the Minister of Finance, for preparing a paper on the Canada Pension Plan and the public pension plans. We would hope to be able to table that this fall, and I'm sure members of this committee will be very highly interested in it.

In conclusion, members can see that this is an ambitious agenda. I think it's a realistic one. I think it corresponds to the budget realities that were set for us in February. It demonstrates that social reform is very much part of the agenda of this government and, we hope, the agenda of other members of Parliament.

The coming year will represent social security reform in action. I will welcome the ongoing cooperation with this committee to ensure that initiatives properly and adequately address the needs of Canadians. I will also need your help, needless to say, in moving the legislation through Parliament.

Thank you very much, Mr. Chairman.

The Chairman: Thank you very much, Mr. Minister, for that overview. I appreciate the response in your remarks to the work the committee did in the social security review. Also, I would like to take up your offer on behalf of the committee to receive the reports on the strategic initiatives that you offered to table to the committee, whenever they are ready.

I will now turn over the questioning in the usual manner, beginning with a 10-minute round starting with the official opposition. I will try to keep as close to 10 minutes as possible so that as many members can have an opportunity to ask their questions to the minister before he is obliged to go.

[Translation]

Mrs. Lalonde: The time allowed is very short considering all the questions we have to ask. May I remind you that the Library of Parliament has prepared 85 questions to guide us in questioning the Minister.

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I would like to say at the outset that I would have preferred getting this report on public consultations yesterday, or the day before yesterday, to be able to ask questions about it. I glanced through it, but it seems to me it is not a survey; it's a report written by the Department on its evaluation of the consultations. It would have been nice to get it earlier.

That being said, we really want answers to our questions, since your Department is one which has the wost impact on citizens, groups, the future. So I will ask my first question, based on the document provided by the Library of Parliament.

Did your Department prepare an analysis of the impact of changes made to unemployment insurance through Bill C-17?

[English]

Mr. Axworthy: Mr. Chairman, in response to Madam Lalonde's first two comments, we understand your interest in pursuing all these issues. I should point out that it's my understanding that in the next week three of our assistant deputy ministers will be appearing before the committee and will be able to go into much more detail on some of the areas, so you don't need to feel compelled to ask all 85 questions today. I'm sure my officials in the department will be more than anxious to respond. As you know, we can't get into major policy areas, but we can certainly deal with some of these areas.

The second point is just to clarify. The report we've prepared was done by a third party, in order to ensure that we hired or gave contract to a third-party organization to tabulate the results and to give us the kind of analysis and evaluation we needed. So you can rest assured.

On the consequences of UI change, yes, we are preparing it. Frankly, the first step was to take an enormous wealth of proposals and ideas and assessments that were made and try to distil them down into some manageable form, which is what we have done. As I said, we're now beginning to do a diagnostic as to what's happening in the area of unemployment in Canada, how we can best tackle it, what the changes will be. Certainly when we look at some of the consequences of Bill C-17, we're already seeing that there are some very useful responses.

I have one thing to point out about the system of providing higher levels of benefits for low-income users. We now have over 250,000 individuals at that higher level of benefits, at the 60% level, which means they are basically getting close to an additional $1,000 per year. We think that in itself is an interesting model to follow in terms of the way in which we can redesign an unemployment insurance program to tackle the poverty of workers who face that problem.

On the larger areas of Bill C-17, we can show that from July 1994 to April 1995, the figures for which are the most recent we have, about 280,000 claimants, or less than 15% of all new claimants, qualified for the 60% dependency rate. It's important to point out that 85% of those were women, which shows that we are able to provide a major benefit in those areas.

Applicants denied benefits due to insufficient insured weeks increased by little more than 0.5% compared to the same period last year, and 197,000 claimants exhausted their claims. This is a lower figure than the year before. Of all claimants who exhausted their claims during this period, 97% lost an average of 11 weeks as a result of Bill C-17.

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We're continuing to monitor the situation, but particularly if you look region by region you'll see that in fact there is less of a growth in social assistance recipients than there was the year before. That is in part attributed to the strength of the economy, but some of the claims made by provincial ministers simply are not accurate, because in fact there have been fewer exhaustees and a lessening of growth in the area of social assistance than before Bill C-17 was presented.

[Translation]

Mrs. Lalonde: I should say to the Minister that my figures show the opposite of what he's saying, regarding the number of welfare recipients, especially young people who have less access to unemployment insurance benefits. I watch every month the welfare figures for Quebec and they show that 40% of new recipients are under 25, while previously it was 15% or 16%. Those are the figures for Quebec. I don't have the figures for other regions of Canada, but I would imagine that the same is true in other parts where economic circumstances are the same. You talk about those getting 60% but you don't say where cuts have been made.

On page 2-53 of your Estimates, it says that there has been a decrease of 16.2% in payouts and you add on the last line that this is:

...due to legislation that reduced the maximum number of weeks of entetlement (i.e. Bill C-17).

This is one factor. But there are also figures...

You have provided some figures. Would it be possible for us to get the overall analysis you are doing, as well as a breakdown by province?

Mr. Minister, I have been provided with figures, confirmed data, showing that out of the yearly $2.4 billion cut, $725 million would come out of Quebec this year and $630 million out of the Maritimes. I remember these figures very well. I don't know the amount for the other provinces.

Yes, there has been some progress. I know that any minister - I have been there myself - likes to talk about his successes, but our responsibility is to look at the whole picture. The reality is that people are worse off because of these changes and that the economy of the province has been affected.

I would now like to turn to the upcoming reform of unemployment insurance.

[English]

Mr. Axworthy: If I might, Mr. Chair, I would say to the hon. member that we would be glad to work with the deputy, but if she would share her information with us as well, I think it would be very helpful. We could do -

[Translation]

Mrs. Lalonde: Certainly.

Mr. Axworthy: I think it would be very interesting to compare these two figures. For example, the number of UIC claims has decreased by 86,000 compared to last year.

Mrs. Lalonde: We are supposed to be in a period of economic growth. If this didn't mean a decrease in the total number of unemployed workers and welfare recipients, it would be extremely discouraging.

Mr. Minister, I would like to talk about the unemployment insurance reform you have promised in the Budget. You say that as of 1996, there will be $700 million of cuts. Since you state it will be 10%, it means that the following year, it will be $1.5 billion. This means that some $800 million will be flowing somewhere. Should we understand from the Budget that these monies will go into the Human Resources Investment Fund?

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Since this is my last question, I'll take this opportunity to ask you to tell us more about this Human Resources Investment Fund. I listened closely to the speeches of members and other ministers and they said that this fund would provide much more flexibility. But a large part of this money will be coming out of the unemployment insurance fund. We need to know what it is going to be for, since there's nothing about this in the Budget or in C-76.

[English]

Mr. Axworthy: Actually, Mr. Chairman, the budget does mention the human resource investment fund.

[Translation]

Mrs. Lalonde: The Budget does, but not Bill C-76.

[English]

Mr. Axworthy: It becomes an administrative matter that we are now consolidating a number of existing programs. I indicated in my opening remarks that we are looking at reducing the program areas from 39 down to a stream of 10 or 12, which would then give the local job centres far more flexibility within those streams to tailor programs to fit local community characteristics. That's the fundamental objective.

Having read the report you prepared, Madam Lalonde, and having listened to your comments, I know you are a strong advocate of decentralization and of giving more community control and opportunities for local regions to tailor and define their needs.

That's exactly what we are attempting to achieve through the HRIF program, to give that kind of hope as a way of giving more discretion to our own people at the local level but also to give them the opportunity to form new partnerships with provinces, municipalities, business partners, and labour partners at that level. That way they can get a much better utilization of the money by getting a synergy out of those resources.

I think I gave you a few examples of what we've been doing to test that out and to demonstrate that through a number of pilot projects across the country.

What we are really attempting to do through the HRIF is to bring those kinds of resources together, which would include money coming from unemployment insurance. I would remind the honourable deputy that right now $1.9 billion is already dedicated to unemployment insurance development funds, but much of it has gone into short-term job creation programs and initiatives of that kind.

Our evaluations show that they don't necessarily help in long-term re-employment. What seems to be more successful, as I said in my remarks, is to deal more directly with individuals on things such as income supplement, wage subsidies, and that kind of direct tool that the individual can use. It leaves the provinces and others far more room or space, if you like, to actually develop the kind of training programs they want and responses to them, because the individuals will be indicating their own preferences and their own choices.

[Translation]

Mrs. Lalonde: But this could result in more duplication and overlap.

[English]

Mrs. Ablonczy: Mr. Minister, in the budget speech, the finance minister announced that there will be an overall reduction in the size of the unemployment insurance program by a minimum of 10%. This, of course, can only be done through raising the weeks necessary for qualifying, lowering the benefits, or increasing the premiums.

In 1994 the qualification level was raised already. Given your decision this week to eliminate the idea of a two-tier UI system, we are still facing a money problem. Are you planning to cut benefits or to raise the qualifications level?

Mr. Axworthy: Mr. Chairman, I'm really glad the hon. member asked me that question.

The three ways in which the hon. member has described the reform of unemployment insurance have been ways that have been used in the past. I hope certain journalists will take note of this. It does not necessarily have to be the way in the future. I think one of the most important parts of the consultation and the dialogues is that quite innovative proposals have been presented to us about ways of fundamentally restructuring unemployment insurance in a way that eliminates the work disincentives, brings down some costs, and at the same time doesn't necessarily require the kind of traditional hacking at the three variables that the member just mentioned.

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I think the member will be very interested, and I hope pleasantly surprised, when we table our new bill to see that some of these innovative ways have been incorporated. I can't guarantee it because I haven't really received approval from my cabinet yet, but over the next six to eight weeks we will certainly be working very closely with them in developing these initiatives. As I say, we will table it in the fall.

Let me just make this caution to the hon. member. If you don't mind my sharing our conversation coming up in the elevator, you said it's time for some new paradigms, to start getting out of some of the old notions that the only way you reform is to either cut or reduce benefits or cut entitlements. I have to tell you that there are some better ways. I've been quite excited by some of the proposals we've received. This shows the value of public consultation.

Mrs. Ablonczy: Well, I'm sure it will be very exciting to see how you cut 10% without doing either of those things.

One of the things you've been talking a lot about with respect to unemployment is the training programs. These are mentioned on page 32 of the estimates. I've been hearing a lot of complaints about these training programs and I know you have as well.

Mr. Axworthy: Yes.

Mrs. Ablonczy: Some of the more common complaints tend to focus on the poor quality of the training programs, the lack or absence of jobs within the area of training, the lack of follow-up by the department after the training is completed. In fact, I've heard these training programs described by disillusioned participants as nothing more than fly-by-night operations set up by people trying to get money from your department.

Under the employability improvement program, we see a considerable number of Canadians have undergone some sort of training programs. The department says it enjoys a success rate of 86%, and this is set out on page 2-32. However, the criteria for measuring success, set out on the same page, is not that all these people have found work or become self-sufficient but includes those who merely completed the training.

Since the goal is to assist unemployed Canadians to regain stable, long-term employment, I would like to know how many have completed the employability improvement program and have actually found work after undergoing this training. Also, would you comment on any evidence you may have that these training initiatives have outweighed their cost.

Mr. Axworthy: Mr. Chairman, in some ways I think the member is right. Many of the traditional forms of training have not been very effective, but I don't think you can be quite so simplistic as to say it affects all people. It depends on who it is.

If you're a young person trying to get in the workforce, the kind of internship program I described earlier is an effective way of doing it. If you're an older worker going back to a pre-cooked training program at a community college, that often doesn't work at all. What does work oftentimes is some good literacy programming.

What we have done in trying to design the new HRIF approach is to look at those evaluations. It's one reason why in terms of government-to-government purchasing, which has been a traditional format, we are moving out of that particular form of training. This is partly for cost-saving reasons and partly because we have found that by establishing a blanket application... we buy an inventory of programs. Someone comes into our office, and we give them that program whether it relates to their needs or not.

I may be repeating myself, but that's why we want to reduce the level down to an area where our own employment centres, job centres, can work with the local community to establish what are the most effective training techniques for that community. We are going to have a very different set of requirements on the north shore of Labrador than we'll have in downtown Calgary, for example. They are very different kinds of labour market initiatives.

We have been assessing each of the different kinds of training areas that we are in, getting rid of some and shifting others over so there can be more flexibility, and putting much more emphasis on the project-based training areas, where we do get some real success, getting away more from the skill-based training of employers, which they can provide, and also looking at ways in which individuals can be more self-sufficient in funding their own training programs.

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I'll just check with the deputy minister on whether we could put together for you the evaluations we have done. It's the raw material. I'm not going to tell you what we're going to do with it because that would be giving away our HRIF announcement next summer, but we can certainly provide you with the evaluations of the different training programs, which we have completed.

Mrs. Ablonczy: I appreciate that.

Mr. Axworthy: Perhaps I'll ask the deputy to comment.

Mr. Noreau: I have one quick comment. Let me just refer you to some of the results you already have on page 2-36 of part III of the estimates, where some impact and skills utilization rates are measured. So you have something there.

The minister is referring to more recent evaluations comparing programs under the jobs opportunity package with the old jobs strategy. This is what we will share with you. It shows that we are indeed improving our understanding of how to design these programs so that they have a greater impact.

Mrs. Ablonczy: I appreciate that. Let me refer to one specific program - one of the minister's favourites, I'm sure - the Atlantic groundfish strategy program or TAGS. This has proven to be a terrible mess. An independent survey has shown that it's over budget by $700 million because so many more people signed up than anticipated. Unfortunately some of these people left good jobs to sign up, and some of them are fishermen who make over $200,000 a year.

The objective of this program, Mr. Minister, was to retrain people for work in areas outside the fishery. However, although training was the key to the whole program, the money that was to be used to train workers is now being diverted into the income support component. The people who are supposed to benefit from the program complain they were not consulted and now they're outraged at the program's waste and ineffectiveness.

As the program has been in operation for a year, do you have figures showing how many recipients have actually found full-time work in a new industry as a direct result of retraining under the TAGS program?

Mr. Axworthy: Mr. Chairman, first let me indicate to the hon. member that we recognize that trying to provide a major adjustment program for an entire industry is not something you do overnight. It has a number of complications, especially when there's been such a strong, almost centuries-old attachment to that industry. People acquire a culture that makes it very important to them, and you don't change people's attitudes overnight. You don't even change them in a year. That's why in many cases we've given ourselves four years to do that.

We recognize as well that there had to be different levels of active programming for those involved. For young people the chance to get new employment was reasonably high, and there have been close to 15,000 people enrolled in a variety of training programs, which is very significant.

I want to caution the hon. member because I know that she's referring to the Price Waterhouse study. That study was completed last January. At that point, when the program was less than six months old, they estimated the intake and uptake.

In fact, it's gone way beyond that at this point. I can give our numbers to the member, but we now have over 1,000 people involved in the green projects, we have close to 15,000 people in various training programs, there are close to 1,000 people in a form of wage subsidy employment areas, and that's of this April.

I'll tell you the most difficult thing to face. All of a sudden the Minister of Fisheries, who is kind of a co-sponsor with me in the program, was faced with the necessity to close down an additional 14 different zones in fishing areas off the Atlantic provinces and Quebec. So the original number we estimated just accelerated. We had an intake of close to 50,000 applications.

Frankly, the first several months of the program were just taken up in trying to process those applications, get people on the program, and do some initial counselling with them to find out what their interests were and where they would go. We've now given counselling to over 26,000 people. Now they're able to make some choices; now they're going into training, literacy or employment. But those first several months... sure they were chaotic because we were trying to deal with 50,000 people who were frustrated. In many cases they were disillusioned, dispirited, because they lost their livelihood and didn't know when it was going to return.

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So I would hope, in fact I would ask, for some tolerance on the part of the member - I'm not sure I'd get it from her leader - when we say you're not going to re-create people's employment or their lives overnight.

But I think we're on the right track and we're going to continue to evaluate it. That's why we have Price Waterhouse as a continuing, independent monitor. The fisheries committee has undertaken hearings on the program. The fishermen's union told the committee they thought 80% of it was successful. They're the ones who are directly affected.

I don't say it's a perfect program - far from it - but I can tell you it is now beginning to work, it's beginning to have some success, and where there are problems we'll fix them.

We took the Price Waterhouse study. They point out about eight or nine different things; we've already put those into place. We'll do the same if other members have other problems; we'll fix those too.

It means that shake-out period had difficulties with it, but they're now being fixed. I still believe it's an awful lot better to give people who are finding their way of life disappearing some new options and choices as opposed to simply sending them a cheque. I still believe that is the way we have to go.

The Chairman: Thank you very much.

I'm now going to have to turn the questioning over to the Liberals. I'll begin with Mr. Scott.

Mr. Scott (Fredericton - York - Sunbury): Welcome, Minister, before the committee.

Mr. Axworthy: It's nice to see you, Mr. Scott; it's always a pleasure.

Mr. Scott: I suspect it won't be a surprise when I tell you I'm quite happy with your recent statements with regard to a two-tiered UI.

Mr. Axworthy: It's called the Andy Scott amendment.

Some hon. members: Oh, oh!

An hon. member: Why?

Mr. Scott: I heard a sigh of relief that emanated from the Atlantic coast when you said it. Basically though, Mr. Minister, I would want it to be understood quite clearly - and I welcome your response to the question from my colleague - that isn't to say that unemployment insurance shouldn't be reformed. In fact, that isn't to say there's resistance in Atlantic Canada to reform either.

There are many ways we can improve the unemployment insurance program without taking the route of the past. In fact, I think that makes reform more necessary. If we don't reform it, we'll inevitably end up on an annual basis facing the prospect of cutting it from the top, or cutting it at the entry level, or cutting its duration, when in fact we should be reforming it.

I would suggest that some of the lists in the social security review report would give us some direction as to how that might happen. There's a list in the report.

Just changing the way we calculate benefits would make it more attractive to work. For instance, making it based on the best weeks rather than on the last weeks would mean that people would work longer. It would allow people to work who now can't afford to work. In the interest of their families, they can't take a job at less money because it hurts their benefits. By making it based on the best weeks, they can take those jobs and....

Anyway, I don't want to repeat the exercise of the social security review, but I can tell you your announcement was well received where I come from.

Because we are interested in reform, would you give us some idea on the kinds of reforms being contemplated? Is this the kind of thing the department is thinking about?

Mr. Axworthy: Mr. Chairman, I think Mr. Scott put it right. He said that simply because we've decided not to follow the two-tier approach outlined in the green book doesn't mean the UI system will stay the same. It won't. It still requires fundamental structural reform. I hope people are prepared for that. It doesn't necessarily mean it will be business as usual. In fact, I know it won't be, and it's going to require some real involvement.

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I intend to meet with the Atlantic ministers in two weeks' time to get their input into unemployment insurance. Next Friday the deputy minister is meeting with his counterparts from all the provinces to give them a briefing on some of the issues. We will then be meeting with individual ministers.

As I said to Madam Lalonde from time to time, the reason we can't do a full meeting is that several provinces are now engaged in various forms of election activity. They're pre- or post-active, and as they always say, politicians and elections are like dogs in heat, because they focus their mind on one objective.

Some hon. members: Oh, oh!

Mr. Axworthy: Well, it's true; it's an old Atlantic saying.

An hon. member: Oh, oh!

Mr. Axworthy: As a result, the only way you can do a rational discussion of these things.... It's not the appropriate time, but where there is a willingness to meet, we will continue to do that.

I think the reform is something that has very strong and compelling support throughout the country. People don't want to see tinkering; they want to see real reform.

It's going to require a lot of investment of time and effort to make it happen in this committee. Clearly, legislation we will table with you this fall will require another serious round of public discussions, but we'd still like to have that ready to be implemented by July 1, 1996. I welcome your offer of cooperation, but it's important to caution you that there's a lot of very serious work ahead in rebuilding and restructuring the system.

Ms Cohen: Do you remember the green paper?

Mr. Axworthy: Yes, I do.

Ms Cohen: I just want to take you back to that, because we had some ideas for reform of student programs in particular in the green paper. But the attention has now been focused on a discussion of the Canada health and social transfer and the impact on funding for post-secondary education, but nobody's talking about student loan programs.

Can you update us on what developments there have been with respect to the Canada student loans program, where you see it going and what we're going to do to help Canadian students pay for their education?

Mr. Axworthy: As I indicated in my remarks, the new student loan program is into implementation. By August 1 of this year we expect to have completed the new financing arrangements with the private lenders. We'll introduce a new part-time loan program that's targeted specifically at part-time students who have income needs. We will be announcing a debt management strategy for students. We'll be having a revised policy for designation of institutions that are eligible and where we can't have full harmonization with the other provinces.

To give you an example of what that means, the loan limit for students will now go up from $105 a week to $165 a week. There will be a new needs assessment program, which most of the provinces, with the exception of Ontario, are now implementing.

A 60% aid sharing approach with each of the provinces and territories will be introduced. Within that legislation we're also retaining the right to do pilot projects on ICRs, so for those provinces that like to test out that methodology we've presented in the green paper, we're open for business and doing that.

This fiscal year we estimate that about 130,000 students will benefit from direct aid of an additional $200 million we brought into the program as a result of these reforms, such as grants for single parents going back to school, women in graduate studies, disabled students and others. About 130,000 students will now be able to get some direct financial assistance.

Mr. Chairman, this is something the committee may want to ponder. There are ways in which we can expand upon that debt management strategy. I indicated earlier how we've altered the rules under the disability benefits to enable Canadians on disability benefits to go back to school and still draw benefits while they're studying. I think there's room for doing the same thing under the Unemployment Insurance Act to again encourage young people to do those things.

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We have been in discussions with various private sector organizations that would like to work with us on Youth Service Canada. Ms Blondin-Andrew has been holding a lot of meetings to see how we could use community employment at the end of the school year for students who can't pay their loans. They can do community employment for a certain period of time and then get, say, a $5,000 stipend at the end of that to help pay off their loan.

In other words, that's if they can't get a job right away and they need to pay off the loan. They would work on environmental and literacy programs. The kind of things we are doing through Youth Service Canada would give them that kind of option.

Even the internship program I mentioned can be used to provide ongoing financial assistance for students while they are in school. If they get into the workplace transition, they can, on the weekends, summer holidays and at other times, get that intern training while the private employer pays their wages and we provide some assistance to make the program work.

So there are a number of other ways in which we can put together a more comprehensive package for students to help meet the rising costs.

As far as one knows, under the CHST, provinces will now have total discretion as to how they spend the transfer payment that will come out of the consolidated grants. So they can chose what they want to do about tuitions and how they want to reform their systems. That would now be fully at their discretion.

Ms Cohen: One of the things that has concerned me - I think it concerns faculty I have talked to specifically at the University of Windsor - is the lack of funding under the current loan system. We addressed this many times in committee consultations. There's a lack of funding for Mr. Bevilacqua's bootstrappers. As you know, these are people who come from middle-class families but who, for instance, might live in an area like Toronto where a middle-class income and four kids isn't going to pay for much tuition. They might not qualify on the objective needs test for student loans.

I am terribly afraid that we can fund low-income people with the needs test we have and that people with substantial incomes can send their kids to school because they can pay for it, that what ultimately happens is that we are are subsidizing those people and we have a great middle class out there whose kids have to maybe go to school part-time because they can't afford tuition and they don't qualify. I just have a tremendous feeling that there are people who are falling between the cracks.

Mr. Axworthy: The question about how to provide some incentive to large numbers of people in the workforce now who recognize that they have got to upgrade is one about which we received a lot of quite interesting proposals.

I would like to mention one pilot that is being undertaken by one of our own CEC's in Montreal, which has provided some form of training loans so that workers are able to access that kind of financial assistance on a basis of repayable. They are very anxious to use the ICR methodology as a way of doing it.

So that is one of the areas that could be looked upon as either a build-on to the Canada student loans program or something that is annexed to it in a way. I want to make it clear that we haven't done it yet, but it certainly is one of the areas that was identified during the consultations as a very high priority. At a time when you have short amounts of money, you have to figure out how you are going to pay for it.

It comes back to a very central philosophy. I know there are a lot of people who are prepared to invest some of their own resources to get back to school, but there has to be a partnership arrangement. We have to work out this mutual responsibility.

Up to this point, there hasn't been any ladder for these people to climb on. I think we want to look for the best way of doing it. Again, by enabling our own new job centre system to make that choice, to use their resources in that kind of a way, to work out a deal with the local credit union, to lever some funds for training for local workers who want to come back and get retrained, that is the kind of discretion they would have.

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Ms Cohen: Then we make a closer link between post-secondary education and career planning and the human resources that we have.

Mr. Axworthy: Yesterday I had an interesting session with the Ontario financial aid administrators. They are all the people who actually give out the loans in the community colleges and universities in the province of Ontario.

A woman from Pembroke who is involved in some of the community colleges there was describing exactly that problem. It's a system that rather than serving a big city, serves a rural area with a number of towns, but with new industries emerging. They're attracting new base industries and they can't get that system in place, so we talked about how, through the structure of our Canada student loans program, we could begin by providing that kind of assistance.

Maybe that's the place to do the piloting on the ICRs for the bootstrappers or people in the workforce who want to get back - occupational workers - who want to do the upgrading. It doesn't take an awful lot, as long as there's a two-way sharing of the resources. They put up x amount, and we put up x amount. All of a sudden you've got somebody. And maybe the employer puts up some as well, and they can begin to develop their own training program out of it. That's the kind of freedom I want to give to our officials to work those kinds of deals out.

The Chairman: I'm going to turn now for a short round to Mr. Dubé, and then we'll come back and invite a couple of the Liberal members who have not had a chance to ask their questions before we wrap up.

[Translation]

Mr. Dubé (Lévis): Mr. Minister, like Mrs. Lalonde, I am drawing my questions from the list prepared by the Library's Research Service. I will ask you three questions in a row, in case I do not have the opportunity to ask you more.

First of all, in the paper prepared by the Library, we see that in post-secondary education, according to the Department's own figures, there is a 236 million cut.

The committee made a recommendation that the Bloc suggests you do not implement, Mr. Minister. As you know, we made a dissenting report. Concerning a two tier system...

[English]

Mr. Axworthy: Could you give us the page number? This is the Library of Parliament?

[Translation]

Mr. Dubé: It is on page 24.

[English]

Mr. Axworthy: Page 24 of what?

[Translation]

Mr. Dubé: Page 24 of the questions prepared by the Library. There are figures. I just wanted to point them out to you. So there are cuts. We oppose the reform because we are concerned about the cuts. I wanted to point out to you that there have been cuts in post-secondary education.

Then, there is a recommendation made by the Standing Committee on Human Resources Development with which we did not agree. We realized that eligibility requirements for UI benefits for first time claimants were being tightened. I was concerned mostly about young people. I point that out to you and ask for your comments. The government side recommended more restrictive requirements in that category. As we know, those concerned are young people and maybe women wanting to get on the job market. We would like you to say what you think about that and tell us that you will not take that into consideration.

As for your figures, Mr. Minister, you mention an increase for Youth Initiatives. It is true. However, there are cuts of at least 15% that apply to organizations that were involved in youth employability, among other things. Why rob Peter to pay Paul? I would like to hear what you have to say about that.

All the new measures under Youth Initiatives concerning Quebec are still falling within provincial jurisdiction. In Quebec, we insist on that. Will you adjust your program to take into account Quebec's difference, that is give that province full control in the area of manpower training?

That adds up to many questions to be answered in quite a short time.

[English]

Mr. Axworthy: Mr. Chairman, I apologize to Mr. Dubé. I haven't been able to find a reference in the Library of Parliament's.... I'm not sure what the $236 million is referring to.

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The Chairman: The page is a little different in the French and the English versions.

[Translation]

Mr. Dubé: It is on page 24 in the French version.

Mr. Axworthy: Mr. Dubé, I would like to examine the figures before giving you a written answer. Does that suit you?

Mr. Dubé: Yes. Besides, it would provide you a good opportunity to answer the other questions in writing.

Mr. Axworthy: I have to examine the questions prepared by the Library.

Mrs. Lalonde: You could answer all those questions?

Mr. Axworthy: I have to see if I agree.

[English]

Secondly, on the question of the majority recommendation dealing with new entrants, as I said, I'm not at liberty to say explicitly what proposals we'll make because we haven't finalized those yet and we've just really started looking at them in cabinet. But we're looking at a number of proposals and we treat them all with equal weight and gravity along the way.

On the third question about cuts being made, yes, there are. As you know, we went through a very severe reduction in some parts of our budget and we've had to make some reallocations. One of the areas we discussed with our own local managers was that many of the project groups had already over the years built up a fairly substantial overhead and that by encouraging them to work together in a cooperative way, to share administrative costs and other overhead costs, they can still maintain the same delivery of services. That's why we've indicated specifically that we'd prefer the cuts to be on the overhead side of it, and I think already we're seeing some good examples of groups now combining efforts in order to maintain the same level of service delivery.

There'll be some jobs lost, maybe for staff and people like that, but at the same time I think it also gives us an opportunity. I don't want to sound too harsh, but a lot of projects that we've been funding for 10 or 15 years have kind of reached the end of their value. Some haven't, some are very good; others have, and we've tried to evaluate them on those bases. As we said, we want to give more space to the provinces to get involved in these kinds of activities and therefore we're certainly giving them the opportunity.

As far as the youth programming is concerned, one of the areas I indicated in my earlier remarks, for example, is not jurisdictionally bound. The internship program is working primarily through the private sector. As you know, in the electronics industry there's not a series of qualifications that are unique just to Quebec or to British Columbia. They're trying to work together and they have a number of pilot projects or training projects right across the country, and we're working to those areas.

As for the other programs, we think what we're doing is.... There's so much work that needs to be open for young people. There's lots of room for working in cooperation with provincial authorities in these areas, and if I might, Mr. Chairman, I would put on record a communication I received from one of Mr. Dubé's colleagues, the member for Laval Centre, who was asking me to support or fund two specific-use service core projects in her riding.

She said:

[Translation]

These two projects are characterized by concrete goals which, if they succeed, will no doubt allow the young participants to discover the value of professional commitment and the worth of cooperation.

[English]

Certainly, it shows a number of colleagues are very much supportive of the work we're doing in the youth service program.

The Chairman: I'll now turn to Mr. O'Reilly first. Brief questions.

Mr. O'Reilly (Victoria - Haliburton): Thank you, Mr. Chairman. A very brief question.

Mr. Minister, I just wanted to know, do you have a retraining program for the Winnipeg Jets in place?

I'll be serious.

Mr. Axworthy: It's not my department, Mr. O'Reilly.

Mr. O'Reilly: There's a big scrum waiting for you and that's what they're going to ask you.

It's my understanding that the Youth Service Canada and youth internship program were to be implemented this summer, and I haven't heard, Mr. Minister, that they have been. Could you inform this committee if they have and what the impact would be on these initiatives?

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Mr. Axworthy: To begin with, Mr. Chairman, I might say to Mr. O'Reilly, since he brought the subject up, that being a minister of this department I feel a real kindred spirit to the goalie of the Winnipeg Jets. All you see is pucks coming at you without much defence in the way.

We initiated the youth service corps program primarily to take advantage of the secretariat that had been established and the kind of developmental work we'd done with a lot of the private sector, municipalities, community organizations, who felt we could give a much better-focused summer experience to students by working through that kind of youth service corps operation rather than just simply a random job providing a subsidy. We experimented with it at this level, and Madam Blondin-Andrew, who is overseeing these programs, may want to comment.

Right now within the summer youth services we're targeting about 10,000 young Canadians for the first time this year. We will in fact have a youth service corps working in two levels, one that is the year-round program, the other that would target about 10,000 young people per year for a summer experience. I can't give you the actual figures because, as you know, the applications are still being received and we're still engaged in funding them right now.

Ms Minna (Beaches - Woodbine): I have just two very quick questions on child poverty and child care. I'm focusing on children for just a moment.

On the issue of child poverty, I haven't gone through it entirely but I don't see it reflected in the estimates or in the outlook of the department. I wondered, Mr. Minister, whether there's been any discussion at this stage with provinces or within the department on looking very closely at the possibility of the integrated child tax benefit or working in a supplement or both. Where does this budget put the whole issue of child poverty? This is still a major issue in the country and I very much want to see us begin to work at it.

The other part is child care and child development. There was very strong support across the country during the hearings for establishing some national infrastructure in terms of child care and child development. I know that through the strategic initiatives you are trying pilot projects. I'm wondering whether there's been any discussion with the provinces as to looking at establishing some form of infrastructure across the country, especially when women from different parts of the country during their presentations talked about the fact that in many cases there's just not enough child care available, and where there is some child care available the quality is not great or is very bad. The major issue right now is a program that is a hodgepodge, and those two are very fundamental to the health of the family. I have other questions, but if you could address those two I'd appreciate it.

Mr. Axworthy: Mr. Chairman, I could point out to Ms Minna that in the departmental outlook we set the departmental objectives first to improve the employability of Canadians by helping them prepare to find and keep work, and secondly, to assist Canadians in their efforts to provide security for themselves by helping prevent or reduce poverty among families, children and seniors. I think we have set that as two mission statements in the departmental outlook.

We've been wrestling with this in a number of ways. Clearly, one initiative already taken in part is the block transfer system that will give provinces far more flexibility. I think your own report acknowledged many of the development programs that provinces wanted to initiate. I use an example in the province of Quebec of the APPORT program, which was a combination of benefits plus assistance for single parents going back to work who could not be funded because of the strict criteria of need. It didn't enable provinces to engage in that developmental style of work that was so important.

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Consider the recent study that was done by a professor at the University of Western Ontario who looked at exit strategies for single parents in particular in Exit Out of Poverty. Some of the most important and useful are in the developmental educational areas, yet our CAP funding, as it existed, didn't allow that kind of investment. The provinces will now have the opportunity and flexibility to make the calls as to how they want to deal with it.

I've said all along that no one jurisdiction can do it by itself. There can't be a federal strategy, a provincial strategy and a regional strategy. It's only going to work when we get our act together in a very combined way. As I said earlier, there's an opportunity provided under the CHST, beginning in the fall when we start talking with the provinces about combined objectives, new sets of principles, and where we want to go, so that we can talk with them about how we can combine our child tax methods.

I've read commentaries on the cries of alarm from some of the groups. They say the federal government isn't doing anything. We have a $6 billion child tax credit being delivered. We're heavily investing, but it's not as effective as it could be if it was integrated with what the provinces are doing. We have to bring them together. We have to get together on that kind of approach.

As part of it - I think I've mentioned this to the committee before - there's the self-sufficiency project that's been conducted in both New Brunswick and British Columbia. This has tested the usefulness of work income supplements to deal with child poverty. In its first year of evaluation, it has been quite a marked success, as 33% of the recipients are now back in employment compared with the average rate of around 5% or 8%, in terms of the normal turnover in the control group.

What happens if you have a stronger income supplement - I talked about this as being one of the elements in our HRIF program - combined with what provinces are doing? You then begin tackling it, but I think it has to be coordinated.

You mentioned a third area, which I think is very necessary: the child care issue. That is part of our HRIF funding. As I said earlier in my commentary, we've already designated the money and the process for aboriginals. This was the probably the most severe child care need in the country. We've set a target of 6,000 spaces.

I also said that we want to have a child care system that reflects their culture and communities. We are working on a fully negotiated basis with the Assembly of First Nations and their regional groups to put the framework in place.

As far as the provinces are concerned, as I indicated, we've been working with Penny Priddy, who is the minister in British Columbia, to sponsor a joint meeting of federal-provincial ministers so we can put that framework into place. Her advice to me was that until the elections and stuff are over, it's not easy to do. But she is now working on that and consulting with her own counterparts.

The deputy minister will be meeting with his counterparts next Friday to pursue that agenda. We're hoping we can get that kind of coming together. The provincial ministers were quite clear to me. We need to have a set of principles first before we can actually get into the funding of the program.

However, in the meantime, if individual provinces want to start discussing how they can do a shared program on child care, I'm prepared to sit down and deal with them on a bilateral basis until we get the multilateral system in place, which I hope can happen this fall. I think it would really be up to provincial ministers, led by Penny Priddy, to come forward with how they would propose doing it.

The Chairman: I'd like to thank our members and especially the Minister of Human Resources Development and the Secretary of State for Training and Youth and their officials for being here this afternoon. In the context of the estimates, we have an invitation for you to return in the near future. We hope you will take that invitation under consideration, and perhaps we could talk about it at a future date.

Mr. Axworthy: Certainly, Mr. Chairman. I want to thank the members for their attention. I repeat that our senior officials will be before the committee next week. They will be able to give answers perhaps in more detail than I've been able to do. We'll watch that carefully. If there are other pieces of information, we'll be glad to supply them.

The Chairman: Thank you very much.

The meeting is adjourned.