Report calls for revamp of employment insurance system
OTTAWA (CP) — A cross-party committee of MPs says it's time for the government to take a deeper look at a guaranteed minimum income to help workers caught in the tectonic shifts of the “gig economy.”
The MPs' report on declines in traditional, full-time employment in favour of short-term contract work says the government needs to explore new types of income supports “that do not depend upon someone having a job.”
To that end, the committee calls on federal officials to review a minimum-income program, which is typically a no-strings-attached government payment to every citizen that replaces an assortment of targeted benefits, as an option to help those between gigs who fall through the existing social safety net.
The report calls for a revamp of the employment insurance system to widen that net, reducing the minimum number of hours someone must work before qualifying for benefits, boosting payments to low-wage workers, and reconsidering the benefits available to self-employed workers. It also calls on the government to modernize federal labour regulations.
MPs on the committee nod to some recent federal efforts, such as a soon-to-be-launched tax credit for individuals to offset the cost of work-training courses.
But here, too, the committee urges the government to pay close attention to the design of the Canada Training Benefit to make sure it is accessible to low-wage, part-time or self-employed workers and to make every effort to ensure they use the program.
The training benefit, to launched in late 2020, would provide a $250 refundable tax credit each year, accumulating over time if it isn't used, to Canadians earning between $10,000 and about $150,000 a year. The plan is expected to cost $710 million over five years.
Federal officials have considered the idea among a wide range of possibilities to reshape social-safety-net programs that were designed for a workforce that needed help at certain fairly predictable points, such as upon losing a full-time job, having children and retiring. Lifetimes of freelancing, contracts and multiple part-time jobs punctuated by returns to school don't fit the model.
A discussion paper crafted in December 2018 for the deputy minister at Employment and Social Development Canada identified rising income inequality and the growth of the “online platform economy” — exemplified by companies such as Uber, Lyft and Airbnb, which broker work while doing everything possible not to become formal employers — among the top issues to tackle in a redesign of federal policies.
Officials wanted to look at a small number of policy areas to keep work manageable and “stress-testing” alternative policies under “more extreme scenarios” than officials had previously envisioned, such as if unemployment spiked. The Canadian Press obtained a copy of that paper and accompanying briefing note under the access-to-information law.
The Commons committee says its report can form the foundation of future federal research and planning but stresses the need to revamp the social safety net.
“The nature of work is changing. Yet, the blueprints of our social safety net and our foundational labour legislation were developed in a different time,” the report, released Monday, reads.
“In this new world of work, it is essential that government and employers take necessary measures to protect workers from precariousness, the effects of which can be mitigated with efficient policies and social safety nets.”
