July 19, 1940

LIB

Paul Joseph James Martin

Liberal

Mr. MARTIN:

It is impossible.

Topic:   UNEMPLOYMENT INSURANCE
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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

I am

inclined to agree, although I did not like to put it as strongly as that. But if we have unemployment relief in the coming years or after the war on a scale comparable to what we have had in recent years, and have to bear the burden of unemployment insurance levies as well, some people are going to be sadly disillusioned.

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Unemployment Insurance-Mr. Hanson (Sunbury)

I have tried to offer some contribution to the discussion of this most important measure. I am glad the Prime Minister has decided to move that the matter be referred to a special committee; it will save the time of the house. I regret that personally I could not serve on the committee; I should have enjoyed the work. I think the best contributions I have ever made to the work of parliament were made in the select standing committees; I look back with some degree of satisfaction to the service I gave to the country in that connection. I hope the committee will give the careful study to this measure that it deserves; that they will deal with all the provisions of the bill relating to administration, and make recommendations to the house if they are not in accord with the provisions of the bill, and that the bill will come back to this house with a report upon which we can take intelligent action and complete the legislation. I hope the committee will call into consultation representatives of trades and labour organizations, boards of trade, manufacturers and industrialists-all who will be vitally affected by this measure, and get their views. I hope the committee will also be given power-I have not examined carefully the notice of motion the Prime Minister has on the order paper-to take independent advice from technical men even if it costs this country something in the way of retainers and fees.

I commend the principle of the bill. I have tried to make such criticisms as have occurred to me, although much of what I have said may be already in the minds of hon. members; if so, I apologize for trespassing upon their time.

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NAT

John Ritchie MacNicol

National Government

Mr. J. R. MacNICOL (Davenport):

As one who has perhaps made as long a study and survey and investigation as any one into the operation of unemployment insurance in every countiy in which such insurance is in practical operation, I cannot let this bill pass second reading without speaking briefly.

First I feel that I should extend a word of praise to several men who are not now in this house, some because they did not care to run again, others because they were defeated, and one is unwell. These men, throughout the eleven years that I have been here and for several years before, I have known of as active in regard to this matter. The leader of the Cooperative Commonwealth Federation (Mr. Woodsworth), who is ill, did a very great deal, in season and out of season, in his advocacy of unemployment insurance; unstinted credit is due to him for the part he played.

I wish to refer also to Mr. Heaps, who formerly represented Winnipeg North. Years ago Mr. Heaps introduced resolutions on this subject in this house, and I always listened to him with a great deal of interest because he was earnest in what he advocated. I am glad to hear that he is now with the Department of Labour, perhaps on this very work. Another man, also I believe in the Department of Labour, who when speaking on this subject in this house always showed good sound sense, was Mr. Humphrey Mitchell, who represented Hamilton East. Hon. Wesley Gordon spoke on it very effectively; also Doctor Stanley, who represented Calgary East, and the former leader of our party, the Right Hon. R. B. Bennett.. Tribute should be paid to these men who are not here. The hon. member for Comox-Alberni (Mr. Neill) deserves great credit, also the hon. member for Vancouver East (Mr. Maclnnis). The Prime Minister himself (Mr. Mackenzie King) has been an advocate of this principle for as long as I can remember. He is in the house still, thank heaven. I am a very warm friend of the Prime Minister, and I am always pleased to see him, for more reasons than one. There are others I might mention, some of them on our side, but these are all whose names come to my mind at the moment.

I should mention some labour papers; I shall select two, although I know there are others. The Labour Leader of Toronto has persistently and consistently advocated unemployment insurance for fifteen years or more. I believe the Stevenson Brothers operate that paper. I say this because I am happy, in the realization as I am sure all these people are, that the long battle to enact in this country an unemployment insurance law will most fortunately end in the legislation that I hope will be passed at this session and go into operation as rapidly as possible. In Montreal there is another labour paper, the Labour World. I might also mention one who consistently writes in that paper, one who has given to this subject most extensive study, Bernard Rose, K.C. I hope he is well; I have not seen him for some time. He is a barrister, and as my leader said in suggesting commissioners, if the department finds it necessary to employ a barrister I do not know of anyone better acquainted with the whole subject of unemployment insurance from its very early stages than Bernard Rose, K.C.

My own studies of this matter have given me a great deal of joy. I have sat in the labour offices in the capitals of all the countries that now operate practical unemploy-

Unemployment Insurance-Mr. MacNicol

ment insurance. I have sat in the branch offices in their main cities and watched the operation, and have seen the unemployed coming in with their cards, which I illustrated on a former occasion. I am firmly convinced that this is one of the finest pieces of legislation that has been introduced in this house.

I have no fear whatever that it will not give satisfaction. Similar legislation has given eminent satisfaction in the old country. Of course I realize that we have to creep before we walk. The government is perhaps not bringing in as complete a measure as they may make it five years hence if they are still in power; they will find opportunity to improve it. That was the experience in Great Britain, where they adopted unemployment insurance in 1911. At that time the scheme covered only about two and a half million workers, while to-day it covers about twenty million, including a long list of workers not mentioned in our act, I presume for good reasons. I concur in what the government is doing, in not trying to run the whole gamut at once but rather in establishing the principle and getting it in operation, just as they did in England. As the minister has said, the present bill will cover only 2,100,000 workers, but I have no doubt that before many years pass our unemployment insurance scheme will cover many more than that. I have every confidence in the principle and am more than delighted to know that this measure is going through.

There is one point I might mention, though it is not included in the bill and no one else has said anything about it. I presume the government will take into consideration the many companies that now have systems of unemployment benefits, workmen's compensation and so on. This was done in the United States and in England. When the 1911 bill was enacted in Great Britain the government cooperated with the great labour unions and companies that had their own out-of-work schemes. As a matter of fact the British labour unions deserve the entire credit for having unemployment insurance legislation enacted. Previous to that legislation being passed the great labour unions had their own out-of-work benefit schemes, or unemployment insurance as it is called to-day, with fairly substantial financial backing. Then when the British government took over the system the labour unions were able to give the government the benefit of their experience, which proved of great assistance. I have no doubt whatever that the minister will cooperate with any of the companies in this country that have initiated their own schemes of this kind.

I have studied this bill very carefully and compared it with the bill passed in 1935. In general it is pretty much the same, though there are a few differences and one or two new provisions. There is one thing which I have not found in any other unemployment insurance measure; that is the staggered rate of contributions. I see the minister shakes his head. Under this bill the contributions are based on the wages received, whereas under the bill of 1935 the contribution of a worker twenty-one years of age and up, for example, was on the basis of 25 cents from the worker, 25 cents from -the employer and 10 cents from the government plus all administration costs. At that time I thought this would make the effective contributions about 25 cents, 25 cents and 25 cents, which compares with the rate in England-above 21 years for males, unless it has been changed recently-of 20 cents from the employer, 20 cents from the worker and 20 cents from the government. This scheme is somewhat different, since it is based, on seven different wage schedules ranging from a minimum of $5.40 a week to a maximum of $38.50 per week or approximately $2,000 a year, which was the maximum established in the 1935 bill. I have no reason to criticize this change; it may or may not be an improvement, and time alone can tell.

It appears to me that the benefits under the British bill are and under the 1935 bill were a little better than those proposed under this measure, and of course there may be some reason for that. For instance, if we look at the second schedule on page 35, class 5, which deals with workers receiving from $15 to $20 a week, which I believe would cover the great majority of ordinary workers in Canada, in Great Britain a worker with a wife and four children coming within this category would receive $10.36 per week while unemployed. That is on the basis of $4.14 for the father, $2.19 for the mother, and 49 cents for each child, plus 25 per cent. Under this bill, however, the husband, wife and four children would receive only $9.60, if I have it figured out correctly. In other words the present bill does not give a large family. the benefits that would have been paid under the old bill, or that are paid now under the British bill.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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LIB

Norman Alexander McLarty (Minister of Labour)

Liberal

Mr. McLARTY:

I wonder if my hon.

friend is bearing in mind the eighty per cent limitation contained in the former bill, which provided that in no case, no matter how many

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Unemployment Insurance-Mr. MacNicol

dependants there might be, would a benefit be paid in excess of eighty per cent of the wages received. That would make a substantial difference in the various categories.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

The worker receiving $20 a week still would not receive more than 80 per cent. Under the United States measure a worker receives up to 50 per cent of his wages or $15 per week, whichever is the greater. Under this bill the worker, his wife and four children would receive only $9.60; under the 1935 bill he would have received $12.30 and under the British bill he would receive $10.36. However, I presume this staggered rate is based on some sound reasons, which I hope the minister will give us when he speaks again.

There is one feature of the United States bill which did not appear in the 1935 act and which is not in the present measure. As the minister well knows, in the beginning the federal government of the United States enacted what they thought would be an example unemployment insurance bill which might be adopted in every state. They said, "We will impose a three per cent excise tax on the wage rolls of all companies having eight or more employees. If the state then adopts a bill comparable with our example bill, we will return to the state 2-7 per cent of the contributions made by the state payroll, and retain -3 per cent ourselves for the contribution we make to the operation of the unemployment insurance scheme."

They had another provision, however, known as the merit clause, which worked to the advantage of all concerned. The manufacturer was encouraged to organize his plant so that employees laid off would be at a minimum. In other words, under ordinary circumstances he might lay off a number of workers, but if under the merit system he hoped to come under the provisions of the measure he would organize his plant so that workers would not be laid off but be engaged in other departments. In this respect their measure strikes me as one tending to permanency in jobs, and with that feature of the United States bill I am in complete agreement. Perhaps the minister will point out something in this bill which would be comparable, although at the present time I have not succeeded in finding it. Briefly, manufacturers in the United States are encouraged to give more continuous employment.

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Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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LIB

Thomas Reid

Liberal

Mr. REID:

Do not the manufacturers pay all the compensation?

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

The manufacturer pays for the worker, too; but of course he takes

it off the worker's wage, although that does not appear in the bill.

The three chief systems are those found in the United States, in Great Britain and that now suggested for Canada. As I pointed out earlier, the system in the United States has the good feature of a merit clause which has the effect of encouraging the manufacturer to maintain continuous employment. The British system provides for standard contributions at the ratio of 20, 20 and 20, while the one now before this committee provides for staggered contributions.

Some one has asked: "Is this the time to enact an unemployment insurance bill?" I maintain it is. If we cannot enact it now, when can we enact it? Certainly we cannot enact it after the war, if at that time we have a vast amount of unemployment. And in passing I must say I believe the war will not be over for a while. There can be no doubt that if this war develops in any respects like the last one, in two years from now the men and women in this country available for jobs will have them, making war materials. We may have over again the same conditions which existed in 1917 and 1918. In my view, on that basis we should have in Canada at least one or two good years during which full wages will be paid, and when full employment will be available. During that time a vast amount of money will be laid aside through contributions. Many people have been discouraged from advocating unemployment insurance because of what was known as the dole. I never looked upon those payments in Great Britain as a dole. If Great Britain had not done what it did after the war she would have had a revolution, and in my opinion $500,000,000 is a small amount to pay to avoid a catastrophe of that kind.

Better than that, they have amended their act to the point where such vast surpluses have been accumulated that they have paid off, I am told, $100,000,000 in the last three years in respect of capital expenditures brought about by the dole. In my last trip to the old country I spent a good deal of time in the government labour office, and while there I was told that they were piling up money in such huge amounts under the operation of the unemployment insurance scheme, that within a very few years the $500,000,000 dole debt would be wiped out. In addition to that they are piling up funds until to-day- or at the time I was there-there was $225,000,000 of a surplus, in addition to what they had paid off the former dole.

Nothing will accumulate as rapidly as moneys paid under an unemployment insurance scheme. Just fancy 2,100,000 workers paying into the government coffers, under this

Unemployment Insurance-Mr. Maclnnis

measure. Those 2,100,000 workers will pay in a lot of money in a year's time. If they are ipaying it in now, they are paying it when they are receiving wages, and those amounts will be laid up against their unemployment, if indeed they are unemployed at the close of the war. I hope even after the war is over whatever government is in power in Canada will have established some scheme under which the natural resources of the country can be developed, so that when our men return home there will be ample work for them to do. I am convinced that such a scheme could be put into operation. Perhaps our fears that many men will be unemployed after the war are all unfounded.

Let me offer a suggestion to the government. We have heard it said that another group of men may be inclined to hold up the passage of this bill. I wonder if hon. gentlemen from the other house could not be invited to send representatives to the committee of this house which is to discuss the measure.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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LIB

Ian Alistair Mackenzie (Minister of Pensions and National Health)

Liberal

Mr. MACKENZIE (Vancouver Centre):

They will be invited.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

In that way the two houses could operate together.

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LIB

Ian Alistair Mackenzie (Minister of Pensions and National Health)

Liberal

Mr. MACKENZIE (Vancouver Centre):

They will have that opportunity.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

They are entitled to recognition. In my judgment hon. gentlemen in the other house do a good job. In fact I do not know what we would do without the other house-and I do not mention it by name, although I believe all hon. members know what I mean.

I have spoken on this subject on many occasions, and it gives me great satisfaction to be in the House of Commons on the occasion of the enactment of a measure providing for unemployment insurance. I have spent fifteen years of my life advocating such a measure-eleven years in the house and four out of it. As I have said on other occasions, from long association with many thousands of men, and from having been in a position to observe what happens to them when they are laid off, I am a convinced advocate of unemployment insurance. I will not give details in this connection, because I have done so before. Let me state briefly, however, that anyone who has been associated with working men, anyone who has given employment to men, knows there can be nothing more heartbreaking than to lay off a man who has been employed by a company for ten to twenty-five years. I have known men to be laid off after employment of thirty-five years, and to have received nothing but the

words, "I am sorry, old man, but I cannot

do anything for you." If ever there was a piece of legislation to which the working people in Canada were entitled, certainly it is legislation bringing about unemployment insurance; and I am going to do my best to assist the government in putting this bill through.

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CCF

Angus MacInnis

Co-operative Commonwealth Federation (C.C.F.)

Mr. ANGUS MacINNIS (Vancouver East):

Mr. Speaker, before I begin the few words I wish to say in regard to this measure I should. like to thank the hon. member for Pavenport (Mr. MacNieol) for his kind observations in reference to the hon. member for Winnipeg North Centre (Mr. Woodsworth) who has not been able to be present for some time. May I thank my hon. friend, too, for what he said about a former member of the house, one who in the last parliament sat for the constituency of Winnipeg North. I refer to Mr. Heaps. Both of these gentlemen have, as he has said, for many years worked strenuously for legislation of this kind, and I am sure both of them will be pleased to hear of the generous tribute paid to them by the hon. member for Davenport.

It is not my intention to delay the house, nor do I intend to make an exhaustive analysis of the bill. I do not think that is necessary at this time. Speaking for the group with which I am associated, I would point out that we have now had an opportunity to read and to examine the bill. Although we do not consider it perfect, we do not intend at this time to indulge in any criticism of it. We realize it is going to a committee, and that is the proper place to make criticisms and offer suggestions. We should like to see in the bill certain provisions which are not in it; on the other hand we would prefer to leave out of the bill certain provisions which appear in it.

This bill follows quite closely the 1935 act for which I voted. Where changes have been made, I believe they show an improvement. The government have decided, quite wisely, to send the bill to a special committee. In that committee those who are in favour and those who are opposed to the bill will have an opportunity of making their representations. I am glad to see that the Minister of Labour (Mr. McLarty) is to be a member of the committee, and I hope that both the minister and the government will not allow the reference to committee to be used as an excuse for the postponement of the enactment of this legislation. The government should insist upon the house remaining in session until this measure becomes law. Those who will benefit have waited for this legislation for many years, and in my opinion the psychological and social consequence of a

1776 COMMONS

Unemployment Insurance-Mr. Maclnnis

further postponement would not be good. I am willing to stay here if necessary until the snow flies in order that this bill may be placed upon our statute books.

There are one or two points which I should like to stress in order to show the desirability of passing this legislation at this session. First, after the bill is passed it will take several months to organize the machinery necessary for administration. After contributions have begun to be made it will be thirty weeks, and perhaps longer, before the legislation will become operative in the sense that benefits are being paid. Even though we do pass the bill this year it will be late in 1941 or 1942 before any benefits are paid under it.

Second, all contributions made are to go into the unemployment insurance fund from which will be paid out any benefits. The employees' contributions, the government's contributions and the employers' contributions will go into this fund, and in addition the government is to pay the cost of administration. The leader of the opposition (Mr. Hanson) referred to the large amount of money which would be taken out of circulation each year, but I think that will be more apparent than real. In any event, it would be taken out only for a short time. Over a period of years all the money collected will be paid out in unemployment insurance benefits. While I am not an authority on these matters, I do feel that a time like the present when the government is anxious to curtail consumption, particularly consumption of an unnecessary kind, is the best time to build up a fund such as this. I think this should meet some of the objections being made to the bill. Objection has been oSered by certain people who have never before shown much interest in the condition of the working classes. These people point out that the enactment of this measure at this time will bear heavily upon the low paid workers. May I point out that there is an easy way to get over that difficulty-increase the wages of the low paid workers. The leader of the opposition said that Canada has not been noted in the past for the payment of high salaries. We may not have been noted for the payment of high salaries, but we certainly are noted for the payment of low wages.

There is another reason why I want to see this bill pass. Any one who has gone to an unemployment relief office and has watched applicants for relief make their applications, be examined and very often be treated roughly by the employees of the office, will realize the degrading effect of unemployment relief. While this measure will not by any means put an end to the need for unemployment relief, it will take a certain number of people, how

TMr. Maclnnis.]

many I do not know, out of the category of relief recipients. When they become unemployed, instead of having to go to the relief office and have all their private affairs investigated, they will go to the unemployment insurance office, present their cards, and certain conditions being met, they will receive their unemployment insurance benefits as a matter of right and not as a matter of charity. That in itself is a great step forward. I hope the time will come when we shall be able to bring more of the excepted occupations under the operation of this bill.

There are many questions which I should like to ask because a number of sections are more or less obscure to me, but I think we can get all the information we desire in committee, and perhaps to better advantage than by asking questions of the minister across the floor. Not only will the minister be in the committee, but it is hoped that there will be present experts who understand the administration of a measure of this kind. As I said before, I hope the government will do everything possible to expedite the passing of this bill. As far as this group is concerned, we intend to assist in every way possible. We will try to improve the bill by offering advice, but we accept the principle and we want to see the legislation in operation.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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LIB

Paul Joseph James Martin

Liberal

Mr. PAUL MARTIN (Essex East):

Mr. Speaker, two years ago the hon. member for Comox-Alberni (Mr. Neill) introduced a resolution calling upon the government to consider the advisability of taking such action as it has now decided to take. In seconding that motion I expressed at much greater length than I propose to do to-day my views with regard to this question. Rut I cannot escape the responsibility of dealing with this measure now because I represent in this house a constituency which possibly more than most constituencies in the country will be deeply affected. I am provoked for another reason to take part in this debate. The Minister of Labour (Mr. McLarty) comes from a county and a city that are also my own, and I know the house would not rob me of the privilege of extending to him congratulations -both upon the manner in which he introduced the legislation and upon being in a true sense its father.

The hon. leader of the opposition (Mr. Hanson) in the two able presentations which he has -given to the house, -has made a number of observations on this bill which I think require some comment. It is highly desirable that the country should not be led into the position of thinking that this measure is capable of yielding something that it is not

Unemployment Insurance-Mr. Martin

capable of yielding. On the other hand no effort should be made to minimize its benefits. Speaking the other day, the hon. leader of the opposition said:

I think the country would like to have the most solemn assurance that the scheme will be actuarially sound, because if it is not, and there is a deficit, the treasury of Canada will be asked to meet the deficit.

No unemployment insurance scheme in any part of the world has yet been able to operate without calling from time to time upon the national exchequer for further assistance, and for us to assume to-day that there will in the course of time be no further demands upon the treasury is, I think, not to face realities. I would say to the hon. gentleman that in the course of time as this bill operates we shall experience what they have experienced particularly in England, because through circumstances which we cannot now anticipate the need will arise from time to time for calling on the exchequer to bolster up the fund.

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NAT

John Ritchie MacNicol

National Government

Mr. MacNICOL:

Does the hon. member not think they have passed that stage in England? They have raised their rates to such an extent that their scheme is on a sound actuarial basis.

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LIB

Paul Joseph James Martin

Liberal

Mr. MARTIN:

That is ,a matter for argument. I can only say that in an article in the Yale Economic Review Mr. Keynes, writing on this aspect of the matter, stated what I have just now affirmed, namely, that since one cannot anticipate the character and extent of employment, it must be expected that from time to time variations in the contributions by the state will have to be made, particularly in view of the dislocation that is bound to follow the war. Any hon. member would indeed be bold to say to the house now, in reply to the hon. gentleman, that we shall not be called upon in this country to furnish more financial assistance than is at present contemplated. Moreover, when the leader of the opposition says that we ought to see that the measure is actuarially sound, I think there should be a clear understanding as to what is actually meant by the term "actuarially sound". If by "actuarially sound" is meant that we shall seek to establish a measure which will be actuarially sound in the sense that life insurance is, that is impossible in unemployment insurance because the nature of the risk in life insurance is altogether different from the nature of the risk in unemployment insurance. While it is laudable to try to make unemployment insurance actuarially sound, we must not be unmindful of the fact that it is impossible really to make it actuarially sound.

When the hon. gentleman asked the Minister of Labour if a certain authority on unemployment insurance had been engaged on this measure, I presume he was thinking of the eminent statistician and authority on this question, Mr. Wolfenden, who of course represents on this whole subject one school of thought which I think it is fair to say is not the dominant school in regard to the actuarial possibilities of unemployment insurance.

But my main reason for taking part in this debate now is this. We have the assurance of the Prime Minister (Mr. Mackenzie King) and of the Minister of Labour that it is the intention of the government to see this measure enacted this year. But I believe I know something of the kind of representations that will be made from all over the country by various groups the moment this measure gets into committee, and unless a clear limitation is imposed upon the nature of the representations that will be permitted- and if all of these groups are to be heard, there is no possibility of this measure passing the house this session. Consequently-I say this now because I am not a member of the oommittee and shall have no opportunity of saying it later-I think it should be definitely understood that because this question has been reviewed by at least three royal commissions and constantly discussed in all sorts of ways during the past twenty years, nobody will be allowed to appear before the committee to discuss the principle of the bill. Otherwise there will be no opportunity of the measure coming back to the house this session, and it is wholly desirable that, as all of us agree, it should be enacted now if for no other purpose than to give it a trial and to deal with unemployment insurance in an experimental manner.

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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sun'bury):

Would the hon. member suggest that if a substantial body of employers and a substantial body of wage-earners appear in opposition to the principle, they should not be heard?

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LIB

Paul Joseph James Martin

Liberal

Mr. MARTIN:

I say that very thing, and for the reason that the country has had ample opportunity to consider this bill or the fundamentals involved in it. While it has some features that differ from the Bennett legislation, the fundamentals are the same, and all the criticism that was leveled against the Bennett bill and all the suggestions that were then made have been generally known for a considerable length of time. To pursue any other course would mean that this bill would not be enacted this session. Therefore there is fundamentally nothing new that is not already known by the department, the

1778 COMMONS

Unemployment Insurance-Mr. Martin

government and the country. Nothing new can be submitted by any group. The Canadian Manufacturers' Association have said, by implication, that they regard this measure to be so dangerous at the present time that they propose to resort to every legitimate means to see that during war time it does not become law; and the effectiveness of that organization will be apparent, I think, when the committee assembles.

The attempt may also be made from other quarters, when the committee meets, to urge upon the government that at the present time at any rate the scheme should not be made compulsory. I hope that if that sort of representation is made, the attitude of the committee will be made clear, because I am sure that the attitude of the house is clear. There can be no question that in ithe light of experience in England our scheme should be made compulsory. First, because a compulsory scheme assures the widest possible distribution of the risk; second, because by levying a contribution on employers, employees and the state, the burden is equitably distributed; third, because by having the state participate in contributions as is done in England, as distinguished from the Wisconsin scheme, for example, the government can shift a considerable share of the burden on to those groups in the country which financially can bear that burden through graduated income and inheritance taxes.

The explanatory note opposite page 3 of the bill indicates that it is the government's intention to establish a commission to organize a national employment service with regional divisions and local offices. The English experience certainly indicates that unemployment insurance cannot be successfully administered unless it is harnessed to a system of employment exchanges or employment offices. In this country we have nine provincial employment exchanges or offices all operating with different policies and consequently lacking coordination calculated to effectuate the purpose of these employment exchanges. Perhaps in speaking on the second reading the minister may indicate whether, in the adoption of the scheme, the provinces have intimated their intention of abandoning their employment offices; because obviously, if the scheme is to function successfully, there cannot be any overlapping and the central authority must be able to deal effectively with the kind of problem that these employment offices have to deal with.

It will be argued in the committee that we should not consider unemployment insurance in relation to unemployment relief or

to the general question of the rehabilitation of labour. This legislation, as far as I can see, does not envisage all the possibilities, and it falls short of adequate consideration of what the perfected legislation in England has taken into consideration, namely, that during a period of prolonged depression, or during a period such as the present when the depression is certainly less acute, unemployment insurance in itself is not sufficient to meet the needs presented by a situation of that sort and must be related to the question of unemployment relief, to the question of the rehabilitation of labour, and to such questions as national health insurance and the like. All these matters are part of a composite scheme, and consequently, when the hon. gentleman said that he agreed with my interjection as to the impossibility of unemployment insurance ever doing away with relief, he concurs, I take it, in the view that unemployment insurance and unemployment assistance or unemployment relief must go hand in hand. The objective is not to do away with relief but rather to cushion it and to have both activities working together.

Finally, the argument will be made before the committee that since every employed person in Canada cannot benefit from unemployment insurance, and since there are vast areas where it will be of small embrace, instead of having a national scheme we should have regional schemes. I have been advised of one group who propose to go before the committee and recommend not a national but a regional scheme. If that is proposed, then I suggest three answers. First of all, the scheme should undoubtedly be compulsory; second, it should be contributory, and third, it should be on a national scale; otherwise serious difficulties would arise. First, the working class move constantly from one province to another, and the difficulty would be greatly enhanced in such an instance particularly when one worker moved from an insured province into an uninsured province. Second, it would be unfair that the taxpayers of an uninsured province should contribute equally with the taxpayers of an insured province. Third, the producers of an insured province would be saddled with a substantial item of cost which would not be borne by their competitors in the uninsured provinces. That would be an obviously unfair provision with respect to employers of labour who had to compete with lower costs in a competing province. I might add a fourth consideration. If the scheme were not on a national basis,

Unemployment Insurance-Mr. Neill

the system of labour exchanges would be frustrated through their jurisdictions not being nation-wide.

Because there is a great move in the country against the enactment of this measure at this time, particularly in view of the fact that we are at war, certain sections of industry are taking a definite view in that regard. Perhaps because I represent a heavy industrial section of the country, strong representations have been made to me that our primary occupation at this time should be in the direction of winning the war. No one quarrels with that as our primary objective, but it is shortsighted for certain sections of industry to assume that taking care of the unemployed is not an integral part of our war effort. Certainly industry is short-sighted in not envisioning the kind of difficulty that will face this country when the war is over unless we have taken the steps which this house so determinedly proposes to take to-day. The spirit which all members of the house have displayed towards this measure indicates its desirability and the importance of enacting it at this session, no matter what the difficulty may be.

I conclude by saying to the Minister of Labour, coming as he does and as I do from an area in which there is unemployment for many months of the year because of the type of industry that predominate in the community, he will have done nothing in his public life greater than to create this measure when he is able to say at the conclusion of this session, as I hope he will be able to say, to his people and to all the people throughout the country that one further great reform for a harassed group of our population has finally been realized.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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IND

Alan Webster Neill

Independent

Mr. A. W. NEILL (Comox-Albemi):

When the resolution on which this bill is founded was before the house we were not furnished with sufficient details-it was not possible- to enable us to understand a measure of this magnitude. I was glad, therefore, when I heard the Prime Minister (Mr. Mackenzie King) agree to the suggestion put forward by the leader of the opposition (Mr. Hanson) and endorsed by myself and others, that the bill should be sent to a special committee, the idea being, as I thought, that it would be thoroughly discussed in a non-partisan way and, if necessary, appropriate amendments made. Since then I have seen the bill, and while I have not been able to go through it as carefully as its importance demands, I see that there are considerable improvements on what is known as the Bennett bill. I do see in it, however, some places where I think 95826-112J

further substantial improvements could and should be made for the benefit of the workers for whom it is intended. [DOT]

Since then I have seen the names of those constituting the special committee, and I am not nearly so hopeful of improvement in favour of the worker. I have heard a good deal about non-partisan service in the last few months, and I supposed that would be demonstrated in the composition of this committee. I expected to see members representative of what are known as the "big interests" and big employers, and quite properly; and the government represented to some extent; also and particularly members representing what would be called the working section of the community. But on analysing the committee of fifteen I see that there are three cabinet ministers, a very large number out of fifteen; they and those they can control would almost guarantee the bill going through without any changes. There are ten Liberals, a huge majority in a committee of fifteen, and three Conservatives, one social crediter and one representative of the Cooperative Commonwealth Federation.

Let us consider their occupations and thus get some light on their possible leanings. There are ten lawyers. Now I like lawyers; I admire them; I had an ambition at one time to be a lawyer myself. Nevertheless we must view conditions as they are. The means of livelihood of lawyers, their profession, puts them in touch far more with the business interests than with the working man. Compare the big corporation lawyer with the average man here and there who takes up the cause of labour. And the ten Liberals give a partisan taste to the composition of the committee. Then we have two hon. gentlemen representing business interests; their interests would supposedly be against the bill, as has been indicated by the last speaker. Another one is a minister of the gospel; he has already expressed himself as having no faith in the measure. There is a farmer, but no farmers are eligible under the bill. There is a social crediter; he has already expressed himself as being in line with the views of his leader who said that "unemployment insurance is only a bauble, only a glittering make-believe which will lead to disappointment or despair", so we may wash out his usefulness on behalf of the working men. Then we come to one man who can honestly claim to represent labour; he is the only member of the committee who in years gone by has consistently advocated this legislation in the house. But I am afraid he will have a hard time getting much for the benefit of labour out of ten lawyers and the parson. I

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Unemployment Insurance-Mr. Neill

would almost say that it appears as if a dictum had gone out that this bill is not to be changed. If that is the case, why send it to a committee; why not take the vote now? We have lost so many of the privileges of private members this session we might lose a few more; it would save time at any rate.

There are two or three further points that I would mention, because I shall not have any further opportunity. There are many points, but I have time for only one or two. The fact that these points to which I take exception were all in the Bennett bill does not justify their existence in this bill, because this government is supposed to improve things and get further light as time goes on. On page 14 of the bill we find a section relating to disqualification for benefit. Please note it is not disqualification for insurance, but disqualification for benefit. That is, you can be insured, but when you come to draw the benefit you will be disqualified.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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NAT

Richard Burpee Hanson (Leader of the Official Opposition)

National Government

Mr. HANSON (York-Sunbury):

You can

pay but you cannot receive.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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IND

Alan Webster Neill

Independent

Mr. NEILL:

Yes, and when I state who

is not to receive, hon. members will appreciate the point I am trying to make. They will find it on page 15. Among those who cannot draw insurance after having paid for it are those in receipt of pension under the Old Age Pensions Act. That is in paragraph (f). What in high heaven is the relationship between the Old Age Pensions Act and unemployment insurance? This is an insurance fund into which the worker has paid and from which he can demand compensation if he qualifies. If my house is burned down it would not excuse the insurance company from paying if they said, "You are not hard up." That is the position taken here, "You are getting $20 a month, therefore you will not be paid insurance under this bill although you may have been paying in for five or ten years."

Section 33 on page 11 even provides for a man having what one may call a side-line occupation being able to obtain benefit, if his main job is gone but he has some little side job such as usher in a theatre, and provided it does not exceed a dollar a day. But-a man is going to be condemned because he is in receipt of an old age pension.

There is a worse feature than that. When you and I hear of people having old age pensions we naturally think of $20 a month. Not a bit of it; there are many reasons, I could speak for hours on it, why people do not get $20 a month, although they are entitled to it. The regulations are framed and the interpretation is so twisted by certain boards that people do not get what they are entitled to.

Take one example; if I own a piece of land away out in the bush, it is worth $100 if I could get it, which I cannot; it is assessed at $1,000; that is quite common in British Columbia, and the board of pension commissioners say that I am drawing $50 a year income, five per cent on that amount. In addition, I have to pay $30 a year taxes, so I am out $80 a year, and that is taken out of the $20, or something like $7 a month.

There is another system of deduction. The board say that they must take into consideration anything which the wretched applicant "might be expected to receive," not in the opinion of the applicant but in the opinion of the board. So they say to the applicant, We "expect" you ought to be receiving so much from your married daughter's cousin, or something of that kind, and we will take that off the $20. I know of cases in which the Parents Maintenance Act is worked in. In one case they wrote me stating that they would not give an old man a pension because he should be living on his son, and his son was living on $5 a month relief at the time. In another instance I think of, in a province which I will not name, I wrote saying, "Why are you giving this man only $15 instead of $20?" The answer I got in black and white from the government official was, "We consider $15 is enough for the likes of him." That, is, they did not say "for the likes of him," but that was clearly indicated. I said, "Yes, but the law calls for $20"; and I had quite an argument. I had to appeal to Ottawa and get a ruling before they would agree that the law did call for $20. They might just as well have said they thought $10 or $5 enough.

I know of cases where the amount of pension that people get is less than $3-$2.87 in one case-after these deductions are taken off. And because a man is getting $2.87 a month he will not be eligible under this bill. The provision was, I know, in the Bennett act, but I cannot think that it is just. So I suggest that that clause be struck out, or at the very least that it apply only when a man is getting the full old age pension, although even that would not satisfy justice. If a man is entitled to benefit by having paid for a number of years he ought to get it, and his poverty or riches has nothing to do with the matter.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   FUND TO BE ADMINISTERED BY COMMISSION ASSISTED BY ADVISORY COMMITTEE- PROVISION FOR EMPLOYMENT SERVICE
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July 19, 1940