Presentation To The Standing Committee on Citizenship and Immigration

June 14, 2017

INTRODUCTION

For the past 27 years the Canadian Taxpayers Federation has been fighting across Canada for three fundamental principals.

Lower Taxes,

Less Waste, and

More accountable government.

I want to thank the committee for inviting our organization to speak to you today. I know that over the last few weeks you have heard from many voices in Atlantic Canada who have outlined the problem all too well.

THE PROBLEM

Our population is in decline, we are aging and the cost to provide public services is becoming unaffordable.

The solution many have put forward is just to find ways to bring as many new immigrants to the region as possible. This is a laudable goal but it won’t work in isolation of other changes.

Consider this between 2011 and 2016 over 31,000 more Atlantic Canadians packed up and moved to other provinces in Canada than moved into the region.

Here’s the problem: if we can’t keep native-born workers home, who have roots here, how will we ever retain newcomers who are mobile and could find better opportunities in other parts of Canada? Of course, we won’t.

It’s all about the economy. The Atlantic economy is failing under high taxes, excessive regulations, a failure to explore our natural resources and large, costly bureaucracies. Fix the economy and we can attract thousands home as well as people from around the world.

We are not economically depressed because of our geography, nor because our people posses a culture of defeat.  

No, it’s because of the economic policies promoted by Atlantic provinces and from Ottawa – sometimes with the best of intentions, have failed to deliver results as they were intended.

Let me tell you a story about what I mean…

In this region we have amongst the highest unemployment rates, our young people are moving west because they can’t find good well paying jobs, at any one time we have almost 100,000 people collecting employment insurance cheques yet companies in the region are bringing in temporary foreign workers to areas that already have lots of people without work.  

TEMPORARY FOREIGN WORKERS

So why is this?

This problem in part was created by the combination of the liberal use of the temporary foreign worker program and the abolishment of changes to tighten the employment insurance rules made by the Harper and Chretien governments.

Fish plants and other businesses have responded to the labour shortage by demanding more and more temporary foreign workers.

Most immigrants have a path to citizenship and enjoy the same economic freedoms as Canadians, including the right to accept a better paying job. Temporary foreign workers have no similar bargaining power and are unable to climb the economic latter. These workers have one option – work for the company that sponsored them, at the pay on offer, or return home.

Former New Brunswick Premier Frank McKenna came before this committee and argued TFWs need a path to citizenship. I agree. But a temporary foreign worker on that path wouldn’t be temporary. They would instead be like other immigrants.

As it stands, the TFW program is unCanadian. It is an illiberal and immoral policy because it creates a permanent underclass of workers.

The TFW policy also drives down wages and causes more people, who are looking for a decent paycheque to move to central or western Canada where were wages are set by market forces. This, in turn, reinforces the argument of some Atlantic employers that they cannot find enough local workers. It increases pressure on Ottawa to further increase the number of TFWs.

The solution is obvious, if workers aren’t willing to work for the pay on offer companies need to raise wages and pay a fair wage.

It’s time we prioritize jobs for Canadians, and tighten the rules for temporary foreign workers. This would force companies who right now aren’t paying a living wage to increase salaries to a true market rate. This would result in more unemployed Canadians being attracted to do the work and earning decent paycheque doing it.

EMPLOYMENT INSURANCE REFORMS

But there is another part to this, the government should look for ways to incentivize work and get people off EI.

The Liberal government eliminated requirements on frequent and repeat EI claimants to accept work at slightly less pay and to consider marginally longer commutes to work.  These changes were put in place to reverse a growing shortage of workers in areas of the country with high unemployment rates. 

Unemployed Canadian workers have choices – they can work for those low wages, kept low by the TFW policy, work elsewhere, or work for a few weeks a year and collect EI.

In effect, companies are competing with the EI program in order to convince people to come and work. After all, why work for $11.25 if you can collect EI instead? Fixing EI is where Ottawa should focus its policy reforms instead of making it easier for companies to bring in more TFWs.

GROW THE ECONOMY

Finally we need to grow our economy.

The region is uncompetitive when it comes to our taxes. An individual in Nova Scotia for example earning about $60,000 a year pays $1,500 more in income taxes alone than the national average. Not to mention the region has the highest sales taxes, corporate taxes and other fees.

CONCLUSION

In summary, here are three recommendations from our organization:

1. Tighten the rules for permitting temporary foreign workers in areas of high unemployment by treating them like other immigrants. This policy would force companies to raise their pay, and do more to hire unemployed Canadians who are currently collecting EI.
2. As Frank McKenna said: Reform the Employment Insurance program: re-institute reforms by the previous government which promote frequent EI users to transition back to the labour force.
3. It’s the economy stupid: we need pro-growth strategies that lower taxes to promote and grow the region. People don’t leave home when they have jobs and opportunity..

Solving Atlantic Canada’s demographic problems with immigration is just part of the solution. But it won’t work in isolation. We need our friends and family who’ve gone west to move home, and we need our governments to bring in policies designed to grow our economy and realize our potential.

Thank you for your time,