It’s no secret that Liberal leader Michael Ignatieff wants to reform employment insurance — he’s been loudly pushing for changes since he officially became leader of the opposition at the beginning of May — but is he really willing to bring down the government, as he says he would, if the EI system isn’t altered? Maybe, according to Ralph Goodale, opposition house leader and Paul Martin’s former finance minister.
“We’re not anxious to precipitate an election for political purposes, but we’re not afraid of it either,” Goodale revealed in an exclusive interview with Canadian Business Online. “He doesn’t want to have a political fight about it. What he is anxious to have is an economic solution. But if the government decides to draw a line in the sand and precipitate a crisis then so be it. Bring it on.”
Ignatieff has been vocal about wanting to bring the eligible qualifying hours for EI down to 360 from the 420 to 700 hours (depending on province) it takes right now. It’s one of the most pressing issues for Canadians, says Goodale.
“This has been gaining momentum over the last several months as the recession has deepened,” he says, explaining why the party chose to champion EI reform before anything else. “Especially since this inverse relationship has emerged, where places in the country that have been hit hardest by job losses are the places where the old formula makes it hardest to get EI.”
So far, Stephen Harper has refused to make changes to the program, saying it will result in an increase in payroll taxes. But, while he might not want to bring down the eligible EI hours to 360, a TD Canada report suggests that he could make other reforms, like setting the base hours worked at 420, the current minimum, across the country.
Goodale says the Liberals are standing firm on the 360 number, but there is a chance they might reassess their demands if Harper makes some changes to EI.
“In our consultation, we concluded that 360 hours, during the course of a recession, is the right number,” he says. “[If Harper does go ahead with some reforms] we would have to judge at that time how sincere and effective what he’s proposing would be. But so far he’s proposed nothing.”
While Ignatieff takes his message of EI reform to the Canadian public, behind the scenes his economic team — which Goodale says is made up of MPs, economists, academics and business experts (he won’t reveal names) — is busy helping create a platform that should be finished in June.
However, Goodale explains that while the platform could be completed in the next few weeks, voters will likely have to wait longer before hearing what exactly Ignatieff has in store.
“Mr. Ignatieff told party officials and the caucus who are working on the platform that he wants it to be ready in June. That’s not a signal that he’s necessarily going to announce and publish a platform then,” says Goodale. “He simply wants all the homework and background to be done.”
Still, the party is slowly revealing some of the other issues it will take on when an election is called. Infrastructure spending, which the Liberals feel the Conservatives have mishandled, is likely going to be on top of Ignatieff’s economic plans.
“At the very beginning the government should have taken the advice of the Federation of Canadian Municipalities, which said if you’ve got three to $5 billion extra that you want to invest in infrastructure, send it as a direct transfer to the municipalities,” he says, revealing what his party would have done if they were in power. “They know what streets need to be paved, what water mains need to be replaced, so the most efficient way to get shovels in the ground is to empower the municipalities to do it.”
He adds that the model for sending money to the local level is in the gas transfer tax, which Paul Martin’s government hoped to put into law before it was toppled. That would give cities 1.5 cents on every litre to specifically put towards infrastructure projects.
Another issue the Liberals will tackle is dwindling pensions. Goodale says it’s an issue that most Canadians haven’t clued into yet, but that it will be a major problem down the road. “As soon as the initial trauma of job losses gets absorbed, I think you will see more and more attention paid by ordinary citizens about their long-term personal and family security. Their monthly pension statements for the last months have not been a pretty picture. That’s a real locomotive coming down the track.”
Paying down the climbing deficit could be another defining issue in the next election campaign, though Goodale won’t reveal what they will do address Canada’s growing debt.
He does say that the Conservatives weren’t wrong for going in the red — and he would have done the same thing — but it was their spending behaviour before the recession took hold that’s put the country in, what he thinks, is a precarious position.
“The fact that there is a deficit now is understandable,” he says. “What bothers us is this: it’s about 40% bigger than it needs to be compared to the stimulus it is creating. The reason is Mr. Harper’s bad fiscal management before there was a recession that put the country into a deficit. The country will carry that excess, non-recession related debt through this whole period of time.
“That Mr. Harper would incur a deficit to fight the recession is explicable. That he would have a deficit 40% bigger than it needs to be compared to the stimulus it is creating is inexplicable.”
It’s just a matter of time until the Liberals do announce their economic plans, and whether or not they’ll pull the trigger and try to bring down the government. But, according to a recent Ipsos Reid poll, which said 46% of Canadians think Harper’s the best choice to manage the economy, versus 32% who said the same thing about Ignatieff, the new Liberal leader still has a lot of work to do before people are convinced that he has the economic wherewithal to lead Canada out of a recession.
To that, Goodale says we’ll hear more from Ignatieff as the party’s economic plans are revealed. “You will see him becoming increasingly more engaged on economic issues and economic leadership. He has led the Commons on EI and as other issues emerge and the whole program develops, people will see him demonstrate tangibly that he knows exactly what he’s doing and that he’s doing it right.”