The Challenge Ahead

C.R. Charlton

Honoured guests, ladies and gentlemen: It may be apocryphal, but there is a story going around of an elderly voter of feminine persuasion, in the constituency of Kingston and the Islands, an ardent, almost fanatical supporter of our guest, who in discussing parliament, summed up her feelings with the words: "Well, it seems to me there's flora, and the rest are mere fauna!" The American poet, Emerson, must have had somewhat the same feeling when he wrote; "Wherever MacDonald sits, there is the head of the table."

To begin at the beginning, Flora MacDonald first saw the light of day from the vantage point of Cape Breton. I say "vantage point", because not only do Cape Bretoners see the light of day before the great majority of Canadians further west, but also because Islanders are identified with several other good qualities, including a strong sense of justice, generously larded with a good sense of humour. Our speaker conforms to this tradition. Her political commitment to the Progressive Conservative Party of Canada is long-standing. She served as Executive Director, PC. headquarters, from 1957 to 1966, and then until 1969 served as the party's National Secretary. In 1972 she was persuaded to run for federal office as the Tory candidate for Kingston and the Islands. She won a comfortable victory. This vote of confidence from the electors has now been extended to her no less than four times. In the short-lived Clark regime, she served as Secretary of State for External Affairs. In the current government, as you know, she holds the sensitive portfolio of Employment and Immigration.

In the give-and-take, move-and-countermove, thrustand-parry of our national political life, Flora MacDonald moves with poise, adeptness and conviction. This is the third time we have been able to persuade her to address us. Perhaps, ladies and gentlemen, if we give her a warm welcome, there may be a fourth!

With pride and pleasure, I present the Honourable Flora MacDonald, Minister of Employment and Immigration.

Flora MacDonald

I thank you for this invitation to speak. It gives me the opportunity to speak about the changes and challenges which are essential to the economic renewal of this country - indeed, our success as a nation.

The problems and opportunities facing Canada were discussed, as they never have been before, at the 'National Economic Conference in Ottawa last weekend. The very fact that the views of people from each part of the economy were stated clearly and frankly represents a great step forward in building a national consensus: a consensus on the future of this country. Today, I hope to advance that process a little further. Both as Minister of Employment, and as a part of a government committed to finding solutions, the first statement of principle for me to make, is that jobs are the number one priority. On this, there can be no disagreement. The economic waste of high unemployment is painfully obvious. No less painful and no less obvious is its social cost - the loss of dignity, the dependency and eventually, the hopelessness.

More than one million Canadians today are denied the basic right to lead productive, fulfilling lives. This cannot continue. This nation, not just its government acting alone, must create hundreds of thousands of jobs. To do so, we must face and surmount challenges and difficulties unprecedented in our history:

- A federal public debt that our young people cannot live long enough to pay off,
- An annual deficit which constrains our ability to respond fully to new needs and opportunities;
- A productivity record which continues to lag behind our partners in a fiercely competitive world;
- A decreased share of international trade.

But these are not the only challenges. We have entered an era, not only of high technology, but of rapidly changing technology. The emerging technologies can be applied to almost anything, almost immediately. They render skills and jobs obsolete just as quickly as they spawn new products. These technologies enable developing countries to establish a manufacturing and processing capability which, combined with the low wages of those countries, makes it much harder for us to compete. For the first time, global business corporations have the ability to shift investment, almost at will, from country to country, in search of economic advantage.

Of particular concern to Canada are the changes effected by the rapid rise of world energy costs since 1973. This spurred the development and production in many Third World countries of the very commodities and resources which had long been a stable and secure source of Canadian exports. That stability and security no longer exists. The fact that our mining industry is still able to compete is testimony to our expertise, our productivity and our determination.

In other sectors, however, our productivity has not kept pace with the competition; our expertise, our very considerable expertise in many areas, has not been fully realized. There are even those who have given way to the easier cry of protectionism. These are the everyday facts of economic life. And they leave us with few choices. As a nation, we can hide from change - and simply seek to prop up the past: and in doing so, forfeit our future. Or we can see change as a means to a new level of world competitiveness and new economic growth - new jobs, in a more equitable society. These changes are not cosmetic. These adjustments are going to be tough and they carry a price tag. But we have no choice. If there are to be new jobs and more jobs, there must be change. As a government, we are committed to doing our part. And you, ladies and gentlemen, must do yours. We must work together, because alone we will not meet the challenge of change.

In Ottawa we are reducing the deficit and creating confidence. We are encouraging investment and strengthening small business. We are putting the energy industry of this country back in a position where it can thrive and grow for the prosperity of all Canadians. For the first time there is a government in Ottawa committed to building a skilled, flexible labour force. Success in this will ensure economic health for this nation and, for individual Canadians jobs and job security. In essence, that is my job: to enable Canadians to get training, to get skills, and, to get jobs.

... there is a government in Ottawa committed to building a skilled, flexible labour force ...

Without question, the quality of our labour force is critical. It is the key to international competitiveness, to increased productivity, and to the making and selling of better products and services. And these are the keys--to future growth and future jobs. A skilled and flexible labour force is one of the first and one of the most important criteria of any potential investor. Industry has discovered that a labour force with inadequate skills is every bit as damaging in the competition for profits as obsolete machines and old ideas.

Individual working men and women are finding out that new skills and training are necessary, not just for advancement but for job security itself. In fact, a recent survey showed almost sixty per cent of Canadian workers prefer new job training to higher wages, for just that reason. Canadian workers know that new skills mean new opportunities.

I have spoken about the need for change - a need that was fully recognized at the First Ministers Conference at Regina last month. There, all eleven First Ministers enthusiastically and fully endorsed the federal government's new labour market strategy. They were backing the new approach because it is clear the old one has not worked.

The old programs were so complex, so ridden with bureaucratic barriers, that business, labour and Canadians generally had simply given up on them. Paperwork and regulations had all but excluded small business - the single most important source of jobs in our economy. Training after training program led absolutely nowhere. Make-work job creation programs did nothing but shift people around like packages in a warehouse until they re-qualified for unemployment insurance. Training offered no hope; no prospect of lasting employment. Regional needs were ignored for the sake of national uniformity.

For the first time our goal is development, not dependency. Investment in people, not in bureaucracy. For the first time, major efforts are being made to enable employed Canadians to retrain for changing technology before they lose their jobs. For the first time a government is considering initiatives such as a registered training savings plan and skill development leave.

Every job creation program will contain a training component designed to give its participants skills they can use in the permanent labour force. For the first time, we will have the flexibility to meet the varying needs of varying regions. Community participation will be actively sought and encouraged. And in the search for new and effective solutions we have taken the unprecedented step of allocating $100 million to an innovations fund.

... For the first time our goal is development, not dependency. Investment in people, not in bureaucracy ...

From now on, the private sector will share the responsibility, with government, for labour market development. And I tell you quite frankly, that if the pri vate sector does not play its part, does not fulfill its role, our chances of success will be slender indeed.

If the needs of business must be met in order to create economic growth, then business must help meet the needs of its employees as well. With benefits come obligations, both for the individual and the organization.

You see people every day. You see the thirty-five year old warehouseman who must learn computer inventory control, or you will have to let him go. You have also seen the fifty-two year old man apply to you for work. He has twelve years' experience, but he was laid off work eighteen months ago. He has been looking for work ever since - and the defeat is beginning to show. It is for these people and for what they can contribute to our companies and to our country that we must change - that we must succeed.

If we are serious in our contention that human resource development is critical to our future success, then it stands to reason that this resource be developed to its maximum potential. Without exception.

... Opportunity has always remained less than equal for many in our society ...

Somehow, as logical as this may seem, it has never really happened in Canada. Opportunity has always remained less than equal for many in our society - no matter what efforts were made in the name of affirmative action. Others may have failed. This government does not intend to. Employment equity will be achieved because it lies not as an afterthought but at the very heart of our employment strategy.

At Regina it was agreed that henceforth there would be equal access to training and employment for women, native peoples and the disabled. Since then, I have announced the federal government's response to the Abella Royal Commission on Equality in Employment. I want to say without equivocation that this government is as committed to economic justice as it is to economic growth. In fact, we believe they are inseparable. Fairness and equality are not just words. They are the prerequisities of economic growth. Without them, there will be no national consensus - no national economic renewal. Achieving economic development must involve an attack on barriers to equity, just as it involves an attack on obstacles to growth.

The plain facts of inequality are clear.

- It is a fact that women, on average, earn only sixtyfour cents for every dollar earned by men. Fully seventy

... We challenge all sectors ofour society to share in the responsibility of making employment equity a reality ...

seven per cent of women are found in only five of the twenty-two major job categories - those at the bottom end of the salary scale.

- It is a fact pointed out in the recently released study "Who Gets the Work" that whites have three job prospects for every one for blacks.

- It is a fact that half, half, of the employable but disabled people in Canada are unemployed. A fact that in many native communities the unemployment rate is over seventy per cent.

As a nation, we cannot afford to exclude these people. As a society looking to create new prosperity we cannot ignore them. It is too expensive and too inefficient. Give these people real opportunities and they will get real jobs. Give them jobs and they will create wealth. Generate wealth and there will be economic growth.

To lead by example, this government will require Crown corporations, federally-regulated businesses, and contractors providing goods and services to the federa] government, to implement employment equity. To accomplish this, we will not create a massive and unnecessary enforcement agency. Rather, we will look to the expertise of the Human Rights Commission. We will not impose an unwieldy set of rigid procedures.

We intend to introduce enabling legislation in June. Before doing so, I intend to consult widely. We are taking a long overdue lead on this matter, but we believe it is good business for everyone. We want to hear other viewpoints but we want more than that; we want active participation. We challenge all sectors of our society to share in the responsibility of making employment equity a reality, just as they will share in its benefits. This, then, is the beginning we have made - some of the first steps to real solutions to the problems of unemployment, labour market change, employment equity, and economic growth. But I stress it is only the beginning. Other steps lie ahead.

First among these is the review of the unemployment system announced by my colleague, the Minister of Finance. This program has become part of our social fabric. It has been an indispensable safety-net during the recession period. It has helped to stabilize the economy and put us back on the road to economic expansion. In 1984, $10 billion in benefits were paid. These benefits provided essential income stability for not fewer than 3.2 million Canadians.

There are those who argue that the costs of unemployment insurance have risen through abuse of the system. I disagree, and so do the facts. The costs of unemployment insurance have increased precisely because unemployment has increased. Far from a criticism, this is a testament to the importance of the program.

... The fact is, Unemployment Insurance is primarily owned by employers and employees...

No one questions - least of all this government or this Minister, who grew up in Cape Breton during the great depression - no one questions that the individual who has lost his or her job, because of the state of our economy, and has no immediate prospect of finding another, must be ensured an adequate income. But a review remains necessary if we are to preserve the program for what it was originally intended - not as a way of life, nor as a way of dependency, but as a stepping-stone, a bridge to new employment opportunities.

We must also ensure that unemployment insurance does not impede the development of new jobs. Because the best thing we can do for the unemployed is create new jobs. To do that we must ask some important questions.

We have to ask if Unemployment Insurance is imposing obstacles to economic growth. We have to ask if the program has grown too complex and too rigid. We have to ask if the enormous resources currently flowing through the program are being used in the most effective way possible. Could they be used in more creative ways, ways leading to new jobs and skill development?

We will have a review because so many people are asking just those questions. But government alone cane not answer them. The fact is, Unemployment Insurance is primarily owned by employers and employees. And they must participate in the review. But if the review is to be effective we must also listen closely to the victims of the recent recession. If major reforms are proposed, then the people most directly affected must be consulted.

And if proposals are implemented, their one purpose will be to create new job opportunities for Canada's unemployed. In the process, as the Prime Minister said at the Economic Conference, their sense of security, their confidence and their dignity, will be respected and reinforced, and not diminished in any way. That is the policy of this government.

Without underestimating in any way the problems confronting our society, I remain strongly optimistic about the future. I believe that we do share, wherever we stand, and whatever our responsibilities, the same hopes for our country in the future - a Canada which is both more prosperous and more equitable; a Canada in which enterprise and hard work are still rewarding.

For all the changes our country may encounter, one thing is permanent. We remain a people of enormous ability and compassion. Be it international competitiveness or the creation of opportunity at home, we can achieve our objectives. And, together, we will.

The appreciation of the audience was expressed by Robert L. Armstrong, a Past President of the Club.