BY LORNE GUNTER, FREELANCE OCTOBER 23, 2011
Federal Immigration Minister Jason Kenney is trying to do two things to rationalize Canada's immigration system: Reduce the number of elderly relatives of immigrants admitted every year and give more points to immigrants who are able to speak either English or French.
Both moves hit at the biggest problem with our immigration policy: Over the past three decades, economic considerations have given way to touchy-feely ones.
At a House of Commons committee on Thursday, Kenney said familyclass immigration had to be scaled back. He did not mean the spouses or children of newcomers. Rather, he explained that the government's concern is with the parents and grandparents of immigrants.
Of about 254,000 immigrants admitted most years, roughly 38,000 are older parents or grandparents. Most of these older immigrants will never work or will work very little between the time they are admitted and the time of their death. That also means they will pay very few taxes to contribute toward the social services they will consume.
How is that fair to taxpayers who have lived and worked here all their lives, or who moved here decades ago and have contributed tens of thousands or hundreds of thousands of tax dollars since?
As baby boomers retire, our pension and health-care systems are going to become over-burdened. Aging Canadians could face the kind of fiscal collapse hitting Greece. There, social benefits and civil-servant compensation have become so generous that the central government must borrow money to pay for them; its tax revenues have been insufficient. Yet it has lost the ability to borrow enough, in part because the cost of underwriting benefits is so high.
"Canada is the most generous country in the world with respect to immigration," Kenney told an often-heated Commons hearing. "But there have to be practical limits to our generosity. We have to calibrate those limits based on our country's economic needs, our fiscal capacity. There is no doubt that the people who are coming who are senior citizens, they have much, much lower labour-market participation and much higher levels of utilization of the public health system."
As Kenney pointed out, just under 20 per cent of newcomers to Canada are what he called "primary economic immigrants." Immigration Canada claims 55 per cent of immigrants to this country are economic-class immigrants, but in truth just 18 to 20 per cent are skilled workers. The other 37 per cent are the spouses and children of someone with a marketable skill.
Canadians should not begrudge newcomers bringing their husbands or wives and children with them. Trying to adjust to life in a new country and culture is hard enough without also having to cope with being without one's husband, wife and children. Besides, most skilled workers are able to fully support their nuclear families, both directly through their wages and indirectly through taxes.
However, most immigrants do not also earn enough to cover the social costs of admitting their parents, and older family-class immigrants themselves are unlikely to work enough after coming to Canada to cover their own social benefits. Admitting tens of thousands of older parents and grandparents amounts to a giant subsidy to new Canadians.
That is the "practical limit" of Canadian generosity Kenney is referring to - the delicate balance between "economic needs" and "fiscal capacity." By some estimates, it costs federal and provincial taxpayers up to $2 billion annually to fund the social services consumed by parents and grandparents of immigrants. For instance, nearly half of all health costs for most people are incurred in the final five years of their lives. Thus, if we admit a lot of older immigrants who work very little before reaching their most expensive years, this amounts to an enormous gift to people who made most of their economic and tax contributions elsewhere.
I'm in favour of plenty of immigration - even open immigration. I am not as concerned by the cultural arguments against immigration as I am by the economic ones. Yet high-volume immigration into a welfare state can easily become a fiscal suicide pact. So for as long as we insist on offering universal state health care, pensions and other social benefits, we have a right (even an obligation) to make economic considerations a part of our immigration calculations.
Earlier this month, Kenney also advocated tightening our immigration rules so that more immigrants were admitted faster if they have proficiency in either of our official languages. The immigration industry likes to portray such reforms as bigoted, but in fact they are economic, too - immigrants who speak either English or French integrate faster and better than those who speak neither. Typically, their incomes are up to Canadian averages within about a decade and (not surprisingly) they have less trouble feeling at home here sooner.
The Liberals attempted such a change in the late 1990s, but it was quickly shot down by immigration lawyers, immigration consultants, ethnic-group leaders and specialinterest advocates.
Thankfully, the Tories are not as beholden to such groups as the Liberals were, so perhaps these sensible reforms have a better chance of becoming federal policy now.