Ottawa starting to tackle rapidly aging workforce with renewed urgency

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BILL CURRY

Finance Minister Jim Flaherty and the highest levels of the public service are immersed in a flurry of closed-door talks aimed at tackling the rising costs of health care and retirement benefits in the face of a shrinking number of working-age taxpayers available to foot the bill.

Internal government documents obtained by The Globe and Mail show Canada’s aging population is no longer a problem on the horizon, but rather one that will impact the federal government this year. It's a challenge Ottawa is now discussing more openly and with added urgency.

This week Mr. Flaherty kicked off a policy retreat with business and policy leaders in Wakefield, Que., by saying he wanted the discussion to focus on how Canada can position itself now for the longer term – listing “Canada’s rapidly aging workforce” as an issue that shouldn’t be overshadowed by the current focus on wildly fluctuating stock markets.

“The need to address current challenges must not keep us from tackling the key questions that affect our future prosperity,” he said.

The Finance Minister has offered few hints as to how he will approach forthcoming negotiations with the provinces over health-transfer arrangements, which need to be renewed. Provinces – and ultimately Ottawa – face rising health costs as older Canadians will make greater use of the system.

Documents obtained by The Globe show Mr. Flaherty has been receiving regular briefings on “transfer renewal” from his deputy minister for months, but offer no sense as to Ottawa's negotiating position.

Canada, currently the 27th oldest country in the Organization for Economic Co-operation and Development, is on track to become the 11th oldest within 20 years. It’s a challenge that will spark debate over Canada’s retirement age, fertility rates and immigration, while risking generational tension between a growing population of older voters and a shrinking pool of younger taxpayers.

Last November, Canada’s most senior public servant, Privy Council Clerk Wayne Wouters, invited deputy ministers from across the government for a meeting on demographics in Ottawa’s Langevin Block. There they reviewed a draft report on the impacts of Canada’s aging population. Unlike past warnings on the topic, this report did not paint it as a problem looming in the distance.

“The oldest baby boomers start to turn 65 in 2011, meaning the dependency ratio will start to increase significantly in a matter of months,” states the draft report, which was obtained in redacted form by The Globe under Access to Information.

Prepared by officials at Human Resources and Skills Development Canada and Finance Canada, the report is full of alarming statistics. It also lays out several measures the government could take to limit the impact, including incentives to boost fertility rates, bring in younger immigrants and encourage Canadians to work longer.

“A Canada where seniors outnumber children is uncharted territory,” the report states.

When asked about the report, Alyson Queen, press secretary to Human Resources Minister Diane Finley, listed recent government measures to encourage older Canadians to stay in the workforce.

“Our Government has done more to support older workers than any before,” she said in an e-mail.

Monte Solberg, who preceded Ms. Finley as Human Resources minister and retired from politics in October, 2008, said incentives for older workers were among the easiest options – politically speaking – available to the Conservatives in the face of an aging population.

Now, he says, the government will have to consider the hard ones, like raising the retirement age – a move so controversial he says it would likely require a Royal Commission to build public support.

Even more pressing are the upcoming negotiations on health-care transfers to the provinces, which currently grow at six per cent a year under the Canada Health Transfer Program that expires in fiscal 2013-14.

“It’s a very real problem,” said Mr. Solberg in an interview. “It’s easily the largest unfunded liability that we have, without question, because we have this wave coming at us [and] there’s no extra money that’s set aside to address it.”

By the numbers

25

Percentage of Canadians by 2036 who will be over the age of 65

5:1

Ratio of workers to seniors in Newfoundland in 2010

1:1

Ratio of workers to seniors in Newfoundland by 2050

12

Percentage of Quebec’s population that is seniors

24

Percentage of Quebec’s population that will be seniors in 30 years

Source: Canada’s Changing Demographics: The Impacts of Population Aging, a draft internal HRSDC report marked secret and dated Oct. 27, 2010, that was circulated in advance of a Nov. 3 meeting of the Coordinating Committee of Deputy Ministers.

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Amendments - Labour Market Opinion

Image via WikipediaIn addition to the standard requirements to apply for a labour market opinion (LMO) under each stream of the Temporary Foreign Worker Program (TFWP), Human Resources and Skills Development Canada (HRSDC)/Service Canada will also evaluate the following criteria starting April 1, 2011:

1. All employers must use the new LMO application form specific to each program stream, and provide:
   • the Canada Revenue Agency (CRA) business number which applies to all Canadian-based employers;
   • a description of the main business activities;
   • an explanation of how hiring a temporary foreign worker (TFW) meets the employment needs of the employer; and
   • a signed statement attesting that the employer will abide by the Program requirements.
   When applying for an LMO, all new employers to the TFWP will be required to provide a copy of their business licence or permit. Should an employer not be required by the municipality to obtain a licence or permit to operate, the documents listed below may be provided instead:
   
   • CRA documents, including: T4 Summary of Remuneration Paid, Schedules 100 and 125 of the T2 Corporation Income Tax Return, T2125 Statement of Business or Professional Activities;
   • business contracts for goods and/or services;
   • provincial workers compensation clearance letter or other appropriate provincial documentation; and
   • attestation by a lawyer, notary public or chartered accountant confirming that the employer exists and the type of business the employer operates.
   Upon request, returning employers may also be asked to submit any or all of the documents listed above.
   
2. The genuineness of the job offer made to the TFW will be assessed based on whether the:
   • employer is actively engaged in the business in which the job offer is being made;
   • job offered to the TFW meets the employment needs of the employer, and is consistent with the type of business the employer is engaged in;
   • employer can fulfil the terms and conditions of the job offer; and
   • employer, or the third party representative acting on behalf of the employer, is compliant with the relevant federal-provincial/territorial employment and recruitment legislation.
3. All returning employers must demonstrate that they have met the terms and conditions of employment set out in previous LMO confirmation letters and annexes (if applicable). In addition, some employers may be required to submit documentation to support a more detailed employer compliance review (ECR), including any or all of the following documents:
   • payroll records;
   • time sheets;
   • job descriptions;
   • copies of the employer-employee contract;
   • collective agreements;
   • TFW’s work permit ;
   • provincial workers compensation clearance letter or other appropriate provincial documentation;
   • receipts for private health insurance (if applicable);
   • receipts for transportation costs; and
   • information about accommodations provided by the employer;
   If it appears that employers did not fully respect the terms and conditions of employment set out in the LMO confirmation letters and annexes (if applicable), the employer will have the opportunity to provide a rationale. In this case, HRSDC/Service Canada will work with the employer to implement the appropriate corrective action, which may include providing compensation to the TFW. Employers may be found non-compliant if they refuse to provide a rationale and/or provide only partial compensation to the TFW.
   If the employer is found to be non-compliant:
   
   • HRSDC/Service Canada may issue a negative LMO and revoke all positions on confirmed LMOs for which work permits have not yet been issued by Citizenship and Immigration Canada (CIC).
   • CIC may deem the employer ineligible to hire TFWs for two years. The employer’s name, address and period of ineligibility may also be published on a list of ineligible employers posted on CIC Web site.

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Canada’s top family-friendly employers for 2011

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To create the Top Family-Friendly Employer list for 2011, Mediacorp, which oversees the competition, examined the most progressive and forward-thinking workplace benefits valued by families. These included maternity and parental leave top-up payments, generous vacation and personal days off, flexible work options, emergency daycare support, and childcare costs for employees attending events or business trips.

6% 34 votes

Yes

94% 521 votes

No

More polls

“Many of these benefits are not big ticket expenses but rather represent an ongoing evolution in how we want to work and an enlightened approach for employers looking to attract and retain their work forces,” says Richard Yerema, managing editor of Canada's Top 100 Employers, including the Family-Friendly competition.
“Less than five years ago, we considered maternity and parental leave top-up over 20 weeks to be quite generous,” he says. “It still is, but we now see more than a few with much more generous top-up, ranging up to 95 per cent for the full year of one's leave.”
The companies in this list are not ranked. They appear in alphabetical order.
Agriculture Financial Services Corp., Lacombe, Alta.: Non-depository credit intermediation; 491 employees. Manages a scholarship program (to $1,000) for employees' children.
BC Public Service, Victoria: General government support; 25,581 employees. On-site daycare centres at some locations.
British Columbia Lottery Corp., Kamloops, B.C.: Gambling industries; 779 employees. Offers fertility drug treatments through its health benefits plan.
British Columbia Safety Authority, New Westminster, B.C.: Regulation, licensing and inspection of commercial sectors; 248 employees. Parental leave top-up for new mothers (to 85 per cent for 52 weeks).
Catholic Children's Aid Society of Toronto, Toronto:Children and youth services; 590 employees. Option of extending maternity leave time for an additional two years.
Edmonton Regional Airport Authority, Edmonton: Airport operations; 276 employees. Parental leave top-up benefits (to 93 per cent of salary for 15 weeks).
George Brown College, Toronto: Post-secondary education; 1,300 employees. Extends its tuition subsidy program to employees' family members.
HP Advanced Solutions, Victoria: Computer services; 377 employees. Maternity leave top-up payments (to 85 per cent of salary for 15 weeks), followed by parental top-up payments (to 75 per cent of salary for 35 weeks).
Human Resources and Skills Development Canada, Gatineau, Que.: General government support; 26,024 employees. On-site daycare centre for returning parents.
Industry Canada, Ottawa: Administration of economic programs; 5,849 employees. Health benefits continue during maternity and parental leave.
ISM Canada, Regina: Computer services; 496 employees. Offers fertility drug treatments through its health benefits plan
Johnson Corp., St. John’s, Nfld.: Insurance; 1,109 employees. Manages a post-secondary scholarship program (to $1,500)
L'Oréal Canada Inc., Montreal: Toiletry product manufacturing; 1,200 employees. Offers early Friday closings in winter and summer.
McGill University, Montreal: Post-secondary education; 5,746 employees. Multiple on-site day-care options for employees (and students) with young children.
Monsanto Canada Inc., Winnipeg: Chemical manufacturing; 270 employees. Offers alternative work options, from telecommuting to informal summer hours.
National Energy Board, Calgary: Administration of economic programs; 335 employees. Maternity and parental leave top-up payments for new mothers (to 93 per cent of salary for 52 weeks) and for new fathers or adoptive parents (to 93 per cent of salary for 37 weeks).
NB Power Holding Corp., Fredericton: Power generation; 2,546 employees. Flexible health benefits that employees can customize.
Office of the Auditor General of Canada, Ottawa: General government support; 698 employees. Gives three weeks of vacation after one year, and offers unpaid leaves of absence for up to one full year.
Saskatchewan Government Insurance, Regina: Insurance; 1,710 employees. Offers post-secondary scholarships to children of employees (to $2,500).
Simon Fraser University, Burnaby, B.C.: Post-secondary education; 4,303 employees. Additional daycare and an elementary school are being developed for the future.
Statistics Canada, Ottawa: General government support; 5,550 employees. On-site daycare centre and emergency short-term daycare services.
Sunnybrook Health Sciences Centre, Toronto: Hospital; 4,825 employees. Parental leave top-up payments (to 93 per cent of salary for 10 weeks).
Toronto Community Housing Corp., Toronto: Residential property managers; 1,412 employees. Compassionate care leave top-up benefits (to 93 per cent of salary for eight weeks).
Toronto Hydro Corp., Toronto: Electric power distribution; 1,519 employees. Organizes a family Christmas party for more than 1,800 guests.
Vancouver City Savings Credit Union, Vancouver: Credit unions; 1,744 employees. Alternative work arrangements including flexible hours, telecommuting, compressed workweek.

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