Tuesday, January 27, 2009

Conservative Budget Fails to Help People in Need

Today's federal budget gives the appearance that the government has taken its head out of the sand, but it fails to address major issues.

Firstly, the requirement for provinces to match funds means that many of the announcements are smoke and mirrors, as the money won't be spent.

Secondly, almost all of the tax breaks given to individuals are done by raising the income thresholds at which people are no longer eligible for them. Is this a joke? The people in this country who need help aren't the ones whose incomes are pushing against upper thresholds for tax break eligibility! They're the ones whose incomes are pushing at another threshold... the poverty line.

The Home Renovation Tax Credit? Give me a break. The Conservative government is completely out of touch with the world if they think that people who've lost their jobs or have precarious employment are going to be spending $1000-$10,000 on home renovations in order to claim this tax credit.

Similarly, with the income tax breaks, the government fails to help those most in need. Sure, they raised the base tax-free amount by a few hundred dollars. But they also raised the thresholds for moving into higher tax brackets. The first threshold, fine, but the second? Leave it where it is, and increase the basic tax-free amount a bit more. People working part-time at or near minimum wage need a tax break a lot more than people whose income is equal to three or four full-time minimum wage jobs.

I was also disappointed to see precious little for the environment, or to encourage investment in alternative energy and green jobs. Here's where a tax credit for individuals buying renewable energy from sources such as BullfrogPower would have been good. It would have stimulated a market-driven shift to green energy.

Another missed opportunity... the Conservatives could have extended the Children's Fitness Tax Credit to all Canadians regardless of age. The payoff in health care savings would dwarf the cost of the credit. Physical activity is also an essential tool in warding off stress and depression, so making it more cost effective for Canadians to participate in physical fitness programs would have been a great idea in tough economic times.

Employment Insurance reforms are where the Conservatives again failed us. They could have reduced the number of hours necessary to qualify (currently 700), which would have reflected the reality that many jobs are part-time and largely temporary in nature. They could have increased benefits from the 55% (maximum $447/week, from which taxes are deducted) EI currently pays, or increased the amount which workers are allowed to earn (currently 25% of their EI payment or $50, whichever is greater) before their EI benefit is clawed back, which effectively penalizes workers for trying to supplement their income with part-time work.

The hours required to qualify for EI benefits need to be reduced, the benefit rate needs to be raised to 60%, and the clawback threshold raised to 100%. This will relieve the financial stress placed on unemployed workers who can't pay their bills while looking for work. The Employment Insurance fund is running a huge surplus, so why won't the government return that money to workers?

Given that this budget is (in appearance, at least) quite different from what the government had been planning prior to proroguing Parliament, it will require a great deal of courage for the Liberals to defeat it and press forward with their plans for a Liberal-NDP coalition government. I hope they do, though, because this country needs a budget that actually helps people in need, instead of people who are already well-off.

The Conservatives have chosen to ignore Canadians who have lost their jobs, and instead decided to give tax breaks to people who have enough discretionary income that they're contemplating $10,000 home renovations. That's neither leadership nor responsible government.

Sunday, January 25, 2009

Stop York back-to-work legislation!

If the Ontario government legislates York University employees back to work, it will legitimize refusing to bargain as a strategy for use by employers.

If the Liberals intend to do anything other than undermine the rights of workers, they need to put some sort of "poison pill" into back-to-work legislation to deter employers from letting their labour disputes go on so long. Unless back to work legislation is as distasteful to the employer as it is to the employees, then employers will simply sit on their hands and refuse to bargain in good faith, confident that the Liberals will eventually trample the rights of their employees.

Back to work legislation needs to impose financial penalties on the employer and it's so-called negotiating team. There need to be substantial penalties for employers who refuse to bargain in good faith, as York clearly has. Any such legislation for York should mandate a refund of tuition for classes which were cancelled due to York's negotiating team refusing to come to terms with employees. Further, there need to be financial penalties for the university (or at the very least, when workers are legislated back to work, then there should be a directive that an eventual arbitrated settlement will clearly be in the employees' favour). If back-to-work legislation poses no downside for an employer, then there's absolutely no incentive to bargain in good faith.

Back-to-work legislation may seem to be in the best interests of York students, but it's not. It simply sets the stage for those students to graduate into the workforce with their rights diminished, which is ultimately going to be far more detrimental to their lives than missing a couple terms of school.

What can you do? Send letters to Premier McGuinty, your local MPP, to the Minister of Labour (Peter Fonseca pfonseca.mpp@liberal.ola.org), and the Minister of Colleges, Training, and Universities (John Milloy jmilloy.mpp@liberal.ola.org). You can also send letters to NDP MPPs congratulating them on standing up for workers rights by opposing back-to-work legislation, and encouraging them to continue to do so.

CUPE has a MPP lookup tool at http://demandastance.com/cupe/ which also opens up a nice form letter you can send to your local MPP.

Addendum:  Well, the Liberals pushed through the legislation.  I think that the Ontario NDP nicely summed up the ramifications of it here.

Monday, January 5, 2009

Campaign for Simple Green Tax Cuts

There are a lot of tax cut schemes out there aimed at helping the environment. Some, such as Ontario's removal of provincial sales tax from sales of bicycles under $1000, are simple and work really well (and should be made permanent). Others, such as tax cuts aimed at homeowners who are doing complete retrofits of their homes for energy efficiency, don't work nearly as well. For one thing, not too many of us can afford to spend thousands of dollars on home energy retrofits, so a few hundred dollars rebate doesn't really help. For another thing, a lot of these programs are heavily laden by red tape.

Politicians have come up with some interesting plans for green tax cuts and the stimulus of green industries, but they tend to be either ineffectual, or so complex that they never become implemented. Various "carbon tax" schemes of late come to mind... complex, confusing plans that, even if they'd work, can't be sold to the public because they're such a departure from the current status quo.

What I propose are simple, effective, targeted tax cuts. For example, in order to power my condo with renewable electricity, short of installing very expensive equipment, my best option is to purchase power from a company such as Bullfrog Power. Since I don't have the option of telling my existing electricity provider I only want power from renewable sources, buying from a third party entails additional expense on my part for doing the right thing. I'm sure that lots of people would like to purchase renewable energy, but are deterred by the added expense.

A Simple Green Tax Cut would be to make the purchase of renewable energy tax deductible. Really simple from both the government and consumer side. Effective, because it encourages people to vote with their dollars and make a market-driven shift to green energy happen. It's also probably a lot cheaper for governments to support green tax cuts like this than to pour money into power generation projects directly.

Since this is budget time for both the federal and provincial governments, the time is right to start sending letters to the Prime Minister, your Premier, and so on. Here's sample text for a letter:

As you're preparing your upcoming budget, I'd like to suggest a simple "green" tax cut. Currently, the easiest way for consumers to vote with their dollars when it comes to renewable energy creation is to source their electricity from places like Bullfrogpower.com.

However, when doing so, consumers have to pay extra for their electricity... essentially they're penalized for making a positive environmental choice.

It would be really great if you made the purchase of renewable energy (say, up to $500 worth) by consumers tax deductible. This would provide incentive for a market-driven switch to renewable energy sources, without all the confusion of complex carbon tax schemes.

So get those letters started! Send e-mails to the Prime Minister and your provincial Premier (Ontario's Premier). The public needs to give politicians ideas like this to move forward with, and we also need to let politicians know that there's a demand for action on this front. Change comes about when people make noise, not when they stay silent.

Leave comments if you'd like to share your ideas for Simple Green Tax Cuts!