Liberals have a $1.7-billion plan to send Canadian workers back to school

Liberals have a $1.7-billion plan to send Canadian workers back to school
The federal government is taking another crack at sending Canadian workers back to school for mid-career training, spending $1.7 billion over five years to launch a new skills training program.

A new tax credit will allow workers to claim half of the cost of a course or training program; they will also be eligible to take up to four weeks off and receive employment insurance coverage for 55 per cent of their average weekly income.

None of this is slated to start in any meaningful way until next year, after the next federal election, and the government says it will embark on consultations to nail down the nitty gritty program specifics.

“Canadians at all stages of in their working lives should have the opportunity to learn new skills to take control of their future,” Finance Minister Bill Morneau said in his speech to the House of Commons.

The government proposes to provide workers with a $250 annual tax credit that will accrue with the Canada Revenue Agency starting this year; the credit will grow each year to a lifetime maximum of $5,000.

So in a couple years if an employee wanted to do a training course that cost $1,000 she could claim it on her taxes and get a $500 refund. She could also have a portion of her income covered through EI while she was taking the course.

One of the things we need is labour market information so the workers know where the jobs are

The budget document also included vague language about “new leave provisions” that would allow a worker to take time off for training without risking losing their job. Ottawa can’t make that sort of change alone, so the budget proposes to consult with provinces and territories to convince them to change labour laws.

For the training tax credit, the federal government is budgeting $710 million over five years, and $256 million per year after that. The EI changes will cost $1.04 billion over five years, and $321.5 million each year after that.

While applauding the government’s move to address the growing skills gap in Canada, Dan Kelly, president of the Canadian Federation of Independent Business said he was concerned that the program doesn’t link training more directly to the needs of business. “Will small business be required to hold open a position if an employee has always wanted to take a paid leave from work in order to study Latin or interpretive dance?” Kelly said.

This isn’t the Liberal government’s first kick at the can when it comes to lifelong learning.

In 2017, the budget aspired to “encourage a culture of lifelong learning, with more accessible post-secondary education, training and employment supports for all Canadian women and men, at all stages during their life.”

At the time, that meant special student loans and grants for students with dependent children, and adult students returning to school, as well as different tweaks to EI, allowing laid-off workers to go back to school while still collecting EI benefits.

Craig Alexander, chief economist for Deloitte Canada, said he interpreted the added skills training as a response to the changing economy, with technology and global market forces creating more volatility in the labour market.

“I don’t think it’s a reflection of the success of the prior programs, it’s just that there’s been steady recognition over time about how important this is, and so we’ve had a steady increase in the amount of resources being dedicated,” Alexander said.

The government also announced in its budget that the Global Talent Stream pilot project will be made permanent, allowing work permits for highly skilled foreign workers to be processed in two weeks.

The pilot program has been very popular with business, especially in the technology sector, since it was launched.

When it comes to the retraining for Canadian workers, Alexander said that he’d like to see more government effort to make sure that training programs are getting enough bang for the buck, and steering workers towards the training programs that will really boost their employment prospects.

“One of the things we need is labour market information so the workers know where the jobs are, and then the other thing we need to know is what are the skills that those employers are looking for,” he said.

Kevin Carmichael: Morneau keeps finding himself with more money than he expected — and he keeps spending it on initiatives that play well with his political base

Morneau’s fourth budget marks a hard shift back toward middle class issues after addressing business competitiveness in the fiscal update

Spending is no longer concentrated in specific areas where government can make a difference, but spread far and wide so it has little impact outside of the bureaucracy
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