Implementing Budget 2012: No Rest for Women

The current government’s economic policies, being rolled out in a series of omnibus bills and ‘administrative changes,’ come at a high price to women. These policies do not create jobs in industries where women work; these policies increase the tax burden on working women while decreasing their access to pension and income supports; they continue to undermine basic equality rights; and they do so in a manner that allows for little public debate or scrutiny.

Set to “fuel the next wave of job creation”[1] the Government’s budget continues to depend on infrastructure projects to fill the tank.[2] Infrastructure projects have been successful in creating jobs, but they do so in the very industries in which women are least likely to find work. An equal investment in industries such as health care, child care and education would yield a double benefit.  It would create more jobs in sectors in which women are likely to be employed and would decrease the burden of unpaid work for both men and women by strengthening Canada’s social infrastructure.

The current budget is also looking to fuel job creation in the private sector while cutting jobs in the public sector. Yet the public sector has been the place where women have realized the greatest level of economic equality. These gains were significantly undermined in the 2009 budget, which stripped public employees of the right to pay equity—making equality rights subject to market forces. Bill C-38 makes similar changes to the Federal Contractors Program, leaving compliance with the Employment Equity Act for contractors of the federal government to the discretion of the Minister. Marjorie Griffin Cohen points out that “there would be no reason to change this legislation if the Minister intended to continue to apply the employment equity provisions.”[3]

The current job cuts planned for the public sector will disproportionately impact women. Women working in the public sector earn an average of 4.5% more than their peers in the private sector.[4] Women seeking comparable work in the private sector, even if economic stimulus were to generate those jobs in the private sector, would see an estimated $2000 reduction in their annual income.[5] Overall, this means that women seeking paid work will have fewer employment choices, earn less income where they are able to secure employment, and experience no relief from their burden of unpaid work.

At the end of their working lives, women will also feel the impact of changes made in the implementation of the current budget. First, only 30% of women employed in the private sector have pensions of any kind. Second, everyone is going to have to work two years longer before they are eligible to receive OAS. However, because women’s earnings peak in their 40s, while men’s earnings peak in their 50s, the first generation of women to be affected by the phase in of the OAS changes (in 2023) will be less able to mitigate against the impact on their incomes than will their male counterparts.[6]

For young women, continued rollback of equity guarantees, the changes to the age of retirement and the failure to invest in industries where women work, mean that those women will have fewer job opportunities, will earn less, will work two years longer before they can access OAS, and will pay more for the privilege. Kathleen Lahey points out that this constitutes a tax on Canadians under age 55, which is “a tax of the most regressive known to tax history: technically a poll tax or a ‘head’ tax (per capita), the likes of which have not been used since riots led to the repeal of Thatcher’s 1989 poll tax in the UK.”[7]

At the same time the Government continues to make minimal investments in addressing a problem that is currently costing Canada’s economy nearly $7 billion dollars a year: violence against women and girls. Status of Women Canada, the government body tasked with addressing violence, spent just over $10 million in 2010-2011—a wholly inadequate response to a problem that directly affects an estimated one in six Canadians.

These policies are creating a new kind of deficit for women and their families: a time deficit. Without stimulus to the industries that would provide secure jobs for women and social services for families in need, women will continue to work longer hours each day. With the ongoing repeal of pay equity guarantees, women will continue to do that work for less money.  With the changes to the age of eligibility for OAS and pension income-splitting, young women will now work for a longer period over their lifetime and face a greater risk of living in poverty in old age. Whether we like it or not, we will all be losing sleep over the economic policies being implemented today.

Kate McInturff  is a CCPA research associate and an expert on gender budgeting and women’s human rights.

[1] Jobs, Growth, and Long-Term Prosperity: Canada’s Economic Action Plan 2012: The Budget in Brief. Department of Finance, Government of Canada, 2012.
[2] Infrastructure spending in the 2012 budget consists primarily of the $33 billion Communities Infrastructure Fund, however, there are clear plans for further infrastructure spending in the near future, including the $35 billion National Shipbuilding Procurement Strategy, over $30 billion for shipyards contracts, $5.2 billion for the Canadian Coast Guard fleet, and continued spending on the F-35 jets.
[3] Cohen, Marjorie Griffin. “Budget Bill and the Federal Contractors Program,” Progressive Economics Forum, 2012. www.progressive-economics.ca/2012/05/31/budget-bill-and-the-federal-contractors-program
[4] Toby Sanger, Battle of the Wages: Who Gets Paid More, Public or Private Sector Workers? CUPE, 2011. cupe.ca/updir/Battle_of_the_Wage_ENG_Final-0.pdf
[5] Toby Sanger, Battle of the Wages: Who Gets Paid More, Public or Private Sector Workers? CUPE, 2011. cupe.ca/updir/Battle_of_the_Wage_ENG_Final-0.pdf
[6] Lahey, Kathleen A. Canada’s Gendered Budget 2012: Impact of Bills C-38 and C-45 on Women: A Technical Report. 2012.
[7] Lahey, Kathleen A. Canada’s Gendered Budget 2012: Impact of Bills C-38 and C-45 on Women: A Technical Report. 2012.