GLOBAL ECONOMICS

GLOBAL ECONOMICS COMMENTARIES



Patrick Grady
How to Fix Canadaís Broken Immigration System
March 6, 2010

Too Many Immigrants

The main problem with Canadaís current immigration system is quite simple. Itís that the number of people admitted to Canada on both a permanent and temporary basis is way too high -- from a long-run structural point of view, not to mention from a short-run cyclical point of view. That the problem is structural is evidenced by the steady deterioration in the performance of recent immigrants in the labour market in each census after 1980. The poor performance encompasses labour force participation, unemployment, and earnings. The situation has deteriorated to the point where a new immigrant now only makes from half to two-thirds as much as the native born and almost half of recent immigrants fall into the ranks of those with low income. And, even worse, the situation should deteriorate even further as a result of the current severe recession, which, when the census numbers finally come in three years, is likely to disproportionately affect immigrants.

In a modern welfare state like Canada, where the incidence of fiscal policy is progressive, benefiting most those with the lowest income, immigration policy must bring in immigrants who on average are capable of earning more than average; otherwise there is absolutely no benefit to existing residents of Canada from their admission.

The failure to succeed economically is most obvious in the large cities like Toronto, Montreal and Vancouver where immigrants have clustered together into enclaves characterized by high poverty rates. In addition, in these urban areas the problems of pollution, congestion and urban sprawl have been exacerbated by excessive immigration.

The solution to the problem, which should be obvious although unpolitic, is to cut back substantially on the admission of new permanent and temporary new residents from the current levels of almost 450,000 per year to something much closer to zero. This number is higher than the usually cited figure of 250,000 as it includes those admitted under the Temporary Foreign Workers Program as well as the quarter million immigrants

In the short-run, there is a strong case for a moratorium on the admittance of new immigrants and temporary workers. It makes no sense to be bringing in more people to work when so many people, both native born and immigrants, are unemployed. Once the economy, and most importantly the labour market, begins to strengthen, it would be appropriate to again admit some new immigrants. This type of approach, which used to be followed, was called ďtap-on, tap-offĒ and in spite of its abandonment still makes a lot of sense.

But since a moratorium would not seem to be politically possible given the highly legalistic way the immigration program has come to be run, it may be necessary to pursue a strategy of adopting an average level of immigration that would be appropriate over the business cycle. This would differ from the current approach which specifies a level appropriate for the peak of the cycle when labour demand is most acute and continues to apply it right through the downturn when large labour surpluses and unemployment start to pile up.

My view is that a target level of 50,000 to 100,000 new immigrants per year would probably be appropriate over the cycle. This would also be broadly consistent with the objective of zero net immigration, taking into account the people that emigrate each year.

The Temporary Foreign Worker Program should be abolished, except that is for the traditional categories of seasonal agricultural workers who really do go home each year and donít become a de facto permanent addition to the labour force. There is really no such thing as a temporary foreign worker as most will do everything they can to stay in the country, and Canadians donít have the stomach for an aggressive enforcement policy. Better, in the first place, not to bring them in. In addition, there is something unfair and un-Canadian about having an underclass of workers without the full rights of Canadian workers. The labour movement has a point when they say that Canadian employers take advantage of foreign workers by paying lower wages and providing less favourable working conditions and that this creates unfair competition for Canadian workers.

It is also strange that so many of the temporary jobs are in fields like food and beverages, and hospitality, and retailing that donít require highly skilled labour. Itís hard to believe that there arenít Canadians who would want these jobs if wages were a bit higher.

Even if a target of 50,000 to 100,000 per year were established, it would be necessary to continue to monitor the performance of immigrants in the labour market. If the expected improvement is not sufficient, it will be necessary to cut back the numbers admitted further. If it is better than expected, the numbers admitted could be relaxed.

The Legal Straightjacket

Establishing a reasonable immigration target such as the one proposed is problematic given the IRPA and the governmentís interpretation of its legal obligations under the act and the Charter. It amended the act to make it clear that the government had no obligation to admit all those who met the established criteria and to prevent the backlog from continuing to grow as quickly as it was from its then level of around a million. However, the government still maintained that it had a legal obligation to admit all those accepted prior to the amendment of the Act. It proposed to do this over time, while continuing to accept new applicants, albeit at a reduced rate through the application of more discretion in assessing applications.

The backlog presents a serious challenge to the success of Canadaís immigration program. Given that it could take as long as ten years for everyone accepted to be admitted and given that there are other alternatives for the best immigrants who have already been accepted and who canít be expected to wait so long, there is a real risk that a mechanical working through of the backlog will result in even fewer suitable immigrants being admitted than in the recent past and will contribute to a further deterioration in the economic performance of new immigrants.

If there is indeed a Charter requirement that everyone processed and accepted must be admitted, then the Government should not be afraid to invoke the notwithstanding clause in the case of the IRPA to restore its flexibility in selecting the immigrants most likely to succeed economically in Canada. It would also give it the tools it needs to deal with refugee claims in a more rational manner. Dealing with a serious problem like this that couldnít be anticipated at the time was one of the reasons that the notwithstanding clause was put in the Constitution.

Selection Criteria

The existing point system is not working as intended in selecting the immigrants most likely to succeed in Canada. It thus needs to be revised and made more discriminating. And only the applicants with the highest scores should be admitted with the cut-off being determined by the numerical target for admissions.

A problem with the existing system is that it does not distinguish adequately among different levels and qualities of education. This is confirmed by the performance of immigrants who get their education in Canada after they arrive rather than in their home countries where the quality of the education may not be up to Canadian standards. Canadian universities and colleges are able to select foreign students capable of succeeding academically. There is no reason why some of these same screening and rating techniques could not be utilized to select immigrants.

Another problem is that the system does not take sufficiently into account relevant work experience. It is a fact that immigrants who have Canadian work experience or experience in a similarly advance industrial country are more likely to succeed economically than those whose only experience is in a less developed country with a different industrial structure and working environment.

The problem with education and work experience is compounded in the case of those applying to come to Canada to work in a regulated profession. The majority with such aspirations are bound to be disappointed when they come up against the provincial and territorial credentialing and licensing requirements. The best way around this problem is to only admit those who are pre-qualified by the relevant regulatory authority, rather than seeking special treatment not accorded to other Canadian residents.

Many immigrants come to Canada with very low levels of skills in either or both of our official languages. As a good ability to communicate in one or the other of our official languages is an absolute requirement to succeed in the labour market, language ability should be emphasized much more in selecting immigrants. Hence, language testing should be made more rigorous. In addition, extra points should not be granted for some, but weak, knowledge of the applicantís second official language. This just weakens the ability of language points to identify true language skills in one or the other of the official languages.

Immigrants should also be evaluated for their cultural compatibility with Canadian values. These values include democracy, a secular state, rule of law, equality of the sexes, and an open tolerant outlook. If applicants are obviously not accepting of Canadian values and seem unlikely to integrate, they should not be admitted. Cultural compatibility with Canadian values should be established as a new selection criterion for immigrants.

The new procedures since April 2009 require that applications be made to the Centralized Intake Office and not to the visa office responsible for the country of nationality or residence of the applicant, as was the case in the past. Presumably, the visa office will still be responsible for any follow-up interviews that are necessary. If so, there will be a continuing problem resulting from the over-reliance of local hires for processing prospective immigrants. And a bias in favour of admitting citizens of the countries with visa offices will still exist. There has been a concern about whether the use of local hires for sensitive activities has compromised the immigration selection mechanism or undermined Canadian security.

Family Class Immigration

Any Canadian citizen or a permanent resident of Canada, can sponsor their spouse, common-law partner, conjugal partner, dependent child (including adopted child) or other eligible relative (such as a parent or grandparent) to become a permanent resident.. While the sponsor is supposed to be responsible for supporting the spouse or relative financially when they arrive and must make sure that they do not need to seek financial assistance from the government, this requirement has not been rigorously enforced by either the government or the courts.

The definition of family class that extends to parents and grandparents and even allows other more distant relatives in specific circumstances is overly generous and counterproductive. In allowing in elderly parents and grandparents who can be expected to make large claims on Canadaís health and welfare system, it runs counter to one of the main purposes of immigration which is to bolster Canadaís prime-age working population to pay for the pensions and health care of our growing population of elderly Canadians. While it is understandable that immigrants have obligations to care for their own elderly relatives, these obligations can be more cheaply met in their home countries where the cost of living and health care is lower and should not be shifted on to the shoulders of Canadian taxpayers through family class immigration.

By allowing parents to come in as family class immigrants, it also opens the door to chain migration whereby the parents can bring in underage siblings of the sponsor without being subjected to the usual selection criteria.

Provincial Nominees Programs

Provincial Nominees Programs, which have been adopted in the English-speaking provinces following Quebecís example of taking responsibility for immigration policy under Canada-Quebec Accord on Immigration, have established a parallel system of immigration run by a level of government without any real experience in selecting immigrants or any knowledge of the problems likely to be encountered. They are thus bound to produce even worse results than the current system as they come to account for an increasingly large share of immigrants admitted. The only real solution to this emerging problem is drastic. They need to be eliminated. And if this is not politically possible, they need, at the least, to be drastically scaled back. This still leaves to Quebeckers the special problem of how to deal with Quebecís special program for selecting skilled workers, but judging from the results of the Bouchard-Taylor Commission hearings, there is a greater appreciation there that there is a problem that needs to be addressed.

National Security

Since 2001, the year of the terrorist attacks in New York and Washington after which the threat to North America should have become obvious, and up to 2009, Canada has admitted as many as 350,000 immigrants from countries with terrorism problems. These countries include: the Republic of Pakistan, Iran, Algeria, the United Arab Emirate, Lebanon, Morocco, Afghanistan, Saudi Arabia, Turkey, Egypt, Iraq, Kuwait, Somalia, and the Democratic Republic of Sudan. The resulting potential security threat to Canada should be obvious given that only a tenth of those admitted can be screened thoroughly for security. This is because of their large numbers and the relative scarcity of security personnel. And it gets worse. Some of the children of these immigrants born in Canada have become home-grown terrorists, a phenomena that canít be predicted by screening the parents who are admitted. Consequently, if we canít properly screen people from these countries, we should be very selective indeed in admitting immigrants therefrom.

Refugee Policy

While the objective of Canadian refugee policy is noble, its implementation is a real mess. Most refugees are self selected economic refugees rather than bona fide refugees under the U.N. Convention. The multi-billion-dollar legal and administrative costs of their selection far dwarf that associated with the few actual Convention refugees admitted. Because of the 1985 Singh decision of the Supreme Court, it has become impossible to deport refugee claimants before they have had the opportunity to take advantage of all available legal recourse up to and including an appeal to the Supreme Court, which can take years or even decades if the claimant is so inclined (Mahmoud Mohammad Issa Mohammad is the most egregious case in point). Invoking the notwithstanding clause in the IRPA would go a long way towards cleaning up these problems. Surely, it would be possible to allow for due process for refugee claimants within the administration of refugee policy rather than getting the courts involved in such a heavy handed and time consuming way.

There are also many specific things that need to be done to reform the implementation of refugee policy as Julie Taub has so ably noted drawing on her years of practical experience as an IRB judge. Establishing a list of safe democratic countries from which claims will not be entertained is a good start. More careful vetting of claimants from countries with terrorism problems and more decisive and speedy use of deportations in these cases is required to prevent Canada from becoming a haven for terrorists and their sympathizers.

It is also necessary to clean house at the IRB. It has been captured by the immigration lobby and as a result its approval rates are among the highest in the world in spite of the large number of bogus claims that it processes. One way to do this would be to make immigration judges a regular part of the Public Service subject to the same recruitment and appointment disciplines as other officials and to put an end to the practice of political appointments from the immigration lobby. Itís also not too much to expect that they have to provide a written basis for their decisions, acceptances as well as rejections.

Deportations

In March 2009, Auditor General Sheila Frazier reported there were 41,000 people that Canada wanted to deport, but couldnít find. She attributed the growing number of people possibly in the country, but not of known residence, to the lack of exit controls. If Canada wants to run a secure immigration and refugee policy, it needs to have a reliable system of tracking and exit controls for visitors to the country.

Citizenship

Canada has the easiest citizenship requirements in the whole world. To become Canadian citizens, all an immigrant must do is to be over 18 and to have lived in Canada for at least three years (1,095 days) in the past four years before applying. And once citizenship is acquired it is permanent and imposes no ongoing obligations such as a requirement to file income taxes if a person chooses to no longer live in Canada. Consequently, the combination of our lax immigration and citizenship regimes has produced a situation where many Canadian citizens of convenience live all over the world, including often their home countries, and only show up in Canada to take advantage of health and social programs and make demands on the Canadian government in case of natural or human produced disasters in their countries of residence.

At a minimum, Canadian citizens should, like Americans, be subject to the requirement of annually filing income tax regardless of where in the world they live.

Another problem with Canadian citizenship law is that it accords citizenship by birth right to anyone born in Canada. This creates an incentive for people with no connection to Canada to come to the country just to give birth, thus according Canadian citizenship with all its advantages to their offspring. While illegal immigration in Canada has not reached the proportions it has in the United States, it is a growing phenomena. And many refugee claimants are in Canada many years before their claims are resolved giving them an opportunity to strengthen their claim to remain by having anchor babies. Consequently, the Canadian Citizenship Act should be amended to only grant Canadian citizenship to those born of those who are legal permanent residents of Canada. And if necessary, the notwithstanding clause should be invoked to make the change legal.

Recommendations

  1. Reduce the immigration target to a level of 50,000 to 100,000 new immigrants per year, which would be broadly consistent with the objective of zero net immigration, taking into account emigration.

  2. The Temporary Foreign Worker Program should be abolished except for the traditional categories of seasonal agricultural workers.

  3. The notwithstanding clause should be invoked in the Immigration and Refugee Protection Act to give the government the required flexibility to conduct an immigration and refugee policy that is in Canadaís best interest.

  4. The selection criteria for immigrants needs to be revised and made more discriminating, particularly with respect to the quality and relevance of the work experience.

  5. In the case of immigrants applying to come to Canada to work in regulated professions, only those should be admitted who are pre-qualified by the relevant regulatory authority.

  6. Language requirements for admission should be toughened up.

  7. Cultural compatibility with Canadian values should be established as a new selection criterion for immigrants.

  8. Limit family class immigration to the nuclear family, which only includes legal spouses and dependent minor children.

  9. Provincial Nominees Programs should be eliminated and, if this is not politically possible, they should, at the least, be drastically scaled back.

  10. Immigrants from countries with terrorism problems should only be admitted in exceptional cases and only after a thorough security screening.

  11. A list of safe democratic countries from which refugee claims will not be entertained should be established.

  12. A more careful vetting of claimants from countries with terrorism problems and more decisive and speedy use of deportations in these cases is required to prevent Canada from becoming a haven for terrorists and their sympathizers.

  13. Canada needs to establish a reliable system of tracking and exit controls for visitors.

  14. At a minimum, Canadian citizens should, like Americans, be subject to the requirement of annually filing income tax regardless of where in the world they live.

  15. The Canadian Citizenship Act should be amended to only grant Canadian citizenship to children born of those who are legal permanent residents of Canada.