This paper depicts the rise of Canadian efforts to construct an active labour market policy which would be supportive of high and stable levels of employment, and the subsequent fall of such efforts.

Despite the apparent chaos of Canadian labour market policy and the alphabet soup of training programmes over the years, training policy in Canada can be viewed as theoretically informed and structured. Trends in labour market policy are related to the economic paradigm informing macro-economic policy at a particular period (currently neo-liberalism, previously Keynesianism), the paradigm itself being associated with institutional preferences regarding the federal-provincial division of powers (centralised under Keynesianism, decentralised under neo-liberalism). Policy trends are also partly the product of the main theoretical approach within the labour market policy area itself (currently human capital theory).

Under the current neo-liberal paradigm, labour market deregulation is associated with devolution of responsibility to the provinces and with privatisation and individualisation of responsibility for training. Human capital theory, especially as understood by neo-liberal politicians and policy analysts, reinforces these developments because it regards the gains from investments in human capital (through education and training programmes) as accruing largely to the individual rather than to society as a whole; consequently the responsibility for making such investments, and paying for them, is also a private matter. The replacement of income support for trainees (social benefit/social provision) by grants and loans to individuals (individual benefit/individual responsibility) under the Employment Insurance reforms provides an example of this perspective in action.

The record of these policy initiatives is assessed and their association with high unemployment, growing contingent employment and labour market insecurity, combined with growing social insecurity as the security system is dismantled, is noted.

While issues of training and labour market policy are often regarded pragmatically, "what works?", the implication of this paper is that labour, and others concerned about access to education and training should play close attention to the theoretical constructs surrounding these areas. The logic of the currently prevalent theories is antithetical to the view of education and training that labour has traditionally held -- that these activities have important non-economic benefits and that the economic benefits that do exist accrue to society as well as to individuals. Since society is a beneficiary there is an important role for a public presence.