I am pleased that our Conservative Government is taking further action to support Canada’s economic recovery by limiting the potential increase in Employment Insurance (EI) premiums. Specifically, the increase in EI premiums for 2011 will be limited to a maximum increase of 5 cents per $100 of insurable earnings and a maximum increase of 10 cents for subsequent years.
The Canada Employment Insurance Financing Board (CEIFB) is required to set the premium rate by November 14, 2010. Without the limit our Government put in place, the CEIFB would have raised premiums by the full legislative limit of 15 cents in 2011, and likely done the same in subsequent years. At a time when every dollar counts for individuals and families, our limit on EI premiums could mean almost $75 extra in the budget of an average Canadian family next year. Canada-wide, it will amount to $1.2 billion back in the pockets of workers and job-creators.
The CEIFB itself was established by our Conservative Government in 2008, delivering on our commitment to improve the governance and management of the Employment Insurance Account. Unlike the previous Liberal government, who kept EI rates artificially high in order to use EI premiums paid by workers and businesses as a political slush fund, our Conservative Government created the CEIFB to ensure that premium rates reflect actual program costs and take into account investment returns so that Canadians pay the right premium rates - just sufficient to cover the cost of benefits received.
Our Government will be undertaking consultations with Canadian individuals and businesses about ways to build on the improvements we have already introduced to the EI system, such as:
- freezing EI rates for 2009 and 2010 at their lowest level in nearly 30 years, providing an estimated $9.2B in relief when it was needed most;
- providing greater flexibility and streamlined processes so more businesses qualify for work-sharing agreements;
- investing in training for workers affected by the global slowdown, including long-tenured and older workers, students, Aboriginals and apprentices;
- making investments in the processing of EI claims, so that nearly 80 per cent of Canadians receive their first EI cheque within an average of 28 days, despite a dramatic increase in claims; and
- providing an extra five weeks of EI benefits to more than 155,000 Canadians.
You may have heard about Liberal Party’s proposal which, among other things, would create a 45-day work year through extremely generous EI benefits. This ‘plan’ would cost Canadians nearly $7 billion annually and increase EI premiums by a whopping 35% – killing jobs and throwing a wrench in the economic recovery. Not only is their ‘plan’ fiscally irresponsible and a drag on the economy, but the idea that 45 days of work will get you a year of EI benefits is downright offensive to hard-working Canadians.
Canadians do not want to see a rapid increase in EI premiums. We are listening and acting on those concerns by limiting EI premium increases to protect Canadian jobs during the fragile economic recovery. The limits we have implemented strike the necessary balance between supporting our economic recovery and ensuring that the EI program breaks even over time.
The bottom line for our Government is that for the economic recovery to continue, taxes need to remain low. Simply put, limiting the increase in EI premiums is about limiting the tax burden on workers and employers.
Sincerely,
Leon Benoit, MP
Vegreville-Wainwright
