Thursday, 24 May 2012

Privatize EI!

We can only wish the Conservative government would get its mangy mitts off of EI (The Employment Insurance Program).  Sadly, it falls within their purview at the moment. And I regret to inform you folks, that their majority in the House of Commons means that the drunken teenagers have been handed the keys to the Corvette.

At Issue?  “Chronic” recipients of EI, who are on it year after year (Seasonal workers, fisherman, etc) have drifted into their government’s crosshairs, and they envision tightening the rules to require them to look for work within an hour commute, or at 70% of their pre-claim wage.  The government claims it can no longer allow these people to do this in this era when other parts of the country are experiencing labour shortages and foreign workers are being imported to pick fruit, flip burgers etc.

The government might have a leg to stand on if EI worked the way they would like you to believe it does, or the way they have deluded themselves, in their ignorance, to believing it does.

EI is not some generous, no strings attached government handout.  It’s an insurance policy, hence it’s name: Employment Insurance.  All Canadians who work are required to pay premiums into so that it is there for all Canadians when they need it.

The beautiful thing about this program was its simplicity.  Even a government bureaucracy couldn’t mess it up.  Because there are so many more Canadians working than not working at any given time, enormous surpluses accumulated in the plan.  In 2005, before the Conservatives came to power, there was a $54 billion surplus in the EI account!

Then we know what happened.  We’ve seen this nightmare movie before, and unfortunately, we still live it every day.  The Harper Conservatives came to power.

If you have any knowledge at all about insurance, you know that it involves setting rates for premiums so that they will fund a policy and make sure the money is there for when it needs to be paid out.  You also know that monies within a fund are managed by actuaries who project and document the policies short and long term sustainability based on its current financials.

Well, since 2009, Canada’s economic expert, Finance Minister “Big Jim” Flaherty, has refused to allow these rate-setters, who are still getting paid, to set a single rate.  The ministries in his government responsible for EI (Finance and HRSDC) have also ignored the annual reports of the chief actuary.  As a result, EI is now chronically underfunded, and the EI fund now sports a $8 billion deficit rather than a $54 billion surplus.

The $62B that is MIA is not only a result of muzzled bureaucrats and inaction.  The Conservatives have also been raiding the fund repeatedly for billions to fund…whatever.  Bailouts, Gazebos, Jails, Malfunctioning Fighter Jets - five figure taxpayer-funded junkets in New York and London - their priorities are manifold.  They are not the first government to raid the fund, unfortunately, and that misappropriation of funds to which the government is not entitled should be stopped by legislation immediately.

A world where that happens is a world where we dream in technicolour.

That's why we need to spin off EI into a crown corporation to save it.  We have a government who says they understand its importance but are intent on quietly starving it and strangling it to death because they really see it as people living on the couch, off of the State.  So take it away from these legislators who fundamentally misunderstand its purpose, and give it to an arms-length body who can be counted on to restore Employment Insurance to the great self-funded, non-discriminatory, non-humiliating program we've all got the peace of mind of knowing is there.

How many people do you know who have worked for decades and never collected?  The Conservatives' proposed reform addresses this in a way by creating three "tiers" of claims (frequent, intermittent and rare), but not really.  The people who've never been on it get the shaft for all the money they put in.  The regional disparities remain.   Worse, the financing of the program is not addressed at all.

There are a lot of things you could do to improve the efficiency of the program, such as removing eligibility for people who get a 2 years severance pay packet and go on it right after.  Doesn't the severance replace EI in that case.  Skiers, snowmobilers and cottagers unfortunately have all gained reputations for using "pogey" while pursuing their interests as well.  There's gotta be a way to let those guys slide for a year or two and not 25.

Overall, the program just needs to be simplified.  Uniform hours requirements, not the current unfair patchwork based on local unemployment rates.  Raising the rates for multiple claimants.  And raising everyone's contribution rate, which the minister has refused to do.  Get all that out of they way, forbid Harper ministers to ever touch it again, and the fund can be a cash cow money maker for all Canadians again within months.  We work enough and pay enough taxes to collect benefits when we need them without listening to bullshit from the government about why we're not picking fruit or driving for 90 minutes each way ($50) to make $84 ($10.25 an hour x 8) for a shift at Tim Horton's.  It's pretty sad when you would have more confidence in a private company administering EI than your own incompetent government.

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