PEI

Liberals renew pledge to lower EI premiums, but won't say by how much

The federal Liberal government is backtracking somewhat on its promise to lower employment insurance premiums, saying it's not clear how much premiums will go down.

Minister says rates will drop, but amount depends on review of employment insurance program

Employment Minister MaryAnn Mihychuk says many of the planned changes to employment insurance are complicated and will take time. (Chris Wattie/Reuters)

The federal Liberal government is backtracking somewhat on its promise to lower employment insurance premiums in 2017, saying it's not clear how much premiums will go down.

"We're definitely going to see lower premiums," Employment Minister MaryAnn Mihychuk told CBC News on Wednesday.

"Exactly where that lands, when we bring in all of the new systems — I think we can say to Canadians the premiums will be lower. Exactly where, I'm not sure."

But in September, during the federal election campaign, Liberal Leader and now Prime Minister Justin Trudeau said premiums would fall to $1.65 per $100 earned in 2017, down from the current $1.88. At the time, the Conservative government was promising to drop premiums even further to $1.49.

"Our goal is to have most of the EI changes in 2017," Mihychuk said.

"People who are collecting right now, this seems very long in the future, and I understand that. We are trying to get this through as quickly as possible."

'A whole rebuild of the system'

But Mihychuk did hold firm on some of Trudeau's other EI reform promises.

She said the government would drop a requirement for new entrants in the job market to work more weeks to qualify for EI, probably early in 2016.

Another promise — to reduce the wait time for benefits from two weeks to one week — remains on the agenda, but will take time.

"[It] requires a whole rebuild of the system, the way it's set up. It's very complicated. It will impact every transaction that we have," said Mihychuk.

"Give us a year and that will probably be ready to go."

That timing has not changed since Trudeau made the promise in September.

Working while on claim

People in Atlantic Canada hoping for changes to the way the EI program handles part-time earnings for those working while receiving benefits will also have to wait.

Justin Trudeau promised sweeping reforms to employment insurance while campaigning in New Brunswick in September. (Jonathan Hayward/Canadian Press)

Mihychuk said government will renew for one year a controversial pilot project introduced under the Conservatives that claws back 50 per cent of earnings, which will allow government to conduct a review.

A previous program allowed claimants to keep all earnings up to a point, then clawed back 100 per cent beyond that.

Mihychuk noted that while there were complaints from Atlantic Canada about the system implemented by the Conservatives in 2012, some in other parts of Canada prefer it.

Simply put, people earning higher incomes are better off under the new system.

Mihychuk stressed the government remains committed to reform of the EI system.

"Clearly employment insurance rules right now are not working for Canadians," she said.

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