Insidious attack on jobless insurance
TheStar.com – Opinion/Editorials – The Canadian Taxpayers Federation scheme to scrap EI and bring in personal unemployment accounts is regressive and disriminatory
Nov 28 2013. By: Carol Goar
Unsatisfied with the success of its campaign to make austerity a permanent feature of government, the Canadian Taxpayers Federation (CTF) has launched a new crusade. It wants Prime Minister Stephen Harper to scrap employment insurance, now in its 74th year.
“For Canadians who plan their lives around staying employed — think about school teachers, bus driver, lab technician, accountants, business managers — EI (employment insurance) is nothing more than a rip-off pure and simple,” says Gregory Thomas, director of the national lobby group. “Canadian workers deserve to keep their own money.”
The organization, which claims to have 84,000 supporters, is circulating a petition urging the Prime Minister to “end this massive government tax grab.”
Its “reform” scheme is just beginning to penetrate the public consciousness. But don’t laugh it off. The federation’s 29-page study, Unmasking Employment Insurance: How EI Increases Unemployment and Steals Billions from WorkingCanadians, is neither a joke nor an ideological rant. It is a well-researched document. There are no obvious factual errors.
Step one: Highlight the flaws and inequities in the program.
Employment insurance, chopped, twisted and mismanaged by successive governments, certainly lends itself to this. Nick Bergamini, research director for the CTF, points out correctly that most of the unemployed are ineligible to receive benefits; that 11 cents out of every dollar paid into the fund is eaten up by Ottawa in administrative costs; that workers in Ontario and the four western provinces contribute vastly more than they receive; and that the overwhelming majority see no benefit in any given year.
Step two: Make it personal.
The CTF has always been good at this. It points out that the government collects $4,277 in premiums from a dual income couple, each earning the average annual wage ($47,400), and their employers. Over a 40-year career, this amounts to $1,065,000 “in lost savings.” Had they put the money into a personal unemployment account, as the CTF recommends, they’d be much better off. In the event that they never — or seldom — dipped into the account, they would have “a nice little nest egg” when they retire.
Step 3: Propose a simple solution — end the program — rather than looking at ways to fix it, asking Canadians what they want or examining the recommendations put forward by policy analysts who have long realized that a jobless relief program designed for the industrial era doesn’t fit today’s labour market.
It is easy to blame the CTF for attacking one of Canada’s longest-standing social programs. But the taxpayers’ group isn’t the real culprit. The federal government — under both Liberal and Conservative leaders — has weakened EI to the point that citizens who believe in standing together against adversity don’t have a lot to defend.
It is a challenge even to catch people’s attention long enough to explain what is wrong with the CTF’s plan.
The basic problem is that it is built on fallacious assumptions. An insurance premium isnot a tax. It is the same kind of payment Canadians make to protect themselves against car accidents, property damage or sudden death leaving their loved ones in financial need. The purpose of EI is not — and has never been — to dole out money equitably; it is to support Canadians who have lost their jobs. And replacing EI with personal unemployment accounts is not fair trade; it serves the interests of those with safe, steady, permanent jobs and leaves the rest of the workforce without a cushion in hard times.
What is most troubling is where the CTF’s what’s-in-it-for-me-right-now logic leads. Using the same calculus, healthy Canadians would pull out of medicare; young workers would forsake the Canada Pension Plan and better-off provinces would repudiateequalization.
It’s true that EI is badly broken. But it still provides a vehicle for Canadians to pool their resources as a hedge against one of life’s most daunting risks.
It’s true that scrapping EI would be easier than modernizing it. But that is a pathetic reason to abandon a program that has helped unemployed Canadians get back on their feet for six generations.
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