Now you see it ... now you don't

Lana
Lana Payne
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With the stroke of a pen and barely a whimper of opposition, the federal Conservatives have wiped out a $57.2 billion debt owed to the workers of Canada and their employers.
There was no news release
from the Prime Minister's Office announcing the fact, no fancy television ad like those promoting
the government's economic action plan, and certainly no full-colour billboard bragging about the elimination of over $57 billion in debt owed to the EI account.
You may consider this column an expression of colossal outrage at the federal government's continued and blatant misuse and abuse of Canada's unemployment insurance system.
Both Liberal and Conservative governments have been guilty of confiscating billions of dollars in EI premiums and using them for purposes other than what they were paid.
And until Bill C-9 - the 2010 Budget Implementation Act introduced March 29 - the billions in EI surpluses transferred into general revenues were still owed to the EI account and, in turn, still owed to the workers and employers of Canada. Government actuaries had to keep track of the surpluses and account for them, including accumulated interest.
Not anymore. The budget act has wiped out the debt, wiped away the surpluses and placed the EI account at zero. (Imagine if Canadians could wipe out their personal debts so easily.)
We should all be fuming mad at the federal government's gigantic write-off, hidden within the Budget Implementation Act, especially unemployed Canadians.
Employers have a little less to be angry about as it could be argued that they have already benefited from the surpluses through billions of dollars in corporate tax cuts since the mid-1990s. Even so, they are also entitled to be ticked off.
The Liberals started this creative bookkeeping in the 1990s after they "reformed" Canada's social safety net.
A key piece of this reform was dramatic and wholesale changes to Canada's unemployment insurance system - starting in 1996 when unemployment insurance was transformed into employment insurance.
The new employment insurance rules make it tougher to qualify for smaller benefits. Today, 60 per cent of unemployed Canadians have either run out of benefits or never qualified in the first place.
Between 1997 and until recently, the federal government continued to rake in billions and billions of dollars in excess premiums - moneys that were not spent to help the unemployed, the sick or new parents.
Instead, these EI premiums (paid by working Canadians and their employers) were transferred into general government revenues and used to fight the deficit, reduce the debt, and to hand out billions in corporate tax cuts.
It is no wonder that the labour movement has said that the deficit and the debt have been fought on the backs of the unemployed and, disproportionately, on the backs of unemployed women who were particularly penalized by the 1996 reforms.
In addition to slashing benefits, the government also cut EI premiums substantially over the past dozen years. Employers benefited significantly from smaller contributions while the unemployed continue to suffer.
And while the federal government is quietly wiping out the debt owed to the EI account, tens of thousands of Canadians have run out or are running out of EI benefits.
Interestingly, the federal government refused to go back further than Jan. 4, 2009 for its so-called provisions to help long-tenured employees, many of whom lost their jobs in the fall of 2008 and were thus excluded from qualifying from the EI recession measures.
Yet it had no problem making retroactive the elimination of the debt owed the EI account. According to Bill C-9, the surpluses owed the EI account will be wiped out as of Jan. 1, 2009.
There is a question of whether this write-off is constitutionally legal.
In 2008, the Supreme Court of Canada ruled that the federal government could accumulate EI surpluses. But it did not say those surpluses could be forever redirected away from the EI account.
At the very least, the transfer of EI premium revenues into non-EI purposes represents a breach of trust. Wiping this debt off the books is much more than a breach of trust. It is a crime - a crime against the unemployed and the workers and employers who paid these premiums.
Playing fast and loose with
accumulated EI premiums while so many unemployed Canadians need help is just plain wrong. The argument for the surpluses in the beginning, put forward by the Liberals, is they would be needed for a "rainy day." For a lot of workers and their families, that rainy day was the recession.
This is indeed a crime. The question is who, if anyone, will do the time. Perhaps if enough of us care, the ballot box might be a good place to deliver a little justice.

Lana Payne is president of the Newfoundland and Labrador Federation of Labour. She can be reached by e-mail at lanapayne@nl.rogers.com. Her column returns April 24.

Organizations: Conservatives, Supreme Court of Canada, Newfoundland and Labrador Federation of Labour

Geographic location: Canada

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Recent comments

  • greg
    July 02, 2010 - 13:34

    Not a peep from the Liberal partners of this most abhorrent of unofficial coalitions. The silence of Coady, Simms , Byrne, Foote, Russell and Andrews reeks of political weakness rarely witnessed in our 60 years of Confederation. They have been assimilated by the Tory Hordes both Federally and Provincially and have failed to represent working men and women in this Province. Should they be reminded they represent a Province largely dependent on a seasonal work force?
    Expect more of the same from these Liberal /Tory cheerleaders of big business.

  • Peggy
    July 02, 2010 - 13:31

    Tell it to the liberals-they wiped it out and moved it to the general revnue column. What choice does the present government have-they can't make the 60 billion the liberals took reappear again? That's why the deficit now during a recession most of it went into programs like job-sharing, extending EI etc. Whether they put it back into the EI fund or revenue the deficit would exist in one column or the other. That's why when liberals give credit to themselves for leaving a surplus it is a joke. Thank god for Sheila Fraser!

  • Taxpayer
    July 02, 2010 - 13:12

    No need to worry business will approve of this action. They like paying taxes don't they( in this case 2.4 times the employees portion).

  • greg
    July 01, 2010 - 20:23

    Not a peep from the Liberal partners of this most abhorrent of unofficial coalitions. The silence of Coady, Simms , Byrne, Foote, Russell and Andrews reeks of political weakness rarely witnessed in our 60 years of Confederation. They have been assimilated by the Tory Hordes both Federally and Provincially and have failed to represent working men and women in this Province. Should they be reminded they represent a Province largely dependent on a seasonal work force?
    Expect more of the same from these Liberal /Tory cheerleaders of big business.

  • Peggy
    July 01, 2010 - 20:20

    Tell it to the liberals-they wiped it out and moved it to the general revnue column. What choice does the present government have-they can't make the 60 billion the liberals took reappear again? That's why the deficit now during a recession most of it went into programs like job-sharing, extending EI etc. Whether they put it back into the EI fund or revenue the deficit would exist in one column or the other. That's why when liberals give credit to themselves for leaving a surplus it is a joke. Thank god for Sheila Fraser!

  • Taxpayer
    July 01, 2010 - 19:49

    No need to worry business will approve of this action. They like paying taxes don't they( in this case 2.4 times the employees portion).