Canadian Manufacturers and Exporters want Ottawa to refund overpayments to employers and employees and change structure of EI program
The Canadian Manufacturers and Exporters is calling on the federal government to refund Employment Insurance over-contributions by employers and employees.
Perrin Beatty, CME’s president, said massive surpluses in the federal government’s EI premium collection that now total $45 billion have contributed greatly over the past 10 years to eliminating the federal deficit. But he called it a costly way to balance the budget.
“EI over-contributions are a regressive and profit-insensitive tax. They are job killers because they drive up the cost of employing workers, and they discourage innovation,” said Beatty.
The group made a submission to the Employment Insurance Premium Rate Review process that supported the government’s goal of a transparent and sustainable process for setting EI contributions. Beatty said rates should be stable over time and mitigate the impact of business cycles. He said CME wants a guarantee that premiums will be used for their stated purposes and not go into general revenues.
He also made suggestions about how the EI fund should be governed.
“We recommend replacing the current EI commission structure with an advisory board of employer and employee representatives proportional to their relative financial contributions to the fund,” said Beatty.
In addition to refunding over-contributions made by employers and employees, CME wants the multiplier applied to employer premiums eliminated.
“The lack of transparency and the disconnect between contributions and the purpose of the fund have weakened the credibility of the EI system,” he said. “Major structural changes are needed. Simply tinkering with how rates are set will not be enough to restore confidence and credibility to the system.”
CME is an Ottawa-based organization with members across Canada. Its members account for 75 per cent of the country’s manufacturing output and 90 per cent of exports.
Perrin Beatty, CME’s president, said massive surpluses in the federal government’s EI premium collection that now total $45 billion have contributed greatly over the past 10 years to eliminating the federal deficit. But he called it a costly way to balance the budget.
“EI over-contributions are a regressive and profit-insensitive tax. They are job killers because they drive up the cost of employing workers, and they discourage innovation,” said Beatty.
The group made a submission to the Employment Insurance Premium Rate Review process that supported the government’s goal of a transparent and sustainable process for setting EI contributions. Beatty said rates should be stable over time and mitigate the impact of business cycles. He said CME wants a guarantee that premiums will be used for their stated purposes and not go into general revenues.
He also made suggestions about how the EI fund should be governed.
“We recommend replacing the current EI commission structure with an advisory board of employer and employee representatives proportional to their relative financial contributions to the fund,” said Beatty.
In addition to refunding over-contributions made by employers and employees, CME wants the multiplier applied to employer premiums eliminated.
“The lack of transparency and the disconnect between contributions and the purpose of the fund have weakened the credibility of the EI system,” he said. “Major structural changes are needed. Simply tinkering with how rates are set will not be enough to restore confidence and credibility to the system.”
CME is an Ottawa-based organization with members across Canada. Its members account for 75 per cent of the country’s manufacturing output and 90 per cent of exports.
