Human Resources committee  Hypothetically, we could say that if the government anticipated a large surplus in the employment insurance fund, it could choose to increase the benefits and to inform the board, which,in turn, should take it into account when setting the premium rates. For instance, if the government anticipated an enormous surplus, the government could decided, in September or in October, to improve the benefits.

Human Resources committee  If it's a change in the benefits that is done through regulations, for example, it's the Governor in Council. If a more fundamental change is required, and it's an amendment to the Employment Insurance Act, then you'd all be consulted because that would have to be discussed in Parliament.

Human Resources committee  It was spent on general government expenditures, so there's no way of saying where exactly it was spent. It was consolidated with the CRF—the consolidated revenue fund—so it was spent on general government activities. So I could not say one area.

Human Resources committee  Well, given that the AG, in the mid-1980s, suggested very strongly that the government consolidate EI expenditures and EI premium revenue collections within the CRF, the moment you had a surplus it had to go towards debt reduction if there was an overall government surplus. As I explained previously, even if we have the best experts in the country, it's very difficult to very accurately predict what the precise EI premium rate should be when you are in October of, for example, 1994.

Human Resources committee  To the best of my knowledge, that's totally accurate. If there were to be a surplus after Bill C-50 receives royal assent, if it does, I can't see any way a surplus in the EI program would be used for any other purpose but for paying the benefits first and reducing the premiums.

Human Resources committee  There are limits to the possible swings in the EI premium rate that are set out in the proposed legislation. How soon that would have to be repaid depends on two things: on the extent of the repayment that would be required; and then on the room that would be left once economic conditions are taken into account--so the room that would be left, the 15¢.

Human Resources committee  If I may, Canadians will be better off in the sense that Canadians are premium payers—at least those who contribute to the EI program—and they will have the certainty that if there is a surplus, it will be returned to them as premium payers through lower premiums, if there is such a thing as a surplus going forward.

Human Resources committee  Should the chief actuary estimate that a premium rate increase is necessary due to changing economic circumstances, the rate will very likely have to go up. The legislation sets boundaries by which the premium rate can go up. There's a limit above which the premium rate cannot go.

Human Resources committee  It started accumulating after the recession of the early 1990s. I don't have the precise figure. I was prepared to speak to Bill C-50 more than the historical background with respect to the notional surplus, but it went back to the early 1990s.

Human Resources committee  Probably around that time.

Human Resources committee  The federal crown will be there to cover any shortfall should the $2 billion be exhausted. Whatever needs to be paid will be paid. This is a statutory program.

Human Resources committee  One benefit of having a separate crown corporation is that it allows the creation of a separate bank account that will be managed to the benefit of premium payers and benefit recipients, so that the rates can remain a bit more stable. Another advantage is that there will be additional predictability in the setting of the premium rate by having a clear set of guidelines for the crown corporation to set its premium rate going forward, as well as having premium rate payers benefit from any potential surplus that could arise in the future years.

Human Resources committee  If I may, I'd like to add to that. It's very difficult to predict very accurately the precise rate in October or November that will be sufficient to cover all of the benefits for an entire year, from January to December. So while I'm confident in the capacity of my colleagues to predict, or the actuaries to predict, the economic conditions 12 or 14 months down the road, it's almost impossible to be bang on, to the cent.

Human Resources committee  I'll do that very shortly.

Human Resources committee  I mean briefly. You are saying that the Employment Insurance Account should be reimbursed this $54 billion. You also appear to be saying that there is a dichotomy between the amount loaned and advanced to the Employment Insurance Account and that this amount, according to Bill C-50, should be reimbursed.