Mr. Chair and members of the committee, good morning.
Thank you for inviting us here today to outline the investments that need to be made to improve Canada's employment insurance plan. Our complete arguments for a thorough reform of the plan are laid out in our brief.
These days, as we have all seen, whatever happens on the other side of the world has an impact on our economy here at home. Climate change is also destabilizing natural-resource-based businesses and our economy as a whole. These events and phenomena are beyond our control, but a good employment insurance plan is one of the essential tools we can use to offset their consequences and provide some security and stability to the entire population of this country.
Choosing an employment insurance plan can also help us avoid tragedies. The Mouvement autonome et solidaire des sans-emploi, or MASSE, would like to express its condolences to the families of the three fishermen from the community of Blanc-Sablon who recently died. We will not forget them.
It isn't right that, in a G7 country in 2023, people should need to risk their lives in a storm at sea because they need to accumulate 595, 665 or 700 hours of work to qualify for employment insurance in their region and then hope to survive on benefits that won't even last the entire off-season. We, as a country, have the resources to correct this situation. It's a matter of priorities. If people want to eat seafood in Ottawa, someone has to fish for it off the east coast. However, no one should have to risk his life trying to qualify for employment insurance just to fill our plates.
There are a few simple solutions for considerably improving the plan starting in 2024, while we introduce the full reform that we have been promised.
In 2020, thanks to the Statistics Canada Simulation database, the Institut de recherche et d'informations socioéconomiques, or IRIS, determined that the introduction of a single eligibility threshold of 350 hours or 13 weeks of work would make it possible to redistribute approximately $1.7 billion in benefits to unemployed workers. That would help maintain the economic vitality of many communities and prevent more than 90,000 households from falling into poverty.
I would also note that it is possible to establish a single threshold. The government did it during the pandemic. We also think that the regional unemployment rate isn't an indicator of the number of jobs available in a region. We therefore request that this requirement be dropped.
The measure of establishing a single threshold of 35 weeks of benefits for eligible individuals would cost the employment insurance fund approximately $1.2 billion annually. That lower threshold is a relatively inexpensive measure that would avoid the black hole of employment insurance for thousands of families. As I said earlier, it could save lives.
One thing is for sure, and that's that, given the rising cost of living in recent years, unemployed workers can't support themselves on only 55% of their normal income. That income must be sharply increased. If the benefit rate is raised to 70%, rather than maintained at the current rate of 55%, the additional benefit amounts remitted would total $4.7 billion.
Of course, many options are available to the Minister of Finance to finance these measures.
First, the return of the government contribution equal to 20% of the total amount of employer and employee contributions would add approximately $5 billion to the fund annually. And that's not an impossible measure, since that kind of contribution was made until 1990.
Second, savings of approximately $2 billion could be achieved every year by ending funding for employability programs from the EI fund. We at MASSE believe that employer and employee contributions should not be used to fund those programs.
It should also be borne in mind that there was a time, not long ago, when the contribution rate was approximately 3% of salary. It's less than half that today. Given the rule requiring that the fund must have a zero balance every 7 years, the fund seems fated to be less and less suited to the needs of unemployed Canadians. If, every time the fund showed a small surplus, those amounts were used to improve the plan rather than to offer contributors very minor reductions calculated in fractions of a percentage point, the plan could be sustainably improved and a new balance could then be established by achieving, in the long term, a more accessible, fair, universal and non-discriminatory plan.
I would recall that $57 billion was removed from the employment insurance fund in 2008. And let's remember that Mr. Duceppe demanded to know where unemployed workers' money had gone.
In addition, approximately $20 billion was taken from the fund in recent years and used to fund the Canada emergency response benefit.
If those amounts removed from the fund were recovered, the employment insurance plan would have a cushion that could be used to fund the proposed improvements as it gradually found its new balance.
The plan is currently underfunded and exacerbates the inequalities within our society. Canada's workers deserve better than that. Everyone who contributed should be entitled to benefits if they become unemployed.
Surely it's possible to make choices in the 2024 budget that will improve the present plan. The employment insurance plan may find its budgetary balance in its improved version. The choice is political, not financial.