We have 20 minutes! That will be enough to persuade the federal government to change its mind.
Thank you, Mr. Chair, and thanks to the committee for inviting us. We represent four organizations, although there is no CSQ representative with us today. The FTQ, the CSN, the CSD and the CSQ represent about a million workers in Quebec.
Because we are an umbrella group for four organizations, we have prepared a document that I am going to read to you calmly. I will then give my colleagues the floor. I thought we had only 10 minutes and I had started to make cuts here and there.
As union organizations, we are involved almost every day in supporting employees who, despite themselves, become unemployed when a plant closes down or they are laid off. In recent years, we have repeatedly called for improvements in the employment insurance scheme. The current program, which has been substantially amended since 1990, is increasingly poorly adapted to the new realities of the labour market and no longer meets the income protection needs of unemployed workers.
In Quebec, the overall rate of eligible workers has fallen from 81 percent in 1990 to fewer than 50 percent today. It is with that in mind that we have chosen to speak with one voice on behalf of all of the workers we represent, nearly a million people.
In its last budget, the government announced the creation of the Canada Employment Insurance Financing Board. The bill being considered today provides that the objects of this new Crown corporation, which is to be independent of the government, will essentially be to set the premium rate, manage amounts paid to it under the rules provided in the Employment Insurance Act, and invest its financial assets with a view to meeting its financial obligations.
In addition, section 5 clearly provides that the Board shall not have any involvement in benefits and entitlement. In other words, it has no powers in relation to the design and delivery of the program. That responsibility will remain with the government, which also retains the power to intervene and set a different premium rate from the rate set by the Board, if it deems it necessary.
In order to carry out its objects, the Board will have to establish three committees: an audit committee, an investment committee and a human resources committee. On this point, we welcome the fact that the Board will have to produce quarterly financial statements and an annual report, which will be public. The Board's operating costs will be paid out of revenue in the employment insurance account and will thus be paid entirely by premium payers.
To begin with, we would point out that creating an Employment Insurance Financing Board as a Crown corporation, independent of the government, is certainly a step in the right direction. We have to applaud the government's commitment to creating a separate account and guaranteeing that premiums will be used exclusively for the employment insurance program. However, we believe that there are several important questions that remain unanswered.
Before we comment on the objects and purposes of the Employment Insurance Financing Board, we would like to make a few recommendations regarding the governance structure of the Board.
Under Bill C-50, the Employment Insurance Financing Board will report to the Minister of Human Resources and Social Development. Its board of directors will be composed of seven people, including the chairperson. Those people will be appointed by Governor in Council, on the recommendation of the Minister, from a list established by a nominating committee. The nominating committee is to be composed of a chairperson appointed by the Minister and the two members of the Employment Insurance Commission, the Commissioner for Employers and the Commissioner for Workers.
The Bill does not specify whether there must be formal consultations with employer and union organizations in preparing the list. We are in agreement with the financial and management qualifications. However, the bill does not mention that the board of directors must be representative in terms of premium payers.
Is it necessary to point out that the program is funded exclusively by the premiums paid by employers and workers? They should certainly have a say in the management of the employment insurance account. Bill C-50 therefore needs to be amended to guarantee fair representation for those who pay premiums into the scheme in the governance structure.
We are therefore asking that the board of directors be composed of a large enough, fixed and equal number of representatives of employer and union associations, and that they be chosen from lists supplied by their most representative respective associations.
The bill stipulates that the Board is to set the premium rate under section 66 of the Employment Insurance Act. This amounts to transferring a responsibility that is currently assigned to the Canada Employment Insurance Commission. We are not happy to see the government taking advantage of this transfer to put an end to the obligation to receive submissions from the public when rates are set. Even though consultation often took place too late in the process and seldom produced useful results, it nonetheless gave us an opportunity to state our views concerning the premium rate.
That being said, the Board will start fixing the rate in 2009, but will have to follow essentially the same rules as have been used for setting the premium rate for the last three years. We have had occasion to comment on the flaws in the employment insurance premium setting process. We can only reiterate our disappointment that the government is persisting in taking an equilibrium approach. That principle requires that the actuary, who will now be appointed by the board of directors on its own authority, will have to determine a premium rate that will generate just enough revenue to cover the anticipated costs of the program for the next year, without regard to the current balance in the employment insurance account or future interest on that balance.
I am going to ask Roger Valois to continue.