Mr. Speaker, I would like to respond to the hon. member's question by reminding him, and the Minister of Human Resources remarked on this recently, that the last federal budget and the main estimates already contain a great deal of information on the employment insurance account.
That said, there is no great mystery regarding the employment insurance account reserve. A reserve is necessary since it makes it possible to apply more stable premium rates throughout the economic cycle, thus making it possible to avoid increasing them in a recessionary period. In addition, the reserve makes it possible to ensure that there are sufficient funds to pay benefits when they are most necessary.
Let us recall for a moment what happened in the last recession. A $2 billion surplus in the Employment Insurance Act turned into a $6 billion deficit in two years and it was necessary to increase premiums by 30% in what was already a difficult time for job creation. That is no time to increase premiums. Consequently the government believes that it is wise to establish a reserve in the employment insurance account.
The size of the reserve varies continually. It increases and decreases depending on the rate at which benefits are paid out. The reserve is currently estimated to contain some $12 billion. However, this amount is to be reviewed and the government will soon be announcing its decision in this regard.
It should be remembered that the funds are kept in an account in anticipation of future expenditures that might be incurred under the program. The interest is credited to the employment insurance account. As indicated in the main estimates for 1997-98, interest this year totalled $345 million.
The employment insurance premiums of workers and employers make it possible to provide income protection. That is very important for persons who unexpectedly lose their jobs.