Mr. Speaker, I will be splitting my time with the member for Mississauga--Brampton South.
I am pleased to join this vigorous debate on EI. It is extremely important that the House, from time to time, devote attention to this very important matter.
In the period that tends to be discussed, 10 or 15 years, there has been an extraordinary change in the nature of work in Canada and the nature of the labour force. The labour force is far more inclusive than it ever was. The percentage of the population which is involved in work, men and women, abled and disabled, increased extraordinarily in that period of time, and this is all for the good. I think it has been reflected in the way the EI program has evolved over those years.
I believe now that in the developed countries, we have the largest percentage of our population involved in the work force, which says something. One of the things it means is that when we say the unemployment rate in Canada is 6.8%, it is 6.8% of a much larger number than what we were talking about 10 or 15 years ago.
For more than six decades, employment insurance has been a mainstay of Canada's social safety net. From its inception down through the years to the present day, governments have adjusted the program in response to changing times. This government has been no exception.
The government recognizes the importance of keeping EI in tune with the needs of Canadians, and my preamble dealt with some of that. Through the budget proposals in budget 2005, which is still unfortunately before the House, on EI rate setting and the subsequent announcement of the enhancements to EI benefits, we have addressed many of the most pressing concerns.
This is the approach that we believe Canadians want us to take: careful study and deliberation in conjunction with sound policy decisions supported by thoroughly tested evidence to support this remarkable program. This is precisely the process the Government of Canada followed in proposing a new EI premium rate setting mechanism.
We recognized that the mechanism set out in the EI Act needed improvement. Therefore, in budget 2003 we committed to undertaking a review of the premium rate setting process and launched public consultations.
We promised the new process would be based on five principles: premium rates should be set transparently, in public; premium rates should be set on the basis of independent advice, not just on the basis of whims of government; the expected premium revenues should correspond to the expected program costs, so there would be a balance each year between the income and the out-pay of the program; premium rate setting should mitigate the impact on business cycles; and premium rates should be relatively stable over time so that employers and employees know what to expect from year to year.
Consultations were held with a wide variety of stakeholders. We heard from business and labour, economists and technical experts, EI commissioners for workers and employers, and individual members of the public.
In budget 2005, which is still before us, the Government of Canada proposes a new permanent rate setting mechanism that meets all five of the principles developed in 2003 and takes into consideration the views of the stakeholders and those of the standing committee, and is consistent with the views of the Auditor General of Canada, which is important.
Starting with the rate for 2006, the EI Commission will have the legislative authority to set the rate. In setting the rate, the EI Commission will take into account the principle of expected premium revenues matching expected program costs, which I mentioned. I also would take into account the report from the chief actuary, whose independence has been increased through a functional reporting relationship to the commission.
What this means is that for the first time the chief actuary who does the calculations of these things will be mentioned in the legislation. This is a step forward.
The commission will take into account input from the public and, as needed, the services of those with specialized knowledge in rate setting matters. Gone completely will be the requirement for the Government of Canada to improve this rate. We are talking about an independent, logical, transparent rate setting mechanism.
These new measures address issues raised by stakeholders and in the standing committee's reports by increasing the independence of the EI commission in EI rate setting and strengthening the transparency of the process.
With respect to EI benefit enhancements, the Government of Canada has taken a similar approach by considering the recommendations of a variety of stakeholders, coupled with the results of ongoing monitoring and assessment. The recent announcement of about $300 million, which I mentioned, in new targeted EI benefit enhancements reflects this process and addresses some of the standing committee's recommendations.
In conjunction with budget 2005, the government has announced three pilot projects to respond to the most pressing challenges facing Canadians who turn to EI for assistance. When fully implemented, these projects will be in effect across the country in regions of high unemployment.
The pilot projects are designed to test the effects on the labour market of the following: first, enabling individuals new to the market or returning after an extended absence to be eligible for EI benefits after 840 hours of work, rather than 910, when linked to EI employment programs; second, calculating EI benefits based on the highest 14 weeks of income over the 52 weeks preceding a claim, thus better reflecting individuals' full time work patterns; and, third, increasing the working while on claim threshold to allow claimants to earn the greater, as I mentioned, of $75 or 40% of benefits in an effort to encourage people to take work without reducing benefits.
These things are being tested so that we can see what their effects are and what the benefits truly are to the people involved with the program.
In addition to these new pilot projects, the government also announced in the budget the continuation for a second year of the pilot project to provide workers in high unemployment regions with five additional weeks of EI regular benefits. This particular pilot helps to address the annual income gap faced by workers with limited work alternatives.
As well, the government has extended until October 2006 the EI transitional boundary provisions in two regions in Quebec and New Brunswick, pending a review of the EI economic boundaries.
These measures demonstrate the government's commitment to ensuring that EI remains responsive to the needs of Canada's workforce.
This approach has worked well. Successive monitoring and assessment reports indicate that overall the labour market is strong and the EI program is working well for the majority of Canadians. The government will continue to monitor and assess the program to ensure that it is responsive to the needs of Canadians.
Our response represents a balanced, grounded approach, one which includes the feedback of stakeholders, is supported by evidence and enhances the independence and transparency of the mechanisms that govern the EI program.
It is an approach that we will continue to follow because this government is committed to ensuring that the EI program remains responsive to the needs of the labour market and all Canadians.