Barely one-third of jobless now get EI By Eric Beauchesne

More and more of the unemployed have fallen through holes in the employment insurance program this year while the federal government sits on a bulging surplus in the El fund of nearly $20 billion.

Figures obtained yesterday from Statistics Canada reveal that only 34 per cent of the unemployed were getting employment insurance benefits in August, down from an average of 42 per cent last year.

So far this year. the average proportion covered by El has been 38 per cent. That's also down from more than 80 per cent before the government, in a bid this decade to save money began making it more difficult for the unemployed to collect benefits.

News that the proportion of unemployed covered by El has plunged to barely one_third comes only days after the federal government claimed in a report that the El system is working.

The report claimed that the EI reforms were to blame for only half of the 50-per-cent plunge this decade in the proportion of unemployed covered by the jobless insurance system.

The economy is to blame for much of the rest, it said.

Increases in long_term unemployment mean more of the unemployed have exhausted their El benefits while increases in the proportion who have been unable to land that first job means more are not entitled to benefits. The system was never intended to protect those people, said the report by Human Resources Development Canada.

EI is still "meeting its main objective of providing temporary benefits to Canadians between jobs, it said.

The system is doing what it is supposed to do, said Human Resources Minister Pierre Pettigrew. Nearly 80 per cent of all workers who are laid off are covered."

But NDP MP Yvon Godin noted that doesn't include the nearly 60 percent of unemployed who are not eligible for El under the new rules.

The issue has been particularly embarrassing for the government because as more unemployed fall through the cracks in the EI system, it is sitting on an El surplus that's growing by $7 billion a year and will reach nearly $20 billion by year-end.

Business groups and the Reform and Tory opposition want that surplus returned to workers and their employers in the form of lower premiums.

The NDP, unions and social groups argue that at least part of it should go to restoring El benefits so that more of the unemployed are protected.

Finance Minister Paul Martin, however, has said no to both sides, claiming he needs the surplus to keep the government from going back into a deficit.#

Editorial note: Both Mr. Pettigrew and Mr. Martin appear to have forgotten that the original UI was introduced to stabilize individual worker incomes and the whole economy during cyclical downturns.

The federal government has generally failed to recognize the major social and economic benefits of a good UI or EI program.

The one thing that both Mr. Pettigrew and Mr. Martin should know is the UI fund was never intended to be used as a source of general revenue to keep the government from going back into a deficit.

The UI/EI fund was built up solely by contributions by workers and employers. It belongs to them and it should be used for the purpose for which it was intended B unemployment insurance. It should not be used by morally bankrupt politicians who lack the courage and/or the political will to implement a fairer, more progressive tax system. 

Information from Ont. Coalition for Social Justice.