Canadians face increases in the employment insurance premiums they pay

EI premiums increasing

In a recent report, I referenced an exchange I had in June 2020 with the employment, workforce development and disability inclusion minister.

In the exchange I asked the minister to reveal the current balance of the EI account? As it turned out, I never received an answer to that question.

The Parliamentary Budget Officer (PBO) also noticed the Liberal government's secrecy around the EI account balance.

“Given that forecasted EI expenses far exceed projected program revenues, the EI operating account is on track for a cumulative deficit of $52 billion by the end of 2024,” it said.

Why does this matter? As I pointed out back in my December 2020 report, by law EI premiums that Canadians pay must cover the expenses of the Employment Insurance program. If the expenses exceed the revenue, as is currently the case, the government must, within a seven-year time frame, recover the deficit of EI funds that have been paid out.

Why mention this now? As of Jan.1, the EI premiums many Canadians pay will increase. Next year, on Jan. 1, 2023 when a two-year freeze on EI increases expires, the premiums will increase again.

The increase for this year is based on the maximum insurable earnings increasing tp 60,300 from $56,300.
That works out to a maximum weekly EI benefit increase to $638 per week from $595 per week.

In turn, the maximum annual premium will increase to $952.74 from $889.54 last year.

Next year, EI premiums will start to increase more significantly from $1.58 per $100 of insurable earnings up to $1.83 per $100 of insurable earnings by 2027.

Obviously, these increases mean many workers will have less net take home pay as a result. At the same time, a recent 2022 food prices study, prepared by researchers with Dalhousie University, the University of Guelph, the University of Saskatchewan and the University of British Columbia, forecast food prices in Canada will increase between 5% and 7% this year.

In other words, at a time when many households may see their net income drop, the purchasing power of their dollar will be less because of these inflationary pressures.

My question this week:
How much are you concerned about this situation?

I can be reached via email at [email protected] or by telephone at 1-800-665-8711 (toll free)

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Dan Albas is the Member of Parliament for the riding of Central Okanagan-Similkameen-Nicola and the co-chair of the Standing Joint Committee for the Scrutiny of Regulations.

Before entering public life, Dan was the owner of Kick City Martial Arts, responsible for training hundreds of men, women and youth to bring out their best.

Dan  is consistently recognized as one of Canada’s top 10 most active Members of Parliament on Twitter (@danalbas) and also continues to write a weekly column published in many local newspapers and on this website.

Dan welcomes comments, questions and concerns from citizens and is often available to speak to groups and organizations on matters of federal concern. 

He can be reached at [email protected] or call toll free at 1-800-665-8711.

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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