Extended EI benefits surpass budget expectations as program closes doors
The program was designed to help workers in 15 regions with stubborn unemployment rates, but costs blew past expectations
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OTTAWA—The federal Liberals are looking for answers after the government’s program to help workers in hard-hit economic regions of the country blew past budget expectations, with spending now topping $1.3 billion.
The government figured that just 235,000 people would use extra weeks of employment insurance benefits when they unveiled the program last year to help workers in 15 regions of the country with stubborn unemployment rates.
That was projected to cost the government $827.4 million between April 2016 and March 2019.
But as of July 9, Employment and Social Development Canada said that it had spent just under $1.31 billion on the extra weeks of benefits for 317,261 claimants.
The spending figure may yet change as officials pore over the last few claims that trickled in by last week’s deadline for program eligibility.
A report will be coming out in September with a revised cost for the program.
A spokesman for Social Development Minister Jean-Yves Duclos said that the high cost for the program was one of the reasons it wasn’t renewed and that a review is underway to determine why costs exceeded estimates.
Opposition critics argued the fault lay in the Liberals’ economic policy.
Conservative critic Pierre Poilievre said the government’s moves to increase taxes had a negative effect on hiring, which meant more spending on employment insurance programs.
“The government should, instead, cut payroll taxes so employers can afford to hire more and employees can enjoy the rewards of their labour.”
NDP jobs critic Brigitte Sansoucy said the Liberals were right to extend EI benefits, but the numbers suggest Canadians are struggling more than the Liberals are willing to admit.
She called on the government to make more permanent improvements to EI, suggesting the high spending and claimant figures show such changes are badly needed.
The program was rolled out in 2016 for workers in 15 economic regions of the country that had seen a hard and sustained drop in employment as a result of the sharp downturn in energy prices.
Eligible workers received an extra five weeks of regular benefits effective July 2016 but retroactive to January 2015.
Long-tenured workers in the regions were also eligible for an extra 20 weeks of benefits, to a maximum of 70 weeks—again, starting last July but retroactive to January 2015.