News Release Archive
PREMIER--STATEMENT-UNEMPLOYMENT INSURANCE CHANGES ------------------------------------------------------------ Following is a statement given today by Premier John Savage on changes to Unemployment Insurance announced by the federal government: "I want to say at the outset that we are not here today to try and explain the ins and outs of the reform to Canada's unemployment insurance system. The proposed changes in Mr. Axworthy's bill are extremely complex. It will be several days until we are aware of the ramifications of the legislation. I would suggest that for a full explanation of the bill, you'll have to rely on representatives of the federal government for answers. However, I did think that it was important to provide you with at least our preliminary reading of the UI changes. There is little doubt that the UI changes will have a negative impact on some Nova Scotians. It was also mean a loss to the provincial economy. We are not in a position this afternoon to tell you what the overall dollar impact will be. We only started receiving the detailed information earlier this afternoon and we have not had time to assess the complete picture. We do know that there is money being taken out of the system in the form of UI payments. We also know that there will be money pumped back into the system through new employment programs. What the difference is in terms of actual dollars we don't yet know. The impact of the changes will likely be more severe in the first couple of years because it will take time to put the new employment programs in place. However, it's been suggested that at the end of five years, the net impact of all the changes will end up meaning a seven per cent reduction in the money spent on benefits and employment programs. In the case of Nova Scotia, that's a net loss of $54 million at the end of five years. But again, all of our numbers are preliminary and best guesses. There are both negative and positive aspects to today's announcement in Ottawa. For new entrants to the UI system, there will be higher entrance requirements. However, there are also built-in features to eliminate disincentives and there's a move towards additional employment programs. I do want to address the issue of special significance to this government.....the seasonal worker. There is little doubt that a new so-called intensity rule aimed at repeat users of UI will impact on seasonal workers. In Nova Scotia, as many as 53,000 claimants will be affected. This government, along with our colleagues in the rest of Atlantic Canada, made the issue of our seasonal workers a high priority. We made it very clear that the unique seasonal nature of a large part of our workforce required special attention from the federal government. We are able to report significant success. The plan introduced in Ottawa today includes a method of calculating benefits that will reduce the impact on seasonal workers in high unemployment areas such as the Atlantic provinces. In other words, many seasonal workers in this region will be treated quite differently than elsewhere in Canada. This was a major concession by the federal government. It was only achieved as the result of a lot of pressure being exerted by provincial and federal politicians across this region. Part of the reason we pushed so hard was that in the last round of changes to the UI system, this region suffered disproportionately to the rest of the country. As I mentioned a few moments ago, we have been told that all regions of the country can expect a maximum net loss of about seven per cent when cuts to UI are offset by new employment programs. Had we not convinced the federal government to make special allowances for the seasonal nature of our workforce, this region would have suffered a net loss of between 18 and 20 per cent. I want to make a few other points about the changes announced this afternoon. - The switch from weeks worked to hours worked will have a positive impact on part-time workers. - The program will provide a supplement to assist low-income families. This is a first step in addressing the issue of child poverty. - There is an increased emphasis on programs that will create jobs. Hopefully these new programs will help to offset the impact of benefit and eligibility changes. - There is some reason to believe that some social assistance recipients will qualify for these new employment initiatives. - There is federal money being put into a special transition job fund and other employment initiatives. It's too soon to tell how much money Nova Scotia will receive from either of these two programs. That's about all we can say for now. There are likely more questions than answers at this point." -30- Contact: David Harrigan 902-424-3750 trp Dec. 01, 1995