About HRSDC | Our Offices | Programs & Services | A-Z Index March 1, 2005 FOR IMMEDIATE RELEASE 05-14 MONTRÉAL, QUEBEC - The Honourable Lucienne Robillard, President of the Queen's Privy Council for Canada, Minister of Intergovernmental Affairs, and Minister of Human Resources and Skills Development and the Honourable Jean-C. Lapierre, Minister of Transport, today concluded a final agreement on Quebec's Parental Insurance Plan with Michelle Courchesne, Quebec's Minister of Employment and Social Solidarity. "This final agreement shows that the Governments of Canada and Quebec continue to cooperate in the best interests of our citizens," said Minister Robillard. "It reflects both governments' commitment to support parents in their efforts to balance work and family life while giving the best possible start to their children." "This agreement is a milestone for Quebec's families and their new-born or newly adopted children," said the Honourable Jean-C. Lapierre, Minister of Transport. "It is also symbolic because it speaks to the future - federalism can work when we want to make it work." The final agreement reflects the principles in the May 2004 Agreement in Principle, concluded between the Governments of Canada and Quebec, and provides the administrative, financial and operational provisions under which Quebec will establish its plan. The maternity and parental benefits available under Quebec's program are different than those available under Employment Insurance (EI). For example, Quebec's program offers claimants the option to receive benefits during different time periods and at different rates. "Once implemented, Quebec's plan will build on the federal government's experience in providing maternity benefits for more than 30 years and parental benefits for almost 15 years to Canadians," added Minister Robillard. "Over 200,000 Canadians annually take advantage of EI maternity and parental benefits. Since the benefits were enhanced in 2000, parents are staying home longer after the birth or adoption of their child, and every year more fathers claim benefits." On December 31, 2000, the Government of Canada enhanced maternity and parental benefits by: extending the duration of parental benefits from 10 to 35 weeks-doubling the overall duration of maternity and parental benefits to one full year; improving accessibility by reducing the entrance requirement to 600 hours; and improving flexibility by allowing parents who share benefits to serve only one waiting period instead of two, and by allowing parents to work while receiving parental benefits. Amendments to federal and provincial labour codes were made so that parents could use their full parental benefits without putting their job and their income at risk. Since these enhancements were made, the reduction in the entrance requirements has resulted in additional claims, there has been increased sharing of benefits among parents due to the improvement in the program's flexibility and parents can spend more time with their newborn or newly adopted child. On average, parents are using over 85 percent of the full year of benefits available to them. Until Quebec's program is implemented on January 1, 2006, residents of Quebec will continue to have access to EI maternity and parental benefits. The Government of Canada will be responsible for maternity and parental claims presented before the implementation of Quebec's program for the full duration of the claim, including all of those pertaining to births or adoptions prior to December 31, 2005. For more information, see the attached backgrounder . - 30 - For more information: Michael O'Shaughnessy Director of Communications Office of Minister Lucienne Robillard (819) 994-2482 Media Relations Office Human Resources and Skills Development Canada (819) 994-5559 BACKGROUNDER Maternity and Parental Benefits Final Agreement between the Government of Canada and the Government of Quebec Background The Employment Insurance (EI) program provides a solid foundation of maternity and parental programs across Canada. The Government of Canada spends $2.1 billion in benefits annually and reaches more than 200,000 parents. Maternity and parental benefits are available to Canadians for up to one year if they are eligible under the EI program. In 2001, the Quebec National Assembly passed an Act respecting parental insurance. This led to the development of the province's Parental Insurance Plan. The Government of Canada and the Government of Quebec signed an Agreement in Principle on May 21, 2004 committing both governments to negotiating a final agreement on the implementation of Quebec's Parental Insurance Plan. The Governments of Canada and Quebec have concluded a final agreement that meets the principles set out in the Agreement in Principle and the EI Act requirements, and provides for the administrative, financial and other provisions under which Quebec's plan would be established. Following the conclusion of the Agreement in Principle in May 2004, officials worked intensively to arrive at a final agreement for Ministers' consideration. The Final Agreement The final agreement between the Governments of Canada and Quebec includes a financial mechanism whereby the Government of Canada reduces Employment Insurance premiums of workers and employers in the province so that the Government of Quebec can collect premiums for its own program. The premium reduction reflects the savings to the EI Account realized as a result of Quebec's program, including benefits that are no longer paid under EI and administrative savings. As of the first year of Quebec's program, the Government of Canada will contribute a premium reduction of approximately $750 million, equal to the cost of a full year of EI maternity and parental benefits in Quebec. During the first year of Quebec's program, the Government of Canada will also continue to pay an estimated $375 million in maternity and parental benefits, for claims submitted to the EI program and births or adoptions that take place before the establishment of the Quebec plan. Quebec will reimburse the Government of Canada at the end of 2006 for these costs. This arrangement will ensure an equitable division of fiscal resources consistent with actual savings to the EI program. In subsequent years, the premium reduction is expected to remain at approximately $750 million per year. The administrative savings realized by the EI program related to Quebec's program will also be transferred to Quebec through the premium reduction. In this regard, the savings available to Quebec will be at least $2.5 million in the first year and will increase to be at least $5 million in subsequent years. In addition, the Government of Canada will provide a one-time payment of $200 million to be sourced from general revenues in the 2004-2005 fiscal year, in recognition of the significant investment required to implement Quebec's benefits program. The Government of Canada has agreed to Quebec's use of the federal Record of Employment form and the Social Insurance Number to administer its Parental Insurance Plan. This will result in substantial savings to Quebec, as it will not have to develop and maintain its own forms or systems, and will ease the administrative burden on Quebec employers while at the same time providing them with savings. The issue of equivalence between the two programs has been addressed. During the first year of the provincial program, Quebec guarantees that no resident will receive a less favourable treatment than he or she would have received under Employment Insurance. Non-residents of Quebec (such as foreign workers in Quebec) will continue to be covered by Employment Insurance maternity and parental benefits. Canada and Quebec will work together to ensure that appropriate accounting mechanisms are in place between the federal and provincial governments for a reconciliation of the premiums and benefits of these non-resident workers. At the end of the first year of the provincial program, the Government of Canada and the Government of Quebec will examine the treatment received by Quebec residents. Issues such as interprovincial mobility, federal-provincial collaboration and effective service delivery are also addressed in the final agreement. For example: Interprovincial mobility is assured. Parents who receive benefits under one plan will continue to receive their benefits under that plan if they move to another province or territory. Canadians who will be eligible for both programs (for example, Employment Insurance sickness benefits and provincial maternity and parental benefits) will continue to receive effective services. Individuals cannot draw from both the federal and provincial or territorial plans at the same time for the same purpose. Appropriate information exchanges will take place between governments to ensure the effective implementation of the final agreement. Prior notice will be given by a government if it is planning changes to programs. Accountability and transparency are maintained through public reporting. The principles and parameters in the Canada-Quebec agreement are those that would guide the conclusion of agreements with other provinces or territories that wish to put in place their own maternity and parental benefits program. For more information, please refer to the Agreement in Principle and the Final Agreement. Signature of the final Agreement on Quebec's Parental Insurance Plan. From left to right: Jean-C. Lapierre, Minister of Transport, Lucienne Robillard, President of the Queen's Privy Council for Canada, Minister of Intergovernmental Affairs, and Minister of Human Resources and Skills Development, Michelle Courchesne, Quebec Minister of Employment and Social Solidarity and Benoît Pelletier, Quebec Minister for Canadian Intergovernmental Affairs, Francophones within Canada and the Reform of Democratic Institutions.
