EI Commission Releases Chief Actuary's Report

News Release

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October 14, 2005
FOR IMMEDIATE RELEASE
05-67
OTTAWA, ONTARIO - The Canada Employment Insurance Commission today released the Report by the Chief Actuary that will be considered by the EI Commission in its determination of the Employment Insurance (EI) premium rate for 2006. The Report is available on Human Resources and Skills Development Canada's Web site at www.hrsdc.gc.ca and a companion report on the Maximum Insurable Earnings for 2006 is also available at this site.
As a result of measures introduced in the 2005 federal budget to bring greater transparency to the rate-setting process and accord increased independence to the EI Commission in that process, the EI Commission now has the legislative authority to set the EI premium rate.
Under the new rate-setting process, the EI Chief Actuary is required to annually calculate, on a forward-looking basis, the estimated break-even rate for the coming year based on the most current forecast values of the relevant economic variables provided by the Minister of Finance. The forward-looking basis means that surpluses, deficits, and the notional interest credited to the EI Account do not enter into the calculation of the "break-even" premium rate. To ensure premium rate stability and limit any negative impact on the business cycle, the maximum yearly change in the employee premium rate is limited to 15 cents (this equates to a maximum shift of the employer premium of 21 cents). The EI Chief Actuary is required to provide a public report of the "break-even" rate to the EI Commission by no later than October 14 of each year.
The EI Commission will soon begin the formal process of setting the EI premium rate for 2006. In doing so, the EI Commission will take into account the Chief Actuary's report, the principle that the premium rate should generate just enough revenue to cover the expected payments to be made during 2006, the legislative requirement that the 2006 premium rate shall not exceed $1.95 and any public input. The rate will be set by the EI Commission no later than November 14, 2005.
The EI Commission is a tripartite organization with representation from business, labour and the Government of Canada that has a series of responsibilities pertaining to the delivery and administration of the EI program, including the setting of EI premium rates.
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EI Commission Releases Chief Actuary's Report

News Release

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