2nd Session, 36th Parliament,
48 Elizabeth II, 1999

The House of Commons of Canada

BILL C-405

An Act to amend the Employment Insurance Act and another Act in consequence, 1999 (Employment Insurance Account and annual premium rate setting)

      Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

1996, c. 23; 1997, c. 26; 1998, cc. 19, 21; 1999, c. 17

EMPLOYMENT INSURANCE ACT

1. Section 66 of the Employment Insurance Act is replaced by the following:

66. (1) On the first day of October in each year, the Commission shall cause a report to be sent to the Minister containing its recommendations respecting the setting of the premium rate for the year and the change, if any, to the amount of benefits at a rate that the Commission considers will, to the extent possible,

    (a) ensure that there will be enough revenue over a business cycle to pay the expenses authorized to be charged to the Employment Insurance Account; and

    (b) maintain relatively stable rate levels throughout the business cycle.

Contents of report

(2) The report under subsection (1) shall contain

    (a) a detailed description of the assets of the Commission on the first day of September in each year;

    (b) a detailed description of the amounts that have been paid into or paid out of the Employment Insurance Account since the previous report;

    (c) an estimate of the amounts to be paid into the Employment Insurance Account under this Act for the following year, calculated on the basis of the premium rate recommended by the Commission in the report;

    (d) an estimate of the amounts to be paid out of the Employment Insurance Account under this Act for the following year, calculated on the basis of the amount of benefits to be paid according to the recommendations made by the Commission in the report; and

    (e) any other information that the Commission considers necessary to explain the choice of recommendations contained in the report.

Tabling of report

(3) The Minister shall cause a copy of the report to be laid before each House of Parliament on any of the first five days on which that House is sitting after the report is submitted to the Minister.

Annual premium rate setting

66.1 (1) Not later than November 30 in each year, the Minister shall set the premium rate that the Minister considers will, to the extent possible,

    (a) ensure that that will be enough revenue over a business cycle to pay the expenses authorized to be charged to the Employment Insurance Account; and

    (b) maintain relatively stable rate levels throughout the business cycle.

Duty to take recommenda-
tions into
account

(2) In performing the duty referred to under subsection (1), the Minister shall take into account the recommendations contained in the report under section 66.

2. Sections 71 to 76 of the Act are replaced by the following:

Employment Insurance Account established

71. There shall be established in the name of the Commission an account to be known as the Employment Insurance Account.

Payment into the Employment Insurance Account

72. (1) There shall be paid into the Employment Insurance Account

    (a) all the amounts credited to the Employment Insurance Account - as this account existed immediately prior to the day this section comes into force - and not charged to this account for the purposes of this Act on the coming into force of this section;

    (b) all amounts received under Parts I and III to IX, as or on account of premiums, fines, penalties, interest, repayment of overpaid benefits and benefit repayment;

    (c) all amounts collected by the Commission for services rendered to other government departments or agencies or to the public;

    (d) all amounts received on account of principal or interest on loans made by the Commission under Part II or as repayment of overpayments made by the Commission under that Part;

    (e) all premiums required to be paid by Her Majesty in right of Canada as employer's premiums for persons employed in insurable employment by Her Majesty in right of Canada;

    (f) all amounts paid into the Consolidated Revenue Fund that are

      (i) received as or on account of penalties imposed under section 38, 39 or 65.1 and repayments of overpaid benefits, except interest and penalties on benefit repayment,

      (ii) received on account of principal or interest on loans made by the Commission under Part II,

      (iii) received as repayments of overpayments by the Commission under section 61 for employment benefits and support measures authorized by Part II,

      (iv) received as repayments of overpayments by the Commission under agreements entered into under section 63, or

      (v) received as interest under section 80.1;

    (g) any amount provided out of the Consolidated Revenue Fund to the Commission by the Minister of Finance under section 74;

    (h) any amount provided out of the Consolidated Revenue Fund appropriated by Parliament intended for any purpose related to employment insurance and administered by the Commission; and

    (i) any other amounts paid into the Consolidated Revenue Fund or the Commission under this Act for any purpose related to employment insurance and administered by the Commission.

Assets of the Commission

(2) All amounts paid into the Employment Insurance Account

    (a) shall become part of the assets of the Commission; and

    (b) as they are paid in, shall be deposited with a financial institution within the meaning of the Financial Institutions Act, a body corporate to which the Trust and Loan Companies Act applies, or an association to which the Cooperative Credit Associations Act applies.

Duties of the Commission

(3) The Commission shall

    (a) manage the amounts paid into the Employment Insurance Account in the best interests of the contributors and beneficiaries under the employment insurance system; and

    (b) subject to section 73, invest its assets with a financial institution, body corporate or association referred to in paragraph (2)(b) with a view to achieving a maximum rate of return, without undue risk of loss, having regard to the factors that may affect the funding of the employment insurance system provided for in this Act and the ability of the Commission to meet its financial obligations.

Loans to Her Majesty in right of Canada

73. (1) At the request of the Minister of Finance, the Commission shall pay, by way of loan, to Her Majesty in right of Canada any amount or a part thereof that it considers will not be immediately required for the purposes of this Act.

Repayment

(2) A loan made under subsection (1) and interest thereon shall be repaid in such manner and on such terms and conditions as the Minister of Finance may establish.

Loan to the Commission

74. (1) Where the assets of the Employment Insurance Account are not sufficient for the payment of the amounts that the Commission is liable to pay under this Act, the Commission may request the Minister of Finance to grant the Commission a loan, from the Consolidated Revenue Fund, of an amount sufficient to meet the payments.

Repayment

(2) A loan made under subsection (1) and the interest on it shall be repaid in such manner and on such terms and conditions as the Minister of Finance may establish.

3. Sections 77 and 78 of the Act are replaced by the following:

Amounts paid out of the Employment Insurance Account

77. (1) There shall be paid out of the Employment Insurance Account

    (a) all amounts paid as or on account of benefits under this Act;

    (b) all amounts paid under section 61 for employment benefits and support measures authorized by Part II;

    (c) all amounts paid under paragraph 63(a);

    (d) the costs of administering this Act, including administration fees or costs paid under section 62 or paragraph 63(b);

    (e) any amount paid by the Commission to Her Majesty in right of Canada under section 73; and

    (f) any other amount that must be paid by the Commission under this Act.

Payment by special warrants

(2) Notwithstanding any other Act of Parliament , amounts mentioned in paragraph (1)(a) shall be paid by special warrants drawn on and issued by the Commission by electronic means or bearing the printed signature of the Chairman and Vice-Chairman of the Commission, and amounts mentioned in paragraphs (1)(b) and (c) may be paid by the special warrants.

No charge for negotiation

(3) The special warrants are negotiable without charge at any financial institution in Canada.

Maximum amount that may be paid under Part II

78. The total amount that may be paid out by the Commission under section 61 and paragraph 63(a) in a fiscal year must not exceed 0.8% of the insurable earnings of all insured persons from which the prescribed amount is deducted under subsection 82(1) in that year as or on account of employee's premiums, as estimated by the Commission and set out in the Main Estimates tabled in Parliament.

4. Section 80 of the Act is repealed.

5. The Act is amended by adding the following after section 80.1:

Regulations

80.2 (1) Within two months following the coming into force of this section, the Governor in Council shall make regulations

    (a) for the operation of sections 1 to 4 and 6 of the Act to amend the Employment Insurance Act and another Act in consequence, 1999; and

    (b) amending sections of this Act or any other Act of Parliament to make them more consistent with sections 1 to 4 and 6 of the Act to amend the Employment Insurance Act and another Act in consequence, 1999.

Coming into force of regulations

(2) Subject to subsection (3), regulations made under subsection (1) shall come into force three months after this section comes into force.

Approval of the House of Commons

(3) The coming into force of any regulations that amend or repeal regulations made by the Governor in Council under subsection (1)(b) is subject to approval by resolution of the House of Commons, and the regulations shall come into force on the day after the House of Commons approves the regulations by resolution.

Consequential Amendment

1996, c. 11

DEPARTMENT OF HUMAN RESOURCES DEVELOPMENT ACT

6. The Department of Human Resources Development Act is amended by adding the following after section 29:

Borrowings and loans

29.1 Subject to the Employment Insurance Act, the Commission may borrow from and lend to Her Majesty in right of Canada.

Coming into force

7. Sections 1 to 4 and 6 shall come into force on a day that is two months after the date on which this Act is assented to.