Court sanctioned diversion plan raises the ire of Nathan Cullen

A recent court ruling by the Supreme Court of Canada, which endorsed the Government of Canada’s right to divert Employment Insurance monies into General revenues, has left the MP for Bulkley Valley-Skeena rather shocked.

With the North Coast particularly hard hit by economic times and a good number of residents finding it hard to even qualify for enough hours for the program, to have the government socking away the money in a different account for different purposes is particularly galling to Nathan Cullen the MP for the riding.

Cullen expressed his disappointment at the court decision, which will let the government keep some 40 million dollars in general revenues but has been instructed to solve the EI problem within twelve months.

That’s a project that Mr. Cullen does not seem to believe the government will be up to handling.

The background on the EI cash grab and the NDP MP’s concerns over the issue could be found in Thursday’s Daily News.

'Overhaul of the EI system urgently needed'
By George T. Baker
The Daily News
Thursday, December 18, 2008
Page one

Nathan Cullen cannot believe the Supreme Court of Canada has ruled in favour of the federal government's right to divert employment insurance money to the general government revenues.
Cullen was reacting to a Dec. 11 decision by the Supreme Court of Canada to allow employment insurance to remain in the government's coffers after it ruled that the government had illegally misdirected employment insurance funds.

"While it's technically allowed, ethically and even intellectually this is completely backwards," said the Skeena-Bulkley Valley MP.

In 1986, the federal Liberal government changed the EI rules so that the government could abolish a separate account that handled the insurance program and instead made it a general revenue fund - or as Cullen called it "a slush fund."

That allowed the government $40 billion with which to attack some of its budget-spending deficit.

But the Supreme Court ruled that parliament broke a major part of the Canadian Constitution of 1867 by working as Section 53 states that there shall be no taxation without representation.
Justice Louis Lebel said that while the scope of parliament's taxing power is well known and that parliament may tax by any means, if a levy is a tax, it must be imposed in accordance with the Constitution.

Section 53 of the Constitution therefore poses a problem as it relates to employment insurance premium, which he ruled were collected unlawfully and without the necessary legislative authorization.

By a vote of seven to zero, the Supreme Court of Canada ruled that the Government of Canada had 12 months to figure out a solution for Canadians with regards to EI payments during the past 22 years.

For Cullen, this all means that reform is absolutely necessary for EI. In a situation where veteran shore workers in Prince Rupert cannot even access premiums because they do not have enough hours worked due to a hurting fishing industry, and at a time when the government is sitting on a $53 billion surplus in EI funds, Cullen believes that it is time for a change.

"This fund has been stolen on to pay for other things and it isn't insurance at all. So, it's unfortunate but one of the benefits that can come out of this economic meltdown is that we will finally reform the employment insurance program. Now do we trust the Harper government to do it is another question," said Cullen.