Thursday, July 1, 2010

Beware the Canadian Insurance Model

Jim Stanford, economist for the Canadian Auto Workers Union, recently gave an excellent talk in Auckland about the dangers of the insurance model of benefits, known in Canada as "Employment Insurance" (EI). This model is being considered by the NZ National Government and its welfare panel.
"The unions in Canada agreed to the introduction of this model some decades ago, as they believed it would remove the stigma of being on a benefit, and give unemployed workers a guaranteed entitlement to their insurance payouts, since they would have been paying regularly into the scheme from their wages. Instead, the majority found that they had no entitlement at all ,as they had not worked enough to qualify;and many of those who did qualify received very little; because they had not earned enough. The system produces inequality, and discriminates against the low paid ,casual or part time worker, who is often female. For some middle class professionals, it gave good support for a short time.

Not only this, scandalously billions of dollars paid into this scheme by workers disappeared.

Lastly, these payments are for very limited times, with an absolute maximum of 6 months and most being only for a matter of weeks.

Is this what we want for New Zealanders? A scam where we pay out of our weekly wages into an "insurance" scheme which gives us no guarantee of any payout if we become unemployed, nor to a liveable amount if we do get it; and which ends in a very short time leaving us with nothing? And if we have been unfortunate enough not to be able to get work in the first place-or not enough- then tough cookies for us?

Jim also gave some excellent talks about Capitalism recently and how it works-or doesn't work. Some of his resources can be found in the website

see also for several articles about EI in Candada, including:

Is EI Working for Canada's Unemployed?:

Women Shut out of Employment Insurance:

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