OTTAWA – Finance Minister Jim Flaherty says employment insurance premiums will be frozen for the next three years.
Previously planned rate hikes are no longer necessary and the freeze will save businesses and workers hundreds of millions, Flaherty says.
“That will result in savings in 2014 of $660 million,” he said.
The premium rate will remain at the 2013 level of $1.88 per $100 of insurance earnings.
Flaherty says the unemployment rate has been falling and EI account is on track to return to balance sooner than expected.
He notes that 60 per cent of the cost of EI premiums is borne by employers, and the freeze will promote hiring.
The Canadian Federation of Independent Business says it is happy with the announcement.
“With the EI premium increase, take-home incomes have been coming down over the last couple of years,” said Dan Kelly, president of CFIB.
But the savings will be modest, Kelly says.
He says on average it will mean $25 annually per worker but he says the money saved by businesses will likely go to creating new jobs.