Austerity, Social Program Restructuring, and the Erosion of Democracy: Examining the 2012 Employment Insurance Reforms

By Porter, Ann | Canadian Review of Social Policy, January 1, 2015 | Go to article overview

Austerity, Social Program Restructuring, and the Erosion of Democracy: Examining the 2012 Employment Insurance Reforms


Porter, Ann, Canadian Review of Social Policy


The austerity period in Canada, unfolding under Prime Minister Stephen Harper's government since 2011, has involved both the cutting back of social programs and a complex process of state reregulation and restructuring in the social policy area. In announcing the turn to austerity the government stated that the post-2008 recession deficit was to be eliminated "without raising taxes, cutting transfers to persons, including those for seniors, children and the unemployed, or cutting transfers to other levels of government that support health care and social services, Equalization, and the gas tax transfer to municipalities" (Canada, Department of Finance, 2011, p. 17). Despite this assertion a significant re-orientation of social policy and social programs is occurring; one which has involved cuts, which is likely to have a significant impact on the level and quality of support and services available, to further increase inequalities and which charts new roles for the federal government in these areas.

Employment Insurance (EI) has been central to this austerity-related social policy change. While the Conservative government's spring 2011 budget marked the turn from a stimulus response to an austerity program, the most significant austerity measures were introduced in the spring 2012 budget. Bill C-38, the 2012 budget implementation bill, was 450 pages long and amended some 70 pieces of legislation. Among these amendments were significant changes to the EI program. On the one hand, the EI amendments continued the erosion of benefits and of state responsibility for the unemployed that had been on-going for some time. On the other hand, the 2012 EI reforms also indicated changes at a deeper level and new directions for the program. Particularly striking was the increased state control in certain labour market areas, seen, for example, in the centralization within Cabinet of decision-making with regard to key aspects of the program and in subsequent, more coercive, regulations requiring certain categories of EI recipients, particularly "frequent users", to accept a wider variety of work at considerably lower rates of pay. In addition, links were made between the EI program and the low-wage Temporary Foreign Worker Program. The appeals procedures were completely reorganized with the tripartite boards of referees (previously in place to hear a first level of appeal) eliminated and replaced by a centralized Social Security Tribunal, located in Ottawa. In the months following the implementation of these changes EI monitoring, fraud investigation and house calls were stepped up. These are changes that go far beyond the cost- cutting implied by the austerity discourse, entailing not only centralization of state control, but alterations to democratic decision-making structures and to administrative processes and procedures, as well as a more aggressive role for the state vis à vis the unemployed.

This paper is concerned both to identify the changes in the EI program introduced by Prime Minister Stephen Harper's government, and to reflect on how these changes connect to, and form, part of the shifting role of the state and of social policy goals in the current austerity context. A central argument of the paper is that there has been a linking in important ways of austerity, social program restructuring, and the establishment of a new, more anti-democratic phase of neoliberalism. Numerous authors have raised concerns about how the current austerity period has amplified the anti-democratic tendencies inherent in the neo-liberal project (see, for example, Streeck, 2013; Crouch, 2013; Ayers & Saad-Filho, 2014). Particularly striking, for example, has been the replacement of elected governments by technocratic "experts" in countries such as Greece and Italy, but elsewhere and in other respects also, attention has been drawn to the erosion of democratic processes and procedures, the continued strength and power of finance capital, the increasing influence of corporations as "insiders" to the policy process (Crouch, 2013), declining voter turnout (Offe, 2013) and other measures that have eroded democratic accountability, in Canada and elsewhere. …

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