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(November 2, 2006) The Canadian Federation of Independent Business says Ottawa should reduce employment insurance premiums, calling the massive surplus in the EI account “unconscionable.”

In a letter to the federal government, CFIB president Catherine Swift observes that the government’s EI account surplus is $48 billion and rising. She adds that the new EI rate-setting mechanism introduced in the 2005 budget was supposed to halt any further surplus build up in the EI account.

Swift thinks, based on CFIB research, that the surplus could reach $53 billion by the end of the fiscal year. To curtail this climb, she argues that EI premiums should be reduced by the maximum legislated amount of 15 cents and the rate-setting mechanism should be reviewed so no further surpluses accumulate.

“The EI system was introduced as an insurance mechanism, which provides short-term financial relief to individuals temporarily out of work,” the letter states. “Currently, only 58% of EI premiums are being allocated to regular EI benefits. The remaining funds are allocated to special benefits and support measures, such as skills development, parental leave, and pilot projects. Although some of these measures may be supported by CFIB members, it is not fair to keep the rates artificially high to pay for them.”

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Canadians unfamiliar with role of estate executor, poll suggests

(November 2, 2006) Less than half of Canadians surveyed by RBC Financial Group are familiar with the responsibilities involved with being the executor of an estate. And two-thirds say they would have concerns about the role.

Specifically, 39% said they wouldn’t really know what they’d have to do, 38% expressed concerns about family disagreements, and 32% worried about legal and liability issues.

“Depending on the size and the complexity of the estate, the time it can take to settle an estate is a minimum of 18 months. It can take as long as four years, if a family member is acting as the executor,” said John Hamilton, president of RBC Estate and Trust Services. “Our survey also revealed that few Canadians are aware of the large number of tasks involved. There are as many as 70 different duties which an executor may be expected to carry out.”

Nearly 40% of survey respondents said they would choose a spouse or partner as their executor, identifying the trust relationship as key. “While [choosing an executor based on such a relationship] is important for peace of mind, it’s also worth having some open conversations with the person that you would like to appoint as your executor, so there can be a good understanding of the role and all the responsibilities involved,” Hamilton added.

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Manulife reports record quarterly earnings

(November 2, 2006) Manulife Financial earned $975 million in net income in Q3 of 2006, a 31% increase from the same period last year.

The insurance giant notes that Q3 of 2005 included $198 million of property and casualty reinsurance losses related to Hurricane Katrina, but a $65 million gain on the recognition of future tax assets in Japan.

In Q3 of 2006, the $60 million negative impact of the strengthened Canadian dollar and the unfavourable resolution of a John Hancock pre-merger tax assessment ($36 million) reduced earnings. But those losses were offset by investment-related gains, higher fee income related to the growth in funds under management in the wealth management businesses, and favourable claims in the life insurance businesses.

“I am very pleased with our third quarter financial results, and in particular with the strong earnings and growth in assets across all of our operating divisions this quarter,” said Manulife president Dominic D’Alessandro.

Total funds under management were $381 billion as of September 30, an increase of 6% from last year.

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