Maternity benefits and unemployment insurance: A question of policy design

Maternity benefits in Canada are delivered through the unemployment insurance program (Ul), and have been controversial since their inclusion as special Ul benefits in 1971. Some of this controversy is due to the self-interest of stake-holders, but this article argues that much of it is due to faulty policy design. Maternity benefits are fundamentally incompatible with UI, in terms of the logic of that program. UI is governed by considerations of labour force attachment, contributions, and capability and availability for work. These are alien to the purpose of maternity benefits, which is to aid families around the time of the birth of a child. An historical and analytical review of the consequences of placing maternity benefits in Ul suggests that the two should be divorced. Further attempts to improve maternity benefits within the context of Ul will only hurt both programs.