Unemployed Hoosiers could see less state aid

November 4, 2010

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Indiana Gov. Mitch Daniels says it's the only way to fix the state program. (file photo)

Indiana Gov. Mitch Daniels said there’s only one way to fix Indiana’s troubled unemployment insurance program: reduce benefits and raise premiums for businesses paying into it.

“There’ll have to be change,” Daniels said from his office at the Indiana State House in Indianapolis Thursday.

Daniels provided a preview of what will be on his legislative agenda when legislators return to work in January. High on the list is fixing problems with the Indiana Unemployment Insurance Trust Fund.

Over last decade the fund has lost millions of dollars as benefits increased and premiums for employers dropped. The fund finally hit rock bottom last year when the state was forced to borrow more than $700 million from the federal government to keep benefits going.

Daniels says something’s got to give.

“We can’t continue with some of the lowest premiums and the highest benefits in America. That’s why the system was leaking money when we were at full employment. It’s leaked a lot of money since we have high unemployment,” Daniels said. “It’s going to have to change from both ends.”

But Daniels said determining how much of the $390-per-week maximum benefit will be reduced for recipients, as well as how much more businesses will have to pay, should be left up to legislators.

Daniel’s proposal comes just as the state GOP take the reins of both the Indiana Statehouse and Indiana Senate. The Republicans retook control in the Statehouse following Tuesday’s election. It already had control of the state Senate.