Hundreds of Millions Being Spent to Recover Billions in Pandemic Subsidies Given in Error

Employment, Workforce Development and Disability Inclusion Minister Carla Qualtrough rises during Question Period in Ottawa on Sept. 29, 2022. (Adrian Wyld/The Canadian Press)

The federal government has spent hundreds of millions of dollars in an attempt to recover the billions of dollars it gave to ineligible recipients of pandemic subsidies, documents show.

An Inquiry of Ministry filed by Conservative MP Corey Tochor returned specific figures from the Canada Revenue Agency (CRA), according to Blacklock’s Reporter.

As of March 31, over $320 million had been spent on audits, investigations, and debt collections.

The inquiry indicates that the CRA assigned 2,601 full-time employees to the case.

The millions spent to date are expected to reach close to a billion in costs for recovery activities.

“Total costs associated with the integrity activities for relief programs for future years (2023–2026) is estimated to be $556,487,045,” says the inquiry, hence bringing the total cost to over $876 million.

The inquiry says the forecasts were based on information available at the time and could change, with costs beyond March 31, 2026, to be re-evaluated at a later date.

“With regard to recovery of overpayments and fraudulently obtained payments to the various COVID-19 related financial relief programs put in place by the government, how much did the Canada Revenue Agency spend to date and expect to spend in the future on recovering the payments?” Tochor wrote in his inquiry.

Recovery costs of payments given in error for the different COVID-19-related federal subsidies include $234 million for the Canada Response Benefit, $229 million for the Emergency Response Benefit, and $184 million for the Emergency Wage Subsidy.

Auditor General Karen Hogan released two reports earlier this week on the Trudeau government’s management of COVID-19 subsidies and vaccine procurement.

She said $4.6 billion in pandemic subsidies were provided to ineligible recipients, and that an additional $27.4 billion in payments needs to be investigated.

Hogan’s report indicates that $6.1 million was paid out to individuals who were incarcerated for the entire benefit period, and $1.2 million was given to deceased recipients. Another $3.3 million was sent to recipients who did not reside in Canada.

Hogan said the government had accomplished the objective of providing relief payments rapidly and helped the economy recover, but the lack of pre-payment verification led to the misallocation of funds.

Federal ministers responsible for the programs have defended their track record, saying supporting Canadians in a time of need was key.

“I remain incredibly proud of the way our government responded to the economic and public health challenges of the pandemic,” said Minister of Employment Carla Qualtrough on Dec. 6, reacting to the auditor general’s reports.

National Revenue Minister Diane Lebouthillier said CRA has been working with “rigour” and that there is a “good plan” to recover the misspent funds.

“During COVID we were there to help people and we really saved lives,” she said.

Qualtrough said $1.3 billion has been recovered to date.