Over 600,000 Canadians Ineligible for CERB Have Yet to Repay Benefit: Gov’t Document

The landing page for the Canada Emergency Response Benefit is seen in Toronto on Aug. 10, 2020. (The Canadian Press/Giordano Ciampini)

A total of 620,310 Canadians who received the Canada Emergency Response Benefit (CERB) but were deemed ineligible for it have not repaid any of their CERB debt, according to a response from the Canada Revenue Agency (CRA) to an MP’s recent Inquiry of Ministry.

The CRA further states that 264,546 Canadians deemed ineligible for the benefit have fully repaid their CERB debt, and 62,982 have partially repaid it. The figures, released March 29, were requested by New Democrat MP Daniel Blaikie and represent data as of Feb. 16.

The CRA said 23,494 individuals have had their CERB debt recovered through the withholding of T1 tax refunds as of Feb. 16. However, the agency said it has not taken any legal action to date to recover CERB money through the garnishing of wages or other income, seizures or holds on bank accounts, or liens on homes or other properties.

The CERB was a temporary income support program created by the federal government in the early days of the COVID-19 pandemic to help employed and self-employed Canadians who were directly affected by COVID-19. Eligible applicants received $2,000 for a 4-week period between March 15 and Sept. 26, 2020.

Blaikie also asked for the total number of Canadians with outstanding CERB debt who fall below the three poverty thresholds of low-income cut-off, market basket measure, and low-income measure. CRA responded that it “does not have the tools or relevant information to provide the statistical information in the manner requested.”

High Percentage Ineligible

A separate Inquiry of Ministry that Blaikie sent to Employment and Social Development Canada (ESDC) stated that as of Feb. 17, 620,784 Canadians who were deemed ineligible for CERB but received payments have not repaid their debt. This is close to the 620,310 figure provided by CRA.

An internal CRA audit of over $5 billion in CERB and other emergency payments to individuals during the pandemic found that about 65 percent, or over $3.4 billion, went to ineligible recipients who need to pay back the money, reported The Globe and Mail in early March. The CRA said it targeted its audits to focus on high-risk cases, having “fully expected” that a high percentage of the payments would be ruled ineligible.

ESDC, in its response to the Inquiry of Ministry, added that 330,224 Canadians ineligible for CERB have partially repaid their debt, while 931,736 have repaid their debt in full. Further, 195,040 ineligible Canadians have had their CERB debt collected through tax refunds and GST, while 170,166 have had that debt collected from a reduction of EI benefits.

The department, which is responsible for social programs and the labour market at the federal level, said it does not track information related to outstanding CERB debt broken down by low-income cut-off, market basket measure, or low-income measure.

‘CERB Debt Amnesty’

In the House of Commons on March 27, Blaikie said it has been “known for a long time now that CERB debt incurred by desperate people at the height of the pandemic would disrupt Canada child benefit payments.”

“How is it compassionate for families to be surprised by an $800 shortfall in their monthly revenue? How is it compassionate for parents, now worried about their rent cheques bouncing, to have to sit on the phone for days just for a chance to beg CRA for relief?” he said.

“Real compassion requires a policy of CERB debt amnesty for low-income Canadians.”