The financial assistance was available to eligible Canadians who were employed or self-employed and directly affected by COVID-19. A few examples of those affected would be individuals who had their hours cut, lost their job due to closures, or those who had to stay home due to no longer having childcare. For those eligible, the government issued $2,000 for four weeks and the ability to re-apply for a total of 28 weeks. The government made it extremely easy for Canadians to apply and receive benefits without providing the appropriate documentation. In several announcements, Premier Justin Trudeau indicated the benefits were to be released as quickly as possible to Canadians, and those who mistakenly received benefits would have it sorted out afterwards.
As of September 8,864,180 Canadians, received CERB benefits. Out of that number, 1,067,470 people were Albertans. Now that the dust has settled, Stats Canada was able to conduct an initial study on the labour market downturn due to the pandemic. The research up to and including April shows an average monthly lay-off rate of 12.4 percent. As more studies are being done, the numbers do not match the number of applicants who received the benefits. The Federal Government soon realized they were too quick to hand out money and later announced that anyone abusing the program would face the consequences.
Government officials drafted a bill as a deterrent stating that Canadians who make fraudulent claims for CERB could face a fine of up to $5,000, and jail time. However, the proposed bill did not pass through the House of Commons. The current penalty will be to pay it back; and false claims will be considered fraud, a chargeable offence through the criminal code. Canada Revenue also indicated that those who falsely filed for CERB would be discovered when they file taxes next year. To assist in weeding out false claims, the CRA developed an anonymous “snitch line” on their website in early May for those who wanted to report someone who received benefits fraudulently. It only took two weeks, and the CRA had over 200,000 files flagged for investigation from the snitch line. No further information has been released for the current numbers of potential fraud cases, as it could take quite some time while they sift through each of the CERB applicants.
The CERB payments have also created issues for employers as they have had difficulty finding people willing to work. It is a common statement that rings out, that individuals are unwilling to work because they received more on CERB. The same is being said for those unemployed who have openly posted on social media, “why go to work when I get paid more to sit at home.” The CERB payments have created a double-edged sword that is keeping the employment rate down. On that note, the CRA mentions on their website, “CERB is available to provide support to those who are unable to work due to COVID-19. Workers should be seeking work opportunities or return to work when their employer requests. Individuals are also encouraged to consult job banks and actively search for employment.” Legislation says individuals who fail to return to work or decline a reasonable job offer when they can work fall into the category of falsely collecting CERB and will face financial penalties.
Due to the pandemic, it could take several years to know the full economic impact it is caused for Albertans and Canadians and whether businesses will survive on their own once financial aid is no longer available.
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