Parliamentary Budget Officer Yves Giroux waits to appear before the Commons Finance committee on Parliament Hill in Ottawa on March 10, 2020. Parliament’s spending watchdog will detail today possible costs associated with extending and changing the Canada Emergency Response Benefit. Budget officer Yves Giroux’s report scheduled to be released this morning comes on the same day that the House of Commons meets to discuss proposed changes to the COVID-19-related aid. Prime Minister Justin Trudeau said Tuesday that his government wanted to redo how the $2,000-a-month benefit is doled out and get more people back to work, while also cracking down on fraud. THE CANADIAN PRESS/Adrian Wyld

Extending CERB for months could double $60-billion budget, PBO report suggests

Recent figures show 8.41 million people have applied for the CERB, with $43.51 billion in payments made as of June 4

Parliament’s spending watchdog says extending the Canada Emergency Response Benefit to provide more weeks of payments, and letting people earn some extra income, would cost the federal treasury an additional $64 billion.

Under one scenario the parliamentary budget officer looked at, the government would claw back 50 cents of each dollar earned over $1,000 and allow recipients to receive an additional 12 weeks of benefits.

The first cohort of CERB recipients will hit the current 16-week limit early next month.

Budget officer Yves Giroux’s report says simply extending the maximum number of weeks to 28, and extending the program through to January 2021, would cost about $57.9 billion.

The costs in Giroux’s report don’t take into account what the government has already spent on the CERB, which now has a budget of $60 billion, up from $35 billion, because more people have claimed it for longer than expected.

The most recent federal figures show 8.41 million people have applied for the CERB, with $43.51 billion in payments made as of June 4.

READ MORE: Fines, punishment for CERB ‘fraudsters’, not people who made mistakes: Trudeau

Under either scenario, Giroux estimates that letting recipients receive payments for 28 weeks, rather than the current 16-week maximum, could be an incentive for some to not go back to work as restrictions ease and businesses reopen.

The cost for that could be over $3.2 billion, the report says, but with a caveat that calculations about how recipients respond to changes “are highly uncertain and rely on strong assumptions.”

Similarly, the overall cost estimates could change based on economic conditions and the course of the pandemic itself, and how many companies use a federal wage subsidy to rehire workers and pull them back from the CERB.

The report comes as the House of Commons is set to discuss proposed changes to the COVID-19 pandemic-related aid, with proposals mirroring some of what Giroux probed as part of a request from the Opposition Conservatives.

People would be cut off if they fail to return to work when “it is reasonable to do so” and their employer has asked them to come back, or if they are able to work but decline a reasonable job offer.

Claim periods would be reduced from four to two weeks for Canadians experiencing short-term job loss, or needing to quarantine.

Many small business owners support measures to cut off CERB payment to workers who are offered their jobs back, barring health-related issues, the Canadian Federation of Independent Business says.

The organization, which represents tens of thousands of small businesses across the country is also asking for changes to the wage subsidy program to ease revenue-loss requirements and create a sliding scale with smaller subsidies for firms with smaller revenue losses due to COVID-19.

COVID-19: A look at how layoffs turned permanent in past Canadian recessions

CFIB president Dan Kelly said that whatever the Trudeau Liberals decide and the wage subsidy and CERB, they need to do it soon to provide certainty for companies as they reopen.

“While it’s too early to do away with CERB, it’s time to shift gears on the federal support programs to encourage people to rejoin the labour force,” he said in a statement.

Almost three million people remained unemployed in May, according to the latest figures from Statistics Canada, as even more decided anew to look for work, pushing the unemployment rate to an all-time high of 13.7 per cent.

Men started gaining back jobs at a faster pace than women in May, widening a gender gap in employment losses.

Women with children six and up gained back jobs at a faster rate than those with younger children, showing what experts say is a need for child care to help workers go back to their jobs.

A survey of more than 8,000 regulated child-care centres and home daycares, released Wednesday by a group of child-care groups, suggested that over one-third were uncertain they would be able to reopen with restrictions easing. Some 70 per cent also said they had laid off staff, with almost 90 per cent of centre staff applying for the CERB.

“To get child care back up and running, governments must find ways to bring employees back to the sector,” Don Giesbrecht, chief executive of the Canadian Child Care Federation, said in a statement.

“This means addressing the problem of low wages and inadequate compensation, and putting in place special funding to make sure that child care facilities are safe for both children and staff.”

The federal government has offered $14 billion to provinces to help with reopening plans, with an unknown part of that targeted towards child care.

Jordan Press, The Canadian Press


Like us on Facebook and follow us on Twitter.

Want to support local journalism during the pandemic? Make a donation here.

CanadaCoronaviruseconomy

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

The corner of North Bluff Road and Stayte Road in White Rock was a hot-spot for signs promoting the five candidates vying for the MLA seat in the Surrey-White Rock riding. (Tracy Holmes photo)
South Surrey/White Rock voters have their say on issues that matter to them

Transportation, trains to COVID-19 are top of mind for Semiahmoo Peninsula residents

Upgrades underway at the Sunnyside Reservoir, adjacent to Sunnyside Acres Urban Forest, raised concerns among some residents Tuesday (Oct. 20), however, stewards of the park say everything went off without a hitch. (Tracy Holmes photo)
‘No issue’ with South Surrey reservoir drainage, despite trail user concerns: urban forest steward

Forest visitor taken aback by ‘unprecedented flooding’ of trails

Staff members at Surrey Pretrial test positive for COVID-19

Ministry of Public Safety says employees tested positive between Oct. 18 and 23

A new 23-storey condo development – which might also house a new White Rock city hall space – is proposed for the current site of 3 Dogs Brewing on Johnston Road, and will be discussed by the Land Use and Planning committee on Oct. 26. (File photo)
Civic centre could be part of new 23-storey White Rock condo tower

Development proposal to be discussed Oct. 26 by council’s land use committee

(Image: CDC)
Fraser Health orders Surrey food-processing facility to close amid COVID-19 outbreak

Staff member at Surrey long-term care facility also tests positive for the virus

B.C. provincial health officer Dr. Bonnie Henry gives a daily briefing on COVID-19 cases at an almost empty B.C. Legislature press theatre in Victoria, B.C., on March 25, 2020. (Don Craig/B.C. government)
B.C. sees 223 new COVID-19 cases, now 2,009 active

Two new care home outbreaks in Surrey, Burnaby

BC Hydro map showing where power has been knocked out is dotted with over a dozen outages. (BC Hydro map screenshot)
Thousands without power in Lower Mainland on election day

One outage in Langley and Surrey is affecting over 4,000 customers

file
One dead after fiery crash near Agassiz

Agassiz RCMP report a 56-year-old man died Friday night

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

BC Liberals Leader Andrew Wilkinson, BC Greens Sonia Furstenau, BC NDP John Horgan (The Canadian Press photos)
British Columbians vote in snap election called during COVID-19 pandemic

At dissolution, the NDP and Liberals were tied with 41 seats in the legislature, while the Greens held two seats

The possibility of the Canadian Premier League expanding to the Fraser Valley has been floated online. (Facebook photo)
Canadian Premier League possibly eyeing Fraser Valley expansion

Soccer league looking to add ninth team to the mix, B.C. markets potentially rumoured

Most Read