Federal aid during the COVID-19 pandemic in Canada

Existing federal social security programs were modified to provide additional financial support to their recipients. Canada Child Benefit payments were given a one-time increase of $300 per child, the Goods and Services Tax (GST) credit for the 2019 tax year was doubled, and personal income tax deadlines for 2019 were extended. == Income support programs ==

CERB (March – September 2020) The Canada Emergency Response Benefit (CERB; ) was a program that provided a taxable benefit of per month for Canadian residents facing unemployment due to the COVID-19 pandemic. Initially announced as providing a maximum of four months' financial support, the federal government announced a further two months of support in June 2020 and another month in August 2020. The benefit is jointly administered by Employment and Social Development Canada (ESDC) and the Canada Revenue Agency (CRA), with eligible persons either applying through ESDC's Service Canada online portal or through the CRA online portal. To be eligible, applicants must attest they: did not quit their job voluntarily, earned at least in the 2019 tax year or the preceding 12 months, have stopped working or are working reduced hours due to COVID-19, and are earning less than in employment or self-employment income. Within one week of the CERB program's launch in April 2020, nearly 3.5 million Canadians applied for this benefit; this grew to 7.12 million by April 24. On April 15, eligibility for CERB was expanded to include seasonal workers, persons who had exhausted their Employment Insurance (EI) regular or sickness benefits, and those who have returned to work but still earn less than per month due to reduced hours or lower demand. Employment minister Carla Qualtrough announced on July 31, 2020 that the CERB would be wound down following a final extension of one month. CERB was ended on September 26, 2020, and a revamped EI program was implemented. Approximately 8.9 million Canadians applied for CERB by its end date. In 2022 the Auditor General of Canada, Karen Hogan, conducted a review into the CERB fund and concluded that "the federal government effectively delivered emergency COVID-19 benefits during the pandemic" but that "deciding to not front-end verification resulted in $4.6 billion in overpayments to ineligible individuals." There are reports of mismanagement, fraud and a number of scams related to CERB. CERB repayment In late 2020, the CRA sent out 441,000 letters asking for full or partial repayment of the CERB to Canadians, due to ineligibility. These individuals were urged to repay the benefit by December 31, 2020, to avoid tax issues. Confusion on eligibility arose from language used to describe who could receive the CERB with the requirement being $5,000 in net income vs. $5,000 gross income. Students who cannot find employment or are unable to work due to the COVID-19 pandemic are eligible for CA$1,250 per month from May through August 2020. CESB applicants with a disability or caring for dependents receive an additional $750, increasing their monthly amount to the equivalent of a CERB payment. The benefit paid a pre-taxed (at 10%) $500 per week for up to 38 weeks; over 240,000 Canadians applied to the program on its first day of launching. To be eligible Canadians must have been unemployed or have had a 50% reduction in average weekly income compared to the previous year due to COVID-19. If a participant made more than $38,000 annual salary, $0.50 of every dollar earned on the CRB would have to be paid back if the participant was still taking it. The CRB was available for eligible individuals for an allocated amount of time between September 27, 2020 and September 25, 2021. Individuals who have travelled internationally were not eligible to receive the benefit for any period where they were not working due to mandatory quarantine requirements. The first 42 weeks (21 periods) provided $1000 ($900 pre-taxed) every two-week period, and the final eight weeks (four periods) provided $600 ($540 pre-taxed). In August 2021, the government extended the program again to 54 weeks (27 periods) in October 2021. CRSB The Canada Recovery Sickness Benefit (CRSB) provides $500 per week (2 weeks maximum) for workers who: (a) "are unable to work for at least 50% of the week because they contracted COVID-19;" (b) "are self-isolated for reasons related to COVID-19;" or (c) "have underlying conditions, are undergoing treatments or have contracted other sicknesses that, in the opinion of a medical practitioner, nurse practitioner, person in authority, government or public health authority, would make them more susceptible to COVID-19." Individuals who have travelled internationally are not eligible to receive the benefit for any period where they are not working due to mandatory quarantine requirements. CRCB Another program, the Canada Recovery Caregiving Benefit (CRCB) supports Canadians that have been working but have to take a break to care for dependents (a child below 12 years of age or a disabled family member). The benefit only applies if schools and care centres are closed, or the dependent fell sick, or contracted COVID-19. Individuals who have travelled internationally are not eligible to receive the benefit for any period where they are not working due to mandatory quarantine requirements. Worker lockdown benefits (October 2021 – May 2022) In October 2021, the federal government created the Canada Worker Lockdown Benefit (CWLB). The programs planned to provide 300 dollars per month for workers who cannot work because their workplace faced a local lockdown. The program is set to run from 24 October 2021 to 7 May 2022. The program was expanded on 22 December to also cover workplaces whose capacity was reduced by 50% due to provincial restrictions. However, these workers were required to prove that they also lost at least 50% of their revenue because of these measures. The program closed for applications on 18 May 2022. ==Employer/business support==

Canada Emergency Business Account The Canada Emergency Business Account (CEBA; ) provides emergency interest-free loans to small businesses and nonprofit organizations during the COVID-19 pandemic. The aim of this program is to ensure that these businesses have access to sufficient capital to remain solvent during the pandemic. CEBA was implemented in the COVID-19 Emergency Response Act, No. 2 which was introduced by Finance Minister Bill Morneau and passed in Parliament on April 11, 2020. The budget for the program was set for , offering loans of financed by Export Development Canada. Businesses that repay at least 75% of the loan balance () by December 31, 2022 will have any remaining balance forgiven. The move underscored the widespread difficulty in repaying the $49 billion distributed, as many businesses continued grappling with post-pandemic economic challenges. The CEWS is targeted "at businesses with revenue declines of at least 15 per cent in March, and 30 per cent in May and June." Administered by Export Development Canada and Business Development Canada, the program is the responsibility of the Minister of Small Business, Export Promotion and International Trade, Mary Ng. Available from September 27, 2020 until June 2021, the subsidy helps qualifying organizations who have experienced a drop in revenue due to the pandemic, paying for part of their commercial rent or property expenses. CERS provides payments directly to renters and property owners, without requiring the participation of a landlord. On 11 May 2020, Trudeau, Morneau and Bains in a press conference said that "a bridge financing facility for large employers that need help to get through the economic downturn caused by the coronavirus." One stated goal was "to avoid bankruptcies of otherwise viable firms wherever possible... Companies that use the lending facility will have to commit to respect collective bargaining agreements, protecting workers’ pensions, and support national climate goals. Rules on access to the money will place limits on dividends, share buy-backs and executive pay." Under the LEEFF companies must also: limit executive salaries to $1 million per annum; provide a share in their business to CDEV through stock warrants; and prohibit dividends and share buybacks until they pay back their LEEFF. Other support for businesses • Black Entrepreneurship Loan Fund: This fund supports Black business owners/entrepreneurs with loans of between CA$25,000 and $250,000. • Tariff relief: On 6 May 2020, the federal government waived tariffs on particular medical goods, including personal protective equipment (e.g., masks and gloves), in order to reduce the cost of imported PPE and maintain efficient supply-chain operations. • Canada Research Continuity Emergency Fund (CRCEF): The program, announced on 15 May 2020, provides wage support for up to 75% of wages for individuals working in universities and health institutes, for a maximum of $847 per week per employee. The program is administered by the Social Sciences and Humanities Research Council (SSHRC) on behalf of itself, the Canadian Institutes of Health Research (CIHR), and the Natural Sciences and Engineering Research Council (NSERC). • Short-Term Compensation Fund (STCF): The initiative was launched by Telefilm Canada on 28 October 2020 as a temporary measure to compensate independent production companies for interruptions in filming and the abandonment of productions caused by the pandemic, along with the lack of insurance coverage for such. == Other aid ==

Proposed Canada Student Service Grant The Canada Student Service Grant (CSSG; ) was a proposed program to provide paid service opportunities for young adults (ages 30 and under) to assist with charities and non-profit organizations. Participation would be limited to recent post-secondary graduates (December 2019 or later) or students enrolled in spring, summer or fall 2020 semesters. Participants would receive $1000 per 100 hours of volunteer work, up to a maximum of $5000. The decision to contract administration of the program to WE Charity was controversial, leading to a political scandal and ultimately the cancellation of the program. 35,000 students and recent graduates had applied for the program. One-time payment for people with disabilities The Government of Canada gave a special one-time, tax-free non-reportable payment of $600 for people with disabilities on October 30. The money would be available for those who already possessed a valid Disability Tax Credit certificate, those receiving Canada Pension Disability or Quebec Disability Pension benefits, or those receiving disability support from Veterans Affairs Canada. ==Enforcement==

On June 2, 2020, the Canada Revenue Agency announced a tip line for reporting suspected fraudulent CERB recipients. As of June 3, the CRA announced it had received 600 tips and had received 190,000 voluntary repayments of CERB from Canadians who were not entitled to receive them. On June 8, legislation was proposed by the Liberal government that would allow persons found to have received CERB payments fraudulently be subject to fines or imprisonment. The proposed legislation was not supported by any of the opposition parties in the minority Parliament and did not move ahead to second reading. ==Clawback and Repayment Controversy==

In 2022, the CRA began a massive clawback of individual COVID-19 benefits, issuing hundreds of thousands of demand for repayment letters to Canadians. According to the CRA, "This ongoing process started by issuing initial contact letters to some benefits recipients to request documents to support their claims. The second step was to issue Notices of Redetermination to individuals who were deemed to be ineligible for a portion or all of their claim, or who did not respond to the initial contact letters. In May 2022, the CRA began its collection approach by sending letters favouring voluntary payment. Then in February 2023, the CRA started issuing collection letters to individuals who had not made an effort to resolve their overpayment. The CRA also made several attempts to reach individuals by phone." Anecdotal evidence suggested that the program was unpopular, with media reporting the clawback was "punishing" and "hurting" the poorest recipients, and that "repayments are hurting small businesses and many are going under." ==Financial impacts of aid programs==

Parliamentary Budget Officer Yves Giroux issued a report on April 30, 2020 projecting the federal deficit for fiscal year 2020 could be in excess of $252 billion, based on nearly $146 billion in spending on federal aid measures. In a fiscal update tabled on July 8, Minister of Finance Bill Morneau projected that the deficit for the 2020 fiscal year will reach $343.2 billion. Most federal aid during the COVID-19 pandemic came in the form of taxable benefits. As a consequence, some provincial governments (including Ontario and British Columbia) experienced a dramatic surge in revenue. This windfall has been referred to as a "secret provincial bailout" by some commentators. == References ==