Ottawa should stop clawbacks of pandemic benefits
Posted on June 26, 2022 in Social Security Policy Context
Source: TheStar.com — Authors: Star Editorial Board
TheStar.com – Opinion/Editorials
June 22, 2022. By Star Editorial Board
Groups such as Campaign 2000 are urging Ottawa to give an amnesty to low-income individuals on the repayment of pandemic benefits.
The emergency financial assistance rushed out by the federal government in the early days of the pandemic provided urgent financial relief for Canadian hit by the economic upheaval.
But for thousands of low-income Canadians, getting benefits like the Canada Emergency Response Benefit has brought unexpected and unfortunate consequences. It has meant other essential benefits have been clawed back. And the Canada Revenue Agency continues to pursue repayment from those individuals it believes were not entitled to get them.
The federal government needs to address the ongoing fallout of this pandemic benefit.
Let’s look at who got the CERB – and who are likely now in the cross hairs of the tax collectors. A 2021 report by Statistics Canada says CERB recipients were often women and employed in businesses hardest hit by the lockdowns such as food services, arts and entertainment. They were low-income, young, racialized and Indigenous.
We’ve known for a year that for many low-income individuals, the short-term financial help provided by the CERB came at a price. The benefit bumped up their income, causing a knock-on effect that meant other social assistance benefits such as rent supplements, seniors’ benefits and refundable tax credits were reduced.
Groups such as Campaign 2000, which advocates to eliminate child and family poverty, have repeatedly called on Ottawa to give an amnesty on repayments for low-income individuals.
They have also pressed the federal government to ensure that benefits and refundable tax credits such as the Canada Child Benefit are not clawed back and that any lost benefits are restored. (Ottawa did act to restore Guaranteed Income Supplement payments that had been reduced or eliminated because of pandemic benefits.)
The call for an amnesty is not new. But the Liberal government has not yet acted. Leila Sarangi, the national director of Campaign 2000, made a fresh appeal last month to the House of Commons’ finance committee, calling the clawbacks “detrimental and punitive.
“These families do not have the financial resiliency to deal with unforeseen reductions, or even foreseen reductions, to their monthly budgets — budgets that have to account for every nickel and dime, because there is so little money, especially right now with rising inflation and the rising cost of living,” said Sarangi, who is also director of social action for Family Service Toronto.
The Canada Revenue Agency won’t say how much it expects to collect or how many individuals could be affected. In May, the agency informed Canadians considered ineligible for benefits that debts have been established on their CRA accounts. “While there will not be any penalties for those who applied for these benefits in good faith, individuals will have to repay the emergency benefits for which they were not entitled,” it stated.
If you think you were eligible, the CRA says you can provide information to validate your claim. The agency says it is committed to “being compassionate” and offers flexible payment plans for those who owe money. Repayment, however flexible, means financial hardship for low-income individuals and families now struggling with a sharp rise in living expenses.
Ottawa should act on calls for an amnesty for Canadians who need help the most.
https://www.thestar.com/opinion/editorials/2022/06/22/ottawa-should-stop-clawbacks-of-pandemic-benefits.html
Tags: budget, child care, economy, featured, poverty, tax
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