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

Single-engine aircraft crashes near Telkwa

Two occupants of the plane sustained minor injuries and were transported to hospital

Cullen announces bid for provincial NDP nomination for Stikine riding

Current MLA Donaldson not seeking re-election

Anne Marie Sam seeks NDP nomination for Nechako Lakes riding

She also ran in 2017 but was defeated by BC Liberal John Rustad

Reserve a gym spot online with the Houston Leisure Facility

The online system is another step to make things easy during the pandemic

Bulk water, sewage project gets council’s approval

Facility to service large-scale users

3 new deaths due to COVID-19 in B.C., 139 new cases

B.C. confirms 40 ‘historic cases,’ as well

Supreme Court Justice Ruth Bader Ginsburg dies at 87

The court’s second female justice, died Friday at her home in Washington

Emaciated grizzly found dead on central B.C. coast as low salmon count sparks concern

Grizzly was found on Gwa’sala-‘Nakwaxda’xw territory in Smith Inlet, 60K north of Port Hardy

VIDEO: B.C. to launch mouth-rinse COVID-19 test for kids

Test involves swishing and gargling saline in mouth and no deep-nasal swab

Young Canadians have curtailed vaping during pandemic, survey finds

The survey funded by Heart & Stroke also found the decrease in vaping frequency is most notable in British Columbia and Ontario

B.C. teachers file Labour Relations Board application over COVID-19 classroom concerns

The application comes as B.C.’s second week of the new school year comes to a close

CHARTS: Beyond Metro Vancouver, COVID-19 cases in B.C. haven’t increased much recently

COVID-19 case counts outside of Metro Vancouver have been level since July

70-year-old punched in the head in dispute over disability parking space in Nanaimo

Senior’s turban knocked off in incident at mall parking lot

Thousands of child care spaces coming to 35 B.C. communities

Province announces milestone in Childcare BC plan

Most Read