Response Benefit to run until mid-September, other options to follow

Shutterstock

OTTAWA – On Thursday, August 20, newly minted federal Finance Minister (and deputy prime minister) Chrystia Freeland joined Minister of Employment, Workforce Development and Disability Inclusion Carla Qualtrough in announcing the government’s plans for a new $37 billion COVID-19 aid package that extends the Canada Emergency Response Benefit (CERB) by four weeks, expands employment insurance provisions and mixes in some new recovery benefits for good measure.

The new benefits are aimed at helping Canadians through the transition period as the economy reopens and includes provisions for greater flexibility in EI work hours, making it easier for people who may have been laid off due to the pandemic to qualify for benefits.

“We’re doing our very best to support all Canadian workers and leave no one behind,” said Minister Qualtrough in announcing the measures. The CERB will continue to September 27, extending the program from six months to 28 weeks. The CERB pays $2,000 a month and the extension comes with an additional $8 billion price tag. 

Those Canadians who qualified for EI when the pandemic hit will now transition to that program, while those who don’t will be able to apply for a set of new recovery benefits.

The added EI cost is slated to be $7 billion, while the new benefits are tagged at a cost of $22 billion. Total cost of the recovery programs comes to $37 billion.

The expansion of the programs to gig economy workers or the self-employed is one major change in the system. Those workers will now be eligible for a benefit of up to $400 a week for up to 26 weeks (provided they stopped working or had reduced hours due to COVID-19). Under this program, those workers can continue to earn income, but they will be required to pay back 50 cents on the dollar for every dollar owned above $38,000.

Another new benefit, negotiated with the provinces as part of safe restart plans, will pony up 10 days of paid sick leave for any Canadian worker who falls ill or has to self-isolate due to COVID-19. That benefit will provide a recipient with $500 a week, but they cannot claim another sick leave benefit at the same time.

Those who must stay home to care for a child under 12, or other dependant because their school/daycare/other program is shut down due to the pandemic, will qualify for a third benefit—but those who choose to keep their children home will not unless they can provide proof there is a medical reason to do so. 

Application for the new benefits are scheduled to open in October, with payments to start coming in three to five days. The fly in this particular ointment is that the government may well fall before some of these measures can be brought into effect.