Before the transition of millions of people who are still claiming CERB onto a revamped Employment Insurance program
beginning on September 27, the federal government is extending the Canada Emergency Response Benefit (CERB) into September.
Although three new temporary benefits are also being established, the new plan released on Thursday details how most people will be transitioned onto EI. The new financial assistance plans are expected to cost at least $37 billion in total over the next year.
Chrystia Freeland, the new Canada’s finance minister together with Carla Qualtrough, the Minister of Employment, Workforce Development, and Disability Inclusion, stated that they are making it possible for the country to continue to practice social distancing and to do the right things in the fight against the coronavirus by supporting Canadians out of work because of the pandemic. They added that their approach also needs to evolve as they shift from their initial emergency response to a safe and prudent restart. Though there are millions of unemployed Canadians, the economic reopening has seen millions back on the job.
Qualtrough indicated that they recognize that there continues to be an ongoing public health crisis in the country, and they will be preparing for other possible economic shutdowns due to outbreaks or future COVID-19 waves. Carla confirmed that not every region across the country or sectors is reopening at the same time. The government is prolonging the program by more than four weeks to a maximum of 28 weeks, as CERB was set to run out at the start of the month for those who have been on the program from the outset. Like every CERB claimant who qualifies for Employment Insurance will be transitioned onto that program as their avenue for support once their 28 weeks of CERB run out as of September 27.
One senior official announced that an overall objective is to support economic recovery. His announcement comes after an approach that provides support to workers at the same time, strengthening work incentives, facilitates access to the EI program, and enhances equity. For most people, this transition will be automatic, but the government says there will be “a few instances” where applications will need to be filed. The EI system is getting a facelift. It is opening up the criteria for the next year to make it so that Canadians with 120 insurable hours can apply and, depending on past earnings, receive a minimum payment of $400 per week and a maximum of $573 per week.
The adjustment is employed to show the effect on weekly earnings the pandemic caused for many workers and other flexibilities being offered for new parents. Qualtrough stated that this means that they’ll be supported as they figure out what’s happening to school and daycare for their kids in the fall, for Canadian families who rely on the CERB. Though EI claimants will have their benefits adjusted, they can earn income. The government will freeze the EI premium rate for two years at $2.21 per $100 for businesses and $1.58 per $100 for employees. Even as the three new benefits are going to be delivered through legislation, the changes can be implemented through regulation through interim ministerial orders.
Freeland defended the idea of putting this massive package before MPs with the pressure to pass it quickly for Canadians to access the non-EI aid measures. She believes the other parties will agree that these programs are what is needed. She refuted claims that they are angling for NDP support on the eventual vote on this package, given their ongoing advocacy for further social safety measures. Prime Minister Justin Trudeau signaled his intent to come back with a throne speech outlining bold new policy moves on Tuesday while responding to the inequities exposed in Canada’s social supports and economic system. He stated that it would take time to make up the economic ground we have lost to this pandemic.
Moreover, the federal government is launching three new taxable benefits, which will also come into effect on September 27 to target specific reasons why Canadians may be out of work or in need of financial aid. They are projected to cost $22 billion. The first is known as “Canada Recovery Benefit.” It will be available for 26 weeks to self-employed workers. Canadians who were looking for work had stopped working or had their income reduced due to COVID-19 will qualify for this $400-a-week program. Workers will be required to repay $0.50 of each dollar made above an annual net income of $38,000 through their income tax return.
After months of work, the newly-strengthened EI system was ready to handle thousands of more applications than the pre-pandemic. The government first signaled that this change was coming in late July. Even though not counting the payments that will be made, officials stated that $7 billion is estimated to be the cost related to the changes to EI. Qualtrough has committed moving the up to four million Canadians who still need support onto EI, saying it will happen without a disruption to their payments when the CERB cycle expires in September. In facilitating access to these new benefits when their application windows open, a new webpage will be launched in mid-September. Since March, CERB has paid $69.37 billion in benefits to 8.61 million unique applicants.