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Colleagues, I call this meeting to order.
This is meeting number 11 of the House of Commons Standing Committee on Government Operations and Estimates.
Before we start, I'd like to announce that the next meeting of OGGO is this Friday, May 15, from 11 a.m. to 1 p.m. For next week, we have yet to hear from our whips as to the schedule. If you recall, at our last meeting we talked about all committee members going to their respective whips to try to tell them whether or not they wished to sit and meet on Monday, May 18, which will be Victoria Day. It's a statutory holiday. If you haven't done so already, I suggest that you contact your whips and give them your preference as to whether or not you would like to meet on Monday, May 18.
Colleagues, in just a few moments, we'll convene the meeting officially. I have asked both ministers—Minister and Minister —to keep their remarks to no more than six minutes each, rather than the customary 10 minutes. That will save us a bit of time.
I'm also asking this of witnesses, ministers and committee members. If you begin speaking in one official language, please complete your remarks and all questions and answers after that in the one language of your preference. That way, we won't have to flip back and forth between languages. From a technical standpoint, it should then go much more smoothly.
When we get into the questions and answers, colleagues, we normally start a little late, particularly in the first hour, because of the technical issues we have to go through. As a consequence, we never seem to be able to complete a full round. Having said that, what I'm suggesting for this first hour is that we amend the question period so that the first round will be for five minutes each, the second round for four minutes each, and the third and final round for two minutes each, which should allow us to get every member involved and hopefully get answers for your questions.
With that, colleagues, I will now turn it over to Minister Lebouthillier for her six-minute opening statement.
Minister, the floor is yours.
:
Good afternoon, Mr. Chair.
Thank you for this invitation to tell you about the work of the Canada Revenue Agency in supporting Canadians during this unprecedented time. The work you are undertaking on government measures to support Canadians in response to the COVID-19 pandemic is very important.
I am pleased to be accompanied today by the commissioner of the Canada Revenue Agency, Bob Hamilton, and three members of the agency's senior management: Frank Vermaeten, assistant commissioner, assessment, benefit and service branch; Geoff Trueman, assistant commissioner, legislative policy and regulatory affairs branch; and Ted Gallivan, assistant commissioner, compliance programs branch.
Since 2015, I have focused on improving the service delivery that is offered to Canadians. This means the agency and I place Canadians at the centre of all our priorities. We recently launched our People First philosophy and it is the pillar of our new service model. This philosophy is a key element in the agency's response to implementing the emergency economic measures.
Driven by the People First philosophy, agency employees have been working hard to support Canadians during the COVID-19 pandemic. In addition to taking part in an impressive mobilization of human resources in the field, we are also seeing a significant increase in the technology being used every day to serve Canadians in an even more accessible, efficient and rapid manner.
Allow me to give you an overview of the CRA's work over the past eight weeks. The agency started by realigning its efforts in order to be more efficient during this crisis. Then, on March 18, it announced it was pushing back the tax filing deadline for individuals, corporations and trusts, thereby relieving Canadians of that burden.
In the same spirit, the agency also announced the temporary suspension of the vast majority of audits. The agency then worked quickly to implement the government's various economic measures. First and foremost: the Canada emergency response benefit.
As I am sure you know, the agency is responsible for a significant part of administering the CERB, and the CRA is fully responsible for administering the Canada emergency wage subsidy, CEWS, as well as the Canada emergency student benefit, the CESB.
Regarding the CERB and the CEWS, I am especially proud of how quick and easy the application process is for Canadians. And I must emphasize that the amounts are paid promptly. In fact, most people receive their payment by direct deposit within three business days—sometimes even two days.
We have also demonstrated significant technological capacity, which is very impressive when you consider the online services were set up in just a few weeks. When the CERB was launched, the agency's system registered 30,000 applications in 12 minutes. Since April 6, the agency has reviewed and processed nearly 7.5 million CERB applications, for more than 4.45 million individuals.
I am very proud of the agency's incredible work under these circumstances. In fact, the media described the technological implementation of the CERB as a “small miracle.” This miracle would have been impossible without the exceptional cooperation between the agency's public servants and those from Employment and Social Development Canada.
On April 27, the agency deployed a new economic measure, namely, the Canada emergency wage subsidy. Again, everyone pitched in to make this application process a success. To date, the agency has received over 128,000 applications for the wage subsidy.
Finally, the agency will soon be able to launch the Canada emergency student benefit, the CESB. Students will soon be able to submit their application through the agency portal and the My Account service.
The CRA was able to mobilize a lot of people in the blink of an eye, starting with the agents at its call centres. To keep up the pace, the agency also reassigned many employees to new duties. A total of 7,500 employees answered a call to lend a hand to the call centres. Of course, while all this work took place, the CRA also made sure that appropriate compliance measures were put in place for all applications for emergency financial assistance.
Ensuring compliance is an essential part of the agency's mission. We are committed to preserving the integrity of our Canadian tax system. In this regard, the agency developed strict auditing measures—electronic and manual—and several safeguards for claimant eligibility, refund terms, and even tax loopholes. You can rest assured that offenders will face severe consequences, up to and including imprisonment.
Mr. Chair, this pandemic continues to have a terrible impact on many of our fellow citizens—not only on their health, but also on their economic well-being. However, I am proud of the efficiency with which the entire government has mobilized in recent weeks to support Canadians. As the saying goes, “When the going gets tough, the tough get going.” I can proudly tell you that agency employees have shown that they are, indeed, very tough.
I am now ready to take your questions. Thank you.
Just to respond quickly on the wage subsidy program, it's fair to say that it's a more complicated program than the CERB. As the minister indicated, the CERB was relatively simple in application, with a priority on getting the money out but also with proper verification to make sure that we catch up on people who don't deserve it.
In contrast, the wage subsidy covers a bunch of more complex business arrangements. One of the things we did in response to that was to engage with stakeholders as we were developing it, to find out some of the questions and answers that we needed to know in order to make it simpler for businesses to apply.
The feedback has been good from that perspective. I note that the CFIB has been very positive in terms of our ability to answer their questions, but there's no doubt that it's a more complicated program.
We've been quite satisfied so far. There is a lot of interest in the questions. The take-up is probably a little less than we thought it would be at this point, but we know from all the questions that people are still perhaps sorting out exactly how they will apply.
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I think we're doing a lot. We have a lot of systems in place to ensure that the right people are getting the money.
We are the CRA. We have a lot of information that we collect regularly on people, such as the amount of money they have earned and the amount of money they're going to earn this year. We have those records. We have that, and the CERB, as you know, is based on social insurance numbers, so we can do a matching between the amounts that individuals receive through the CERB and the income they're earning.
We're also asking employers to provide us with additional information in February of next year on the T4 information they provide to us so that we know when people earned income and when they were rehired.
That way, I think we'll be able to do a very good job of matching the two. If there is a mismatch, we'll be writing people letters to indicate to them that our records show they may have earned money at the same time, and if they have, we'll of course be asking them to pay that back.
To save the minister and the department from providing a response in writing, I'm going to ask the same question again that I had asked earlier.
Minister, in your opening statement that was submitted, you mentioned the mobilization of so many CRA resources as well as the reassignment of up to about 7,500 employees who answered the call. You also talked about keeping the process's integrity as well as implementing strict auditing.
Can you share with us some of the initial challenges in your partnership with the employees and in the training? How did you work with the unions and other departments, such as ESDC, to be able to roll out all these programs, which were coming at different stages?
I'm going to complete the question I was asking earlier. Every business, when it fills out the T2 form in its income tax return, mentions its shareholders and owners. So it is easy for officials to know who owns which business and to trace it back to the owner of the parent company. If the parent company has assets in tax havens, you can get the information.
First, Madam Minister, does the Canada Revenue Agency maintain a list of the companies that use tax havens?
Second, have you considered using this list to ensure that those receiving government assistance are not companies that use tax havens?
It's not complicated, just take the list and check the information on the T2 form to see if the company uses tax havens or not.
:
Thank you very much to the honourable minister.
You will note that on April 15, I provided your ministry with a letter requesting that you provide information on how individuals who are not able to file their taxes by the June 1 date can ensure that their supplementary income supports, such as the GIS, the GST, child tax benefits and other associated provincial benefits are not cut off as a result. In my letter, I recommended that you consider extending the deadline once again, until the fall, and that the federal government extend the current benefit payments until October 2020, based on the 2018 income filings.
Can you comment on that? In our office, we process hundreds of these through our volunteer tax clinics, and many people are at risk of getting cut off from those significant monthly income supports.
Minister, I'm sure you will take Mr. Green's comments under advisement and provide an answer to Mr. Green if you possibly can.
Minister, thank you very much for your appearance here today.
We have to set up for our second round of questions, which will be with Minister Qualtrough.
Minister, once again, thanks to you and to all of your officials. You are excused.
Colleagues, we will suspend for a couple of moments while we prepare for our next round of witnesses. We are suspended.
:
Colleagues, we are reconvened.
For the benefit of Minister Qualtrough, I'll repeat what I mentioned in my opening remarks before she came on the line. If you begin by speaking in one official language, please continue to speak in the same official language without switching back and forth. This will help our technical ability to avoid delay.
Colleagues, for those of you who have just joined us, I have a similar request of you. If you ask a question in one official language, please keep the entire question and the responses in the same language so that we don't have to switch back and forth.
We'll remain with the same procedure as for the first hour, so it will be five minutes for questions in the first round, four minutes for the second round, and then two minutes in the final interventions.
With that, Minister, I'll turn it over to you for six minutes, please.
:
Mr. Chair, I apologize. My remarks are in both languages, back and forth. I'm going to do my best to just do English, so please indulge me.
Hello, everyone. I'm pleased to join you today to speak about the measures to support Canadians during the COVID-19 pandemic as they pertain to my current portfolio.
Before I begin, I'd like to thank the committee for your study on our government's response to the COVID-19 pandemic. Your work is truly essential to our democratic process.
It's been nearly two months now that Canadians have been adapting to the COVID-19 pandemic gripping our country and the world. To give you a sense of the scope of the need, I can tell you that we've received 11.38 million applications, of which we have processed 11.29 million applications under the Canada emergency response benefit, both through Service Canada and through the CRA. A total of $30.48 billion in payments have been made to 7.83 million people.
The CERB was created to come to the aid of Canadians during these unprecedented circumstances. In reality, our EI system was not built for the situation of a global pandemic. It doesn't cover all the different situations in which Canadians find themselves in this time of a public health crisis. Service Canada and CRA stepped up, formed a team, and in the space of a couple of weeks elaborated and put into place a system that really responded to Canadians' needs. For eligible workers, the CERB provides temporary income support of $500 a week for up to 16 weeks. It applies to workers who have stopped working for reasons related to COVID-19. It also supports working parents who are staying home to care for children because of school and day care closures.
We've made extraordinary efforts to make this emergency benefit as inclusive as possible. Workers, including the self-employed, can earn up to $1,000 per month while collecting the benefit. The benefit also applies to workers who've recently exhausted their regular EI benefit payments and aren't able to start working again because of COVID-19. This helps many seasonal workers, including fishers and those in the tourism industry, who may not have had their usual seasonal work to return to as a result of COVID-19.
Now I'll say a word about supporting temporary foreign workers and ensuring Canada's food supply.
The COVID-19 pandemic has made it difficult to bring in the needed temporary foreign workers. That's why we've made modifications to our temporary foreign worker program to try to add some flexibility to the system. I want to emphasize that there are definitely jobs available for Canadians in the areas that are also supported by temporary foreign workers, as has been the case historically.
I'll now say a word about students and youth.
We've announced comprehensive support for post-secondary students and recent graduates, representing an investment of approximately $9 billion. As part of that support, we introduced a four-month Canada emergency student benefit. Students who are not receiving the CERB and meet the criteria for this new benefit will be able to apply to receive $1,250 per month between May and August. Students with permanent disabilities and students with dependants could receive an additional $750 per month.
We've heard a lot in the past few weeks about how these payments might disincentivize students to work. Well, that's not what we've heard from young people across the country. We've heard very clearly from students that they want to work and serve in their communities in this time of crisis. That's why we also announced the creation of 76,000 additional jobs and training opportunities, including jobs in the agriculture and processing sectors, through mechanisms such as our youth employment and skills strategy program. This is on top of the 70,000 jobs that will be available through the Canada summer jobs program, with greater flexibility for employers to hire young people this summer and through the fall.
Other important measures to help students during the COVID-19 pandemic are changes to the Canada student loans program. These changes will expand eligibility, increase the weekly cap and double the value of our grants. These new measures came in addition to earlier measures to pause the repayment of student and apprentice loans, interest-free, until September 30, 2020.
Mr. Chair, we've taken these measures with the goal of helping Canadians and supporting our economy. As the situation evolves, my colleagues in cabinet and I will be ready to respond to whatever Canadians need.
I'm available now for questions.
:
Well, that is very different, though, because in the Province of Alberta's labour code, for example, you have to have proof that it's unsafe. You can't just feel unsafe because of COVID. You would actually need a ruling from the labour board, so you're kind of contradicting yourself.
If I am at home and I can go back to work, but I do not feel it's safe to go back to work because perhaps I'm living with an elderly person or someone with a compromised immune system, and I refuse, under EI laws or the labour code, it has to be checked. The says that I can refuse, but you're saying that it's nuanced because of the province.
Do you agree with the that if someone says “no” because they fear for their safety, they can remain on CERB?
Hon. Carla Qualtrough: Well, I think it—
Mr. Kelly McCauley: I just want to get a straight answer from you. Do you agree with the finance minister?
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But the province is not deciding the CERB.
Hon. Carla Qualtrough: No.
Mr. Kelly McCauley: You are.
Hon. Carla Qualtrough: Yes.
Mr. Kelly McCauley: If you are saying that if someone stays home because they feel unsafe returning to work, they can still stay on CERB, that's the same as the . If I'm hearing that, well, wonderful.
The government has stated that the wage subsidy is going to be extended past June. Is there talk right now about extending the CERB past the original stated time?
:
Thank you for that really important question. It's lovely to hear your voice as well, Mr. MacKinnon.
We've taken a number of steps on the administrative side of the temporary foreign worker program, as well as in streamlining some of our policy decisions around it. On the one hand, we have tried to make it more streamlined to give employers the certainty of getting their LMIAs approved, and on the other hand we have been trying to make sure that workers are protected and employers know very clearly their obligations.
Like anyone, temporary foreign workers coming into the country have to have a mandatory 14-day isolation period. There are protocols in place for the period around that. As for what is expected of employers, we have beefed up regulations—and when I say “we”, I mean IRCC—so that there are significant consequences to employers if they fail to comply with these beefed-up compliance conditions, including monetary penalties—if I'm not wrong—of up to $1 million.
We're trying to make it easier for temporary foreign workers to move between jobs. We're trying to make it easier for LMIAs to get approved. We've waived the minimum recruitment requirements. We're prioritizing certain kinds of LMIAs.
Graham, I don't know if you have anything else to add. The list is quite significant.
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This is Cliff Groen from Service Canada. There are a number of points I would raise. Certainly we do know there have been challenges in accessing our EI call centre. There have been a number of measures we have put into place, one of which has been significantly automating our technology.
We had been having issues back in April in which a number of callers were being blocked at the automated level. In our EI call centre, lots of clients can actually self-serve and report on a biweekly basis using that automated system, but because of the number of calls we were receiving, we had lots of callers who were being blocked. We've actually adjusted that technology, and since last week we're now in a situation in which no callers are being blocked at the automated response level, which has actually dramatically improved service for those Canadians.
Second, we are in the process of continuing to hire lots of different call centre agents. We stood up a new 1,500-agent call centre for the CERB, and that's in addition to our existing 1,000-member—
:
What happened through our system, as we just discussed in the EI stream, is that expectant mothers who were answering “yes” to the question “Are you pregnant?” despite having applied for the CERB and more appropriately getting the CERB, were getting the regular EI benefits.
I had committed to addressing this, and I had also committed that no woman who was on the CERB would in any way have her entitlement to EI maternity or parental benefits impacted. As of last Friday, expectant mothers who should have been receiving the CERB will have their claims converted retroactively.
Just for precision, this means that, if a woman was receiving less than $500, she would get a top-up to $500. If she had been receiving more than $500, she will not have that money clawed back. In addition, the weeks during which she had been collecting the CERB will not impact the number of weeks. If weeks need to be put back into her personal entitlement, that will happen as well.
We wanted to make sure that nobody was in any way detrimentally or adversely impacted by this system challenge we were facing, so it has been solved.
:
My goodness, I could talk about this one forever. Thank you for your really important question.
People with disabilities in our country have faced significant barriers to accessing the health care system over the course of the pandemic, whether being impacted by visitor policies that don't let them have a communications support person with them, or by triage practices that basically discriminate on the ground of disability.
The and I are both working with our P/T colleagues, because, as you know, health is a provincial jurisdiction, to make sure that this isn't happening and that people's right to health care and medical treatment is upheld. That's one of the main priorities of our disability advisory group, which is a diverse group of disability experts, people with lived experience and parents from across the country, who have said that the number one thing they are worried about is health.
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In mid-March, two things were happening at the same time. The first was that we were getting an unprecedented level of EI applications. Very quickly, within days, it became apparent that our EI system couldn't respond as nimbly as we needed it to. People would have to wait 12 to 18 months if we were processing millions and millions of EI claims. At the same time, we recognized that there were a lot of people who weren't falling within the EI system whom we needed to help.
Our initial solution was the creation of two new benefits that would parallel the EI regular benefits and EI sickness benefits. What then happened, again within a day or two, was that we realized that having four benefits out there was proving difficult and complicated for Canadians. With those two things happening at the same time, we got together and said that we needed to do something drastic, something different, outside of EI. We needed one benefit for everyone. We couldn't spend our time, and Canadians didn't need us to spend our time, trying to explain which stream.
We basically pivoted, within probably 48 hours, from announcing those two first benefits to consolidating into one benefit all four streams: people who are EI-eligible and EI sickness-eligible, and the same two for non-EI people. We worked very quickly to find a solution within our existing systems. We found CRA and Service Canada to be the solution to that, because of their proven track records in delivering for Canadians, and Canadians' trust, particularly in CRA. They get their GST, their tax refund, and their Canada child benefit, so they're used to getting payments from CRA.
We knew that we had to automate. We knew it had to be a flat payment; that's what the system would allow us to do. Within probably a week of the initial consolidation conversations, we had figured out the solution, designed the system, put legislation in front of Parliament and received royal assent.
Thank you.