About 1.7 million Canadians have fallen into debt with the federal government after Service Canada determined they never should have received thousands of dollars in COVID-19 emergency payments.
Dubbed the Canada Emergency Response Benefit (CERB), Ottawa rushed emergency supports to Canadians shortly after the pandemic began in 2020. But many of those who received the first $2,000 payment have since been deemed ineligible. In the lead-up to this year's tax deadline, they are now receiving notices of debt, according to Employment and Social Development Canada.
“A total of 1.7m clients were unable to fully reconcile this advance payment and therefore will have a debt established,” a ministry spokesperson for Employment and Social Development Canada told Glacier Media in an email. “The notices of these debts to Service Canada will continue to be established over the next couple months.”
The spokesperson added that the federal government will work with Canadians who owe money “to establish flexible repayment schedules with an eye to their ability to pay.”
The ministry did not answer questions over how much money could be collected, but not every case will garner a full $2,000 repayment, the ministry indicated.
The $2,000 payment was issued “urgently in order to provide immediate income support to Canadians when they needed it the most,” said the spokesperson.
There were only about one million Canadians who remained eligible for this advance payment, which was eventually repaid in the summer when payments were lowered to compensate for it.
Those who applied on or after June 14, 2020, did not receive the advance payment of $2,000.
Overall, CERB payments assisted eight million workers and their family members during the first year of the COVID-19 pandemic, according to the ministry.
The ineligible advance payments are not connected to a round of ineligible payments made to self-employed individuals that came to a head in the lead up to last year's tax deadline. At the time, the federal government sought repayments to those with 2019 gross income of at least $5,000. It later backed down due to reported miscommunication on its part.
