It appears two million to three million claims were paid that do not appear attributable to COVID-19 job losses
Last Friday, Statistics Canada released its Labour Force Survey for the month of May. The numbers suggest fraud and error under the Canada Emergency Response Benefit may be even more pervasive than previously feared.
When CERB was introduced in March the government decided its priority was to get cash into people’s hands as quickly as possible: there would therefore be little if any review of applications. The risks of fraud and error were obvious but in an unprecedented emergency it was a price the government seemed willing to pay.
Last month, the National Post reported that government employees had been instructed to ignore most possible cases of cheating. Though 200,000 applications had been “red-flagged” as possibly fraudulent they were paid and would only be reviewed in future. Minister Qualtrough confirmed all this but, without providing detail, said 200,000 was not “remotely near” the real number. She presumably meant it was way too high. It turns out it may have been way too low.
The government made two errors when it introduced the CERB. First, it telegraphed the fact that there would be very little vetting of claims. Second, it introduced legislation that had no penalties for wrongful claims. Unless fraud charges were pursued under the Criminal Code — which will only occur in exceptional circumstances — offenders got a free pass.
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