Deputy Prime Minister and Minister of Finance Chrystia Freeland and President of the Queen’s Privy Council for Canada and Minister of Intergovernmental Affairs Dominic LeBlanc look on as Prime Minister Justin Trudeau speaks during a news conference on parliament hill in Ottawa, Tuesday, Aug. 18, 2020. THE CANADIAN PRESS/Adrian Wyld

Deputy Prime Minister and Minister of Finance Chrystia Freeland and President of the Queen’s Privy Council for Canada and Minister of Intergovernmental Affairs Dominic LeBlanc look on as Prime Minister Justin Trudeau speaks during a news conference on parliament hill in Ottawa, Tuesday, Aug. 18, 2020. THE CANADIAN PRESS/Adrian Wyld

Liberals plan to use regulations to create income support after CERB winds down

Around four million workers will move onto EI next month when the COVID-19 benefit ends

The Liberals plan to use existing tools to quickly create a new support measure next month for struggling workers who won’t qualify for employment insurance.

Some four million workers will move onto EI next month when a key COVID-19 benefit for workers, the Canada Emergency Response Benefit, begins to wind down.

Millions more who have seen their incomes crash as a result of the pandemic-related shutdown won’t qualify for the decades-old social safety net program, but the Liberals had promised a new EI-like support for those who will still need the help.

Sources who have been briefed on the government’s plan say that transfer will be done through regulations, rather than legislation that could not be introduced until late September, following the prorogation of Parliament.

The measures are to be temporary and flow through existing programs and tools, the sources say, meaning the Liberals won’t need parliamentary approval.

The sources, who spoke to The Canadian Press on the condition of anonymity because they weren’t authorized to discuss the plans publicly, say details will come soon.

The Liberals have agreed on how to extend EI-like benefits to those currently deemed ineligible for the program, as well as a floor on the value and duration of payments.

Hassan Yussuff, president of the Canadian Labour Congress, said he sees the temporary measures as a springboard to a larger overhaul of the federal safety net.

Its weaknesses have been known for years and widely exposed through the pandemic-induced crisis, he said.

“We need to look at these temporary measures and figure out how do we incorporate some of that as permanent measures into the future,” Yussuff said, “because you can’t have a social safety net where a significant chunk of people don’t even have any net.”

Prime Minister Justin Trudeau has made clear his intention to reshape a safety net that supports a modern workforce and “gig” economy. The Liberal cabinet is slated to talk about the larger overhaul at next month’s retreat.

David Macdonald, a senior economist with the Canadian Centre for Policy Alternatives, noted recently that about 4.7 million people were receiving the CERB at the start of August, with about 2.1 million not eligible for EI under existing program rules.

He added that just over half of CERB recipients at risk of being ineligible for EI are women, and they would also receive less than under the CERB.

NDP Leader Jagmeet Singh called on Trudeau to extend the CERB until the end of September and present a plan to fix EI by the end of this month.

“Millions of people across the country are stressed about how they’re going to make ends meet when the Liberals cancel the CERB at the end of the month,” Singh said in a statement issued Wednesday.

Unemployment is expected to remain high for the rest of 2020, with employment levels not reaching pre-pandemic levels until some time next year, based on Royal Bank forecasts released Wednesday.

READ MORE: 21% of Canadians worried about ‘losing the roof over their heads’ if CERB ends: poll

It makes sense to help people in the short term, but the question for the government will be what to do if a large chunk of the labour force still needs help by late 2021, said Robert Asselin, a former adviser to Trudeau and now former finance minister Bill Morneau.

“If you create a program like EI and say, we’re going to support these people as long as it takes … you basically create a permanent income-support program and it’s hugely expensive,” said Asselin, now a senior vice-president at the Business Council of Canada.

“It’s going to have to be paid for by someone, including employers. You’re effectively putting a tax eventually on businesses, which I think would be very damaging in the current circumstances.”

Modelling done in the latest report on EI premiums showed rates would have to rise by five cents per year for four years in response to a recession like the one the country suffered during the 2008-2009 financial crisis.

The estimate didn’t account for any special, temporary economic measures the government could put in place like a rate freeze, or benefit expansion.

Jordan Press, The Canadian Press


Like us on Facebook and follow us on Twitter.

Want to support local journalism during the pandemic? Make a donation here.

Coronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Nanaimo RCMP hope the public can help them find a 16-year-old who has been missing since Sunday. (Photo submitted)
UPDATE: 16-year-old Nanaimo boy located safe

Teen had been reported missing last week and it was thought he may have left town

The Regional District of Nanaimo plans to make its operations more efficient as it works on long-term goals around carbon-neutrality. (PQB News file photo)
Regional District of Nanaimo works to become carbon neutral by 2032

RDN committee of the whole members endorse plan developed by consultant

The Millstone River in Nanaimo. (News Bulletin file photo)
Regional district looks at value of Nanaimo’s natural assets

Report focused on the Millstone River could inform future decisions on corporate asset management

Protesters gather along the Pearson Bridge on Terminal Avenue in downtown Nanaimo last month as part of an event called Worth More Standing. (News Bulletin file photo)
LETTER TO THE EDITOR: B.C. hasn’t managed forests properly

Protesters opposing logging in Fairy Creek speak for many British Columbians, say letter writers

Nanaimo singer Victoria Vaughn recently released an EP with local producer Austin Penner. (Photo courtesy Taylor Murray)
Nanaimo singer and recent VIU grad releases EP about becoming an adult

Victoria Vaughn’s ‘Growing Pains’ recorded with local producer Austin Penner

In this image from NASA, NASA’s experimental Mars helicopter Ingenuity lands on the surface of Mars Monday, April 19, 2021. The little 4-pound helicopter rose from the dusty red surface into the thin Martian air Monday, achieving the first powered, controlled flight on another planet. (NASA via AP)
VIDEO: NASA’s Mars helicopter takes flight, 1st for another planet

The $85 million helicopter demo was considered high risk, yet high reward

B.C. Labour Minister Harry Bains. (Hansard TV)
B.C. moves to protect employee pay for COVID-19 vaccination

Most won’t need to take time off work, labour minister says

Orca 1
Orcas: Our Shared Future finally surfaces at Royal B.C. Museum

Museum dives into the world of the killer whale as delayed feature exhibition now open

New figures show Canadian housing prices outpacing those in other developed countries. (Black Press Media file photo)
Canadian housing prices fastest rising in the world

Relative to 2000, housing prices have risen by a factor of more than 2.5

The Nanaimo Clippers are seeking assistance in raising money for Loaves and Fishes Community Food Bank. Texting NANKIDS to 41010 will see a $10 donation to the food bank. (Submitted photo)
Nanaimo Clippers look to assist food bank with fundraising goal

People can text-to-donate to support Loaves and Fishes Community Food Bank

Polystyrene has been outlawed as a take-out option for restaurants in Tofino and Ucluelet. (Black Press Media file photo)
Styrofoam done as a takeout option on Island’s Pacific Rim

Tofino and Ucluelet ban polystyrene take-out containers

The IIO is investigating after a police dog bit a man during a traffic stop near Ladysmith on April 17, 2021. (Black Press Media stock photo)
IIO investigating after police dog bites man near Ladysmith

RCMP dog bit man during traffic stop on Friday, April 17

Most Read