Editor’s note: Global News will be updating this story as more information becomes available. Latest update: April 3, at 8:47 p.m.
The Trudeau government created an all-new benefit for Canadians reeling from the economic impact of the coronavirus pandemic: the Canada Emergency Response Benefit.
CERB would deliver $2,000 every four weeks for up to four months to workers who lose their income as a result of COVID-19. The new program combines and replaces two previously announced benefits, the Emergency Care Benefit and the Emergency Support Benefit.
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CERB was part of the Liberals’ Emergency Response Act, which is now law. The CRA, which is well-versed in handling millions of applications at a time, will be administering the program along with Service Canada, which handles Employment Insurance (EI).
Here’s what we know so far, along with some of the major questions the new program raises:
Who can apply for CERB?
CERB is for Canadians, whether employed or self-employed, who have lost their income because of COVID-19. It is both for those who would normally qualify for EI unemployment or sickness benefits and those who would not. However, applicants have to have been — or expect to be — out of work for at least 14 days of the initial four-week period in which they apply.
To qualify, you must be a resident of Canada and have had income of at least $5,000 from work or maternity and parental benefits under EI or the Quebec Parental Insurance Plan for 2019 or the 12-month period prior to submitting an application.
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Canadians will be able to access the benefit whether they have lost their income as a result of the economic repercussions of the health emergency or can’t work because they are sick, quarantined, caring for someone with COVID-19 or have had to stop working in order to care for children who are either sick or home from school and daycare. There will be no need to submit a medical certificate to receive CERB.
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Canadians who are still formally employed but not receiving any income would also be able to receive CERB.
“This would help businesses keep their employees as they navigate these difficult times,” according to the Department of Finance.
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The list of beneficiaries is long but leaves out some Canadians who have also seen a heavy financial hit from the crisis. So far, only Canadians who have seen their income reduced to zero qualify for CERB. Workers who have seen a significant reduction in income but are still bringing in some money do not.
“That’s the gap in their program, without a shadow of doubt,” said Lindsay Tedds, a professor of economics at the University of Calgary.
The program also leaves out those who were already out of a job when the outbreak hit as well as those who may lose the ability to find employment in the future as a result of the crisis, such as new graduates.
The benefit is also not available to those who have quit their job voluntarily, even if they did so because of the pandemic.
How long will CERB run?
The benefit would cover the period from March 15 to Oct. 3, 2020.
How and when can you apply for CERB?
The government will start accepting applications on April 6. Meanwhile, Canadians who are out of work and eligible for EI can continue to apply through the EI portal.
The earliest you get to apply depends on the month in which you were born. For January through March, you’ll be able to send in your application on Mondays, starting on April 6. For April-through-June babies application day is Tuesday, starting on April 7. Those born in July through September get Wednesdays, and those with birthdays in the last three months of the year get Thursdays. Fridays, Saturdays and Sundays are freebies open to anyone who qualifies.
The staggered application process is Ottawa’s attempt to ensure the system doesn’t become overwhelmed with potentially millions of applications coming in at once.
There will be two ways to submit an application: online through the CRA’s My Account or over the phone with an automated phone service. If you don’t have a CRA My Account but have a My Service Canada account, you can skip some steps to set up your CRA account.
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To apply for CERB, you will only need to provide your contact information, social insurance number and confirm you meet the program’s eligibility requirements.
Several economists had been calling on the government to prioritize the speed at which emergency benefits will reach households and businesses over making sure that only deserving applicants receive the money.
“This is unprecedented,” Tedds said. “We have people hurting and very, very scared and almost ready to lose their home.”
“Let’s worry about mistakes and error and fraud later.”
Still, the government may ask you to provide proof of your eligibility for CERB at a later date.
As long as they don’t have an income, eligible Canadians can re-apply every four weeks for up to four months.
How quickly will you get the money?
Once they’ve submitted an application, Canadians can expect to receive payments within three days if they choose direct deposit and 10 days by cheque, the CRA told Global News. Payment will come in as a single $2,000 deposit or cheque every four weeks.
Will you have to pay taxes on CERB?
Possibly. You’ll have to report CERB income in your 2020 tax return. Whether and how much tax applies will depend on your overall income for the year, among other things. Still, for now, Canadians will get the full $2,000 a month and can worry about taxes later.
Does CERB replace EI?
It does not.
Here’s what we know so far about how the two benefits will co-exist:
- Canadians who were already receiving EI unemployment or sickness benefits as of March 15 will continue to receive the benefits and should not apply to CERB. This seems to imply that Canadians who are receiving EI benefits of less than $2,000 a month will get temporarily stuck with the lower benefit. A recent analysis by the Canadian Centre for Policy Alternatives found that 78 per cent of workers who face the most immediate risk of layoff in major cities amid the pandemic would be better off with CERB than EI. However, Canadians whose EI benefits run out before Oct. 3 would be able to apply for CERB if they are still unable to return to work because of COVID-19.
- Canadians who have applied for EI but whose applications have not yet been processed don’t need to reapply for jobless benefits. If they became eligible for EI before March 15, they will receive EI. If they became eligible for EI on or after March 15, they’ll be automatically enrolled in CERB.
- Canadians who qualify for EI can continue to apply for jobless benefits through the EI portal until CERB is up and running. Canadians who lost their jobs because of COVID-19 and would be entitled to more than $500 a week under EI will get a slightly less generous benefit under CERB. (The maximum one can receive through EI is $573 per week, which works out to slightly under $2,300 every four weeks.) However, they will still be entitled to receive their full EI benefits, if eligible, once CERB runs out.