Additional income support for hard-hit workers may not stay after pandemic, PM says

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OTTAWA – Prime Minister Justin Trudeau has said the more generous benefits available to unemployed Canadians during the pandemic should not be seen as permanent changes to the social safety net.

Millions of people have received emergency benefits since March, when the first wave of COVID-19 hit Canada and resulted in widespread lockdowns and historic job losses.

A new package of $ 500 per week benefits for the unemployed has since been put in place and extended until next summer.

Trudeau suggested the government watch to see how things play out before deciding on its next move.

Speaking at a virtual event hosted by the Financial Times, Trudeau said just because aid programs are helping during the pandemic doesn’t mean they will come in handy after the crisis is over.

He also said the extra perks are unlikely to stay.

“Let’s not pretend that something that’s working right now is giving us stability,” Trudeau said in the pre-recorded interview.

“This is not a measure that we can automatically continue in a post-pandemic world. I think there are some really important thoughts to be had about how we provide income support and how we make sure that everything the world has opportunities. “

The Canada Emergency Benefit disbursed $ 81.6 billion to approximately 8.9 million people during its delivery from March to October.

Since then, the three benefit programs that replaced it have paid out nearly $ 2.3 billion, with the majority going to more than one million people who have used the Canada Stimulus Benefit for the unemployed. The number of recipients has steadily increased and now exceeds federal demand estimates.

The three “take-back” benefits will be in place until next summer.

At the same time, a slowdown in the number of EI claims suggests that demand for these benefits may be lower than the 2.8 million civil servants previously estimated.

All of that could change, depending on how the pandemic progresses.

Trudeau said in the Financial Times interview that the uncertainty caused by COVID-19 is the reason the Liberals revamped the aid program over the summer so that the benefits increase if the economy turns low. south or lower costs if circumstances improve.

He said the benefits, along with an extension of the wage subsidy program, a new commercial rent relief program and additional help for businesses closed by local lockdowns are all automatic stabilizers to ease conditions during the second wave of COVID-19.

The extension of the wage subsidy program until next summer will not be official until the Senate approves the necessary legislation.

Finance Minister Chrystia Freeland is scheduled to appear before the Senate Finance Committee on Thursday to testify on the bill, known as C-9.

The Senate had some of the loudest voices for the Liberals to adopt another automatic stabilizer in place of a myriad of benefits: a basic income program.

Basic income is essentially an unconditional benefit that governments offer to citizens that sets a financial floor for individuals and families.

Some supporters of the idea, which Trudeau has not publicly supported, point to the existing set of pandemic benefits as proof that the idea works – even though experts have said CERB and its successors are not exactly a basic income.

“What we are doing now should not be confused with what we might or might do in the future,” Trudeau said when asked about Basic Income.

“I think we have to get over that before we start to design a whole new world of social supports.”

The Parliamentary Budget Officer recently revised his estimates to provide a basic income for six months to almost all Canadians, forecasting a cost of between $ 30.5 billion and $ 71.4 billion, down from the 47 , $ 5 billion and $ 98.1 billion described in July.

The overall cost would increase each year to reach between $ 84.2 billion and $ 197.2 billion in 2025, depending on the share of the benefit clawed back from people whose other income increases.

This report by The Canadian Press was first published on November 11, 2020


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