This week a memo that was leaked or circulated to the media raised more than a few eyebrows and questions.
The memo distributed in late April on the ESDC/SC IntraWeb said:
“Effective immediately, while processing a claim, if an agent uncovers information that suggests potential abuse of the EI system by a client, an employer or a third party, they do not impose a stop pay and do not refer the file to integrity unless it is considered an urgent investigation,” the note says.
In effect, federal employees vetting the millions of applications for emergency and employment-insurance (EI) benefits have been told to ignore most potential cases of cheating, despite reports of widespread fraud. 200,000 applications have already been “red-flagged” as possibly fraudulent. Now these cases range from individuals who suddenly pull up fake or dubious employment records to others who were paid exactly $5,000 in the last month of 2019 which made them eligible for CERB benefits.
The federal government has stated that their only interest is ensuring Canadians in need have the financial resources to tide them through this difficult period. I think the operative word here is NEED. Unfortunately, too many unscrupulous individuals are taking advantage of this generosity and abusing what I consider one of the most generous systems in the world. While most people would rationalize this saying it is just a small percentage of dishonest people but these are the ones like termites slowly eating and ruining a great social safety net in the long run.
As Aaron Wudrick, federal director of the Taxpayers Federation of Canada says: “it is one thing to push the payments out rapidly with few questions asked, another to brush aside actual evidence of abuse.
The one criticism that is being leveled at the emergency benefits being doled out by the federal government is that it has almost invited individuals to abuse the system.
There are government employees making $100,000 plus who have filed for CERB because their second job isn’t generating any income. So they have filed based on the company they registered just so they could write-off losses. Hundreds of international students are working and being paid by employers under the table so they are eligible for CERB.
I am all for the government ensuring that the most economically vulnerable get all the assistance possible, and that goes for businesses as well. However, there needs to be an understanding that cheats will be dealt with harshly when the time comes. Perhaps if those having multiple investment properties and other sources of income are also availing of benefits meant to help those in need should fear having the government put a lien on their properties until they pay back anything they weren’t entitled to.
Only when individuals and business owners know that they can’t cheat and get away with it will there be some integrity to this system.
It is important that the federal government ensures that this system isn’t compromised to such an extent because the next time there is an emergency of this kind, more Canadians will be encouraged to file for benefits even if they aren’t eligible because no one ever got caught the first time.
If the federal government ever decided to write-off CERB benefit fraud, it will create a terrible precedent for the future. That is assuming Canada can still afford to be as generous, there is only so much abuse that a taxpayer-funded system can take. And yes, a first world country could also end up economically like the countries most new immigrants currently come from.