Finance Committee on Dec. 10th, 2021

[Marc Lemieux]

Mr. Chair, I can take this question.

We haven't yet begun the post-verification work on the CRB.

[Adam Chambers, Conservative, Simcoe North, ON]

Okay. Thank you for providing that clarification.

We heard testimony yesterday from the Department of Finance—I can't recall if it was the minister or a witness—that a medical certificate would potentially be required in an audit, but I read in the document provided that there was a decision made to not seek medical certificates. I'm just trying to find out which one is correct. Will we ask for medical certificates for sickness benefit audits or not?

[Marc Lemieux]

Mr. Chair, on this, as we indicated in our written response, the decision was made not to request those certificates as a step towards eligibility for the program. The reason was to protect the health system from the pressure that doing that could have generated. That means that those certificates are most probably not available for post-verification work, which means that we will have to ask for information and the recipients would have to demonstrate whether or not they are eligible.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much.

[Marc Lemieux]

Then we will—

[Adam Chambers, Conservative, Simcoe North, ON]

Thanks for clarifying.

For my final question, we did hear some information from our friends and officials at FINTRAC, and they raised some questions and concerns. Have we contemplated or made changes to the post-verification or prepayment verification process based on some of the information and advice uncovered by FINTRAC?

[The Chair, Liberal, Peter Fonseca]

That's five minutes. I need a short answer, please.

[Cathy Hawara]

I can take that one.

[Marc Lemieux]

Go ahead, yes.

[Cathy Hawara]

We are constantly evolving our risk assessment processes and our pre-validation processes as we learn more and as, throughout the pandemic, we have learned more from both our own experience and what our partners are telling us, so we do continue to evolve those risk approaches that we've been taking.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you again for your responses.

[The Chair, Liberal, Peter Fonseca]

Thank you.

We're now moving to the Liberals.

Madame Chatel, you have five minutes.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Chair.

I would like to thank all the CRA officials for their extraordinary work. They had to deliver these programs at a time when all Canadians had to work from home, often in tough conditions. You have my utmost admiration.

I want to apologize for the tone of my Conservative colleague Mr. Stewart when he questioned you earlier. That isn't the way to behave in committee. That isn't how committee members should question witnesses who have been invited to appear. Please accept my apologies on behalf of my colleague.

Now, I want to talk about the Auditor General's 2020‑21 report. There was considerable focus on the agency's verification efforts. I have here the English version of the report.

The main point of the audit was about whether the Canada Revenue Agency designed a mechanism so that the benefit would support eligible workers who suffered a loss of income for a reason related to the COVID-19 pandemic, including limiting abuse of the benefit.

I would like to know if the CRA could explain what exactly the finding of the Auditor General was in this very recent report.

[Marc Lemieux]

If I may, Mr. Chair, I will answer in French.

The Government of Canada swiftly provided emergency benefits and recovery benefits to millions of Canadians during the COVID‑19 pandemic. What we observed was verified by the Office of the Auditor General. The purpose was to determine whether we had taken a reasonable approach, in other words, using an attestation-based system to deliver the emergency response benefit and the recovery benefit to ensure that Canadians in need received the support quickly. This attestation-based approach is very similar to the one the CRA uses for income tax returns. It is based on the premise that people want to comply with the rules and will submit valid tax returns. We advanced this program on that basis.

As the Auditor General of Canada pointed out in her examination of the CERB, this approach has risks. Expediting payments to those in need is consistent with best practices promoted by the International Public Sector Fraud Forum and its principles of fraud control in emergency management. This approach is precedent-based and evolves over time.

The Auditor General also indicated that, once the program had been implemented, we made changes to the pre-payment control process. We added controls when we identified a risk of non-compliance. The agency's approach was really based on attestations and public education. People need the right information so that they can comply with the rules that we have to enforce.

We made a considerable amount of information available to Canadians to help them fully understand the eligibility criteria. In some cases, we even wrote to Canadians when the information we received showed that they were not eligible. The Auditor General also noted that.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Lemieux.

Overall, the report reflects positively on how you responded in light of the circumstances and the tight time frame you had.

[Marc Lemieux]

If I recall correctly, the last time we appeared before the committee, when the report was tabled, it was viewed as good news.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you, Mr. Lemieux.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mrs. Chatel.

We will now move over to the Bloc and Madame Sinclair-Desgagné.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Thank you, Mr. Chair.

My question is for whoever wishes to answer.

The finance minister, and your colleagues and counterparts at the Department of Finance told us that it was extremely complex to target a specific sector when delivering CRB payments.

Can you elaborate on that?

[Frank Vermaeten]

I'd be happy to start. I'm sure my colleagues will supplement my answer.

Yes, it is a challenge to target payments to a sector, simply because there are borderlines. Whenever you create any sector, you're going to have a challenge about who's in and who's out, no matter how well the legislation is defined or, previously, the rules are established.

In terms of establishing borderlines, I think that under the circumstances, Bill C-2 has done an excellent job to try to articulate, as much as possible, borderlines of tourism, but you can imagine how there's always a borderline situation. If you are, for example, providing food and you are a chip truck, a poutine truck, are you a restaurant or are you simply selling chocolate bars and chips? Those kinds of questions ultimately can never be fully specified in legislation, and therefore the CRA will need to do its job of looking at the facts and trying to distinguish whether you're in this sector or that sector. That's the challenge.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

I understand.

You're telling me that a G7 country can't target different sectors when delivering benefit payments, thereby justifying the creation of an altogether new program. The excessively complex IT systems are to blame for delaying the process that would make desperately needed government support available to workers in the cultural sector, especially those who are self-employed.

Now I have a better understanding of the challenges.

[Frank Vermaeten]

I'm sorry; I'm not sure I understand the question. Are you asking if it would be difficult to target the cultural sector?

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

It was a comment further to your answer. I was simply saying I understood that targeting a specific sector was too complex for the CRA's computer system, even though other systems manage to do it.

I think that's all the time I have.

Thank you.

[The Chair, Liberal, Peter Fonseca]

That's the time.

We have to move to the NDP and Mr. MacGregor. You have two and a half minutes.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you very much, Mr. Chair.

This is for all of the officials who are joining us today. I would like to know if there have been any impact studies or analyses regarding the Canada recovery benefit cancellation for self-employed workers and if you have any comments on that, or if you can share with the committee or table any documents to that effect.

If you need clarification on who I'm specifically referring to, this would be, for example, independent contractors, any workers who have online platforms, workers on contracted business, on-call workers and temporary workers.

Thank you.