Human Resources Committee on Jan. 31st, 2022

[Lori MacDonald]

I'll begin the answer, and then I'll turn to my colleague Mr. Groen to respond as well.

Over the course of the pandemic, we have actually flipped our workforce from 100% place-based, for the most part, to almost 85% virtual and telework. During that time, from a continuity perspective, we've been able to continue to deliver services to Canadians across all of our business lines.

As we are here today to talk about EI, I'll ask Mr. Groen to speak to this issue in terms of what we've been able to put into place.

[Cliff C. Groen, Senior Assistant Deputy Minister, Benefits and Integrated Services Branch, Service Canada, Department of Employment and Social Development]

Thank you, Lori.

To further add to the response, over the past two years, $825 million has been invested in the delivery of the employment insurance program for the timely processing of applications, as well as to nearly triple the size of our EI call centre. We've been able to do that work virtually. Almost all of our staff who are involved in direct processing and answering calls from clients are able to work remotely. We've been able to transition toward that as of April 2020.

In addition, over the course of the pandemic, different simplification measures were introduced related to the delivery of EI, helping to ensure that we were able to process these applications in a timely manner, as well as answer clients' questions.

Thank you.

[Chad Collins, Liberal, Hamilton East—Stoney Creek, ON]

Thank you for those answers.

Several media reports have referenced fraud and/or hacking, the impact on clients and the possible theft of their identity. Could you speak to how you have maintained security in the transition services that you just referenced? How have we protected our clients who have submitted personal information? What level of security have you invested in? What level of fraud have you realized through the security initiatives that you've put in place?

[Lori MacDonald]

We have invested a significant amount of money—the $68.1 million I referenced earlier—in fraud activities. At the same time, we've worked very closely with other organizations and partner agencies to assist us in combatting those particular fraud issues.

I'll ask Mr. Littlefield to comment on this question, please.

[Peter Littlefield, Chief Information Officer, Innovation, Information & Technology Branch, Department of Employment and Social Development]

Thanks very much, Lori.

Thanks for the question.

To further Lori's remarks, since the beginning of the pandemic, there is no question that we have noticed an uptick in attempts at fraud and fraud against our services, as has been the case around the world. We have made some significant changes, from a cybersecurity perspective, to our systems that serve Canadians, putting in place additional measures to validate the identity of clients who are coming in to receive benefits, and to detect any fraudsters, or attempted fraudsters, who are trying to take advantage of the systems that we have.

These aren't perfect measures, but they have resulted in our ability to detect and repel fraud attempts in a better way than we did before, even recognizing that there has been a significant increase throughout the pandemic. There are further measures that will be put in place over time, as we continue to evolve our responses, in response to the way in which fraudsters continue to evolve around the world.

[Chad Collins, Liberal, Hamilton East—Stoney Creek, ON]

If I still have time, I'd like to ask this. You provided an update on the security measures that have been implemented throughout the first two years of the pandemic. What's the vision for 2022 and beyond? What are you looking at right now in terms of investments to protect clients and the personal information that they provide when they apply for EI?

[Peter Littlefield]

Going forward, recognizing that this is not going to stop and the negative activities of fraudsters around the world will continue, we are continuing to make plans and invest in further measures. There is a large focus on the identity of our clients. Recognizing that the major challenge we have here is identify theft, in Canada and around the world, we need better and stronger ways to know for certain who the clients are who are coming to obtain services from us, and to validate that they are who they say they are.

Our continued measures going forward are to strengthen our identity proofing and the management of credentials—usernames, passwords and things like that—for clients who are coming in to obtain our services. We work with our security partners as well. It's not just Service Canada or ESDC, but also the Canadian Centre for Cyber Security and Shared Services Canada. Others, including the Canada Revenue Agency, have significant efforts under way to continue to improve our anti-fraud and cybercrime-type measures going forward, so there are many more measures to come.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Littlefield.

Mr. Collins, your six minutes are up. We will now go to Madame Chabot.

I would ask the members of the committee to identify which members of the panel they are directing their questions to.

Madame Chabot, you have six minutes.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Thank you, Mr. Chair.

I'd like to thank the witnesses for being with us.

Ms. MacDonald, thank you for your testimony.

While we are very pleased to have you here, allow me to remind you that it would have been timely and wise to hear from Minister Gould today. I find it absolutely unfortunate that the Liberal Party and the New Democratic Party opposed a meeting with the minister to discuss an issue that is very important to EI claimants. This is all the more true because, this morning, in an article published by Mr. Bellavance in La Presse, we read that Ms. Gould announced measures, particularly with regard to identity theft. For that reason, we strongly believe that ministers must feel fully accountable for their decisions and that she would have been perfectly able to come and inform us of the situation.

Ms. MacDonald, with all due respect, I listened to you, but I do have two specific questions to ask.

First, at what point were the two ministers responsible, not the cabinet, informed of the urgency of the situation, and at what point did you inform them of these important issues?

My second question is very specific. You talk about the service standard. The current situation for claimants—it's not just a question of identity theft—with respect to processing delays for regular or special EI benefits has been ongoing since last fall. This has been going on for weeks and months. How many files are in “limbo”, as you call it, or outside the service standard?

According to our information, we're talking about tens of thousands of claimants.

So I'll repeat my two questions. First, when were the ministers responsible informed of the urgency of the processing delays for EI claimants? Second, how many files are outside the service standards?

This situation has been disparaged since last fall.

[Lori MacDonald]

Thank you for the question, Mr. Chairman.

I'm going to break this question down into three parts, and I'll turn to Mr. Groen at the end to give Madame Chabot some statistics.

To begin, the minister has been seized with this from the very beginning. She met with us in the fall on the challenges associated with our benefit delivery services to Canadians. We meet with her on a weekly basis to provide her with updates. She challenges us in terms of how we are able to ensure that more people are processed within the timeline of 28 days or four weeks.

She has challenged us in terms of looking at various solutions, including, as an example, hiring additional staff, which we have done. We have had staff come in literally on a monthly basis so that we can train them and put them into these very important key processing areas.

We continue to brief her on a weekly basis. At each one of those briefings, she has very serious conversations with us in terms of what more we can do to deliver these services to Canadians. That includes things like hiring, realigning resources and doing deep-dive analyses in particular areas.

As an example, she raised the issue of fraud in the Quebec region with us last fall. She was concerned about that. As a result, we went out to hire additional resources, particularly for Quebec. In fact, next week we should be onboarding 105 new, additional investigators for Quebec as it relates to identity theft, so that we can more efficiently validate those claims to get people back into pay.

The minister is very seized with this issue.

Unfortunately, as I said in my opening comments, we are experiencing delays because we had two very difficult events happen at the same time: winter—a peak season that happens from late November until now—and then omicron. Unfortunately, when the region of Quebec locked down on December 19, all of those things came together to dramatically increase the volumes of claims. In fact, as I said, they were 36% higher.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Thank you. My question is about the number of files. I think we understand the context very well. In any case, it’s a regular volume of files in December and January, and I want to know the exact number—and you have the number—of files, not percentages, that are outside service standards.

[Lori MacDonald]

I'll ask Mr. Groen to come in on that question.

[Cliff C. Groen]

Thank you very much for your question.

As Ms. MacDonald mentioned, over the past six weeks, we've seen a significant increase in the number of applications. In fact, the number of applications we received during this period is much higher than in the past and in normal times.

For example, during the week of December 20, we received 189,000 new EI claims. Over a four‑week period, we received over 100,000 applications per week. This situation is not normal, and the impact of the Omicron variant on our service delivery is really clear.

During this period, we were still able to process the vast majority of these requests. Currently, we are still able to meet our target, which is to process applications within four weeks. As mentioned, the vast majority of requests have been processed, 88% of them. Twelve per cent of requests that are not processed—

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Groen.

Madame Chabot, your time has concluded.

We will now go to Madame Zarrillo for six minutes.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Mr. Chair.

Thank you to Ms. MacDonald and the staff she has brought with her today.

We all agree that the beneficiaries need their entitlement, so I'm going to direct my questions toward the fraud and the account lockouts. When will people who have been victims—waiting over the four-week expectation—receive their benefits? Is there a unique liaison number for those “complex call” applicants to reach out to? If so, what is that telephone number?

[Lori MacDonald]

Thank you for that question, Mr. Chairman.

I will begin, and then I'll turn to my colleague Mary Crescenzi to provide some additional information.

I think it's important from a context perspective to understand what we're talking about here in terms of pure numbers. Mr. Groen gave some examples of numbers that we've received over the last several weeks, but, grosso modo, during the past year we've processed hundreds of thousands of claims.

Currently in our inventory we have approximately 10,000 cases that would be identified under that umbrella of fraud. Of those 10,000 cases, about 2,000 would be what we would call “urgent” in terms of clients in dire need who have contacted us. Those cases will be resolved in the next two weeks, given the additional resources we've put in place over the last number of weeks and the triage we've been doing in those cases.

I would also say that it's important to recognize that fraudsters are very bold people. They actually contact us pretending to be clients, because they do have information pertaining to those clients. It's not always as simplistic as a one-phone-call resolution. Because we have to balance not revictimizing those clients and at the same time verify their information, they're not always resolved in one day, although most are. As I indicated, those 2,000 I referenced in terms of urgent need will be resolved in the next two weeks. Beyond that, we are also triaging additional cases, some of which will be fraudulent as well, and we continue to work through those identity pieces to resolve the situation.

I'll ask Mary Crescenzi to provide any additional information.

[Mary Crescenzi, Assistant Deputy Minister, Integrity Services Branch, Department of Employment and Social Development]

Thank you so much, Deputy.

Hello, everyone.

As you know, Service Canada balances the protection of the public fund from fraudsters, while at the same time, we understand the priority of putting real clients into pay as quickly as possible. As our deputy indicated, we are working with a number of clients who have been the victims of fraud as a result of their credentials being either stolen or compromised through the private sector or financial institutions. These are not unusual sorts of circumstances, unfortunately, these days. We have heard from the International Public Sector Fraud Forum that these activities are happening across the country.

In support of those clients who are most in need, the 2,000 that our deputy indicated, we are redirecting our staff to focus on contacting these clients immediately and working through those issues. It really is on a case-by-case basis, but we hope that, in terms of the straightforward cases, we will be able to address them during the conversation of the second-level and third-level assurance questions we will need to have answered appropriately.

Unfortunately, there are more complex cases. There may be cases where the fraudster is trying to represent a legitimate client, and we will have to work through that as well. We are also developing, and will introduce later this week, a dedicated team at the call centre who will be taking on those calls, and we'll move the conversation of verifying identity right at the first point of contact to expedite addressing those concerns.

We are also hiring those additional resources in the Quebec region. They are starting imminently and they will be able to bolster our capacity. Unfortunately, the Quebec region has seen a disproportionately larger number of impacted...cases of fraud associated with compromised and stolen identities, but we have a dedicated action plan that will bring all of these activities to bear quickly and in a timely way to offset those impacts as quickly as possible.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Mr. Chair, those are all my questions.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madame Zarrillo.

We will move, then, to the second round.

Mr. Ruff, the floor is yours for five minutes.

[Alex Ruff, Conservative, Bruce—Grey—Owen Sound, ON]

Thank you, Chair, and thanks to the witnesses for coming today.

My first point would be that I've had constituents reaching out since last summer on issues with the 30-day standard, for different reasons, and 100% of the constituents who have reached out to me are ones whose cases were not resolved in the 30-day resolution period and standard.

My questions are going to focus on getting some facts around the scope of this challenge and this issue that's ongoing. My first question is likely best addressed to Mr. Groen.

Can you please provide the committee with the approximate number of EI cases that failed to be resolved during the 30-day target in 2021, just the number?

[Cliff C. Groen]

Certainly. We have received 3.1 million applications over the course of the current fiscal year, and 88% of those applications have been processed within the service standard of 28 days. Therefore, 12% of about three million applications have not been processed within that 28-day service standard. To do the simple math, it would be about 300,000 applications.

However, I would stress that for the vast majority of those individuals whose applications are not processed within the four-week service standard, they are processed within six weeks. It will happen, but it is extremely rare that someone would not have their application processed within six weeks, and those situations are dealt with—

[Alex Ruff, Conservative, Bruce—Grey—Owen Sound, ON]

Thanks, Mr. Groen. That was the answer to my question: Over 300,000 Canadians have been impacted.

How many EI claimants have experienced payment disruptions due to these hacked accounts?

[Lori MacDonald]

Mr. Chair, I'll jump in first here and say that, to be very clear, Service Canada accounts have not been hacked. These issues in terms of identity and fraud are a result of people's information being stolen or breached through the private sector or financial institutions.

As I said in the beginning, a few minutes ago, right now we have about 10,000 cases in our inventory. We don't know how many of those cases are legitimate and how many are actually fraudster cases. Of those—

[Alex Ruff, Conservative, Bruce—Grey—Owen Sound, ON]

Okay. Thanks, Ms. MacDonald. That answers the question.

You are saying 2,000 are still frozen and need to be resolved, if I heard your earlier testimony correctly.

[Lori MacDonald]

That's correct.