Public Accounts Committee on May 4th, 2021

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

In terms of the female presumption concept, what were some of the difficulties resulting from that? How can we fix it or mitigate the confusion and sensitivities caused by this concept?

[Martin Dompierre]

As I indicated in my opening statement, we found that the female presumption program concept presents a challenge for administration, and not just for the agency but also for the applicant. There seems to be some sense of confusion about who the primary caregiver is.

By law, the primary caregiver is presumed to be the female parent. If this clause is rebutted, the male parent could also be the person entitled to get the payment. Sometimes, as we saw in the sample that we reviewed, there was some confusion in identifying who the primary caregiver was, and sometimes the amount that should have been given to that person was not given at the initial point.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

How can we make changes to lessen the confusion?

[Martin Dompierre]

Basically, we made a recommendation to the agency for them to enhance some of the procedures and the communication. We saw that in some cases the letters that were communicated to the applicants were convoluted and confusing and that it was not always clear what steps an applicant needed to take to receive the amount they were due.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Mr. Hamilton, could you expand on those points?

[Bob Hamilton]

As mentioned, this is a feature of the legislation, so we administer it on the basis of the legislation. However, we are looking at two things to help reduce the confusion that the Auditor General referenced.

The first is to make sure that we're properly training our people and that they understand. That would be one way to make sure that we're applying things in a way that's consistent and clear for the recipient.

The second is to make sure that we improve our communication to those recipients so that when somebody is applying for the benefit and they go through the process, they understand how this female presumption rule works and, more importantly, how it affects the benefits they're applying for. I guess in a sense we're looking at communication on two fronts: One is internal, to make sure that it's clear for our employees, and the other is for the recipients, to make sure that it's clear for them.

[The Chair, Conservative, Kelly Block]

Thank you very much, Ms. Yip and Mr. Hamilton.

We will now move to Mr. Blanchette-Joncas for six minutes.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you, Madam Chair.

I want to say hello to the witnesses here today.

My first question is for Mr. Dompierre, Assistant Auditor General at the Office of the Auditor General.

Good morning, Mr. Dompierre. Welcome to the committee. It is a pleasure to hear from you.

We rarely have an opportunity to talk to you. By the way, I want to say hello to Ms. Hogan. She is a regular in our committee, and she has been participating in our work for many months.

I can imagine how relieved Canada Revenue Agency officials must have been when they read your report. That is good news. Your dedicated and rigorous work is also helping the agency in its management of public funds. That deserves recognition.

That said, I do have something of a doubt about your finding on the criteria of female presumption related to the well-being of children. In the case we are considering, the approach related to the Canada child benefit, that goes without saying.

However, I am wondering about the discomfort today's reality raises, concerning the fact that a child can have two dads or two moms. The agency has already accepted your recommendation to make questions for parents more focused.

I want to understand your recommendations and observations. Do you think similar situations could be avoided if broader criteria regulated the Canada Revenue Agency's methods? Here I am mainly thinking of spousal benefits in cases where marital status is not quite clear.

[Martin Dompierre]

Thank you for the question.

We are happy to be here to talk about a report that is pretty positive concerning the Canada Revenue Agency.

The female presumption concept is still justified today. That concept is not being questioned. Women are earning less than men in the labour market, and they are provided with financial assistance to raise their children.

What we noted is that the law states that the female presumption concept is the starting point for determining to whom the money will be paid. In the case of some blended families, it may be difficult for both the agency and the applicant to understand at what point they are entitled to the money they're owed.

As I mentioned, we found that there may have been challenges in terms of communication, as well as in terms of procedure the agency should modify to clarify that concept and to ensure that someone who has one or several children in their care in a family setting receives the money they are due.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you for clarifying, Mr. Dompierre.

You also mentioned in your report that some information the agency had was outdated, or, at the very least, no longer accurate.

Do you think it would be relevant for the Canada Revenue Agency to launch an investigation to ensure that cases of fraud, such as identity theft, have not been disguised within the workings of the program?

[Martin Dompierre]

Thank you for the question.

As we mentioned, we found that the amounts were accurate and timely. However, we did note that there was room for improvement in terms of the program's integrity.

For example, in some files in our sample, we noticed that a few months had gone by before the information that was changed in the file was communicated to the agency, so that it would be able to properly determine the applicant's eligibility and, of course, the payment amount. That situation can occur when a couple separates and the parents share custody of the children, partially or fully. That can delay the work of the agent reviewing the file every year in order to manage payments and to determine their amount, as well as the applicant's eligibility.

So there may be overpayments or underpayments. Someone who has received overpayments will have to pay the money back and, in the opposite case, the agency will have to make other payments to make up for the difference.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

If I understand correctly, if information is not up to date in the file, the person may no longer be eligible for the program, but they may still continue to receive payments. Is that right?

[Martin Dompierre]

That's right. We also indicated in the report that there were some communication-related problems between the agency and federal departments. For example, if someone leaves Canada permanently, it would be good for the agency to know that. In this kind of a situation, the agency is not aware and continues to make payments. Once the parent stops filing tax returns, there may be overpayments, and the agency must then recover that money.

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Dompierre, you mentioned in your report that, if payments were made to people who were not eligible for the Canada child benefit, it could cost up to $100,000 per child.

How did you calculate those costs?

[The Chair, Conservative, Kelly Block]

Give a very short answer, please, Mr. Dompierre.

[Martin Dompierre]

We calculated the cost for a family of raising a child from birth to the age of 18. We ended up with a total amount of approximately $100,000, as we stated in our report.

[The Chair, Conservative, Kelly Block]

Thank you very much.

We will go to Mr. Green for six minutes.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you.

I would agree with the previous speaker, my friend Ms. Yip, that it is good to have a report before us highlighting a successful program, one that delivered for many Canadians across the country in a time of need and for which I have seen very little controversy in my preliminary overview of the report.

I do want to zero in, though, on some of the processing questions. Section 4.32 states that “First-level agents at the CRA were required to complete the initial processing of benefit applications in approximately 5 minutes. In this very limited time, they were expected to enter information from a paper application into an electronic database. The system logic then made the decision whether to approve the application, deny it, or refer the application to a higher level for further assessment.”

Why are the agents expected to complete the initial processing in five minutes? Is this a reasonable time, or could it lead to errors in inputting information?

[Bob Hamilton]

Madam Chair, I'm happy to respond to that, although one of my colleagues may want to supplement my answer

The reference in the Auditor General's report is to five minutes. Is that reasonable or is it not reasonable? My sense is that if you couple it together with the conclusion of the report, which is that we were able to administer and make the payments in a timely and accurate way, we are allowing our agents adequate time to make an initial assessment, or a more detailed one if that's required.

We don't feel that we are not giving them enough time, but obviously, as part of our review of the program, we will look at this to see if there's anything we should be doing at the front end in terms of training and maybe making sure people are clear as to the processes so that they can continue to get payments out in an accurate and timely basis, and perhaps even improve the process.

[Matthew Green, NDP, Hamilton Centre, ON]

Is there any idea, through you, Madam Chair, on how many Canadians were eligible but did not apply for this benefit? How much was left on the table in terms of who might be eligible in preliminary policy reviews versus who actually applied for it?

[Bob Hamilton]

I'll take that again, Madam Chair, but I will ask my colleague, Frank Vermaeten or one of the others, to respond.

We feel quite confident that we have good outreach and education to make people aware of these benefits, the Canada child benefit being one, but it is an ongoing challenge. We try to make sure we're improving the awareness so that people file returns and become eligible for these benefits.

Whether it's in vulnerable communities or what have you, we know there are some people out there who aren't filing to get the benefits. We have an ongoing work program to try to improve our communication and outreach to make sure that we maximize the utilization of these benefits that people are eligible for and should be receiving.

In terms of how many are out there, I'm not sure we would have that figure, but I'll ask Frank if he wants to add anything.

[Frank Vermaeten]

Thank you.

It's difficult to determine exactly how many people are not applying, but we do have—and this is really important—the automated system at birth. When we have newborn children, we work with the hospitals, the people there, to automatically provide us with that information, so we get an extremely high take-up rate for those individuals. More than 97% of children are registered right at birth through that process. We have a very high take-up rate.

Of course, we have recent immigrants, or maybe people who hadn't applied in the past. Those individuals become a more manual process, and you can imagine—

[Matthew Green, NDP, Hamilton Centre, ON]

I don't want to get too stuck on the process. Through you, Madam Chair, I want to get to the outcomes.

Is it ever the case.... In Hamilton, for instance, we help thousands of people process their taxes through our constituency office in a voluntary tax program. Has there been any analysis or policy discussion around what automatic tax filing for fixed-income people might do in terms of unlocking this?

I can share with you that in Hamilton there's an estimated $30 million a year that goes unclaimed in social service supports, including Ontario Works, ODSP, and a whole host of others.

When I think about programs like GIS, OAS and of course the child tax benefit, I'm wondering if there have been any policy discussions on what automated tax filings for fixed-income folks might look like to help streamline this critical support for people.

[Bob Hamilton]

Madam Chair, I'll take a stab at that.

It is an ongoing area that we're looking at. Indeed, in the Speech from the Throne, there was a reference to automated tax filing to make it easier for people to get their benefits.

We have a few mechanisms in place that help on this front. I think you mentioned the community volunteer income tax program, the CVITP, which helps people fill out their tax return, and, if eligible, to receive benefits. We also have File my Return, which is a phone-based system.

We are looking at other options, including automated filing, to see how that could help in this area to make sure people are aware and are filing so that they are eligible for their benefits.

We have a few things in place, but that issue of automated filing is one that we're looking at.

[Matthew Green, NDP, Hamilton Centre, ON]

That's encouraging.

Thank you, Madam Chair.