(a) Revenue Canada has effective processes in place to ensure that duplicate payments cannot be made in respect of a child, for the same period. As a result, such cases are extremely rare. A review of all compliance activities for the 1997-98 fiscal period, over 31,000 actions, revealed only one case of duplicate payments being made in respect of a child. Data were not kept at that level of detail prior to 1997-98.
(b) For statistical purposes, the percentage is effectively “O”.
(c) The one case detected involved an overpayment of $1,574.
(d) Not applicable.
(e) For the case detected, overpayments continued for 17 months.
(f) The overpayment is being recovered from the client. In general, overpayments are recovered by deducting 50% of the amount of future benefits until the debt is repaid. However, a lower rate will be accepted if the client demonstrates that the 50% withholding causes significant financial hardship.
(g) Each year, about 400 clients fail to report the death of a CTB, child tax benefit, entitled child to Revenue Canada, and continue to reveive benefits in respect of that child for an extended period of time, i.e., more that a year following the death of the child.
(h) This represents 0.007% i.e., about one child in 14,000, of children in respect of whom CTB is being paid for the year.
(i) The annual total of 400 cases is about 18% of CTB entitled children who die each year.
(j) Losses for the last and current fiscal years are estimated to be less that $800,000 and $1,000,000 respectively, against annual expenditures of $5.1 billion.
(k) The average annual overpayment per case is approximately $510.
(l) If neither the client nor Revenue Canada take corrective action in respect of a case, payments may continue for an average of 9.6 years following the child's death. Using this as a worst case scenario, Revenue Canada risks overpaying CTB by an average of $4,900, over the duration of the case. It should be noted that CTB is a relatively new program, with the first payments being made in 1993.
In the near future, Revenue Canada hopes to obtain detailed infromation on child deaths directly from the provinces, so that the department can accurately and quickly take appropriate action to prevent overpayments, without adding to ghe stress and duress experienced by the grieving family.
(m) In most cases the parent contacts Revenue Canada when he or she realizes that benefits are still being received in respect of a deceased child. They may be detected during routine reviews of the account, but the frequency of occurrence is too low for this to happen more than a few times a year. In either case the account is adjusted and any overpayment is recovered without interest and penalities being charged, barring deliberate fraud.
(n) To date Revenue Canada has not undertaken any compliance reviews that specifically target the failure to report the death of a child. Revenue Canada has concentrated its efforts on imforming the public of the need to advise the department immediately of such an event. Assuming the required data will be made available by the provinces, Revenue Canada will soon be able to take prompt corrective action at a very modest cost.
Question No. 101—