September 19, 2020

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'Stakes are very high' in CERB shuffle

Transition to revamped EI will have negative impact on millions: report

Experts and advocates are sounding the alarm as the federal government transitions from COVID-19 emergency aid to other recovery benefits, calling the move a "recipe for economic disaster."

As of Sept. 27, more than four million Canadians who received the Canada Emergency Response Benefit (CERB) will no longer have access to the weekly $500 — with only about half eligible for lower payments under the revamped employment insurance program, according to a report released Tuesday.

Roughly three million people will be "worse off" once the switch happens, suggests data from a new study by the Canadian Centre for Policy Alternatives — at least 50,000 of them are in Winnipeg.

"It shouldn’t be entirely surprising that we’re all very worried," senior CCPA economist David Macdonald told the Free Press. "Government hasn’t even come back yet after they prorogued Parliament, and all these changes were announced just weeks ago."

Access to EI benefits is normally based on the number of insurable hours someone has worked in the year prior to their application, or since their last claim under a qualifying period. In major cities such as Winnipeg, that means working about 700 or so hours for a given year before being eligible.

Under new rules, Ottawa has temporarily altered eligibility: a minimum of 120 insurable hours or documentation that an individual’s been unemployed since March will provide them with a payment of $377 per week, on average.

Stressing that "major reduction" in funds for at least 1.3 million Canadians switching between the benefits, Macdonald said 781,000 people won’t automatically be switched over and will have to apply manually.

"CERB was definitely generous and there's no shying away from that," he said. "But it was also necessary because of the times we're in. And certainly, the EI just isn't like that — it's quite restrictive."

On top of that, the CCPA estimates about 482,000 people will stop receiving recovery support altogether. Around 20,000 of those are in Manitoba.

Macdonald believes a majority of those are gig, contract and low-wage workers who make less than $1,000 per month.

“About 30 or so of the tenants I work with are on social assistance,” rooming house landlord Steve Tait said Tuesday.

MIKE DEAL / WINNIPEG FREE PRESS

“About 30 or so of the tenants I work with are on social assistance,” rooming house landlord Steve Tait said Tuesday.

"The transition off of CERB will be historic," he said. "The timeline is tight and the stakes are very high, so we’re urging the government to be very careful about these changes and how they could adversely affect vulnerable people who are still going through a crisis during this pandemic."

For Steve Tait, who runs lower-income housing in Winnipeg, the end of CERB could mean "watching more people get homeless and out on the streets."

"About 30 or so of the tenants I work with are on social assistance," he said Tuesday. "Thankfully, not all of them applied for CERB. But some of them did, and now they’re unfortunately going to feel the consequences of that."

The end of CERB could mean “watching more people get homeless and out on the streets.” – Steve Tait

Meantime, the CCPA suggests more women will be worse off when the switch to EI happens (about 1.6 million women versus 1.2 million men). The research organization also believes the change will "disproportionately affect" people who face long-term unemployment, international students, migrant workers and recent immigrants.

The new recovery programs have yet to become legislation, however, since Parliament is out of session.

Come Sept. 23, a four-day window will be open for the feds to make changes to the emergency benefits — which Macdonald hopes is when Ottawa will increase EI to match the former CERB.

"We certainly hope they'll listen to us and other economists who want them to do better."

Twitter: @temurdur

Temur.Durrani@freepress.mb.ca

Temur Durrani

Temur Durrani
Reporter

Temur Durrani reports on the economic impact of the coronavirus pandemic for the Winnipeg Free Press. Funding for this Free Press reporting position comes from the Government of Canada through the Local Journalism Initiative.

Read full biography

History

Updated on Tuesday, September 15, 2020 at 7:27 PM CDT: Fixes typo.

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