Morantz says Liberals ‘on the fly’ decisions hurt recovery

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This article was published 20/05/2020 (1985 days ago), so information in it may no longer be current.

OTTAWA — The number of Canadians receiving the COVID-19 unemployment benefit is triple those getting a wage subsidy, raising worries federal programs will be slow to help the economy recover.

“Clearly, something has gone wrong,” said Conservative MP Marty Morantz, whose riding straddles Winnipeg’s west.

Federal departments reported Wednesday that 2.7 million Canadians are on the wage subsidy, versus 8.1 million who applied for the Canada Emergency Response Benefit.

Ottawa launched the monthly $2,000 CERB in early April, in an effort to help Canadians who have lost jobs or work hours, and the Liberals rolled out the Canada Emergency Wage Subsidy three weeks later.

The wage subsidy pays up to 75 per cent of an employee’s wage, maintaining their health insurance and making it easier for businesses to scale up as the recession abates.

But numerous industry groups have said the six-week lag between the COVID-19 shutdown and the wage subsidy was too late for businesses to survive.

Ottawa allocated $73 billion for CEWS over 12 weeks, but in the first eight weeks, just $5.7 billion had been paid out, dating to March 15.

“These programs are not really working,” said Morantz. He noted CEWS provides many workers with more cash than CERB, and yet it’s only gotten scant uptake. “The government is letting down Canadians.”

Prime Minister Justin Trudeau has extended the program by another 12 weeks, and urged businesses to bring back laid-off staff.

“Please rehire your workers; use the wage subsidy for their paycheque. That’s what it’s there for,” Trudeau said Tuesday.

Jennifer Robson, a political-management professor at Carleton University in Ottawa, said CEWS late rollout is just one factor.

For one, self-employed people who don’t have a wage to subsidize could qualify for CERB.

CEWS requires employers to complete a complex application form, compared with the simple CERB form, which is given to almost anyone with a Social Insurance Number and checked for compliance after the fact.

“Perhaps (employers) would like to hold off on using (CEWS) until they’re up and going — that they’re kind of banking it,” said Robson.

Comparing archived data on the two program’s uptick, Robson reported a slight jump in CERB applications a week after the CEWS launched. She also noticed the number of CERB applications, unique applicants and total payouts suggest many are only applying for part of the eligible two-month period.

To her, that suggests employers might have taken longer to apply than staff expected, or perhaps employers who didn’t qualify for the subsidy then suggested their staff apply for the CERB.

“Reopening is still very much a patchwork right now, so it’s still early days,” said Robson, an expert in social policy who will testify Thursday before MPs.

Morantz says the federal Liberals botched their COVID-19 pandemic response by not getting enough outside advice. For example, CEWS was originally set at 10 per cent, a rate almost universally panned before the Liberals raised it to 75 per cent.

“You see the government making changes to these programs on the fly, reacting after weeks and weeks of suggestions,” said Morantz, arguing parliamentary sittings would have caught some issues before programs were launched.

Finance Minister Bill Morneau said last week he expects more workers to go from the benefit to the wage subsidy after the government broadened CEWS criteria and time frame.

“Employers have been signing up at a rapid pace. You will see more funding through that program come as that is rolled out,” he told reporters May 15.

That day, the Free Press asked both the Canada Revenue Agency and Service Canada how many Manitobans had applied or received either the CERB or CEWS; neither agency could provide an answer by Wednesday.

Robson said getting the number of applications by week, region and gender would help experts figure out how the pandemic is impacting different people and whether policies are working.

NDP MP Daniel Blaikie said it could also help provinces craft their own supports.

“It’s obvious that there’s a benefit in having that information,” Blaikie said.

“We’re living in a really fast-paced policy environment; there are a lot of decisions, with big financial and other implications, being made.”

dylan.robertson@freepress.mb.ca