Canada Recovery Benefit (CRB) – update and increase in the maximum number of weeks available
The CRB, introduced on September 27, 2020, provides $500 per week to workers who do not qualify for EI, who earned at least $5,000 in 2019 or 2020 and who are unable to return to work or had their income reduced by at least 50% due to COVID-19. The program will last for one year.
Claimants will need to repay $0.50 of the benefit for each dollar of their annual income above $38,000 in the calendar year, up to a maximum of the amount of benefit they received. The $38,000 threshold will not include amounts received under the benefit. The benefit will be taxable.
In February, the program was amended to increase the maximum number of weeks for which the CRB can be claimed from 26 to 38 weeks.
The CRB, introduced on September 27, 2020, provides $500 per week to workers who do not qualify for EI, who earned at least $5,000 in 2019 or 2020 and who are unable to return to work or had their income reduced by at least 50% due to COVID-19. The program will last for one year.[^1]
Claimants will need to repay $0.50 of the benefit for each dollar of their annual income above $38,000 in the calendar year, up to a maximum of the amount of benefit they received. The $38,000 threshold will not include amounts received under the benefit. The benefit will be taxable.
In February, the program was amended to increase the maximum number of weeks for which the CRB can be claimed from 26 to 38 weeks.[^2]
To estimate the cost of increasing the maximum number of weeks available for the CRB, PBO used the same projection method that was published with the CRB legislative costing note on October 7, 2020.[^5]
However, in light of the data published by the Canada Revenue Agency, PBO has made some methodological adjustments to account for the cost of the program to date. It has also accounted for changes in the labour market since the costing note of October 7.
Lastly, based on data that the CRA has shared with PBO, the tax rate and the magnitude of the repayment have been revised downward in relation to the costing note of October 7.
This estimate is highly sensitive to future labour market conditions and Canada’s economy, as well as the progression of the COVID-19 pandemic. In addition, since the LFS is a survey, the reliability of some of the data on specific labour groups varies. There is also significant uncertainty regarding the behavioural response of workers.
There is additional uncertainty surrounding how the proposed measure will be administered (specifically, the extent and intensity of compliance monitoring activities).
- Estimates are presented on an accruals basis as would appear in the budget and public accounts.
- Positive numbers subtract from the budgetary balance, negative numbers contribute to the budget balance.
- “-“ = PBO does not expect a financial cost.