Opening Statement to the Standing Committee on Public Accounts
Canada Emergency Response Benefit
(Report 6—2021 Reports of the Auditor General of Canada)
15 April 2021
Karen Hogan, Chartered Professional AccountantCPA, Chartered AccountantCA
Auditor General of Canada
Madam Chair, thank you for this opportunity to discuss our audit report on the Canada Emergency Response Benefit. The report was tabled in the House of Commons on March 25. Joining me is Jo Ann Schwartz, who was the principal responsible for the audit, and Robyn Roy and Steven Mariani, who were the directors for the audit.
The audit focused on 2 aspects of the Canada Emergency Response Benefit. The first was whether Employment and Social Development Canada and the Department of Finance Canada provided analysis to support the initial design of the benefit and subsequent adjustments.
The second was whether Employment and Social Development Canada and the Canada Revenue Agency designed controls so that the benefit would support eligible workers who lost income because of the COVID‑19 pandemic, including limiting abuse of the benefit.
Overall, we found that the organizations quickly designed, rolled out, and adjusted the benefit to support workers who lost income because of the pandemic.
Employment and Social Development Canada and the Department of Finance Canada considered key areas in the initial design of the benefit. They subsequently performed analysis to inform changes to the benefit and respond to the evolving pandemic situation.
To expedite issuing benefit payments, Employment and Social Development Canada and the Canada Revenue Agency adjusted their usual approach to pre-payment controls and decided to focus on post-payment controls. Both organizations understood the risks involved with this approach. They decided to rely on the attestations of applicants to assess eligibility for the benefit. They also relied on some automated pre-payment controls that were possible using their existing information technology systems.
Accepting risks in order to expedite payments to those in need is consistent with international best practices. As the ability to implement pre-payment controls is limited in an emergency, post‑payment verification becomes very important and must be planned for and carried out to uphold the stewardship of public funds.
To prevent payments from being issued to ineligible applicants, the department and the agency introduced additional controls after the benefit was launched. One such control, introduced about 1 week after the emergency benefit was launched, was to stop applicants from receiving payments from both the department and the agency. Before this control was introduced, a number of individuals applied for and received payments from both organizations. According to the department and the agency, this represented approximately $500 million. In our view, it will be critical for the organizations to conduct rigorous post-payment verification work.
The department and the agency have developed post-payment verification plans. Most of this work is to start in the 2021–22 fiscal year. The implementation of the organizations’ post-payment verification work will be the subject of a future audit.
In our report, we made 2 recommendations. They focus on the post-payment verification work and on conducting a formal assessment of the delivery of the benefit to inform future initiatives. Employment and Social Development Canada and the Canada Revenue Agency agreed with both recommendations.
Madam Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee may have. Thank you.