CERB cutting into child care benefits unexpected, mom says

For Kathleen Coady, a single mother living in New Waterford, N.S., the Canada Emergency Response Benefit was a lifeline during the COVID-19 pandemic.

But Coady said that temporary boost in income last year has come with a cost this year.

She expected her Canada Child Benefit to go up with the addition of a baby 15 months ago, but instead it has been cut because of CERB — and advocates say others are in the same boat.

"I lost $323 a month, so in the end it kind of screwed us. But at the time, it seemed like a great idea," Coady said.

"When you lose three hundred and twenty-something dollars a month, when you were expected to get even more than what you had before, it stings. It stings a lot."

Coady said when her employment insurance sick benefits ran out last year, she thought she would qualify for CERB.

She applied for CERB, and received the $2,000 a month, but then found out she did not qualify.

'I don't think it's right at all'

Coady paid that money back at tax time this year, but said it's not fair that her child benefit has been cut as a result.

"I knew that you'd have to pay it back," she said. "I knew that, but I didn't know, honestly, I did not know that it would affect my children's money.

"I don't think it's right at all that CERB should be classified as income toward how much your baby bonus is for your children to survive, because what you made last year getting that extra $2,000 a month, obviously, you're not getting that this month."

With a newborn in the house, Coady says she doesn't regret the extra income because it helped her with food and clothing as well as toys to keep her other two children busy during the lockdown.

"Of course, as a mother, you'd do anything you could for your kids," she said. "If asked, I would say yes, I'd do it again, because it was a chance to give them that stuff and help them have better birthdays under the pandemic."

JoAnna LaTulippe-Rochon, executive director of the Cape Breton Family Resource Centre in Sydney, said a number of clients have had their child benefits cut due to emergency pandemic funding.

"Some people were quite thrown and will remain in a real dire situation," she said.

LaTulippe-Rochon said CERB payments were meant to help people out in a crisis, but they have come with an unintended consequence, affecting the calculations for many income-tested government programs.

CERB payments are now causing hardship for parents expecting child benefits and low-income seniors who qualify for the guaranteed income supplement, she said, and it will have the same effect on people applying for income assistance or public housing.

The resource centre offers help for clients needing food, transportation and child care, but La Tulippe-Rochon said the government needs to review the pandemic's effect on low-income earners.

Christine Saulnier, Nova Scotia director for the Canadian Centre for Policy Alternatives, praised the provincial and federal governments for quick action on income supports during the pandemic.

But she said they failed to take into account how the programs would affect income-tested programs the following year.

Saulnier said the solution is simple. She and her colleagues with the Campaign 2000 to End Child and Family Poverty say governments just have to remove the federal COVID-19 benefit programs from any income calculations.

"CERB could have been excluded from the calculations, looking at what was happening with seniors' income," she said. "That would have been actually a pretty simple change to the taxation system's assessment of income."

Saulnier also said governments demonstrated they can change gears rapidly, when they want to.

"The pandemic ... exposed where we knew the disparities already existed, but it also exposed that we can do things," she said. "Government can respond more quickly."

A spokesperson for the federal Finance Department said in addition to CERB, the government "increased the Canada Child Benefit to keep up with the cost of living and helped lift 435,000 children out of poverty, and we expanded the Canada Workers Benefit so that a million more low-wage workers are now eligible for support (up to $2,400 per family)."

Employment and Social Development Canada administers the guaranteed income supplement and says GIS benefits are reduced by one dollar for every two dollars of net income in the previous year.

It says that means a senior would have received more in CERB than they would lose in GIS.

The department also says seniors can appeal, if they wish.

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