For the BC Seniors’ Advocate Isobel Mackenzie, the situation that local senior Peter Fletcher finds himself in as he took advantage of the Canada Emergency Response Benefit (CERB) last year is nothing new.
Fletcher came to find out his 2020 income exceeded the limit that now denies him access to the guaranteed income supplement that he relies upon to round up his income from his Canada Pension Plan and old age security pension leaving him struggling to not only make ends meet but also to pay back the $14,000 in benefits he owes.
“I am very sympathetic to the GIS recipients,” Mackenzie said. “I’ve had a conversation with Ottawa about this and I am still hoping it will be resolved. When you look at it on the surface it is unfair - that is certainly one description - and inconsistent with the overarching policy and people who were receiving the GIS legitimately did not expect the full amount of their CERB payment to be deducted.”
The way it normally works is that a person applying for GIS is allowed to earn up to $5,000 of taxable income a year and not have it impact the GIS, Mackenzie added.
After that $5,000, a person can earn $10,000 more and 50 per cent of that is discounted.
When visiting the GIS website, it clearly states that Employment Insurance money is not eligible for the exemption.
“But people didn’t apply for Employment Insurance they applied for CERB and when they applied for CERB, a taxable income, it was not unreasonable for the person to think they still had the $5,000 taxable income exemption,” Mackenzie said. “So when July 1 came along people realized they are worse off now than if they had not collected CERB.”
How would people know that CERB would not meet the criteria for the deduction?
“It wasn’t explicit on the CERB website and the response was it was stated on the GIS website - but they weren’t applying for GIS, they were applying for CERB,” Mackenzie pointed out.
“So fair enough - if I applied for GIS in the same year I applied for CERB then on the website for GIS it says CERB is not exempt - but that’s not who we’re talking about here - we’re talking about people who have been collecting GIS and have no reason to go back to the GIS website - they’re looking at the CERB website and they’re not seeing if you’re on the guaranteed income supplement this will not quality for exemption. And I think the key here is that it was taxable income and when you think about the exemption it’s taxable income.”
The calls the Seniors’ Advocate office is getting are from people whose GIS is drastically reduced or completely kicked off it, Mackenzie said.
And with the result of not getting any GIS comes other consequences because then a person is not eligible for some of the perks that come along with GIS like an annual bus pass, Mackenzie added as an example.
“The BC seniors supplement is tied to the GIS,” Mackenzie said. “Now not everyone on GIS gets the supplement - that’s for the poorest of the poor - but the amount you get and if you get it is determined by your GIS status. It’s complicated and what’s also complicated is that it’s highly unlikely that we will see any change in the period leading up to the election.”
Mackenzie said she had a letter ready to send to the Minister for Seniors but there wasn’t one to send it to.
“So that gives you an idea of OK, for the next 30 days or so there isn’t going to be a change,” Mackenzie said. “This perhaps gives people an opportunity to raise the topic in all-candidates meetings in the context of the election forum.”
Mackenzie also noted that the GIS is now money the government doesn’t have to spend because people have become ineligible for it.
“The salient point to me is that GIS recipients are allowed an earning exemption of taxable income when they applied for CERB they were told it was taxable income and they were not told it would not qualify for the earnings exemption on GIS. Period,” Mackenzie said. “So I think treating the CERB income like other taxable income is the fair way to go.”
At the end of the day, CERB was created differently than Employment Insurance and a lot of people received more on CERB than they would’ve on EI that is based on previous earnings, Mackenzie noted.
“A lot of people don’t get $2,000 a month on EI so they’ve been enriched by CERB but we’re saying to the people on GIS, now not so fast there, not only are we not going to allow you to be enriched we’re going to leave you worse off. And these are people who by definition are low income and will be low income for the entirety of what is left of their life.”
