Nearly 5.4M receiving emergency federal aid as requests climb

OTTAWA

Nearly 5.4 million Canadians are receiving emergency federal aid, with hundreds of thousands more claims waiting to be processed, the federal government said Monday, providing another snapshot of the economic fallout from COVID-19.

Federal figures showed that by Monday morning, 5.38 million people were getting payments through the Canada Emergency Response Benefit.

That includes some two million people who were previously approved for employment insurance benefits, but moved over to the new $2,000-a-month benefit that opened for applications one week ago.

During the first week it was available, there were just under 3.5 million claims, including nearly 172,000 over the weekend.

Figures provided by Employment Minister Carla Qualtrough’s office show the government has received about six million claims for financial help in total since the crisis began about one month ago, when non-essential economic activity was paused due to public health concerns.

The Liberals are likely to roll out more help soon to fill gaps in existing programs, such as by broadening the scope of the CERB to capture workers currently being left out.

On Wednesday, the Bank of

Canada will make a rate announcement, issue an economic outlook, and could coordinate any new actions with the Finance Department, said Scotiabank deputy chief economist Brett House.

“The bank’s work isn’t quite done here,” House said.

“If they’re going to roll out additional measures, it’s the perfect time to do so.”

Since the start of March, the central bank has slashed its key interest rate to 0.25 per cent from 1.75 per cent, including two unscheduled cuts. It has also started a massive bond purchase program that goes beyond what the central bank did during the global financial crisis just over a decade ago.

At the last of those unscheduled cuts, the bank indicated the target overnight rate was as low it could be.

Last week, A C.D. Howe Institute panel of economists concluded there was little reason for the bank to move the key rate “appreciably over the next year” and instead should focus on keeping credit markets functioning.

Panellist Thorsten Koeppl, a professor in the economics department at Queen’s University, said he expects the rate to go to zero because the central bank is paying interest at the target rate instead of on a half-point band around the rate - removing any hurdle to putting the rate lower.