B.C. defends $1,000 COVID-19 benefit, as applications open

Finance minister says program spotty, but efficient and watchful against fraud

B.C.'S new COVID-19 benefit of up to $1,000 isn't perfect, but it's the best the province could do without the help of the federal government, while protecting against fraud, says the finance minister.

Online applications for the benefit opened Friday morning, and immediately crashed the government website.

The program offers $1,000 taxfree for households with an annual income of less than $125,000, with the amount lowering on a sliding scale up to an income cutoff of $175,000. Single people are eligible for $500 with an annual income of less than $62,500, with a lesser amount up to $87,500.

Selina Robinson defended the program from criticism that it fails to help those who've lost income due to COVID-19 because eligibility relies only on a person's taxable income from 2019 — before the pandemic even began.

Robinson told the legislature on Thursday that B.C. tried to convince the federal government and Canada Revenue Agency to give it some sort of early access to 2020 tax records, but was rebuffed.

“There was a call made to CRA to find out if there were any possibilities and what it would look like,” she said. “CRA is absolutely swamped and unable to adjust their program to accommodate any changes that we would be making. So it was a given that was off the table. It wouldn't have been possible to actually make that happen.”

If B.C. waited for the CRA to finish 2020 taxes, the money wouldn't flow “until the end of the summer or maybe into the fall,” she said. Premier John Horgan promised in the October election that the money would flow before Christmas.

Opposition Liberal critic Mike Bernier said the program is poorly designed and its reliance on 2019 tax data means those who actually lost their jobs or income due to the pandemic in 2020 might not be eligible.

“There could have been alternatives,” Bernier said in the legislature while debating Robinson on the topic. “There could have been different ways of rolling this out to meet that election promise, which, more importantly, means to help people.”

Government estimates 3.7 million people will receive some or all of the benefit. If a person applied Friday, with a government-estimated turnaround of five days, the money could arrive via direct deposit by Christmas Eve.

Bernier asked why the province didn't ask people to estimate their 2020 taxable income, pay out the money based on those declarations, and recover any overpayments when the CRA calculated the final taxes.

“With large payment programs like this one, there is always concern about fraudulent claims,” replied Robinson.

“It would be a challenge, without unverified information, to look to make sure that it met the risk assessment for that. And it would be very difficult, once payment is made, to then recover it.

“One of my staff even suggested that if somebody then moved to Ontario, we would never be able to recover that payment. So it would be very, very hard to manage if they file taxes outside of British Columbia.”

The benefit program is estimated to cost government $1.7 billion. Robinson said internal financial risks and controls had to be satisfied, and that meant using 2019 tax returns.