OTTAWA — The Canada Revenue Agency (CRA) has taken decisive action by terminating 120 of its employees who were found to have unlawfully applied for the Canada Emergency Response Benefit (CERB) while still employed by the tax authority. This development marks a significant escalation in the ongoing saga that began on June 30 when the CRA initially reported the dismissal of 20 employees while investigating a total of 600 suspected cases of “inappropriate” CERB claims.

Nina Ioussoupova, spokesperson for CRA, issued a statement on Friday, declaring, “Out of the approximately 600 cases we can report that 120 individuals are no longer with the CRA as a result of this internal review. The investigations and disciplinary processes continue.”

CERB, introduced during the early stages of the COVID-19 pandemic, provided crucial financial relief by offering $2,000 per month to eligible recipients. A pivotal criterion for eligibility was that recipients must have lost their jobs or primary sources of income due to the pandemic, rendering employed individuals largely ineligible unless they earned less than $1,000 per month when applying. It is essential to note that during this period, the CRA employed approximately 45,000 individuals.

Government sources revealed that the review of 600 employees was initiated due to mounting pressure from the former National Revenue Minister, Diane Lebouthillier. Initially, in March, CRA announced the investigation of 10 employees, which raised considerable skepticism from Lebouthillier. Consequently, the CRA expanded its inquiry to encompass a broader range of cases.

Marie-Claude Bibeau subsequently replaced Lebouthillier as minister in a mid-August cabinet shuffle, marking a transition in leadership as this matter continued to unfold.

In its statement, the CRA has clarified that they are meticulously examining each of the 600 cases individually because employment with the CRA did not necessarily imply immediate CERB ineligibility. To date, it has been determined that 30 staff members under investigation were, in fact, eligible for the benefit.

Addressing requests for information on the job titles or occupational groups of employees under investigation, the CRA has consistently refused to comply, citing concerns related to confidentiality and privacy rights.

However, while the CRA’s internal investigations are of paramount importance, they represent just a fraction of the broader effort to recover billions of dollars in COVID-19 benefit overpayments that were disbursed to Canadians. Earlier in 2023, the agency delivered notices to nearly one million Canadians, informing them of the recoupment of a staggering $4.2 billion in overpaid COVID-19 benefits. Furthermore, it is anticipated that additional overpayments will be uncovered as the CRA, in conjunction with Employment and Social Development Canada (ESDC), continues to conduct in-depth verifications.

In a December report, Auditor General Karen Hogan identified a substantial $27 billion in payments from various pandemic benefits, with a particular focus on the Canada Emergency Wage Subsidy (CEWS), as suspicious. The CRA strongly disputed these numbers, asserting that the auditor general employed an improper calculation method that led to the erroneous flagging of numerous CEWS payments as inappropriate.

However, it is worth noting that Hogan also voiced her concerns about the lack of rigor in the CRA and ESDC’s plans to recover inappropriate payments. She cautioned that this lack of thoroughness could lead to the failure to recoup “significant” amounts in overpayments.

Notably, the CRA is not the sole federal department that has been compelled to dismiss employees who received CERB while still employed. In February, Mary Crescenzi, head of ESDC integrity services, informed MPs on the public accounts committee that her department had terminated 49 workers who had received CERB during the pandemic. Crescenzi clarified that these employees had availed themselves of CERB benefits outside of working hours and had not used government devices for their applications. As this situation continues to evolve, it remains unclear whether the department is investigating additional cases of improper CERB claims among its staff.