Remission Order from Debts Owed by Persons with Disabilities, their Caregivers or their Estates: SI/2022-21
Canada Gazette, Part II, Volume 156, Number 8
SI/2022-21 April 13, 2022
FINANCIAL ADMINISTRATION ACT
Remission Order from Debts Owed by Persons with Disabilities, their Caregivers or their Estates
P.C. 2022-273 March 25, 2022
Her Excellency the Governor General in Council, on the recommendation of the Treasury Board and the Minister of Employment and Social Development, pursuant to subsection 23(2.1)footnote a of the Financial Administration Actfootnote b, considering that the collection of debts resulting from overpayments made in error under the program to provide a one-time payment to persons with disabilities for reasons related to the coronavirus disease 2019 (COVID-19) and owed by persons with disabilities, their caregivers or their estates is unreasonable, remits those debts.
(This note is not part of the Order.)
Pursuant to subsection 23(2.1) of the Financial Administration Act, the Governor in Council, on the recommendation of the Treasury Board and the Minister of Employment and Social Development, makes this Order to remit debts owed by persons with disabilities, their caregivers, or their estates resulting from overpayments made in error under the program to provide a one-time payment to persons with disabilities for reasons related to the coronavirus disease 2019 (COVID-19), considering that the collection of those debts is unreasonable.
The objectives of the Order are
- (1) to limit the financial hardship on Canadians resulting from the COVID-19 pandemic by remitting debts to the Crown for those who received an incorrect amount of the one-time disability payment, through no fault of their own; and
- (2) to maintain the original policy intent of the one-time disability payment to help relieve financial hardship on persons with disabilities with extraordinary expenses due to the COVID-19 pandemic.
The COVID-19 pandemic has had a disproportionate impact on persons with disabilities, who face additional financial pressures to support a broad range of needs, such as the purchase of personal protective equipment and new information technology to support physical distancing, fees for personal support workers, extra medication dispensing fees, and costs related to an increased use of taxis and home delivery services to obtain groceries and prescriptions.
In June 2020, the Government of Canada announced that it would provide a special one-time, tax-free payment to individuals who were certificate holders of the Disability Tax Credit as of July 1, 2020. Following that announcement, in July 2020, the Government informed that, based on consultations with stakeholders and opposition parties, the one-time payment would be issued to approximately 1.75 million Canadians with disabilities who were recipients of any of the following programs or benefits: Disability Tax Credit (DTC) certificate provided by the Canada Revenue Agency, Canada Pension Plan (CPP) disability benefits or Quebec Pension Plan (QPP) disability benefits, and disability supports provided by Veterans Affairs Canada.
The announcement indicated that the deadline to apply for the DTC in order to receive the one-time payment, and to receive a positive eligibility decision before the final payment eligibility list was compiled, was extended from September 25 to December 31, 2020.
The one-time payment to persons with disabilities was issued in three instalments, from October 2020 until April 2021, to approximately 1.75 million recipients. The final payments were completed in April 2021.
The one-time payment was paid to eligible individuals, their caregivers, or their estates without the need for any application, attestation or notification. Instead, those persons identified as eligible for CPP disability benefits, QPP disability benefits or one of the veterans’ disability support programs as of July 1, 2020, as well as those with a valid Disability Tax Credit certificate for 2020, received the one-time payment automatically. This process minimized the risk of payments being issued to non-eligible recipients and minimized the risk of duplicate payments and fraud.
At the time the first payment was issued in October 2020, an administrative error was discovered whereby seniors with disabilities received an amount in excess of the allowed maximum combined amount of $600 for the one-time payment for seniors and the one-time payment for persons with disabilities. It was determined that the error occurred while consolidating a significant volume of data pertaining to the seniors’ one-time payment. The senior’s one-time payment data was contained in multiple files for over six million Canadians and was compared to over 1.6 million client records for the payment to persons with disabilities. Given the short time frames to design this product and the volume of data involved, some data files were not loaded correctly. As a result, 17 152 payments to persons with disabilities were calculated incorrectly, since the amount of the seniors’ one-time payment was not factored into the calculation as it should have been.
Public trustees, who had received bulk payments for both the seniors and persons with disabilities for clients under their care, were advised not to disperse any of the one-time payments to persons with disabilities, and to return these payments to the Department of Employment and Social Development so that the administrative error could be corrected. As a result, 11 984 payments were intercepted, corrected, and reissued in a timely manner, avoiding $5,580,100 in overpayments.
There were, however, a total of 5 166 persons with disabilities not under the care of a public trustee whose payments could not be intercepted, resulting in an overpayment worth $1,575,000.
Approximately 4 400 persons (85%) who received the overpayment are also Guaranteed Income Supplement or Allowance recipients. It is expected that these individuals would struggle to repay the amount owing due to their financial situation.
Subsection 23(2.1) of the Financial Administration Act provides for the Governor in Council, on the recommendation of the Treasury Board, to make an order remitting debts owed under certain circumstances. In this case, the Treasury Board has recommended the remission of debts owed by those seniors eligible for both the one-time payment to persons with disabilities and the one-time payment for seniors, since the debts are due to an administrative error, none of the persons with disabilities affected by the overpayment applied for the benefit, many would not be aware of having been overpaid and would likely lack the financial resources to repay the debt and, therefore, the collection of the debt would be unreasonable.
The Department of Employment and Social Development proposes to use existing reference levels as the source of funds for the Order. There will be no impact on the fiscal framework. While the current cost estimate of the remission is $1.58 million, the Department of Employment and Social Development is proposing to allocate up to $2 million to ensure coverage in the unlikely event that the total cost of the remission ends up being higher than the current estimate.
Individuals that received the one-time disability payment in error will have their debt remitted.
The cost of the Order is estimated at up to $2 million.
Given the nature of the Order and the fact that the recipients of the overpayment are not aware of the overpayment, no consultation was made with the affected group.
Benefits and Integrated Services Branch