Poll: Is it Premature to Reduce the Canada Recovery Benefit?

On June 23, the April 19, 2021 Federal Budget was passed into law by the House of Commons.  It included changes to pandemic supports, including the extension and reduction to the Canada Recovery Benefit to $300 per week. Our June Poll asked our readers if they feel this move is premature, and the answers provide insights to the question “Is it time to get our economy back to normal?” For the majority of our June Poll respondants (66%), the answer is ‘yes’ it’s time.  But it was a close neck-in-neck race and insights from both sides of the equation are enlightening.  Please read on to find out why:

These pros were in the majority and felt the extension of benefits should stop or be reduced:

“Already over budget.” - Peter Lupton

“It will force people to look for a job instead of relying on the government. If there was no financial help form the government, people would find a job in a different type of industry.” – Gilles Royer

“No - this should have been scaled back before now - most employers are scratching their heads trying to find employees and most common response from potential employee(s) is - why would I work when I can stay home and make $500 a week?” – Lorraine Keating

“All the more reason to get vaccinated and continue with PPE and hygiene. Maybe time to drop free deliveries, offer incentives for dining and hotels. More people spending money will need more workers, more workers spending money will ... and on it goes. If you haven't learned anything yet, you don't need everything new every week and should have an emergency fund.” – Jay D

On the side of “Yes”, the benefits should continue:

“The COVID subsidy monies should be industry specific. There are industries, such as hospitality and tourism, that will need it for several months yet.” – Connie Pettigrew

“Yes, With the stay at home order just lifted and many industries still cannot open at all, while many that are open can't open to full capacity.  How can people survive a minimum wage job where there is only a fraction of seating capacity?  Hair salons, tattoo parlours and entertainment venues still cannot open at all in Ontario.  Many small businesses haven't been able to call their employees back full time as the owner operator can handle the client flow as it is still minimal.  There will always be outliers who want to live on the government dole, but there are many more who still need the assistance.” – Carol Catchpole

“Without taking a single day off (in my essential occupation) ever since March 17, 2020 my earnings diminished to less than 20%. Without CERB/CRB it would have been impossible to put food on the table. The stay at home order just got lifted 3 days ago. It will certainly take time for things to go back to pre-COVID status. This reduction of CRB by 40% is highly premature. May be after another 6 months it becomes viable. Thank you.” – Mansur Khan

Thanks to everyone who participated in our June poll! In July we’ll be asking….

“In the last election some parties suggested an increase to the capital gains inclusion rate to 75% or more as the best way to raise new money to pay down government debt. Do you agree?”

Additional educational resources: For a guided update of the federal budget, the Advanced Retirement & Estate Planning course as featured in the May 20 Virtual CE Summit is still available. Enrol today!

This will also be part of the discussion as the speakers at the 2021 Distinguished Advisor Conference share their world class thought leadership for tax and financial professionals virtually from October 17-19. Enrol by June 30 to take advantage of early-bird pricing.