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Experts say extending CERB will cost an additional $64 billion

Prime Minister Justin Trudeau's decision to extend the Canada Emergency Response Benefit (CERB) would cost an additional $64 billion to the federal treasury.
Quinn Patrick Montreal, QC

Prime Minister Justin Trudeau's decision to extend the Canada Emergency Response Benefit (CERB) would add additional $64 billion to the federal treasury, according to CTV News. This would effectively double the budget for the program

Those who were among the first wave of CERB recipients will come to the end of their four-month period of distributions in early July.

The government will be repaid 50 cents of each dollar earned over $1,000 and allow recipients to continuing getting the benefit for another 3 months as it stands now, according to the parliamentary budget officer. By expanding the CERB program through to January of 2021, it would cost an additional $57.9 billion, estimates a report by budget officer, Yves Giroux's.

The report doesn't factor in the money already spent on the CERB program by the federal government, which currently sits at $60 billion, up from it's initial $35 billion as more and more Canadians apply for the benefit and many Canadians are staying on it longer than expected.

As of June 4, the program has paid out $43.51 billion to the 8.41 million people who have applied for it.

Giroux believes the extension of the program may be enough for some people to not want to go back to work as businesses begin to reopen and restrictions are loosened.

Applicants are not to continue receiving the benefit if their employer has asked them to return to work and they are able to do so. Many small business owners are in favour of cutting off CERB payments to workers who are offered their jobs back, with the exception of health-related issues, according to the Canadian Federation of Independent Business (CFIB) says.

Dan Kelly, president of CFIB said that whatever the final decision should be from the Liberals regarding CERB, they should do it sooner than later to allow for some certainty for companies as they reopen.

"While it's too early to do away with CERB, it's time to shift gears on the federal support programs to encourage people to rejoin the labour force," said Kelly in a statement.

Statistics Canada recorded that in May three million people remained unemployed which brought the unemployment rate to 13.7 percent, an all-time high. Men began returning to work at a faster pace than women, which has widened the gender gap regarding job losses.

Quinn Patrick
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