B.C. unfairly clawed back COVID-19 benefit from thousands, ombudsperson says

A report says thousands of people in British Columbia saw their $1,000 COVID-19 benefit unfairly clawed back by the provincial government.

Ombudsperson Jay Chalke's report says so far, 12,000 people have been told to repay their B.C. Emergency Benefit that the government said was for workers who had been affected by the COVID-19 pandemic.

The claw back came because the government didn't properly communicate a deadline for people to have filed their 2019 taxes to be eligible, and by the time the deadline was announced, Chalke says, 90 per cent of applicants had asked for the cash.

Chalke said the original benefit application when the program started in May 2020 did not set any firm deadline for people to have filed their 2019 income taxes, only that they had either filed or agreed to file.

Legislation introduced eight weeks later set a Jan. 1, 2021, deadline for filing the tax return.

The report says people were not told retroactive changes by the government made them ineligible, and Chalkerecommended the government give those people 90 days to file their 2019 taxes, allowing forgiveness of the debt or return of the benefit.

"As we said in the report, the ministry didn't tell people the change would apply in that first [application]window, 90 per cent of the applicants by the way," he said.

"Not only did government not tell people who had already agreed to the early, open-ended tax filing requirement, but when the ministry audited the program thousands of people ended up having to pay back the benefit."

The B.C. government announced the one-time, tax-free benefit in March 2020, which paid out $653 million in benefits.

Chalke said he found it "ironic" the B.C. government, along with other provincial governments, recently called on the federal government to extend the repayment deadline for the federal Canadian Emergency Business Account pandemic loan program for small businesses, but rejected similar extension recommendations by the Office of the Ombudsperson.

Govt. won't be implementing recommendation

A response contained in the report from Heather Wood, the deputy minister of finance, says the government won't be implementing the recommendation because the benefit is an income tax refund for 2019, regardless of whether people understood that.

The statement said filing a 2019 income tax return was a requirement of the benefit.

"The ministry does not agree with the Ombudsperson that this requirement can reasonably be understood to be an open-ended promise that could be met at any time in the future as determined by each individual applicant," said the statement.

Chalke said he's "astonished" the government is not agreeing with his recommendation to allow the early applicants who have since filed their 2019 taxes or agree to within 90 days to keep the payment.