Computer glitch withholds $1.7M in EI payments to struggling families

A computer glitch has been withholding employment insurance money from hundreds of families. Officials are now scrambling to pay the money back.

'System anomaly' at Employment and Social Development blamed for underpaying low-income families

The federal government says it will reimburse hundreds of families after a computer glitch held back about $1.7 million in payments. (First Call)

The federal government hasn't provided hundreds of low-income families their full government benefits since at least 2007, an internal review has found.

A staff member at Employment and Social Development Canada recently identified a "system anomaly" that has been withholding employment insurance money from about 800 needy families in each of the last eight years.

The money was supposed to be paid as a family supplement to top up EI claimants whose household income, including spousal income, is no higher than $25,921.

The underfunding glitch apparently occurred whenever the Canada Revenue Agency turned over information to the department about changes in the marital status of the claimants.

"It is estimated that since 2007, approximately 800 claimants per year have been underpaid an average of 10 weeks at $35 per week each year," says a February briefing note to the minister, Pierre Poilievre.

"This represents underpayments of approximately $1.7M(illion)."

No apologies in letter

The department is not able to fix the computer glitch for another 18 months, so new claims are being handled manually. A form letter was also sent to people who may be due back-payments, alerting them to the problem.

The letter says "we learned that we may owe you money," with no apology offered, and advises that Service Canada will be reviewing all files.

For those currently receiving EI benefits, their next payment will be adjusted to reflect the missing money, along with a message of explanation.

CBC News obtained the briefing note and sample letter under the Access to Information Act.

Pierre Poilievre, minister of employment and social development, is also trying to find 200,000 families not registered for an expanded child benefit payment. (Sean Kilpatrick/The Canadian Press)

"If a client received a letter and there is money owing, the client should receive their payment within 60 days of receiving the letter," said department spokesman Pierre Nolet.

"We have put in place a manual solution to prevent this from reoccurring in the short term."

The department was unable to provide a total number of people affected by the shortchanging.

"Payments have started to be issued for any outstanding benefits owing to these clients and the work is ongoing," said Nolet.

Called a 'serious strain'

A spokeswoman for a poverty group said the underpayments are significant for families struggling to make ends meet.

"Losing up to $350 a year for the last eight years, for those in a low-income bracket, puts a serious strain on families who are already struggling to pay their rent," said Leilani Farha, executive director of Ottawa-based Canada Without Poverty.

"It would be important to consider that some of those recipients may now be in receipt of social assistance, and we hope that the reimbursement in no way jeopardizes that."

Nolet said no interest is paid on any outstanding money owed to claimants. The government does charge interest on EI overpayments if the money was obtained through false or misleading statements.

In April, Poilievre said the government was trying to track down about 200,000 families eligible to receive money under an enlarged child-care benefit program but who aren't registered.

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