The words “pandemic,” “lockdown,” and “COVID” have settled comfortably into our vocabulary, but for the majority of 2020, we weren’t just adapting to a crisis – we were living in the Upside Down.
City streets were empty.
Businesses were closed – all of them.
Millions of people lost their jobs.
In Canada, we were fortunate that the federal government acted quickly. Programs like the Canada Emergency Response Benefit (CERB) and the Canada Emergency Business Account (CEBA) were rolled out at unprecedented speed. They were imperfect – many of us said so at the time – but CERB put food on the table and paid the rent for millions of people when the economy came to a full stop.
For most self-employed Canadians, CERB wasn’t just a lifeline. It was the only thing keeping their shelves stocked with toilet paper and hand sanitizer.
Self-employed individuals were initially excluded from business supports like CEBA, which was originally designed around payroll spending in the previous year. No payroll, no eligibility. That design choice alone revealed how poorly our economic systems understand modern work, especially women’s work.
Eighty per cent of women who earn business and professional income in Canada are self-employed. They may hire subcontractors or collaborate with peers, but they don’t have employees; they employ themselves.
They are employers of one.
And that matters.
By employing themselves, self-employed women reduce pressure on the labour market. If all of those women were suddenly forced to seek traditional employment, Canada’s unemployment rate wouldn’t tick up marginally. Based on my calculations, it would jump from roughly six per cent to closer to 15 per cent.
That’s not a niche group. That’s a structural pillar of our economy.
Six years later, the clawback continues
Fast forward to today.
The Canada Revenue Agency (CRA) is actively pursuing individuals who received CERB but are now deemed ineligible. According to a recent CBC report, the CRA has collected roughly $4 million, while another $10 million is still outstanding.
At first glance, this sounds like fiscal responsibility. But look closer.
The CRA is a public institution, funded by taxpayers. Investigating, auditing, corresponding, appealing, litigating; none of that is free. What was the net return on that $4 million? Once administrative and legal costs are accounted for, I would be surprised if we even broke even.
So what, exactly, is the goal here?
It isn’t deficit reduction, not in any meaningful sense.
Confusion is not fraud
Most people who applied for CERB did so in good faith. Eligibility rules were shifting in real time, guidance was often unclear, and many people were making decisions under extraordinary stress.
To retroactively punish individuals for navigating a confusing system during a once-in-a-century crisis is not accountability. It’s revisionism.
And it disproportionately affects people with the least power to fight back.
The money was never really “Gone”
There’s another part of this story that hasn’t made the headlines.
Between 2020 and 2022, the federal government transferred billions of dollars to the Business Development Bank of Canada (BDC) through share purchases. This capital funded COVID-related programs, such as the Business Credit Availability Program (BCAP) and Highly Affected Sectors Credit Availability Program (HASCAP).
The BDC is an enterprise Crown corporation. It’s publicly owned, but it operates commercially. It pays dividends back to the government. It is not funded through annual tax appropriations, but it can receive money from the government in other ways.
When those COVID programs wound down, not all of the money had been spent.
So what happened?
In 2023, the government quietly repurchased $5 billion in BDC shares. Another $1.5 billion followed in 2024. The money flowed back into government hands. These transactions are disclosed in BDC annual reports, though they rarely make front-page news.
Which brings us to a simple conclusion.
If the government can recoup $6.5 billion in unused pandemic capital, it can absorb $10 million in CERB overpayments (if the CERB applications were, in fact, incorrectly approved). The CRA currently has $1.4 billion in outstanding tax debt to collect and has stated that recovering these amounts is necessary to maintain public trust in the institution.
But public trust isn’t built on balance sheets alone. It is built on how governments treat people—especially in moments of crisis.
Self-employment, dignity, and public trust
Self-employed people of all genders already operate without many of the protections afforded to employees: no paid leave, no employer-sponsored benefits, no guaranteed income, and little margin for error. When the pandemic hit, they were largely excluded from mainstream business supports and redirected to emergency individual benefits – often with unclear, shifting guidance and minimal tailored support.
Now, years later, many are being retroactively penalized for navigating those programs imperfectly during a crisis that shut down the economy overnight.
This does more than harm individuals, it undermines public trust.
It sends a deeply corrosive message: you are expected to comply flawlessly with complex systems designed without you in mind, and if you don’t, the consequences will arrive years later, without regard for context or good faith. That kind of governance doesn’t encourage responsibility; it breeds fear, disengagement, and mistrust in public institutions.
When people believe that the rules will change after the fact – and that they will bear the full cost of that uncertainty – they stop seeing government as a partner in crisis and start seeing it as a risk to be managed. That erosion of trust doesn’t just hurt self-employed workers. It weakens the social contract we all rely on.
A better way forward
Going up against the CRA is intimidating. The appeals process is complex, slow, and ultimately funnels people toward tax court – an expensive and frightening prospect for individuals and small businesses.
We need an alternative.
Canada should establish a small-claims-style tribunal for tax and compliance disputes and penalties below a certain threshold. A forum that is accessible, affordable, and proportionate.
This would:
- Save public money
- Reduce administrative burden
- Increase trust in public institutions
- Engage individuals to understand and exercise their rights
Most importantly, it would replace fear with fairness.
Six years after the Upside Down, the question isn’t whether we made mistakes during COVID. Of course we did.
The question is whether we will compound those mistakes by punishing the very people who held themselves and our economy together.
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Nick Seebruch, editor
