Question Period Note: REASSESSMENT INVENTORY (CPPD)

An inventory of Canada Pension Plan Disability reassessment cases has increased over the last several years. Delayed reassessments can result in clients continuing to receive benefits to which they may no longer be entitled, leading to large overpayments for clients.

• The Department is committed to ensuring that the CPPD program continues to be responsive to the needs of Canadians with disabilities while maintaining its effective stewardship of Canada Pension Plan (CPP) funds in an open and transparent manner.

• Reassessing the eligibility of beneficiaries is necessary to ensure that CPPD benefits are paid to individuals who continue to be eligible and stopped for those who are no longer eligible because they have regained the capacity to work.

• Timely reassessments are an important part of effective program stewardship as they ensure that overpayments are limited, that individuals qualify for the safety nets to which they are entitled, and that the negative impacts on clients’ contributory periods and ability to requalify for and receive other CPP benefits are limited.

• Employment and Social Development Canada is currently managing an inventory of Canada Pension Plan Disability files that require reassessment. The Department recognizes the impacts that delayed reassessment decisions can have on clients.

• The Department is currently processing all files in the reassessment inventory and is focused on maintaining a client-centric approach to mitigate impacts where possible. The Department is committed to complete all reassessments in the current inventory by March 31, 2025.

• The Department has developed strategies to stabilize the reassessment inventory and prevent delayed reassessments from occurring again in the future. This includes establishing reassessment service standards, developing automation tools, implementing a reassessment policy framework, and analyzing evidence from a pilot project that is testing enhanced return-to-work supports.

The Canada Pension Plan Disability (CPPD) program is the largest long-term disability insurance program in Canada. It is administered throughout Canada, except in Quebec, where the Quebec Pension Plan provides similar supports to eligible individuals. CPPD benefits include the Disability Pension and the Post-Retirement Disability Benefit (PRDB). The Disability Pension is for individuals who are found to be disabled and are under age 65, while the PRDB is a flat-rate benefit for individuals between the ages of 60 and 65 who are already in receipt of an early Canada Pension Plan (CPP) Retirement Pension and become disabled. The Disabled Contributor’s Child’s Benefit (DCCB) is an associated benefit for the dependent children of a CPPD beneficiary (either the Disability Pension or the PRDB) and is a flat-rate amount.

CPPD benefits provide partial income replacement for eligible contributors who have a severe and prolonged mental or physical disability that regularly prevents them from working at any substantially gainful occupation.

CPPD beneficiaries are entitled to receive benefit payments for as long as they continue to be eligible. They are obligated to report to Employment and Social Development Canada (ESDC) when they return to work, participate in volunteer and education activities or when there is a change in their medical condition(s), as this may indicate that they are no longer disabled within the meaning of the CPP.

There is also a responsibility on the part of ESDC to conduct timely reassessments of continuing eligibility to ensure CPPD benefits are paid only to those who continue to be eligible and ceased for those who are no longer eligible. To facilitate the process, ESDC identifies files that may require reassessment in a variety of ways, including self-reports from beneficiaries who have returned to work, pre-scheduled reassessments, third-party complaints, and information from the Employment Insurance program and the Canada Revenue Agency.

During the COVID-19 pandemic, ESDC prioritized the processing of applications for the CPPD and DCCB to ensure that disabled contributors and their dependent children received benefits during a period of economic crisis. Due to capacity restraints, most work was halted on all existing open reassessments for older files. As a result, there is an inventory of older files pertaining to 2020 or earlier, for which ESDC has information indicating a reassessment of eligibility should take place. Some of these files have information reaching back over 10 years. As a result of the delay in processing the reassessments, overpayments have accrued for many of the beneficiaries in the inventory. Other factors contributed to delays in processing reassessments and increased inventory volumes, including:

• Limited communication with beneficiaries during the COVID-19 pandemic. An information sheet was issued in May 2022 to beneficiaries to clarify their reporting obligations, which led to an influx of beneficiaries reporting their return to work, many of them several years late. This resulted in a sudden increase in priority reassessment files, further delaying existing older reassessments.
• Insufficient resource capacity, which contributed to delays in actioning and completing aged reassessment files. Additionally, the complexity of CPPD (e.g., earnings and contributions requirements, severe and prolonged eligibility criteria, appeals, comorbidities, and mental health, etc.), means that it takes time for new staff to attain the full skills and knowledge required to be fully productive.

Delayed CPPD reassessments can result in large overpayments and negative impacts to clients’ contributory periods, which can result in lower retirement pensions, issues requalifying for and receiving other CPP benefits, and financial hardship for clients who are required to repay refunded CPP contributions. Beneficiaries do not contribute to the CPP when they are receiving a CPPD benefit, during periods when they have no earnings, or when their annual earnings are below the minimum threshold of $3,500. When a beneficiary returns to work while receiving CPPD benefits, any CPP contributions they make are refunded to them with their tax assessments. However, should a beneficiary be found to have received a CPPD benefit when they were not entitled, they will need to repay the CPP contributions that were refunded to them for that period. If they do not, they may not qualify for other CPP benefits (including disability, death, survivor, and children’s benefits) and/or it may impact the amount of future CPP benefits they may receive, such as their Retirement Pension.

Work to resolve ESDC’s workload challenges, including those regarding the reassessment process itself, has continued. Strategies are also being developed and implemented to prevent future overpayments of this nature. Activities include:
• developing an overarching reassessment policy framework;
• improving correspondence with clients;
• developing automation tools to streamline screening processes;
• upskilling existing staff to be better equipped to process reassessments;
• reviewing existing volume and funding models;
• establishing service standards for reassessment;
• improving the alignment of the roles and responsibilities of processing staff with respect to reassessment;
• analyzing the evidence gathered through a pilot project that is testing enhanced return-to-work supports to inform future changes to CPPD.

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