Plan to direct-deposit government cheques rolled back

By Kathleen Martens
APTN Investigates

Ottawa says its plan to directly deposit all government cheques into Canadians’ bank accounts is no longer mandatory.

The move comes after APTN Investigates posted a story online earlier this month about the direct-deposit directive.

“Earlier government communications suggested direct deposit would become mandatory,” Public Works spokesman Pierre-Alain Bujold said in an email.

“However, Canadians who are not enrolled in direct deposit will continue to receive payments from the Government of Canada by cheque.”

Bujold says it was always the government’s plan to exempt people who don’t have access to financial institutions because they live in a remote location.

But now, while everyone is “encouraged” to enroll in direct deposit, Bujold said “enrolment is not mandatory.”

Public Works originally rolled out the paperless plan in 2012. Then-minister Rona Ambrose announced the move saying cheques would be phased out by April 2016.

“This initiative is expected to save the Canadian government approximately $17.4-million per year starting in 2014-15. The cost to produce a cheque is approximately 82 cents while a direct deposit payment costs about 13 cents.”

Using direct deposit is more convenient and secure, Ambrose said then, noting it also helps Ottawa meet its targets as part of the Federal Sustainable Development Strategy by reducing paper consumption and reducing greenhouse gas emissions.

Dialling the initiative back won’t change the North West Company’s (NWC) response.

Mike Beaulieu, vice-president of NWC services, says the pre-paid credit card option the northern grocery chain unveiled last week will go ahead.

“North West learned about the GOC’s initiative to replace cheques with direct deposit from our customers and through the government’s communication campaigns.

“Customers, for some time now, have been approaching our store staff and managers with requests to enable direct deposit onto their We Financial Visa prepaid cards for payroll and for government benefits.”

Most NWC customers don’t use banks because there aren’t any in their northern provincial and territorial communities.

Adding direct deposit to its Visa card will make financial life easier for those customers. Beaulieu said.

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