Small-business groups say they would like to see more long-term commitments in the Ontario budget to support sectors hit hardest by the pandemic.
Public-health restrictions meant to curb the spread of COVID-19 have forced businesses in sectors such as retail, hospitality and travel to close their doors for weeks at a time, leading to substantial drops in revenue, rising debt and employees out of work.
Sueling Ching, president of the Ottawa Board of Trade, said it was imperative for the Ontario government to give small- and medium-sized businesses a clear plan for how they will be supported going forward.
“At this stage of the game, we need to figure out what we need to do to keep the economy going,” she said. “Letting all these small businesses go bankrupt is not going to bode well for us.”
For example, Ms. Ching said, tourism is a key driver of the local economy in Ottawa, normally drawing millions of visitors each year. Investments in planning safe business conferences now could pay off two or three years down the line when the coronavirus is under control, she said.
Restaurants and bars, which normally operate with high overhead and slim profit margins, have often been reduced to only serving takeout. A Statistics Canada survey released Thursday suggested two-fifths of food services and drinking places had taken on more than $40,000 in debt because of the pandemic, and half were not sure how much longer they could stay open.
James Rilett, vice-president for Central Canada at Restaurants Canada, said it will be some time before restaurants can pay off their debts and see customer levels return to normal.
“We figure it’ll take 12 to 18 months for restaurants to return to profitability,” he said.
Ontario, along with other provinces, has allowed restaurants to earn more revenue by selling alcoholic products with their takeout food. Mr. Rilett said that was a positive step, but that Ontario and Manitoba are still the only provinces that do not allow restaurants and bars to purchase alcohol at wholesale discounts – which keeps prices high for consumers, and makes it hard to compete against the government-owned LCBO.
The biggest spending on business supports has come from the federal government, through programs such as the rent and wage subsidies. One of the most significant provincial programs has been the Ontario Small Business Support Grant, which provides between $10,000 and $20,000 to small businesses that can show their revenue has declined at least 20 per cent.
Stephanie Stoute, owner of the Curio children’s museum in Barrie, Ont., said the provincial grant was important for her because as a new business she does not qualify for federal programs. She took out loans to open Curio in July, 2020, and most federal programs will only help businesses that were open before the pandemic began in March.
“In terms of any kind of continuous support to keep my doors open, I don’t qualify for anything other than more debt,” she said. “And that’s just not anything I can sustain.”
She said she would like to see the provincial grant renewed and for federal programs to allow new businesses to apply for subsidies, so that she can finally hire staff to help her run the attraction.
Michael Wood, an Ottawa-based events manager who has organized townhalls for small businesses to share their concerns with government, said another item he would like to see is investment in retraining to help entrepreneurs restart their careers after the pandemic.
“People who lose their business through no fault of their own should be able to get some postsecondary education and learn some new skills so they can move forward.”
The office of Ontario Associate Small Business Minister Prabmeet Sarkaria said it could not discuss the budget ahead of time, but said the government understands the pressures that small businesses are under.
“With record investments and supports, our government is committed to helping our small businesses manage through this pandemic, so that they can sustain their operations, keep Ontarians employed, and continue serving our communities long after COVID-19 is behind us,” Mr. Sarkaria said in a statement.
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