Freeland agrees to slight broadening of COVID-19 wage and rent subsidy

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The federal government has added clear references to Canada’s cultural sector and other industries in new legislation aimed at revising and extending federal wage and rent supports for businesses that have been the hardest hit by the COVID-19 pandemic.

The new legislation, Bill C-2, implements an announcement Finance Minster Chrystia Freeland made last month and includes new details related to the programs.

That October announcement included an immediate end to the Canada Recovery Benefit, which was the main income support program that was paid directly to individuals who could not work for reasons related to the pandemic. The announcement also included an extension of wage and rent subsidies for businesses, but through more narrowly targeted programs aimed at the hardest-hit sectors of the economy such as tourism and hospitality.

Wednesday’s announcement lists a large number of business categories that will qualify under the more generous tourism and hospitality program, provided they meet the criteria of having revenue losses of at least 40 per cent. Categories include everything from restaurants and nightclubs to fitness facilities and theatres. The program offers a subsidy rate of up to 75 per cent.

The government said last month that extending these programs until May will cost $7.4-billion. It restated that cost estimate in Wednesday’s announcement.

The October announcement divided the wage and rent supports into two separate programs: the Tourism and Hospitality Recovery Program and the Hardest-Hit Business Recovery Program. The October announcement did not provide a detailed breakdown of the types of businesses that would qualify for the first program.

The Canadian Federation of Independent Business and others had raised concerns that some sectors – such as the cultural sector – would have fallen into the second program, which is less generous than the program focused on tourism and hospitality.

Ms. Freeland said the new list of qualifying sectors is the result of feedback the government heard since announcing its original plans.

“What has happened since our announcement is we had a process of consultation. We made the basic announcement and we said this is the approach we’re taking. And then we talked to a lot of people. We talked to stakeholders, we talked to businesses,” she said.

CFIB president Dan Kelly said his organization is pleased that more sectors were listed as qualifying for the tourism and hospitality program. However, the CFIB had also called for the revenue loss threshold to be lowered.

“This is not the comprehensive change needed to help small firms make it across the COVID-19 finish line,” he said in a statement. “The Canadian Federation of Independent Business is disappointed the federal government has not changed the 40- to 50-per-cent minimum revenue loss requirement to access small-business support programs, which means most small businesses will be cut off from accessing them.”

The CFIB is calling for the threshold to be lowered to 10 per cent.

Finance Canada released a long list of business categories that can qualify for the program, including restaurants, nightclubs, live events, museums and zoos, tours, theme parks, fitness and sports centres, amateur sports clubs, theatres, casinos and hunting camps.

“Those businesses that do not qualify under the Tourism and Hospitality Recovery Program but are still facing significant losses may be eligible for the Hardest-Hit Business Recovery Program,” the government said in a news release.

The government needs the support of at least one other major party in the House of Commons to win votes. Bloc Québécois Leader Yves-François Blanchet said this week that his party is prepared to support the COVID-19 benefits legislation. He said on Tuesday, prior to the bill’s introduction, that his party has secured assurances from Ms. Freeland that the government will provide support to workers in the cultural sector.

Ms. Freeland said Canadian Heritage Minister Pablo Rodriguez is working on an additional measure related to the cultural sector that will be announced soon.

NDP Leader Jagmeet Singh said his party will vote against the bill because the NDP disagrees with the decision to shut down the main benefit program for individuals.

Conservative finance critic Pierre Poilievre said this week that his party is in favour of continued support for businesses as long as it is targeted at hard-hit areas such as tourism, but he also said it was too early to say whether his party would vote in favour of the bill.

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