Ottawa expands eligibility for Canada Worker Lockdown Benefit and wage and rent supports to regions with capacity limits

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Weeks after ending the main pandemic support program for workers, the federal government is again offering financial assistance directly to Canadian employees as a response to the current wave of Omicron-related capacity restrictions that fall short of full lockdowns.

Ottawa announced Wednesday that it is temporarily expanding access to the new Canada Worker Lockdown Benefit for individuals. It is also easing eligibility to wage and rent supports for employers. The CWLB was initially promised as a safety net in the event regions in the country were forced to impose complete shutdowns of businesses.

The government is now revising those rules to make benefits available to eligible workers in regions affected by capacity limits of 50 per cent or more who have also had their income reduced by 50 per cent or more as a result.

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The changes will be in place until Feb. 12, 2022, and are retroactive to Dec. 19, at an estimated cost to the federal government of about $4-billion. The spending was accounted for in the government’s recent fall economic update last week.

“We will be there with supports for the areas that need it,” Prime Minister Justin Trudeau said at a virtual news conference. He appeared with Finance Minister Chrystia Freeland, Health Minister Jean-Yves Duclos, Employment Minister Carla Qualtrough and Chief Public Health Officer Theresa Tam.

In what was likely the Prime Minister’s last news conference on COVID-19 before Christmas, the government’s message to Canadians was to limit gatherings to immediate family members and to be careful and prudent over the holidays. The senior ministers struck a different tone from the message coming from the United States that fully vaccinated people can safely celebrate as planned.

“We’re just going to have to hunker down for the coming weeks, as it will prove to be a difficult winter,” Mr. Trudeau said, when asked about the apparent cross-border dissonance. Despite Canada’s higher vaccination rates, Mr. Trudeau urged people to limit their physical interactions to protect the health care system if cases “skyrocket.”

The Prime Minister said three of his staff and three people on his security detail tested positive for COVID-19. He said so far that his rapid-test results have come back negative and he is following public-health advice.

The announced changes to pandemic supports relate to a package of measures that Parliament approved last week with Bill C-2, which included provisions for cabinet to revise the programs later through regulation.

The federal government ended the $300-a-week Canada Recovery Benefit on Oct. 23. It had been the main support program that went directly to individuals who were unable to work for reasons related to the pandemic.

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However, C-2, which extended more narrowly targeted versions of wage and rent supports for businesses in hard-hit sectors, also included a provision to reinstate support for individuals in the event of a regional lockdown. The Canada Worker Lockdown Benefit is also worth $300 a week.

The government had also promised a “Local Lockdown Program” through C-2 for businesses that are required to cease some or all of their activities because of public-health restrictions. It is this part of the legislation that is being temporarily expanded for employers.

For employers, the qualifying thresholds for the wage and rent support programs will be eased.

“It means that if you are an employer who has to reduce the capacity of your main business by 50 per cent or more, you will be eligible for wage and rent subsidy support through the local lockdown program,” Ms. Freeland said. “And we are lowering the revenue-decline threshold from 40 per cent to 25 per cent.”

Cases of COVID-19 in Canada have climbed rapidly, with average daily cases growing by 122 per cent in the past week. The fastest growth has been in Ontario, Alberta, B.C. and Quebec. In response, premiers have rolled out a quick succession of restrictions and closings and people have been urged to scale back their holiday plans and cancel international travel.

In contrast, U.S. President Joe Biden on Tuesday told fully vaccinated Americans that they “should feel comfortable celebrating Christmas and the holidays” as planned. He added that while there will be more breakthrough infections, the vaccines will protect them against severe illness.

Ms. Freeland pushed back when asked why the public messaging from senior officials in the U.S. and Canada appears to be different with respect to the risks of Omicron.

“Canada is not the United States,” she said. “We’re a careful country and I think that’s a really good thing. And I think all of us need to be careful.”

“This is not panic, this is prudence,” Mr. Duclos said about the government’s response.

Meanwhile, a study released on Wednesday by South Africa’s National Institute for Communicable Diseases suggested that those infected with Omicron were much less likely to end up in hospital than those with previous variants of COVID-19. However, the authors cautioned that the results may not easily translate to other countries with older populations. Mr. Trudeau said the sheer number of cases could still lead to a swamped health-care system.

In addition to the potential lockdown supports, the federal government’s Bill C-2 created two new categories for wage and rent subsidies for employers: the Tourism and Hospitality Recovery Program is available to businesses with a qualifying revenue drop of 40 per cent or more, and the Hardest-Hit Business Recovery Program is open to businesses with a qualifying revenue drop of 50 per cent.

Business groups have warned that the thresholds for the two programs are too high, meaning many struggling businesses will not receive federal support.

Also on Wednesday, the Ontario government announced new supports that it said will provide relief for about 80,000 businesses in the province. The new Ontario Business Costs Rebate Program is aimed at helping businesses such as restaurants, gyms and smaller retail stores that are required to reduce capacity to 50 per cent under recently announced restrictions.

The program allows eligible businesses to receive rebate payments equivalent to 50 per cent of the property tax and energy costs they incur while subject to the current capacity limits.

Manitoba announced a direct grant program Wednesday for affected businesses, at an estimated public cost of $22-million.

Dan Kelly, president of the Canadian Federation of Independent Business, dismissed the Ontario government announcement as a “thin rebate program.” But he welcomed the federal decision to expand eligibility of the lockdown benefit as “good news.”

“Unfortunately, if you are losing your customers, not because of a capacity restriction [or] lockdown, but because public-health officials and Omicron are scaring the crap out of them, then you do not qualify for any additional help,” he said in a statement on Twitter.

The Canadian Chamber of Commerce also responded positively to the federal announcement.

“While questions remain for businesses who have capacity restrictions under different definitions – such as distancing requirements between tables at restaurants, for example – we applaud the quick action of government to bring reassurance to businesses across Canada,” said Alla Drigola Birk, a policy director with the chamber.