Small business advocates call on Ottawa to halt 'phase out' of wage and rent subsidies

Vancouver -

Despite eased restrictions, and the prospect of welcoming back U.S. visitors on the horizon, small business advocates say it’s still too soon to pull back on critical federal subsidies for rent and wages during the pandemic.

The Canadian Federation of Independent Business is calling on Ottawa to halt the current phase-out of the two programs to buy more time for struggling businesses to recover.

Though local businesses that have relied on tourism are looking forward to the border reopening to American tourists next month, Gastown Business Improvement Society executive director Walley Wargolet said there’s still no replacing the wave of visitors that used to flood the area with each year’s cruise ship season.

“Over a million people come through this city on those cruise ships. So that will not happen,” he said. “Some of our businesses experienced up to a 90 per cent loss in revenue, when you look back at year over year to 2019 prior to the pandemic.”

Wargolet while there are hopes for a full cruise season next year, In the meantime many have been helped by federal wage and rent subsidies.

“I’ve talked to a lot of business owners here, and a lot of them have said without those subsidies, they’re not sure they would have been able to weather the storm of the pandemic,” he said. “The impacts on the really tourist-centric businesses are going to be felt quite heavily if we don’t see those subsidies continue.”

The Canadian Federation of Independent Business’s provincial affairs director, Annie Dormuth, said those supports are still needed, and the organization has started a petition campaign online to call on the federal government to put a pause on phasing out the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Rent Subsidy (CERS), and extend them further into the fall. Currently, the two programs have only been extended until Sept. 25. Dormuth said the maximum subsidy amount available is also going to drop over the next several weeks.

“The percentage of what basically businesses can access will be further reduced as we head into the summer months here and into September,” Dormuth said. “We’re definitely calling for an extension until at least November.”

The CFIB says says only about a third of businesses are back to normal sale levels and others, including some in the tourism industry, aren’t expecting revenues to recover until next year.

In an email to CTV News, the press secretary for federal Finance Minister Kat Cuplinskas said businesses will have access to a new hiring incentive subsidy called the Canada Recover Hiring Program until November, while a loan program for highly affected sectors is available until December.

“The recent federal budget builds on this support,” she said, and added that also includes a “more accessible” financing program for small businesses. “Now including financing for operating expenses and start-up costs, a digital adoption program, the ability to immediately expense up to $1.5 million of capital investments, and a reduction in credit card transaction fees.”

Dormuth said the loan program has “narrow eligibility” and starts at $25,000, and the new hiring subsidy is lower than what’s currently available.

Warglolet said they’re encouraging people to shop local, and are hoping more office workers return to the area in the fall. But when it comes to tourism, rebounding from the pandemic is going to take time.

“There’s a lot of optimism,” he said. “But we’re not there yet.”