The federal government has long said the federal wage and rent subsidies, along with benefits like the Canada Recovery Benefit, were always designed to be temporary to get the country through the economic crisis COVID-19 caused. The government yesterday unveiled a $7-billion redesign of pandemic aid for businesses and individuals that kicks in Sunday, which targets sectors including tourism and hospitality to receive aid.

After a last-minute extension this summer, Deputy Prime Minister Chrystia Freeland said Thursday, most would not be given an extra month of life past Oct. 23, but reshaped until late November. The country is in a different phase of the COVID-19 pandemic, Freeland said, noting the labour market has recovered all the jobs lost last year and vaccination rates are rising.

Targeted sectors receive aid

However, unemployment remains high, companies face labour shortages and some sectors are further from recovery, which is why aid is being redone and targeted based on need.

“The best possible support for a Canadian is actually a job,” Freeland said, “and that’s what these programs are designed to really promote.”

Wage and rent subsidies for businesses will be more generous and targeted to still-hurting tourism and hospitality sectors, so long as they can prove a prolonged and deep revenue loss.

Tourism and hospitality generally pleased

Restaurants Canada told its members it was happy for ongoing help, but disappointed that eligibility requirements will leave many operators out in the cold this winter.

“The federal government had Canadians’ backs throughout the pandemic,” said Beth Potter, President and CEO of the Tourism Industry Association of Canada (TIAC).

“Today, the government delivered on its election promise to provide the tourism, hotel, and events businesses the help they need to survive, and to continue to maintain the highest levels of employment possible.”

“The tourism industry is the hardest hit industry. Even as the economy reopens, business and international travel will take time to recover,” said Susie Grynol, President and CEO of the Hotel Association of Canada (HAC). “The new programs announced today will help our members stay alive through a difficult winter until our expected recovery in the spring.”

“This new program will support the survival of 1000s of Canadian travel agencies, who are among the hardest-hit businesses in the pandemic. We are pleased that the Deputy Prime Minister directly referenced travel agencies in her announcement. This speaks to the tremendous and aggressive advocacy efforts of ACTA, travel agents, and our partners,” said Wendy Paradis, President of ACTA.

“Further, we are working to understand how Independent Travel Agents fit into this new program. The Deputy Prime Minister said employers and businesses are included, so we are strongly urging the federal government to include these small businesses.”

The Canadian Federation of Independent Business said it would push the government to let a wider array of businesses qualify for help, such as gyms, bowling alleys and dance studios, as well as businesses that launched after March 2020.

The government is also looking to extend to May a hiring credit for companies that add to their payrolls by boosting wages, rehiring laid-off workers or new hires, and doesn’t require as deep a revenue loss to qualify.

Income support measures for Canadians unable to work because of COVID-19 will only flow to those off the job because of a government-imposed lockdown, but not if a person refused to adhere to a vaccine mandate.

The $300 weekly lockdown benefit would equal what the CRB provides to unemployed workers, over two million of whom have used the CRB since last year and received $27 billion in aid.

Out in the cold?

An analysis from the Canadian Centre for Policy Alternatives said the end of the CRB would leave some 880,000 people without income support starting Sunday, which the Montreal-based National Council of Unemployed Workers noted would hit self-employed and gig workers hardest, since neither qualify for EI.

The government has promised to help those workers access EI, but not until at least 2023.

Freeland said there is still a need for the benefits to help parents stay home to care for a sick child, or to stay home themselves if sick, which is why the government wants to extend them past next month and add two more weeks of eligibility.

Political pressure

The new measures will exist until Nov. 20, after which the Liberals will need support from enough opposition MPs to enact the proposals unveiled Thursday that Freeland said would cost $7.4 billion through May 7.

NDP Leader Jagmeet Singh in a statement suggested his party would push back against an end to the CRB to make sure “people aren’t left to fend for themselves.” Conservative finance critic Ed Fast said his party wouldn’t support the CRB living past Nov. 20 because of “skyrocketing inflation and ongoing labour shortages across the country.”

The House of Commons returns Nov. 22, which doesn’t leave much time for MPs to approve a new aid package before Parliament starts its winter break in mid-December.

“The last thing that we want to see is brinksmanship and games that are going to stretch this out to the 11th hour,” said Mark Agnew, senior vice-president policy with the Canadian Chamber of Commerce. “It needs to pass in a fairly expeditious manner.”