Canada’s federal government offered a lifeline to businesses struggling amid the latest wave of the COVID-19 pandemic by expanding eligibility for two benefit programs.
Prime Minister Justin Trudeau and several members of his cabinet announced Wednesday that, due to the increasingly widespread Omicron variant and spiking COVID-19 cases, the government will change eligibility requirements for its Local Lockdown Program and Canada Worker Lockdown Benefit.
The Local Lockdown Program will now offer wage and rent subsidies ranging between 25 and 75 per cent to employers who are subject to capacity restrictions of 50 per cent or more. Additionally, the current-month revenue decline threshold requirement will be lowered to 25 per cent.
It will also expand the Canada Worker Lockdown Benefit, which provides $300 weekly to workers who have lost at least 50 per cent of their income because of lockdowns, to include workers in regions where provincial or territorial governments have introduced capacity restrictions of 50 per cent or more.
Until now, these programs required recipients to be in regions where businesses were ordered shut and workers were instructed to stay home.
Wednesday’s announcement loosens that requirement in areas where capacity restrictions that fall short of a full lockdown have been issued.
The new requirements apply to areas where provincial and territorial orders involving capacity restrictions of 50 per cent or more have been issued, said Jessica Eritou, a spokesperson for Finance Minister Chrystia Freeland’s office, in an email.
The government said the new eligibility requirements are retroactive to Dec. 19 and will last until Feb. 12, when the eligibility will revert to the requirements previously in effect.
Any public companies that accept the subsidies and increase executive compensation or pay out dividends will have the benefits clawed back, Freeland said.
Wednesday’s announcement came after business owners spent the last week calling for more government help for companies contending with temporary closures, capacity limits and the growing number of Canadians who are avoiding in-person shopping, dining and other activities.
The Canadian Federation of Independent Business, which teamed up with Restaurants Canada to ask premiers on Tuesday to push Ottawa to increase small business supports, welcomed the new round of aid, but said it’s “not perfect.”
“Unfortunately, if you are losing your customers, not because of a capacity restriction/lockdown, but because public health officials and Omicron are scaring…them, then you do not qualify for any additional help,” CFIB President Dan Kelly tweeted just after Trudeau’s announcement.
“So a retailer or drycleaner that is allowed to open but loses 40 per cent of their business due to Omicron fears qualifies for zero help from Ottawa.”
The Canadian Chamber of Commerce also had concerns about how the expanded programs will work.
“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, the chamber’s director of small and medium enterprise policy, in a statement.
Business owner Cristina Junca was just pleased to hear any relief was on its way.
Junca fears capacity measures or other restrictions will be levied in Calgary, where she operates Crafted, a store selling handmade works from emerging Canadian artisans.
“We don’t know what will happen, but my husband and I are preparing for that,” she said.
“We have saved money, but if (restrictions happen), we need to cut employee hours.”
Workers have already approached Junca asking if they’ll still be collecting a paycheque or asked to come in, if lockdowns are issued. Many are students, who really need the money, she said.
Knowing that government relief will be there if the worst comes is a relief for Junca, who is already seeing the Omicron variant impact business.
“Now, we have less people, we have less sales and we have less work,” she said.
“It’s a struggle for us.”