Emergency wage subsidy program extended to end of August
Posted May 15, 2020 8:01 am.
Last Updated May 15, 2020 11:54 am.
This article is more than 5 years old.
OTTAWA (NEWS 1130) – The Canada Emergency Wage Subsidy program is being extended until the end of August.
The extension will help employers bring employees back as the economy slowly starts to reopen, Prime Minister Justin Trudeau said Friday.
“Business owners, please take confidence from this announcement. You now have some runway to catch your breath as you get restarted. So, please, bring back your employees,” he said.
BREAKING: Prime Minister @JustinTrudeau says the federal government is extending the wage subsidy until the end of August. #cdnpoli #COVID19
— Cormac Mac Sweeney (@cmaconthehill) May 15, 2020
The $73-billion program, which covers 75 per cent of an eligible company’s payroll up to a maximum of $847 per week per employee, was set to expire on June 6.
Eligible companies are those that saw revenues drop by 15 per cent in March or 30 per cent in April and May. Trudeau has said the government is also considering changes to the program so more businesses can access it.
“One of the things we’ll be looking at is the 30 per cent revenue decline threshold for eligibility,” he explained. “As businesses start up, needing a decline shouldn’t be a barrier to growth.”
Trudeau says the government is also considering changes to the wage subsidy program, including the criteria that a business needs 30% decline in revenue to get the assistance #cdnpoli #COVID19
— Cormac Mac Sweeney (@cmaconthehill) May 15, 2020
The federal government has billed the subsidy as the largest economic program since the Second World War. But so far, it has paid out only $3.4 billion for some 1.7 million workers.
However, the government sees the wage subsidy as crucial to the country’s economic recovery and is hoping that more companies will take advantage of it as they rehire employees laid off when the country shut down in mid-March to prevent the spread of COVID-19.
That, in turn, would decrease reliance on the $35-billion Canada Emergency Response Benefit, which is paying $2,000 a month to Canadians who have been thrown out of work or seen their incomes nosedive due to the pandemic.
More than 7.5 million Canadians have received CERB payments so far — almost double the anticipated number of recipients. Trudeau would not say if the CERB will be extended or changed moving forward, with the first round of applicants set to see the benefit expire near the end of June.
The subsidy extension is in line with what the Canadian Chamber of Commerce had hoped for.
According to the chamber, any of the 200,000 businesses it represents are still in crisis mode. It noted this kind of extension is important because even as provinces are strating to reopen their economies, it will still be a long time before it’s business as usual.
“It’s not a switch you flick on. You’re not going from zero back to 100, or whatever that new normal looks like,” Leah Nord, director of workforce strategies at the Canadian Chamber of Commerce, said ahead of the announcement Friday.
Since March, around three-million Canadians have lost their jobs due to closures caused by the pandemic.
Help for researchers
Meanwhile, Trudeau also announced $450-million to help researchers and research institutions whose work is unrelated to the COVID-19 crisis continue their work amid the pandemic.
Research unrelated to the deadly coronavirus that causes COVID-19 was halted in mid-March, including clinical trials and research into cancer, stroke and other diseases. Hospital-based institutes have warned that much of the funding they rely on to pay for that research — including charitable donations, contributions from foundations and clinical trial contracts with pharmaceutical companies — has evaporated.
For universities and affiliated research institutions that closed their labs because of this pandemic, we’ll provide temporary support on wages to help keep those who had to put their work on hold.
— Justin Trudeau (@JustinTrudeau) May 15, 2020
Without financial support from the government, they’ve warned that they’ll have to begin laying off thousands of researchers by the end of this week.
