Ottawa Announces 75 Percent Wage Subsidy For Small Businesses
OTTAWA – The Trudeau government announced on Friday a dramatic increase in the wage subsidy for small businesses that have been shut down or scaled back their activities in many sectors of the economy.
Qualified businesses will now be eligible for a 75 percent wage subsidy, a substantial increase from the 10 percent subsidy first announced by the federal government.
“Small- and medium-sized businesses are the backbone of the economy,” said Prime Minister Justin Trudeau in his daily address Friday morning. “You are collectively the largest employer in the country…You’re going to get the support you need to help rebuild a more resilient and prosperous economy.”
“So please keep your workers on the payroll or think of hiring them back.”
Trudeau said a more significant subsidy will help companies not only survive a difficult period but also emerge in a better position to rebuild.
“To keep being able to pay their employees through this time, we know that coming out of this crisis will be smoother and better than otherwise,” he said.
One of the hardest-hit sectors has been food and beverage businesses like cafes and restaurants. Trudeau singled them out in his address as businesses that need substantial support.
“For example, a family restaurant that’s been in business for many, many years and has had the same employees [that have] been with them through the good times and the bad times. Now in the midst of this crisis, they find themselves unable to continue to pay those employees, when they need the money most. We need to be there for them,” he said.
The initial program featured a 10 percent subsidy with a cap of $25,000 per business for a maximum of three months.
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Huddle interviewed some of those business owners after that subsidy was announced, and like many others across the country, they said it wasn’t high enough to make a difference.
Louis-Philippe Gauthier, the director of provincial affairs for New Brunswick and Prince Edward Island with the Canadian Federation of Independent Business, told Huddle the 10 percent wage subsidy was “woefully inadequate considering the magnitude of impact that this crisis is having” on small businesses.
“The reality is many, many, many, many businesses have already laid off their staff. And for those businesses that have already laid off their staff this wage subsidy is no help,” Gauthier said.
The Trudeau government heard that feedback and came back this week with a much-higher subsidy.
“It’s important to send that message right now that if you’re a small business who is facing the impossible choice of laying off longtime employees because there’s just no money coming in, and you don’t know how long you’ll be able to keep operating, we’re there to help out,” he said.
Trudeau said more details about eligible businesses and updated caps on time frames and the subsidies available for each business will be available early next week.
“We’re finalizing the details and expect to provide all of that information by Monday,” he said. “But I can assure you that whatever measures we need to take will really help them to keep their employees on the payroll…even though there’s very little work to be done.”
With files from Huddle reporter Trevor Nichols.