April 19, 2021 – Canadian government update on the COVID-19 pandemic following the tabling of its 2021 budget
Here is an update on recent decisions and actions by the federal government in connection with the COVID-19 pandemic following the tabling of the 2021 budget.
The budget presented by Minister of Finance Chrystia Freeland is designed to take Canada out of the crisis and contains a series of financial assistance measures, in particular, extending the wage subsidy and introducing a new subsidy for hiring workers.
Here are the highlights.
Extended assistance benefits
COVID-19 will have cost the federal government $365.7 billion once the crisis is over, according to the Freeland budget.
The largest category of spending was, not surprisingly, the multiple assistance programs announced last year to help taxpayers. Benefits that, in fact, will be extended as a third wave sweeps across the country.
– The Canada Recovery Benefit (the CRB, which replaced the CERB last year) will be extended by 12 weeks, for a maximum total of 50 weeks, between now and September 25, 2021.
However, it will be gradually reduced to less than $300 a week by fall, since the Trudeau government anticipates an economic upswing. The Canada Recovery Caregiving Benefit will be extended by four weeks, and will be maintained at $500 per week.
– The wage subsidy will also be prolonged until September 25, 2021.
However, it will be gradually reduced, starting July 4, 2021, dropping from a maximum of $847 per week per worker to $226 in September.
The commercial rent subsidy will also be available until the end of September.
Support for businesses: $16 billion more
“Ensuring economic recovery isn’t enough,” the government announced during the tabling of the budget. “The challenges and fundamental changes Canada was facing before the pandemic will not disappear.”
To achieve this, Ottawa is promising, in particular, $16 billion in additional assistance to businesses over five years. One-quarter of this amount will be earmarked for SMEs.
The federal government will also increase the Canada Workers Benefit, at a cost of $8.9 billion over five years, to help close to one million workers in difficulty.
EI sickness benefits will be prolonged and will be increased from 15 to 26 weeks, and a $15 minimum wage will be introduced for workers under federal jurisdiction.
The budget has earmarked money to increase funding for the Canada Small Business Financing Program by $560 million annually.
This money will serve, among other things, to increase the maximum loan amount from $350,000 to $500,000, and extend the coverage period from 10 years to 15 years. Eligibility will also be expanded to loans related to intellectual property as well as to the assets and expenses of start-ups and non-profit enterprises.
“People who are affected by the pandemic are very much on our minds and they continue to be our priority,” the Trudeau government stated.