Prime Minister Justin Trudeau announced today in his daily update a new rent subsidy program that will help support businesses that were forced to shut down due to the global pandemic as some provinces in the country prepare to reopen their economies.
The new rent relief plan, which will be funded jointly with the provincial governments, will be providing non-repayable loans to commercial property owners to cover 50% of the rent payments for April, May, and June.
Property owners who agree to cut the rent by at least 75% and promise not to evict tenants will have the loans from the program forgiven. Small business tenants will be expected to cover the remaining 25% of the rent.
At this time, the qualifications for the program are as following: small business, including non-profit and charitable organizations, tenants must pay less than $50,000 a month in rent and have experienced a revenue decline of 70% from pre-COVID-19 levels OR they must have been forced to close down due to pandemic restrictions.
The rent relief program was announced after small and medium-sized businesses, many of which have been shut down since mid-March, have been calling for a relief as the next rent deadline is coming up very soon on May 1.
According to the Canadian Federation of Independent Businesses (CFIB) president Dan Kelly, 70% of the CFIB’s 30,000 members pay monthly rent for their businesses and more than half report that they cannot afford to pay the next month’s rent. He says that many of these businesses are struggling and need a non-repayable rent subsidy, not loans or deferrals of rent payments.
Kelly has urged the government to make the rent relief program to be “broadly applicable” to all small and medium-sized businesses without imposing a lot of eligibility criteria. He believes that these criteria would cause some business owners to give up following the pandemic.
“If we do that, I think we have a fighting chance of having the majority, not all, but the majority of our small business community make it across the emergency phase of this [pandemic],” said Kelly.
“Remember, businesses have been ordered to shut down to protect society, and it is deeply unfair that they would have to pick up the costs of keeping real estate open and paying those bills while they are essentially unable to earn an income.”
Prime Minister and Premiers to hold Weekly Calls
Prime Minister Justin Trudeau is scheduled to hold a virtual conference call with provincial and territorial premiers this afternoon with the agenda of potentially reopening the economy.
In this past week, the province of Saskatchewan released a plan to gradually restart its economic activity as the number of COVID-19 cases in the province remained steady.
Today, it was mentioned that New Brunswick’s Premier, Blaine Higgs, will also be outlining his four-phase plan to reopen his province’s economy.
The Prime Minister said in his address yesterday that it is up to the provinces to decide the best course of action in determining when and how to reopen their economies. He has also said the federal government will be offering a set of guidelines to help support the provinces and territories as they discuss how to reopen their economies.
“What we’re doing at the federal level is attempting to pull together and co-ordinate all different provinces so that we are working from a similar set of guidelines and principles to ensure Canadians right across the country are being kept safe as we look to those next steps,” said the Prime Minister.