OTTAWA (NEWS 1130) — Finance Minister Bill Morneau proposed changes to the federal government’s wage subsidy program Friday that would open it to more businesses.
All Canadian companies that have suffered a drop in revenue because of COVID-19 would qualify for financial support under the proposed changes, eliminating the requirement that they prove a 30 per cent decline to qualify.
That 30-per-cent mark excluded some companies and make it difficult for them to hire or rehire staff, Morneau said.
“Businesses will get the wage subsidy if they’ve had any reduction in revenue,” he added. “They’ll get the subsidy, as well, and it will be in proportion to the amount of their revenue reduction that they will get a subsidy. So it broadens the number of organizations, helps them to safely restart to get their employees back at a time where their revenues are reduced.”
The subsidy has been touted as a way to get Canadians back to work after months-long shutdowns due to the pandemic. The federal government announced earlier this week an extension to the wage subsidy program until December.
Today we are proposing to extend and expand the Canada Emergency Wage Subsidy. With these changes, more workers and employers will get the support they need through the fall. https://t.co/LBZqi3TDPs pic.twitter.com/nRKVUaiae4
— Bill Morneau (@Bill_Morneau) July 17, 2020
The changes will give businesses confidence, Morneau said, to hire and rehire staff.
“So that extension in duration is important,” he added.
Another proposed change is an additional 25 per cent subsidy for businesses that have lost more than 50 per cent of revenues during the pandemic.
“So that they can deal with this really challenging time for their businesses,” Morneau said.
The changes would take effect retroactively as of July 5.
The most recent federal figures for the program show the government has given almost $20.4 billion in payroll help to about 262,200 companies.
The government has been under pressure to ease eligibility rules, specifically around the requirement of a 30 per cent drop in revenues, so more companies under that cut-off can qualify.
“We think it’s particularly important that we change these programs as rapidly as we can to make them work for a broader cross-section of businesses,” Morneau said. “There are there are businesses who’ve been telling us that this change is important.”