Ottawa, province announce new supports for business and workers

The federal and provincial governments announced plans Wednesday to offer more financial support for workers and businesses affected by recent capacity restrictions.

In the face of the omicron surge, many parts of the country including Ontario have introduced new restrictions on businesses, primarily in the hospitality, entertainment and retail sectors.

Ottawa said Wednesday that it is temporarily expanding eligibility for wage and rent subsidy programs as well as income support of $300 per week for certain employees who have lost work. Ontario announced a rebate program for property tax and energy costs for businesses.

Business and labour groups had been calling for more to be done to help those who have been hit hard by the latest round of public-health measures.

Prime Minister Justin Trudeau said the government is using regulations to adjust the criteria for support under pandemic aid legislation passed last week. The change will mean businesses and workers can qualify for support if they are subject to capacity restrictions of 50 per cent or more rather than being under an official lockdown."

It was created in case of localized lockdowns ... now we're expanding it so that it's there for places with reduced capacity," Trudeau said at a news conference, noting that the legislation only passed at the end of the Parliamentary sitting last week.

The government is temporarily expanding the Local Lockdown Program, which provides wage and rent subsidies of between 25 per cent to 75 per cent depending on the scale of revenue loss.

Under the new rules, a business can qualify if one or more of its locations is subject to an order reducing capacity by 50 per cent or more and if activities restricted by public health orders accounted for at least half of total revenues.

The Canada Worker Lockdown Benefit will include workers subject to those same capacity restrictions. The benefit will provide $300 per week to affected workers who have lost 50 per cent or more of their income.

Finance Minister Chrystia Freeland said the changes are retroactive to Dec. 19 and will be in place until Feb. 12. She also added a warning against large companies taking the money and simultaneously increasing executive compensation or paying out dividends to shareholders, a problem that plagued the government in earlier programs.

Public companies receiving the wage subsidy through these support programs that increase their top executive compensation in 2022 compared to 2019 will have this wage subsidy support clawed back," Freeland said. These companies will also become ineligible if they pay dividends while receiving the wage subsidy."

Meanwhile, the Ontario government said it's creating the Ontario Business Costs Rebate Program to give eligible businesses repayments equivalent to half of the property tax and energy costs they incur while subject to the current capacity limits.

The province said qualifying businesses will include restaurants, smaller retail stores and gyms and that a full list of eligible businesses will be available in mid-January, which is when it will open up online applications for payments retroactive to Dec. 19.

We recognize that these necessary capacity limits to reduce the transmission of the virus will impact businesses," said Ontario Finance Minister Peter Bethlenfalvy. That's why we are introducing these new supports, which will put money directly into the hands of business and free up their cash flows during this critical time."

Ontario will also give businesses a six-month grace period with no interest or penalties for payments of most provincially administered taxes, starting on Jan. 1, a measure meant to help businesses manage cash flow.