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NDP: small businesses being failed by federal COVID supports

A generation of businesses could be lost ~ Gord Johns, NDP Critic for Small Businesses

Wednesday March 17, 2021 | BC & NATIONAL

by Mary P Brooke, Editor | Island Social Trends

Canada is at risk of losing a generation of businesses as a result of mismanagement of supports during the COVID economic crisis.

That’s the position of the NDP’s Critic for Small Business, Gord Johns (Courtenay-Alberni), as pointed out during a media Zoom call today about the impacts of federal government economic initiatives which they claim are failing small businesses.

Specifically there was mention of the failture of the Canada Emergency Rent Subsidy (CERS) and the Canada Emergency Wage Subsidy (CEWS) to address the needs of many small businesses.

Two of the challenging factors have been if a business did not meet the government’s stated year-over-year loss threshold or had not filed a 2019 tax return (new businesses started in 2019 would fall into that situation).

Gord Johns, MP
Gord Johns, MP (Courtenay-Alberni) is the NDP Small Business Critic.

“Small businesses haven’t been getting the help they need,” said Johns during the Zoom call. Yet overall the newly acquired debt load taken on by small business during the pandemic in Canada has reached $135 billion, he said.

NDP asking for adjustments:

In an interview with Island Social Trends today, Johns said that the NDP is working on asking for an extension to the Canadian Emergency Bank Account (CEBA) application deadline (presently March 31, 2021) and a way to include start-up businesses (who presently miss the threshold for not having filed a tax return in 2019 and also cannot show a revenue drop in 2020).

The NDP also believes that the CEBA payback period should be extended beyond December 31, 2022 for the large loans of $40,000 to $60,000.

He says the NDP has brought along the federal government’s programs “kicking and screaming” throughout the pandemic (that includes how the NDP pushed for the Canadian Emergency Response Benefit/CERB to be $2,000 per month as a way for Canadians to properly cover their basic living expenses).

Last year the NDP managed to coordinate Canadian Labour and the Canadian Federation of Independent Business to together ask the government to increase the wage subsidy (CEWS) program from providing a 70 percent subsidy instead of 10 percent.

The pattern is the same through all of this: the federal Liberal government either doesn’t understand or won’t readily offer help to small businesses. The larger business model seems more readily understood to them.

Johns is a former small business owner and Chamber of Commerce executive director. He says that small businesses — especially startups — have challenges at the best of times.

He notes that the federal government did also not help small business during the 2008 financial crisis and the multi-year recession that followed.

Putting livelihoods on the line:

This is despite that small businesses closed their doors to do the right thing. “Businesses closed their doors for public health and did the right thing and now have been penalized,” said the Vancouver Island MP.

Particularly hard hit have been the restaurant and tourism industries which of course depend on people gathering together. Public health orders and guidelines during the COVID-19 pandemic have restricted large numbers of people from gathering and also prohibit smaller gatherings indoors except with one’s own household.

The loss of small and mid-size businesses usually has a qualitative impact on communities and reduces the opportunities for job creation and active mentoring of people getting into new careers.

Favouring large businesses over small:

Peter Julian, finance critic
Peter Julian, MP (New Westminster-Burnaby) is the NDP Finance Spokesperson

The Zoom call was co-led by NDP MP Peter Julian (New Westminster-Burnaby) who pointed out that Johns has advocated for small businesses in the House of Commons throughout the pandemic.

Julian said today that the federal government through their policies and programs has refused to be supportive to startup businesses, meanwhile amply supporting the banking sector and larger companies who have fared quite well during the COVID crisis.

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