Federal aid during the COVID-19 pandemic in Canada

The Government of Canada introduced multiple temporary social security and financial aid programs in response to the economic impacts of the COVID-19 pandemic in Canada. The initial $82-billion aid package was announced on March 18, 2020 by Justin Trudeau. The first measures were implemented when the COVID-19 Emergency Response Act received royal assent from Governor General Julie Payette on March 25, 2020. Modifications to existing programs: Existing federal social security programs were modified to provide additional financial support to their recipients. Canada Child Benefit payments were given a one-time increase of $300 per child, the Goods and Services Tax (GST) credit for the 2019 tax year was doubled, and personal income tax deadlines for 2019 were extended. Catherine McKenna, the Minister of Infrastructure and Communities, also announced on April 16 that the federal government was seeking "shovel-ready" infrastructure projects to receive stimulus funding. Income support programs: The Canada Emergency Response Benefit (CERB; French: Prestation canadienne d'urgence) is a program which provides a taxable benefit of CA$2,000 per month for Canadian residents facing unemployment due to the COVID-19 pandemic. Initially announced as providing a maximum of four months' financial support, the federal government announced a further two months of support in June 2020 and another month in August 2020. The benefit is jointly administered by Employment and Social Development Canada and the Canada Revenue Agency, with eligible persons either applying through ESDC's Service Canada online portal or through the CRA online portal. To be eligible, applicants must attest they: did not quit their job voluntarily, earned at least CA$5,000 in the 2019 tax year or the preceding 12 months, have stopped working or are working reduced hours due to COVID-19, and are earning less than CA$1,000 in employment or self-employment income. Within one week of the CERB program's launch in April 2020, nearly 3.5 million Canadians applied for this benefit; this grew to 7.12 million by April 24. On April 15, eligibility for CERB was expanded to include seasonal workers, persons who had exhausted their Employment Insurance regular or sickness benefits, and those who have returned to work but still earn less than CA$1,000 per month due to reduced hours or lower demand. Due to the lack of summer employment available for post-secondary students or graduating high school students, the Canadian government introduced the Canada Emergency Student Benefit (CESB; French: Prestation canadienne d'urgence pour les étudiants) as a counterpart to CERB to help students. Students who cannot find employment or are unable to work due to the COVID-19 pandemic are eligible for CA$1,250 per month from May through August 2020. CESB applicants with a disability or caring for dependents receive an additional $750, increasing their monthly amount to the equivalent of a CERB payment. Employment minister Carla Qualtrough announced on July 31, 2020 that the CERB would be wound down following a final extension of one month. CERB recipients who are still unemployed will be transitioned to the regular Employment Insurance system and those who do not qualify for EI will be transitioned into one of three new recovery benefit programs. CERB was ended on September 26, 2020, and a revamped EI program was implemented. Approximately 8.9 million Canadians applied for CERB by its end date. On October 12, 2020, the federal government rolled out a new income support program, the Canada Recovery Benefit (CRB) which pays $500 per week for up to 26 weeks; over 240,000 Canadians applied to the program on its first day of launching. Another program, the Canada Recovery Caregiving Benefit (CRCB) supports Canadians that have been working but have to take a break to care for dependents (a child below 12 years of age or a disabled family member). The benefit only applies if schools and care centres are closed, or the dependent fell sick, or contracted COVID-19. Canada Emergency Business Account: The Canada Emergency Business Account (CEBA; French: Compte d'urgence pour les entreprises canadiennes) provides emergency interest-free loans to small businesses and nonprofit organizations during the COVID-19 pandemic. The aim of this program is to ensure that these businesses have access to sufficient capital to remain solvent during the pandemic. CEBA was implemented in the COVID-19 Emergency Response Act, No. 2 which was introduced by Finance Minister Bill Morneau and passed in Parliament on April 11, 2020. The budget for the program was set for CA$25 billion, offering loans of CA$40,000 financed by Export Development Canada. Businesses apply for CEBA loans through their current financial institution, which administer the loan and submit required information to EDC. Businesses that repay at least 75% of the loan balance (CA$30,000) by December 31, 2022 will have any remaining balance forgiven. The size of the loans could be increased, along with the amount forgivable. The due date could also be moved into 2024 if need be. Canada Student Service Grant: The Canada Student Service Grant (CSSG; French: Bourse canadienne pour le bénévolat étudiants) provides paid service opportunities for young adults to assist with charities and non-profit organizations. Participants in the program must be 30 years old or under, recent post-secondary graduates (December 2019 or later) or enrolled in spring, summer or fall 2020 semester. For every 100 hours volunteered, the participant will receive $1000. Each participant may receive up to $5000 grant. This was temporarily place on hold during the summer of 2020, the week that students were supposed to start their placements, July 9. 35,000 students and recent grads applied for the program. It was expected to cost $900 million. As of the first week of October 2020, it had not commenced. Special One-Time, Tax-Free Non-Reportable Payment: The Government of Canada gave a one-time payment of $600 for people with disabilities on October 30. Canada Emergency Wage Subsidy: The Canada Emergency Wage Subsidy (CEWS; French: Subvention salariale d'urgence du Canada) is a program created by the Government of Canada to provide financial support for businesses during the COVID-19 pandemic and prevent large layoffs. CEWS allows eligible employers to receive a 75% subsidy on each of their employees' wages (up to their first $58,700) for 12 weeks retroactive to March 15. The CEWS is targeted "at businesses with revenue declines of at least 15 per cent in March, and 30 per cent in May and June." The program was announced on 1 April 2020, as an expanded version of a previously proposed temporary wage subsidy. The Parliament of Canada reconvened on 11 April 2020 to pass the COVID-19 Emergency Response Act, No. 2 on division. Several large employers which had laid off employees due to the economic effects of the pandemic announced they would re-hire workers in response to CEWS. Air Canada announced because of the CEWS it would re-hire (backdated to 15 March) 16,000 airline staff that were laid off due to the pandemic. Business Credit Availability Program: This programme, which was announced on 11 May 2020, consists of guaranteed loans at commercial rates of between $6-80 million. It had seen as of mid-June 2020 only 400 applications. It is administered by Export Development Canada and the Business Development Bank of Canada, Mary Ng, the Minister of Small Business, Export Promotion and International Trade is responsible for this programme. Large Employer Emergency Financing Facility: The Large Employer Emergency Financing Facility (LEEFF; French: Crédit d’urgence pour les grands employeurs) provides government-backed bridge financing to large Canadian employers through the Canada Development Investment Corporation (CDEV). On 11 May 2020, Trudeau, Morneau and Bains in a press conference said that "a bridge financing facility for large employers that need help to get through the economic downturn caused by the coronavirus." One stated goal was "to avoid bankruptcies of otherwise viable firms wherever possible... Companies that use the lending facility will have to commit to respect collective bargaining agreements, protecting workers’ pensions, and support national climate goals. Rules on access to the money will place limits on dividends, share buy-backs and executive pay." The LEEFF will only target companies with annual revenues in excess of $300 million, and only if they request $60 million or more from the LEEFF. Under the LEEFF companies must also: limit executive salaries to $1 million per annum; provide a share in their business to CDEV through stock warrants; and prohibit dividends and share buybacks until they pay back their LEEFF. Enforcement: On June 2, 2020, the Canada Revenue Agency announced a tip line for reporting suspected fraudulent CERB recipients. As of June 3, the CRA announced it had received 600 tips and had received 190,000 voluntary repayments of CERB from Canadians who were not entitled to receive them. On June 8, legislation was proposed by the Liberal government that would allow persons found to have received CERB payments fraudulently be subject to fines or imprisonment. The proposed legislation was not supported by any of the opposition parties in the minority Parliament and did not move ahead to second reading. Financial impacts of aid programs: Parliamentary Budget Officer Yves Giroux issued a report on April 30, 2020 projecting the federal deficit for fiscal year 2020 could be in excess of $252 billion, based on nearly $146 billion in spending on federal aid measures. In a fiscal update tabled to on July 8, Minister of Finance Bill Morneau projected that the deficit for the 2020 fiscal year will reach $343.2 billion.