Federal budget 2021: What it means for SMEs
Federal budget 2021: Program extensions, new hiring subsidy for small business
THE FEDERAL BUDGET measures for small and medium-sized businesses include pandemic-related program extensions and funding boosts even as the government rolls out a $15 federal minimum wage.
Ottawa now plans to extend its popular Canada Emergency Wage Subsidy and Emergency Rent Subsidy and Lockdown Support programs to September 25 with an additional $12 billion in funds to continue giving Canadian businesses further stability over the coming months.
Both of those subsidies will see their rates gradually reduced beginning this July to ensure an orderly phase-out of the programs. It will also require any publicly-listed company that applies for the wage subsidy and found to increase pay for its top executives to pay those funds back.
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Canadians will also now have their one-week waiting period for employment insurance (EI) claims waived, and those who are self-employed, caregivers or gig workers who may not qualify for EI during the pandemic will receive additional weeks of recovery benefits until September 25. The Liberal government is also earmarking an additional $3.9 billion over three years to increase access to EI benefits and another $3 billion over five years to provide better EI sickness benefits.
The Liberal government will also spend $595 million this year to introduce the new Canada Recovery Hiring Program to help businesses still trying to recover from the pandemic by subsidizing a portion of the costs employers take to re-open.
All told, the Liberal government expects to spend about $32.4 billion in additional benefits and subsidies over the next five years to help workers and businesses get through the pandemic.
In addition to those measures, the Liberal government proposes spending $960 million over three years on new workforce training programs, $470 million over three years in new apprenticeship and trade grants, introducing new legislation to establish a new $15 hourly minimum wage that will also rise with inflation and $8.9 billion over five years to expand the Canada Workers Benefit to support Canadians working low-wage jobs.
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It will also provide $4 billion over four years that will be earmarked to help businesses adopt new digital technologies through microgrants, training, and financing through the Business Development Bank of Canada.
As well, an additional $7.2 billion will be spent funding the government’s Strategic Innovation Fund over the next seven years to support projects mainly in the life sciences, automotive, aerospace, and agriculture sectors, as well as businesses that help support Canada’s shift to a greener economy.
To help address the massive job and financial losses incurred by Canada’s aerospace sector due to the pandemic, the Liberal government plans to spend $250 million over three years for regional development agencies to deliver a so-called Aerospace Regional Recovery Initiative.
Other measures include upcoming legislation to provide new labour protections for gig workers and contract workers in the air transportation sector, new programs for Black and female entrepreneurs and begin consulting on ways to establish employee ownership trusts. 