Navigating Uncertain times and planning for growth
On November 30th, 2020, the federal government released Supporting Canadians and Fighting COVID-19 - Fall Economic Statement 2020. This fiscal update outlines Canada’s plan to fight the COVID-19 pandemic, support Canadians, and invest in an economic recovery that is inclusive, sustainable, and creates good jobs for Canadians.
The Economic Statement details record spending and the nation’s largest projected deficit on record: nearly $381.6 billion. This deficit also has the possibility of increasing if more drastic measures are needed to curb the spread of COVID-19. Considering how the government has had to adapt, adjust, and bolster individuals and industry impacted by COVID-19, the unprecedented government spending indicated in this document is not a surprise to the GrantMatch team. It is clear that the federal government is motivated to invest in key business sectors which stimulate and grow our economy. Over the next three years, stimulus spending is forecasted to amount to upwards of $100 billion. Such strategic investments are intended to kick-start our economy and aid recovery.
With the 2020 Economic Statement in mind, we have consolidated some of the key programs and funding announcements from the federal government to offer our readers and clients a helpful point of reference as they look ahead to 2021. Our message continues to be that businesses and municipalities must think proactively about the emerging programming and grant funding in the context of the pandemic . We are here to help organizations navigate these uncertain times and to provide plans for growth.
Notable Funding Program Updates:
Support for the Air Sector
The Airports Capital Assistance Program will make $186 million available over 2 years for small and regional airports making investments in health and safety infrastructure. Small federally-owned airports would now be eligible for this program in 2021-22 and 2022-23
A $500 million transfer payment program will be established over 6 years to support large airports making investments in safety, security, and transit infrastructure
Airport authorities are promised an additional $65 million in support in 2021-22
Rent relief will be extended to the 21 airport authorities that pay rent to the federal government
Canadian Emergency Business Account (CEBA)
The federal government will extend CEBA to allow eligible businesses access to an extra $20,000 in interest-free loans where necessary. Half of this amount ($10,000) will be considered forgivable provided the loan is repaid by December 31, 2022
Canadian Emergency Rent Subsidy (CERS)
The federal government will extend CERS to mid-March with an additional three periods. The base subsidy rate of up to 65% will be available for eligible expenses until March 2021. The 25% Lockdown Support is also being extended to March 2021, and together businesses may be eligible for a subsidy of a maximum of 80% of their eligible expenses
Canada Emergency Wage Subsidy (CEWS)
CEWS will return to previous levels, at 75% of payroll
Agri-Food Sector Support: Canada-United States-Mexico Agreement (CUSMA)
In addition to the $250 million Dairy Farm Investment Program, and the $345 million delivered through direct payments to dairy farmers in 2019-20, the government is announcing that dairy farmers will receive $1.4 billion in payments over three years, beginning in 2020-21, including a payment of $468 million this year
The federal government is also announcing $691 million for 10-year programs for supply-managed chicken, egg, broiler hatching egg, and turkey farmers. These programs will provide support for farmers including funding to invest in farm productivity and marketing activities
Highly Affected Sectors Credit Availability Program (HASCAP)
The government will be working with financial institutions to put together HASCAP: a program intended to provide businesses in the hardest-hit sectors with government-guaranteed financing and low-interest loans of up to $1 million over extended terms for up to 10 years. Rates will vary depending on market rates for the particular sector
Large Employer Emergency Financing Facility (LEEF) program
The federal government has stated intent to look into how to enhance the (LEEF) program so as to best respond to the liquidity needs of large Canadian businesses, but no information or promises have been released
Regional Relief and Recovery Fund (RRRF)
To best support the fund, the government is proposing a $500 million top-up to Regional Development Agencies and the Community Futures Network of Canada.
$3 million is proposed to be given to the Canadian Northern Economic Development Agency for economic development projects that support small businesses in the Territories
For Western Canada, the government is proposing to develop a 7th regional development agency for British Columbia, separating it from Western Economic Diversification (WD) and the Prairies
Strategic Innovation Fund (SIF)
The federal government plans to provide $250 million over five years to SIF to support innovative businesses and industries weather the effects of COVID-19
Universal Broadband Fund (UBF)
- The federal government plans to provide an additional $750 million to the UBF over five years for higher-impact projects