Small business relief plan is missing many, B.C. says
Help earmarked by federal rent program goes unspent due to complications: James
VICTORIA Many B.C. small businesses aren’t getting the financial help they need to pay rent during the pandemic because of flaws in Ottawa’s commercial rent relief program, says provincial Finance Minister Carole James.
James expressed her concerns directly to federal Finance Minister Bill Morneau in a conference call Monday, saying aid earmarked for B.C. small businesses and landlords is going unspent due to the high threshold needed to qualify, the fact only landlords and not tenants are permitted to apply, and other complications that have discouraged applications to the program.
The problems have been highlighted publicly by organizations that represent B.C.’s major commercial landlords and most of the province’s 500,000 small businesses.
“I have certainly heard the concerns loud and clear, and we’ve raised many of those concerns,” James said in an interview Monday.
“Every two weeks we have a call with the federal finance minister, and every two weeks myself and a number of other ministers give updates. We always raise the same issue, which is the program is missing a large number of small business owners that could benefit from the program.”
The Canada Emergency Commercial Rent Assistance program is jointly funded by the provinces and Ottawa.
A commercial landlord can get a non-repayable funding from Ottawa for up to 50 per cent of their monthly costs, if they agree to cut the rent for tenants by 75 per cent and promise not to evict them. But a small business has to have lost at least 70 per cent of its pre-pandemic revenue to qualify, a threshold both landlords and businesses say is far too high and out of line with 30 per cent financial reduction thresholds used for other federal aid programs, such as wage assistance.
Only 4,600 B.C. small businesses have qualified under the program to date, according to figures provided Monday by the province. That represents 2.3 per cent of the roughly 200,000 B.C. small businesses that said their revenue has declined more than 70 per cent in a May survey by the B.C. division of the Canadian Federation of Independent Business.
“The uptake is embarrassingly low, that’s what these numbers say to me,” federation vice-president Laura Jones said.
The figure amounts to less than one per cent of the 508,700 total small businesses in B.C. with fewer than 50 employees — although not all small businesses pay rent.
“The numbers are small when compared to the number of small businesses in the province, but how many are actually able to get the program is another question,” James said.
“It’s not fully subscribed. And I think a lot of that has to do with the way the program is designed. It hasn’t met the needs of a lot of small businesses and hasn’t met the needs of a lot of landlords.”
There is $300 million in rent relief available for commercial landlords and small businesses under the program, $220 million from Ottawa and $80 million from the province.
James said government is unsure how much has been spent so far. But she said she is hopeful that Ottawa, which last week extended the program until the end of July, will make changes like it has on criteria for other federal aid programs during the pandemic.