OTTAWA — The industry will have to wait a while longer to hear about any bailout for Canada’s airlines, and, crucial for the retail travel industry, any potential protection for travel agent commissions amid airline refunds.
While many believed today’s economic update from the federal government would include details about an airline bailout, it did not. Transport Minister Marc Garneau had announced on Nov. 8 that the federal government was putting together a financial assistance package for Canada’s airlines, contingent on the airlines offering refunds to out-of-pocket travellers amid the COVID-19 pandemic. Airfare refunds mean commission recalls, of great concern to travel agents.
However there was news of a loan program for industries that have been hit particularly hard by the pandemic, including tourism, hospitality, the travel industry and arts & culture.
Deputy Prime Minister and Finance Minister Chrystia Freeland said Ottawa will create a new stream of support for these industries. The initiative will be “a credit availability program with 100% government-backed loan support and favourable terms,” she said in today’s update.
The low-interest loans will be available in amounts up to $1 million.
The program is called the Highly Affected Sectors Credit Availability Program.
Close to $700 million in capital investments, and rent relief, are coming to airports over six years. The government has also committed $206 million in support for regional airlines. But so far that was it in terms of bailout news for airlines.
“We will get through this, we are a resilient people,” said Freeland in her address to the House of Commons today. “We know what we must do to get through the dark months ahead.”
“We do not have the luxury of fatigue,” she added.
The federal government’s economic relief package for Canada is the largest since World War II, she said.
The vast majority of Canada’s travel agencies, up to 90%, are small, ‘mom and pop’ businesses. Freeland acknowledged that many small businesses have had to shut their doors amid the pandemic. “Small business are the heart of our community”, and the pandemic has devastated small business owners, “imperiling in a few months the work of a lifetime.”
Looking ahead, once the virus is under control, the Government of Canada will invest in a growth plan of roughly 3 – 4% of GDP, between up to $70 and $100 billion, over three years, to jumpstart Canada’s recovery, said Freeland.
To support businesses big and small through the second wave, the federal government will be increasing the maximum rate of the Canada Emergency Wage Subsidy (CEWS) to 75% for the period beginning Dec. 20, 2020 and extending this rate until March 13, 2021,
It is also extending the current rates of the Canada Emergency Rent Subsidy and Lockdown Support until March 13, 2021. Both programs will be there for businesses until June 2021, said Freeland.