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Federal wage subsidy program is extended

Federal wage subsidy program is extended

Prime Minister Justin Trudeau has extended the federal wage subsidy program to the end of August. The subsidy program was intended to allow employers hit hard by COVID to keep their employees working by providing 75 percent of the workers salary. The plan was to end in June but now will be extended for two more months. Of all the government COVID support programs the wage subsidy plan had received less participation than programs like CERB which pays directly to laid off workers.

Trudeau said the idea is to give employers more runway and confidence to resume operations slowly if they have to. He is also asking companies to bring back their employees.

A release from Finance Minister Morneau’s department said eligibility rules will allow Indigenous-government-owned corporations or partnerships to qualify, as well as amateur athletic associations, registered journalism organizations, and private colleges and training schools.

Trudeau also said the government change the qualifying threshold regarding the amount of revenue loss a business must have experienced in order to get funding.

“If part of the eligibility criteria for getting the wage subsidy is a decrease of 30 per cent of your business, we wouldn’t want people who are getting back their business going to feel like they have to hold back on their growth, on their expansion, on their rehiring in order to be able to continue benefiting from the wage subsidy.”

The subsidy covers 75 per cent of wages for employers that have seen sharp declines in revenue since the novel coronavirus pandemic hit Canada hard in March, up to $847 per worker, per week. The legislation that created the subsidy gave the government the authority to extend qualifying periods for help through to the end of September.

Federal figures show just under eight million people have applied for that Canada Emergency Response Benefit, receiving just under $35.9 billion between them. The program had a budget of $35 billion.

The latest federal figures show Ottawa has paid out $3.36 billion in wage subsidies to 123,642 companies, the vast majority of which are for under $100,000 in aid.

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