Fall fiscal update signals intent to support needs of “hardest hit” restaurant sector

Published November 30, 2020

Restaurants Canada welcomes commitments unveiled in the federal government’s fiscal update to help hardest hit businesses like restaurants pull through the remainder of the COVID-19 crisis.

In response to recommendations from Restaurants Canada, today’s fiscal update, unveiling the federal government’s 2020 Fall Economic Statement, included the following commitments to support the country’s vital foodservice sector:

  • The Canada Emergency Wage Subsidy (CEWS) rate will return to 75% of employee wages for eligible businesses, back up from the current maximum rate of 65%. As previously committed, the subsidy will continue to remain available until June 2021.
  • Support through the Canada Emergency Business Account (CEBA) program is being expanded (as previously committed) from $40,000 to $60,000, of which a total of $20,000 will be forgiven if the balance of the loan is repaid before Dec. 31, 2022.
  • A new Highly Affected Sectors Credit Availability Program will be introduced to provide 100% government-backed loans to businesses in the hospitality sector, recognizing businesses like restaurants continue to be among the hardest hit by the pandemic and will need targeted support to survive and recover. Details about this new program will be provided at a later date.

Restaurants Canada looks forward to working with the Government of Canada to build on these commitments and will provide updates as further details become available.

A step in the right direction: Update signals continued intention to support hardest hit restaurant sector

The promise to increase the wage subsidy rate back to 75% is welcome news, with colder weather increasingly discouraging guests from coming out to patios and many establishments operating under lockdown restrictions once again.

However Restaurants Canada remains concerned about the new Canada Emergency Rent Subsidy (CERS) program’s unequal treatment of single-location operators versus multi-unit operators across the country, particularly in downtown cores. With each individual location operating as its own small business, despite being under one corporate umbrella, this subsidy should be calculated on a per-location basis rather than at a corporate entity level. The current legislation does not capture these operational realities, and as a result unintentionally leaves out many small and medium-sized business operators who are struggling to survive this crisis. Restaurants Canada will continue to advocate for changes to this legislation to allow more hard hit businesses to access this critically needed support.

While taking on more debt is not viable for most foodservice businesses, Restaurants Canada nevertheless welcomes the commitment to provide further business loan support for the hospitality sector as recognition from the federal government that our industry requires targeted assistance.

With the new year around the corner, now is the time to lay the groundwork for bringing industry to the policymaking table to ensure our vital sector is set up for success to survive the rest of the pandemic and feed Canada’s recovery.

Marlee Wasser

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