Tuesday,  November 30, 2021  12:29 pm

Budget 2021: Tapering of support will devastate travel agents, says ACTA

  • Agency
  •   04-27-2021  6:21 am
  •   Pax Global Media

Budget 2021: Tapering of support will devastate travel agents, says ACTA
Wendy Paradis, President, ACTA. (Pax Global Media)
Pax Global Media

The Association of Canadian Travel Agencies (ACTA) says it has “carefully studied” the Canadian government’s 724-page federal government budget and has identified the areas of benefit (and area of significant concern) to travel agents.

Although the extension of financial aid programs through to September 2021 is welcome news to ACTA, there is a serious concern with the decline in the aid programs scheduled to begin in July.

“Leading up to the budget, ACTA was hearing from multiple sources in Ottawa that there were strong indications that the government would be eliminating several financial support programs including CEWS, CERS and CRB programs,” said Wendy Paradis, President of ACTA, on Tuesday (April 27). “This move would follow New Zealand and Australia who ended their Job Keeper or wage subsidy programs effective March 31, 2021 causing a devastating impact on travel agent businesses.”

READ MORE: Liberals promise cash for hard-hit businesses, but sector-specific support for agents still needed, advocates say

She added: “So, we were pleased the Canadian government extended these financial aid programs, but have grave concerns about the aggressive tapering off for all of these programs in the travel industry.”

Wendy Paradis, President of ACTA. (Pax Global Media)

ACTA, along with other travel and tourism associations and its members, will continue to “aggressively lobby the government to stress the importance of these financial support programs to our industry,” the association said.

Premature timelines

Deputy Prime Minister and Finance Minister Chrystia Freeland presented aspects of the Liberals’ Budget on April 19, announcing extensions to the wage subsidy and rent subsidy programs until September.

The Canada Recovery Benefit (CRB) will also remain in place through September 25 and extend an additional 12 weeks of benefits.

Deputy Prime Minister and Finance Minister Chrystia Freeland on April 19.

Although, the benefit amount will reduce to $300/week after July 17, which independent travel agents quickly flagged as an area of concern.

All in, the Liberals will provide $1.5B in support of Canada’s travel and tourism sector, allocating $1B for tourism and $465M for air travel and airports.

READ MORE: Feds unveil $1.5B for travel & tourism, but reducing CRB will "push" more agents out of industry

In a meeting with Minister Freeland last week, ACTA learned that the budget assumes that vaccine rollout will continue at a rapid pace through the end of June – and Minister Freeland stated, “I believe Canadians are going to have a great summer.”

The full 2021 budget can be viewed here.

“While we hope that the Minister is correct, ACTA along with other travel and tourism associations stressed that the timelines are premature,” said Paradis. “Given that we are still under very strict lockdowns, borders closed and travel restrictions in place – travel agencies and travel agents will not see any notable increase in revenue in Q3 and Q4 when aid programs are set to expire.”

ACTA’s urgent priorities

As such, ACTA has outlined its lobby priorities over the next 30 days:

  • Extend the critical CEWS, CERS and EI programs at maximum support to the end of year, or 90 days after travel restrictions lifted
  • Maintain the CRB benefits at the current $500/week level to the end of 2021, or 90 days after travel restrictions lifted
  • Extend the RRRF application deadline and other liquidity programs (CEBA, HASCAP, etc) to the end of 2021, or 90 days after travel restrictions lifted, and expand the accessibility to sole proprietors for programs where this criteria is not in effect.
  • Extend the CRHP to the end of 2021, or 90 days after travel restrictions lifted.

Good news (pending further detail)

The Regional Relief and Recovery Fund (RRRF) application deadline was extended to June 30, 2021, though travel agents have experienced many challenges with this program, much like some of the other liquidity programs.

The government has proposed to create the Canada Recovery Hiring Program (CRHP), designed to help hardest hit businesses.

The CRHP could provide opportunities as the CEWS program decreases, business begins to pick up and there is a need to rehire, although funding amounts decrease monthly and the program is only available June to November, 2021.

The government’s allocation of the $1B for Tourism is currently broken out to $500M for the Tourism Relief Fund – administered by the Regional Development Agencies, and $500M to Festivals, Canadian Heritage and Destination Canada.

Still time to influence changes

While the budget has been tabled, it still has to move through the parliamentary process and as such, “by no means is this document the end product,” ACTA said.

Which is good news because:

“This means that our industry still has the opportunity to influence changes to the programs or direct how some of the monies earmarked for the programs can be utilized,” ACTA said.

The association says it already has meetings with some key Ministries and will continue this newest lobbying campaign over the next several weeks.

Air Canada’s commission protection

Meanwhile, ACTA has been soliciting feedback from travel agency and travel agent members highlighting the gaps with the protection of commissions.

While Air Canada and Air Canada Vacations have been making positive adjustments to refund policies, gaps in commission protection remain, ACTA said.

In its original ask of the government, ACTA stressed the importance that if consumer refunds were mandated, airlines and tour operators needed to be given funding to cover travel agent recall commissions.

ACTA has already reached out to the Ministries of Finance and Transport advising that there are some gaps in recall commission protection commissions and that an additional fund may be required.

Important webinars this week

ACTA is hosting important advocacy webinars with special guest MPs: the Hon. Michelle Rempel Garner, Shadow Cabinet Minister of Health on April 27th (English) and Stephanie Kusie, Shadow Cabinet Minister of Transport on April 29th (French).

Outbound consumer travel trends and insights by the Conference Board of Canada will also be shared.

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