Wednesday,  August 4, 2021  3:08 pm

Ottawa unveils "stream of support" for Canada's travel & tourism sector, restores CEWS to 75%


Ottawa unveils "stream of support" for Canada's travel & tourism sector, restores CEWS to 75%
Canada's Deputy Prime Minister and Finance Minister Chrystia Freeland.
Michael Pihach

Michael Pihach is an award-winning journalist with a keen interest in digital storytelling. In addition to PAX, Michael has also written for CBC Life, Ryerson University Magazine, IN Magazine, and DailyXtra.ca. Michael joins PAX after years of working at popular Canadian television shows, such as Steven and Chris, The Goods and The Marilyn Denis Show.

Canada's Deputy Prime Minister and Finance Minister Chrystia Freeland delivered the Liberal government's fall fiscal update on Monday (Nov. 30), announcing a plan to help Canada’s travel and tourism tourism sector and other hard-hit industries. 

“We know that businesses in tourism, hospitality, travel, arts and culture have been particularly hard-hit. So we’re creating a new stream of support for those businesses that need it most — a credit availability program with 100-per-cent government-backed loan support and favourable terms for businesses that have lost revenue as people stay home to fight the spread of the virus,” said Minister Freeland, speaking in the House of Commons. 

The Highly Affected Sectors Credit Availability Program will offer eligible businesses loans of up to $1 million at favourable rates with a 10-year term.

Finance Minister Chrystia Freeland speaks in the House of Commons on Monday (Nov. 30)

Freeland called travel and tourism a “particularly hard hit” sector, noting how the guaranteed money will be lent by banks or other financial institutions.

What about help for major airlines? 

Minister Freeland said $1.2 billion is in the budget for airports, airport infrastructure, and regional airlines, according to a report from CBC News. 

However, the Minister did not share any details about a possible bailout package for Canada’s major airlines on Monday.

However, in speaking with CBC's Chief Political Correspondent Rosemary Barton, Freeland said talks are underway with major airlines about the government providing more support.

"In order to know exactly how to support them, we need to really see what their financial position is," Freeland told Barton. 

Canada's Minister of Transport Marc Garneau has previously said that the government is developing an assistance package for airlines, airports and the aerospace sector, with talks beginning the week of Nov. 9. 

READ MORE: If airlines want federal aid, they must refund customers for cancelled flights, says Garneau

Garneau has made it clear that Ottawa's future support for the airline industry is contingent on passengers receiving refunds for cancelled travel. 

"Before we spend one penny of taxpayer money on airlines, we will ensure Canadians get their refunds," said Garneau on Nov. 8.

That response has left many travel agents feeling frustrated, angry and nervous as they now face the real possibility of having to pay back thousands of dollars in hard-earned commissions. 

In some cases, such commission recalls are clawing back income that agents made as far back as 2019. 

CEWS bumped back to 75%

The Canada Emergency Wage Subsidy (CEWS) will also be bumped back up to 75 per cent of eligible wages, from Dec. 20 until March 13, 2021,  Freeland proposed. (The current cap is set at 65 per cent).

Freeland said the government's priority is to do "whatever it takes" to help Canadians and businesses stay safe and solvent.

READ MORE: Ottawa extends 14-day quarantine, travel restrictions to Jan. 21, 2021

The Liberal government says it plans to spend $100 billion to kick start the economy as it faces a deficit projection of more than $381 billion for this fiscal year.

"When the virus is under control and our economy is ready for new growth, we will deploy an ambitious stimulus package to jump-start our recovery," said Freeland.  

Travel agents still face obstacles 

Canada's travel industry still faces a dire financial situation as 2021 approaches and as many travel agencies continue to face bankruptcy amid a wave of commission recalls. 

The Association of Canadian Travel Agencies (ACTA) has been lobbying on behalf of the trade for several months now and, last week, presented a six-point plan to the federal government to support travel agencies. 

The plan includes demands to: 

1. Increase the CEWS to the 85% level

2. Amend the Canada Emergency Rent Subsidy (CERS) to 90%

3. Extend the Canada Recovery Benefit (CRB) to June 30, 2021

4. Include agents in any airline aid package

5. Introduce a travel industry subsidy to assist with fixed expenses, and amendments to BCAP so travel agencies would be eligible.

6. Devise a plan for the government to work with the industry to develop clear criteria for re-opening borders and future travel advisories when it is safe to do so, including a travel incentive program.

ACTA has also alerted the government that an airline aid package contingent on passenger refunds will put travel agencies, travel agents and independent contractors in a "precarious situation due to airlines and other travel suppliers recalling commissions paid long ago."

This is a developing story.


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