We've all heard Dr. Bonnie Henry refer to her goal of "flattening the curve" of COVID-19. That means reducing the impact on our hospitals, health care providers and suppliers of equipment by minimizing the number of cases at any one time. This will ensure the health care system can continue to function and that resources are available for everyone in need.
The same strategy is important for our economy. We need to flatten the curve of a financial downturn caused by consumers doing their public duty and staying home and by businesses being ordered to close by the government. The more businesses that remain viable — even at a reduced level of demand or in a maintenance mode — the sooner they can resume operations and we can get back to a new normal and start an economic recovery. This matters very much for business owners and also for the vibrancy of our community, the future of employees as well as the revival of tax revenue to governments.
Government investment now will help flatten the curve of business failures and will certainly contribute to governments' financial picture down the road, and their ability to continue providing public services.
This week, The Chamber vigorously
for the government to provide very generous support for businesses, as was done in many European countries. Today I was extremely relieved to hear the announcement by the prime minister that Canada will provide a 75% wage subsidy for small to medium sized businesses to enable them to keep their employees, or hire them back. This is a much better option as it leaves more money in the pockets of employees and enables employers to hold on to their teams.
Prime Minister Trudeau announced that GST payments due at the end of this month can be delayed until June, which helps businesses preserve more cash for longer. This is helpful, but The Chamber will continue to ask for a reduction in taxes from all levels of government and not just deferrals.
The prime minister also said businesses can access $40,000 in loans that will be interest free for a year. See below for details. This is in addition to the measures announced earlier this month delaying income tax payments.
More details, including how to access the subsidy, are expected Monday.
We have also asked for help with commercial rent, which is likely to be a provincial government measure. And we continue to call for a large recovery fund, which the federal government may act on when we are closer to recovery. At the moment they are rightly focused on business preservation.
Yesterday, in response to our advocacy letter, I had a very good conversation with the federal Minister of Middle Class Prosperity and Associate Finance Minister, Mona Fortier. We had initially connected, courtesy of Mayor Lisa Helps, when the Minister was visiting Victoria back (in the good old days) on March 4. At that time, the Minister and I talked about the problems of a booming economy. That discussion resulted in the Minister asking me to talk with her about the current crisis, and helped make sure she understood the challenges facing our region.
I am impressed by the efforts of our federal, provincial and local government to respond quickly to the drastic loss of business due to public health measures to control COVID-19. I am optimistic this help will continue through our recovery which, based on countries ahead of us in this pandemic, is hopefully only a month or so down the road.
Catherine Holt, CEO
Greater Victoria Chamber of Commerce