What You Get From the Canadian Relief Fund
A few days ago the Government of Canada announced its economic course of action to fight back against COVID-19. The Government states that “no Canadian should have to choose between protecting their health, putting food on the table, paying for their medication or caring for a family member”. As a result the Government seeks to implement the Canadian Emergency Response Benefit to support workers and business through this difficult period.
But what specifically does it entail? Thus far the Government has stated that the benefit will be taxable and will include the following:
- $2,000 per month for four months to workers that lose their income as a result of COVID-19. This would also apply to wage earners, contract workers, and self-employed individuals that would not otherwise be eligible for Employment Insurance (EI). Workers still employed but not receiving income due to COVID-19 are also eligible to receive the benefit.
- Canadians already receiving Employment Insurance should not apply to the benefit unless their EI ends before October 3, 2020, they could apply for the benefit once the EI ends.
- $300 increase to the Canada Child Benefit. Expected to be available in mid-May. Further details to follow.
- $1,500 one-time payment for low income individuals that are a single parent with two children. Expected early May.
- $400 for singles and $600 for couples receiving the Goods and Services Tax Credit.
- Federal student loan payments are frozen for a period of six months.
The Government of Canada intends to have the portal for accessing the benefit available in early April and to have Canadians receive their payments within 10 days of applying. The benefit would then be paid for every four weeks and be available from March 15, 2020 to October 3, 2020.
- $200 per child and $250 per special needs child one-time payments to parents dealing with indefinite closure of schools.
- Maximum payments double to up to $166 (single individual) and $332 (couple) per month for low income seniors currently paid by the Guaranteed Annual Income System. Commencing in April and lasting for a period of six months.
- Ontario Student Assistance Program (student loans) recipients get payment deferral for a period of six months.
- Electricity pricing switching to off-peak rates for 45 days.
- $573 per week for 14 days to those in self-isolation AND unable to access federal emergency assistance. Applications currently open and available here: Temporary Aid for Workers Program.
- Tax deadlines extended to September 1, 2020.
- Minimum loan of $50,000 to businesses in need of liquidity to maintain operation. Businesses must evidence their ability to be profitable post-COVID.
- Suspension of hydro chargers for unpaid bills starting March 23, 2020; customers invited to discuss alternative payment plans with Hydro-Quebec.
- $1,146 over two weeks to those in isolation.
- Deferral of loans, lines of credit, and mortgages for customers of Alberta Treasure Branches for a period of six months.
- Six month reprieve from provincial student loan payments.
- Three month deferral of electricity and natural gas bills for residential, farm and small commercial customers.
- $1,000 one-time payment to individuals directly affected by COVID-19.
- An offer to pay up to $500 per month for four months of rent to landlords on behalf of tenants.
- Student loan payments frozen for a period of six months commencing March 30, 2020.
- Sales, employer health, and carbon taxes deferred until end of September 2020.
- $600 for BC Hydro customers that have lost wages due to termination of employment or illness stemming from COVID-19.
- $3,000 to eligible childcare educators to provide home or community care to children.
- Businesses with a payroll less than $10, 000 may extend their tax deadlines for a period of two months.
- $900 one-time payment to works and self-employed individuals impacted by COVID-19.
- A commitment to cover child-care fees for parents that have lost income.
Newfoundland and Labrador
- Costs of childcare to be covered by province for parents that were asked to pay despite the centres closing.
- Business loans issues by the Innovation and Business Investment Corporation deferred by three months.
- $50 extra to individuals on income assistance as of March 20, 2020.
- Government loan payments deferred until end of September 2020.
Prince Edward Island
- $250 per week to employers that had employees work at least 8 hours per week between the date March 16-29, 2020.
- $500 per week to self-employed people impacted by COVID-19. Must have been self-employed between the date March 16-29, 2020.
- $900 over two weeks for those forced to self-isolate and not covered by federal measures.
Commentary: The actions outlined above from the Government of Canada and its respected provinces are what measures are being taken to support businesses and individuals through COVID-19. From a larger economic perspective, the Government is also providing support to certain sectors to act as bridge from now until the crisis is over. The Government of Canada’s current “stimulus” that it intends to inject into the economy is estimate to total $107 billion.
Across the world other nations have taken similar measures to bridge the economic impact COVID-19 is causing. In the United States, President Donald Trump and Congress recently passed $2 trillion stimulus bill in its effort to fight the virus. From the bill, the American can expect the following:
- $1,200 to each individual earning $75,000 (gross) or less.
- $2,400 to married couples earning a combined $150,000 (gross) or less.
- $500 additional per child.
The markets have since steadily rose with the Dow Jones rising 11% last week to have its best day since 1933 and have continued to do so in comparison to this month’s sharp decline and despite volatility. Certain industries such airlines have been heavily impacted by the lock-downs and are expected to receive a bailout from the US Government. Yet it appears that we have learned something from 2008 as the bailouts intend to prohibit layoffs, stock buybacks, and dividends.
The economic situation stemming from COVID-19 is indeed fluid and subject to change. Time will tell if the measures the Government and our people have taken will blunt the impact of the virus.