THE WEEK IN REVIEW - 3 APRIL 2020
your rennie brief
what you need to know about the latest COVID-19 initiatives in canada
• In response to the anticipated disruptions caused by the spread of COVID-19, Canada’s federal government, the government of British Columbia, the Bank of Canada, and other institutions are taking steps to help mitigate the negative effects. • Each week rennie will publish a summary of the latest policy changes, financial market interventions, and other relevant actions introduced in the preceding week. • This summary includes all announcements up to 3 April 2020.
government of canada The new 75% WAGE SUBSIDY measure—which will be available to any business whose revenue reduction totals 30% or more compared to the same month in 2019—will soon be able to apply for funds through the CRA website, with funds being made available beginning the second week of May. Businesses will need to re-apply for the subsidy each month they qualify. (For employers established after February 2019, eligibility would be determined by comparing monthly revenues to a “reasonable benchmark”.) An important note for employers is that the wage subsidy they receive will be considered government assistance and will therefore be included as part of employers’ taxable income. Furthermore, any assistance received under the wage subsidy programme would reduce the amount of employers’ remuneration expenses eligible for federal tax credits. The government will begin accepting applications for the CANADA EMERGENCY RESPONSE BENEFIT (CERB) on Monday, April 6th. A $2 billion PURCHASE ORDER has been made by the federal government for protective and diagnostic equipment, including masks, gowns, ventilators, test kits, and test swabs. In order tomeet the URGENT FOOD NEEDS of Canadians, $100 million will be distributed through organizations such as Food Banks Canada and the Salvation Army. A total of $7.5million has been pledged to KIDS HELP PHONE in order to providemental health support to children and youth impacted by school closures and reduced access to social support and community resources.
The government will contribute $9million through the UNITED WAY CANADA to assist seniors with the purchase groceries, medication, and other critical items. government of british columbia An ECONOMIC RECOVERY TASK FORCE has been launched to advise the provincial government on its economic response to the COVID-19 crisis and discuss the province’s long-term economic recovery. The task force includes the premier and senior cabinet ministers, as well as leaders from First Nations, the business community, labour, and the not-for-profit sector. BC HYDRO will be providing a three-month credit to residential users who demonstrate need as a result of COVID-19. The credit will be equal to three times the average monthly bill over the past year (expected savings would average $477 per customer). Small business power bills will be forgiven for up to three months between April and June, while larger businesses—such as pulp and paper mills or mines— will be able to defer 50% of their power bill for three months. bank of canada With the Bank committing to purchasing $5 billion in government of Canada securities well into the economic recovery, and with economic growth not expected to resume until Q3 2020, TOTAL ASSET PURCHASES could extend into the range of $200-250 billion.
For further information please contact Ryan Berlin (rberlin@rennie.com) or Andrew Ramlo (aramlo@rennie.com). The information set out herein (the “Information”) is intended for informational purposes only. RAR & RMS has not verified the information and does not represent, warrant or guarantee the accuracy, correctness and completeness of the information. RAR & RMS does not assume any responsibility or liability of any kind in connection with the information and the recipient’s reliance upon the information. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information may change any time without notice or obligation to the recipient from RAR & RMS.
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