Canada extending small business emergency loan repayment deadline
Canada is giving small businesses in Canada more time to pay back emergency loans offered during the COVID-19 pandemic, Prime Minister Justin Trudeau announced Thursday.
The Liberals have decided, after consistent calls from businesses, to give them another year to pay back their Canada Emergency Business Account (CEBA) loans, despite previously taking the position that repayment deadlines were "final and cannot be changed."
"We know that some need a bit more runway," Trudeau said.
Groups across Canada representing hundreds of thousands of small businesses have been pleading with the federal government to grant them an extension, ideally a two-year grace period and the ability to maintain access to the forgivable portion of their loans.
But, what was announced Thursday falls short of advocates' expectations.
The federal government created CEBA early in the pandemic as one of a suite of financial aid measures aimed at keeping businesses afloat in the face of forced closures and health restrictions.
Offering initially up to $40,000 to small businesses and non-profits that have experienced a loss of revenue due to COVID-19, an expansion was then granted, seeing businesses able to apply to receive up to $60,000 interest-free loans.
Open for applications between April 2020 and June 2021, the loans were approved for 898,271 businesses, totalling $49.2 billion in federal assistance.
In January 2022, in the wake of the Omicron variant surge and new restrictions, the Liberals announced they would be extending the repayment deadline by a year to the end of 2023. This meant that eligible businesses "in good standing" would have until Dec. 31, 2023 to repay and be eligible for debt forgiveness of one-third—up to $20,000—of their loan.
According to background provided by Deputy Prime Minister and Finance Minister Chrystia Freeland's department, the repayment deadline for CEBA loans to qualify for this partial loan forgiveness is only being extended by a couple of weeks, from Dec. 31, 2023, to Jan. 18, 2024, "recognizing that the end of December is a busy time for many Canadian businesses."
Or, if businesses make a refinancing application with the financial institution that provided their CEBA loan by Jan. 18, 2024, the repayment deadline to benefit from the partial loan forgiveness extends until March 28, 2024.
When the initial extension was announced, the government said outstanding loans after the 2023 deadline would be converted to two-year term loans with a five per cent interest rate, starting on Jan. 1, 2024, with the loans due in full by Dec. 31, 2025.
Now, small businesses that are not in a position to pay back their CEBA loan in time to benefit from the partial loan forgiveness have until Dec. 31, 2026 to pay their loan back in full.
The Canadian Federation of Independent Business (CFIB) was quick to say it was "disappointed" with the announcement, calling it "not good enough."
"It is helpful that the government has given business owners an additional year to repay the full balance of the loan, but the plan misses the most central issue - the loss of the forgivable portion," said CFIB president and CEO Dan Kelly in a statement. "We need a redo."
The NDP, local chambers of commerce, tourism and industry groups that were imploring the government to grant this loan repayment leniency made the case that while the government gave business in crisis a lifeline with these loans, years later, many still are treading water in their post-pandemic recoveries.
This has left many unable to make much more than a dent in the debt they've taken on, in the face of supply chain and hiring woes, as well as high inflation. Without the extension, many local businesses—particularly in the tourism sector—were facing the prospect of closing their doors for good.
Kelly said based on CFIB data, losing access to the forgivable portion will put the future of up to 250,000 small businesses at jeopardy.
The Tourism Industry Association of Canada (TIAC) expressed similar disappointment and concerns, saying that while it appreciates the government extending the overall runway for CEBA, the forgiveness period provisions insufficient and leaves many tourism businesses in precarious situations.
"This falls short of adequately addressing the immense financial strain and uncertainty that our members are experiencing," said TIAC President and CEO Beth Potter. "A mere three-month loan forgiveness extension for businesses needing to refinance does not align with the severity of the crisis."
As of May 31, approximately 21 per cent of businesses that received a CEBA loan had fully repaid according to federal statistics.
IN DEPTH
Budget 2024 prioritizes housing while taxing highest earners, deficit projected at $39.8B
In an effort to level the playing field for young people, in the 2024 federal budget, the government is targeting Canada's highest earners with new taxes in order to help offset billions in new spending to enhance the country's housing supply and social supports.
'One of the greatest': Former prime minister Brian Mulroney commemorated at state funeral
Prominent Canadians, political leaders, and family members remembered former prime minister and Progressive Conservative titan Brian Mulroney as an ambitious and compassionate nation-builder at his state funeral on Saturday.
'Democracy requires constant vigilance' Trudeau testifies at inquiry into foreign election interference in Canada
Prime Minister Justin Trudeau testified Wednesday before the national public inquiry into foreign interference in Canada's electoral processes, following a day of testimony from top cabinet ministers about allegations of meddling in the 2019 and 2021 federal elections. Recap all the prime minister had to say.
As Poilievre sides with Smith on trans restrictions, former Conservative candidate says he's 'playing with fire'
Siding with Alberta Premier Danielle Smith on her proposed restrictions on transgender youth, Conservative Leader Pierre Poilievre confirmed Wednesday that he is against trans and non-binary minors using puberty blockers.
Supports for passengers, farmers, artists: 7 bills from MPs and Senators to watch in 2024
When parliamentarians return to Ottawa in a few weeks to kick off the 2024 sitting, there are a few bills from MPs and senators that will be worth keeping an eye on, from a 'gutted' proposal to offer a carbon tax break to farmers, to an initiative aimed at improving Canada's DNA data bank.
Opinion
opinion Don Martin: Gusher of Liberal spending won't put out the fire in this dumpster
A Hail Mary rehash of the greatest hits from the Trudeau government’s three-week travelling pony-show, the 2024 federal budget takes aim at reversing the party’s popularity plunge in the under-40 set, writes political columnist Don Martin. But will it work before the next election?
opinion Don Martin: The doctor Trudeau dumped has a prescription for better health care
Political columnist Don Martin sat down with former federal health minister Jane Philpott, who's on a crusade to help fix Canada's broken health care system, and who declined to take any shots at the prime minister who dumped her from caucus.
opinion Don Martin: Trudeau's seeking shelter from the housing storm he helped create
While Justin Trudeau's recent housing announcements are generally drawing praise from experts, political columnist Don Martin argues there shouldn’t be any standing ovations for a prime minister who helped caused the problem in the first place.
opinion Don Martin: Poilievre has the field to himself as he races across the country to big crowds
It came to pass on Thursday evening that the confidentially predictable failure of the Official Opposition non-confidence motion went down with 204 Liberal, BQ and NDP nays to 116 Conservative yeas. But forcing Canada into a federal election campaign was never the point.
opinion Don Martin: How a beer break may have doomed the carbon tax hike
When the Liberal government chopped a planned beer excise tax hike to two per cent from 4.5 per cent and froze future increases until after the next election, says political columnist Don Martin, it almost guaranteed a similar carbon tax move in the offing.
CTVNews.ca Top Stories
Serial sexual offender linked to unsolved 1970s homicides of four Calgary girls, women
An investigation into unsolved historical homicides from the 1970s has linked the deaths of two girls and two young women in and around Calgary to a now-deceased serial offender.
Woman with liver failure rejected for a transplant after medical review highlights alcohol use
For nearly three months, Amanda Huska has been in an Ontario hospital, part of it on life support, because of severe liver failure. Her history of alcohol use is getting in the way of her only potential treatment: a liver transplant.
A look back on Alberta's record-breaking wildfire season: Preparing for potential challenges in 2024
By the end of the 2023 wildfire season in Alberta, 1,088 wildfires had burned more than 2.2 million hectares of land, and this year, the wildfire season is already in full swing.
Craig Berube named as next head coach of Toronto Maple Leafs
Craig Berube is the next head coach of the Toronto Maple Leafs.
Video appears to show Sean 'Diddy' Combs beating singer Cassie in hotel hallway in 2016
Security video aired by CNN appears to show Sean 'Diddy' Combs physically assaulting singer Cassie in a Los Angeles hotel hallway in 2016.
B.C. man 'attacked suddenly' by adult grizzly near Alberta border: RCMP
A B.C. man is recovering from multiple injuries after he was "attacked suddenly" by an adult grizzly bear near Elkford Thursday afternoon.
Australia's richest woman seeks removal of her portrait from exhibition
Art is subjective. And while many artists long to share their work with the world, there's no guarantee that the audience will understand it, or even like it.
Anglers reel in 3.5-metre-long tiger shark off coast of Florida: 'She found my bait'
A group of fishers said it took roughly 20 minutes to reel in this 3.5-metre-long tiger shark off the coast of Florida.
Scottie Scheffler isn't the first pro golfer to be arrested during a tournament
Scottie Scheffler's arrest hours before his second-round tee time at the PGA Championship in Louisville, Kentucky, will go down as one of the most shocking in professional golf history. It certainly wasn't the first, though.
Local Spotlight
'Another pair of eyes watching over me:' How a B.C. woman's service dog saved her from drowning
A B.C. woman says her service dog pulled her from a lake moments before she had a seizure, saving her life.
Starbucks fan on decades-long journey to visit every store in the world
A Starbucks fan — whose name is Winter — is visiting Canada on a purposeful journey that began with a random idea at one of the coffee chain's stores in Texas.
'Sacred work': Sask. First Nation learning how to conduct its own underground searches
Members of Piapot First Nation, students from the University of Winnipeg and various other professionals are learning new techniques that will hopefully be used for ground searches of potential unmarked grave sites in the future.
'It could mean a cure': Cautious optimism for groundbreaking ALS research at Western
ALS patient Mathew Brown said he’s hopeful for future ALS patients after news this week of research at Western University of a potential cure for ALS.
B.C. musician's song catches attention of Canucks
When Adam Kirschner wrote 'Slap Shot,' he never imagined the song would be embraced by his favourite team.
'We're on standby': Team ready to help entangled right whale in Gulf of St. Lawrence
A team is ready to help an entangled North Atlantic right whale in the Gulf of St. Lawrence.
Thieves caught on camera stealing pet chicken from North Vancouver backyard
A $200 reward is being offered by a North Vancouver family for the safe return of their beloved chicken, Snowflake.
Adopted daughter in the Netherlands reunited with sister in Montreal and mother in Colombia, 40 years later
Two daughters and a mother were reunited online 40 years later thanks to a DNA kit and a Zoom connection despite living on three separate continents and speaking different languages.
'Reimagining Mother's Day': Toronto woman creates Motherless Day event after losing mom
Mother's Day can be a difficult occasion for those who have lost or are estranged from their mom.