Bill C-9 (Historical)

An Act to amend the Income Tax Act (Canada Emergency Rent Subsidy and Canada Emergency Wage Subsidy)

This enactment amends the Income Tax Act to revise the eligibility criteria, as well as the level of subsidization, under the Canada Emergency Wage Subsidy (CEWS) as part of the response to the coronavirus disease 2019. It also extends the CEWS to June 30, 2021. The enactment further amends the Income Tax Act to introduce the Canada Emergency Rent Subsidy (CERS) in order to support those hardest hit by the coronavirus disease 2019. This subsidy provides relief in respect of rent and interest on debt obligations incurred to acquire real property used by businesses, charities and not-for-profit organizations in the course of their businesses or other activities. The rent subsidy is effective as of September 27, 2020.

Motion in Amendment

[Emmanuella Lambropoulos, Liberal, Saint-Laurent, QC]

Mr. Speaker, of course it has been a very difficult time for all businesses across Canada or at least for the majority of them. We know we are not anywhere near the end of this pandemic. We know that businesses will continue to need our help in the months to come, and perhaps in the years to come.

I am glad we have made progress, and I will keep advocating for more supports to businesses. I am sure everybody in our caucus will do so. As time goes on, we will continue to provide the help as needed.

[Adam Vaughan, Liberal, Parliamentary Secretary to the Minister of Families]

Mr. Speaker, I hear the opposition party members speaking to this program, but I am curious about the member's thoughts on the safe restart program of $19 billion, including $2 billion that was added to it for schools. This is part of the way in which the provincial governments have responded.

Is it surprising that the opposition members do not give credit to the federal government when the provincial governments spend our money to make these programs a reality?

[Emmanuella Lambropoulos, Liberal, Saint-Laurent, QC]

Mr. Speaker, the federal government has taken huge steps to support Canadians and their businesses. Using Quebec as an example, they were very late to respond and to offer help.

Many of my constituents were saying that the only help they were receiving was from the federal government. I am honestly proud of our government's response to the pandemic and of the supports it has offered to businesses and Canadians in general. I know we will continue to be there to support Canadians.

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, we on this side of the House will be supporting Bill C-9, a bill that will be providing rent subsidies to Canada's small business community.

Quite frankly, this is a welcome bill although it has many flaws in its history. Over six months ago our party was encouraging the Liberal government to adopt many of the amendments and changes to this program. Unfortunately, at that time, our pleas for amendments and changes fell on deaf ears. Primarily, I think it is because the Liberal government does not understand the plight of small businesses.

On the Conservative side, we most certainly understand. I know, for example, many small businesses in my province of Saskatchewan are not only struggling, they are on the verge of bankruptcy primarily because of the pandemic. There is no question about that. I am not trying to sugar-coat this by saying the program the Liberals brought in was a flawed program. It was brought in during a time when the pandemic was first rearing its ugly head across Canada.

I appreciate the fact that the Liberals acted quickly. They acted quickly with the CERB. They acted quickly with the rent subsidy program, however, it was flawed. What we have been doing consistently since that time is trying to point out, not only to the Liberal government but to Canadians, where the flaws are in this program and encourage the government to make positive changes to help small businesses across Canada.

I will give credit where credit is due. Although six months too late, the government actually did make some positive changes that will help small businesses across Canada.

Initially, as many Canadians and many small business owners know, the restrictions placed upon them were too onerous. The uptake of the initial program was less than 10%, primarily because the program was designed to go through landlords rather than directly to tenants. Because of that, many landlords chose not to apply. Therefore, their tenants, the small business owners or leaseholders, were left in a very uncomfortable position, because their landlords would not apply for the rent subsidy program. That way it left the small business owners, who had to pay rent on a monthly basis, in a position where they were offered no relief whatsoever. That was almost untenable.

Now, however, there have been some positive changes and, as I said earlier in my remarks, I applaud the government for doing so. However, let us take a look back, a short brief view of the history to see exactly how we came from the initial bill that was introduced by the government six months ago to today's debate on Bill C-9.

As I mentioned, initially the government proposed that this rent subsidy program would be designed in such a way that landlords would have to apply. If they were successful in their application, then they would be the ones who would offer rent relief to their tenants. While some people may say that sounded like a reasonable approach, in reality it was anything but, as evidenced by the fact that less than 10% of landlords actually made application.

What should have been done initially is what the government has finally done in the current Bill C-9, and that is to offer rent relief directly to tenants so that those most affected by revenue drops and revenue losses will be able to gain relief and some financial assistance.

Initially, not only did the government fail to see that, it chose a very onerous and bureaucratic way in which to deliver this program. Initially the government decided that CMHC should be the delivery mechanism to bring this program into the pocketbooks of small business owners across Canada. However, CMHC was simply not designed to administer such a program, and that was discovered very early on in the process. Then the government doubled back and decided that if CMHC was not the way to deliver this program, it would find another way, and it came up with MCAP. MCAP is a mortgage insurance and financing company that the government determined, for whatever reasons, would be appropriate to deliver this program to small business owners.

However, shortly thereafter it was discovered that one of the principals of MCAP was a gentleman by the name of Rob Silver. In fact, he is a vice-president of that company and very influential because he is married to the current Prime Minister's chief of staff.

Anyone with any knowledge of how governments work would recognize that this was a complete conflict of interest. Here we had an individual, Mr. Rob Silver, who had been a spokesperson for the Liberal Party on many occasions over many years, now contracted by the government to deliver a program that would assist his company. That is absolutely a blatant conflict of interest that should have been obvious to anyone, anyone except, of course, the Liberal government.

However, we should not be surprised. We have seen conflicts of interest arise so many times before with the Liberal government. Whether it be the Prime Minister accepting gratuitous gifts to the Aga Khan's island or whether it be the Prime Minister embroiled in the WE Charity scandal, we have discovered time and time again that the ethical compass of the government has long been missing. The delivery of the government contract to MCAP is one more example of that ethical wrongdoing.

Thankfully, however, saner voices were heard and MCAP was removed from the bidding to deliver this program. The government avoided another messy ethical conflict that would have proved to be incredibly disappointing and embarrassing for the government. It finally took our advice and gave the administration of this program to CRA, which is where it should have been delivered in the first place. CRA has proven, through its administration of CERB and many other government delivery programs, to be the most effective mechanism that the government has at its disposal. Therefore, we are to a point now where, I think, the government has finally got it close to being right, but it is still not perfect.

What this has done over the past six months is demonstrate to small business owners that the government, despite the Liberals' protestations, does not in fact have their backs. If they had the back of small business owners, the Liberals would have employed the changes that we had suggested long ago.

Let us make no mistake. The small business owners across Canada are in an untenable position. Many of them, for example in the restaurant industry, are facing a reality that once rent and wage subsidies expire, come the summer of 2021, they may be forced to close their doors. In fact, many independent analyses have been done and have shown that over 60% of restaurants could be shuttered permanently unless these temporary wage subsidies are extended. Whether that will happen, I do not know.

We need many things to combat this pandemic. I believe, in all sincerity, that the government is working as hard as it can to try to find a vaccine, and I hope a vaccine is found because the lives of Canadians are at stake. The economy of Canadians is at stake.

The small business community in our country is the backbone of the Canadian economy. Small businesses have to be protected. They have to be given an opportunity, as they would be given with Bill C-9, to be able to tap into the government largesse and, at least for the foreseeable future, see a light at the end of the tunnel.

[Lloyd Longfield, Liberal, Guelph, ON]

Mr. Speaker, at the beginning of his speech, the hon. member was starting to head down a path where we could see a bit more information coming from him; that the landlord tenant acts are under provincial jurisdiction. The federal government looked initially at doing something through CMHC to get relief to landlords as well as tenants at the same time. As a member of Parliament, I work with landlords and tenants who are both facing revenue drops during this crisis. I was able to connect landlords and tenants to federal support through CMHC.

Could the hon. member comment on how Saskatchewan is structured with respect to landlord-tenant agreements being under provincial jurisdiction? In Ontario, 97% of funding has been coming from the federal government. Is the Province of Ontario doing any better providing support for businesses in his province?

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, I believe my colleague misspoke when he asked if I could make comment on whether the Province of Ontario was better positioned, as it was actually the Province of Saskatchewan.

I am speaking, holistically, about the fact that small business owners across Canada, regardless of region, need support. They desperately need support. I can assure my hon. friend that small business owners in Saskatchewan are no different than small business owners in Ontario, Quebec, Alberta, British Columbia and right across this great country of ours.

They are not looking for handouts. They are just looking for a level playing field that allows them to be able to put food on the table for their families, operate a business, and be able to walk home each month with pride to their families and say that their business is still alive and operating.

That is the purpose of Bill C-9, and for that we offer our unqualified support, but it has taken far too long to get to this point.

[Jenny Kwan, NDP, Vancouver East, BC]

Mr. Speaker, the commercial rent subsidy program was flawed when it was first introduced because only landlords could apply. As a result, many small businesses, including those in Vancouver East, were not able to access this support.

Now, with the new program, the Minister of Finance yesterday said it would only be retroactive back to September 27, not to April 1. Consequently, many small businesses would not be able to qualify under this new program. It is not as though they do not have to carry that debt forward from the first wave.

Does the member agree that the government needs to fix this program once and for all and allow for small businesses to apply for this program retroactively to April 1?

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, I could not agree more with my hon. colleague that this program was flawed from the outset. Mistakes were made by the government and not rectified for a full six months. I believe that most small business owners in Canada would love to see a retroactive aspect to this bill, so that going back to April 1 they would be able to have taken advantage of the current provisions within Bill C-9.

However, I do not believe the government is going to be listening to that or acting upon that, although I would encourage my friend from Vancouver East to keep pressuring the government. Perhaps we will see some relenting in its approach in the future.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Mr. Speaker, I wonder if my hon. colleague could tell me if I am understanding him correctly.

We were not able to get this done properly the first time, we were told, because it was provincial. Now, suddenly, we can do it federally, and is that because the wife of the man in charge of MCAP actually wanted to make sure it went through his organization?

[Tom Lukiwski, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, as I mentioned in my earlier remarks, yes I believe this was a huge conflict of interest. Initially, the government was considering giving this contract to administer the rent subsidy program to MCAP, a company that had direct ties to the Prime Minister's Office.

This delivery mechanism would have benefited MCAP directly. We have a situation where Mr. Silver, on many occasions, directly lobbied the federal government and had complete access to the Prime Minister's Office because of his relationship to the Prime Minister's chief of staff, who is his wife.

This was morally repugnant, quite frankly. When I say it was an obvious breach of the conflict of interest code in Canada, that is an understatement.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Mr. Speaker, it is a huge privilege to speak on this bill and also to be able to represent the federal NDP as a critic for small business, tourism and economic development.

Before I get started, I do want to give a huge shout-out to someone special in my life, my mom. It is her birthday. I appreciate the round of applause in the House of Commons.

Speaking about my mom is so relevant today because moms are really so important, as we know, in times of crisis. We see them bringing food to a neighbour if they have been sick, or if they see an injustice in the community, they are the first to rise up.

In times of desperation, when people are in difficult times and in crisis during this pandemic, we expect our government to really take that motherly approach, so it is so relevant that it is my mom's birthday today and we are talking about this important bill. People expect the government to take that “mother bear” approach and make sure that everybody is taken care of and looked after. That is something I appreciate about moms, not just my mom, but moms across this country. We expect our government to take that approach.

Sadly, when this crisis broke out, we saw the government step forward with an initial wage subsidy offering 10%, which was clearly not close to adequate. We saw Ireland, the U.K. and Denmark offering wage subsidies between 70% and 80%. With our pressure, working beyond the normal means of lobbying and advocacy, we worked together with organized labour, the Canadian Federation of Independent Business. Our party, our leader and I signed a letter calling on the government to raise that wage subsidy. We were glad to see them do that.

My colleague from New Westminster—Burnaby brought forward a proposal to bring forward a commercial rent program, similar to what they were doing in Australia. I know the government likes to say that it is difficult in the federation of Canada to be able to take on issues like rent, but other countries were able to do that. They were able to work collaboratively to bring forward programs to help people.

Today we are really glad to see the government come back with a fix when it comes to the commercial rent assistance program and extending the wage subsidy, but there are still a lot of unknowns, such as the wage subsidy and what it will look like moving into the new year. We know that for tourism and hospitality businesses, certainty is so important.

I want to give a huge shout-out to Charlotte Bell, of the Tourism Industry Association of Canada, and Keith Henry, from the Indigenous Tourism Association of Canada, for their advocacy in calling on the government to extend that wage subsidy.

However, these businesses need certainty, not just on the wage subsidy, but also around financing programs such as the BCAP program, which only 14% of tourism businesses have actually been successful in receiving financing from and 43% have been flat out denied. We know liquidity is going to be a big issue.

These are a lot of issues that have not been addressed. I am going to get into the importance of the government working with everybody, especially during this pandemic.

My big concern is the disconnect of the government not completely understanding the challenges small businesses are facing. We heard last night from the Deputy Prime Minister and Minister of Finance that the government is not willing to support our motion, which they flat out denied today, to backdate the commercial rent assistance program to April.

It baffles me that the government understands it had designed a flawed program and admits it made a mistake, which it is willing to fix it here today, moving forward, but it will not backdate it to April 1. By not doing so, there is a serious injustice going on. We heard the Deputy Prime Minister say that the government is forward-thinking, but the debt comes forward for all of those tenants who were denied access to the landlord-driven, flawed program. Basically, many people were not even able to apply because their landlords would not participate. Two-thirds of Canadian businesses were excluded from that program.

This is so unfair because many of these business owners were denied, although their neighbour got access to the program. They will also be responsible, like all Canadians, to paying back the debt that we are accumulating to help save small businesses in this country.

The fact that the Liberal are unable to backdate the program shows the disconnect. It shows they do not understand the debt that these businesses are accumulating and the challenges they are facing. While they talk about being equitable, there is nothing equitable about them not backdating their broken and flawed program.

The Liberals were actually threatening to go to an election without providing these emergency supports, and then there was the delay. Here we are on the final day of three weeks of sitting before a break week fast-tracking legislation to get help to people. It just shows that the government really does not understand how serious this issue is for small businesses.

Many small businesses are watching today. Many of them are steeped in debt or are in arrears with their landlords. They are looking today to see if the government is actually going to backdate the program, or if they are going to have to go file for bankruptcy, because that is what many businesses are looking at.

I remember being self-employed in the 2008 recession, and that does not even pale in comparison to today. I remember the injustice of the government of the day, the Harper government, bailing out the big banks and big corporations and leaving small businesses to hang out to dry. This is unacceptable. We need the government to move much more quickly.

I want to thank so many different groups, but I particularly want to identify one. Savesmallbusiness.ca identified really important opportunities, solutions and flaws in the program. It advocated for rent relief and for the government to fix the program. It identified that there were huge problems such as a slow rollout, over-complicated paperwork and banks being let off the hook. It also identified that the government failed to bring in help.

We look at other countries such as Australia, for example, which commissioned a group of business leaders quickly to come together from various sectors to provide help. The government here also did not listen to real people on the ground and put away the hammer to bring out the scalpel. It needs to listen to people on the ground when it deals with these issues.

As well, the government did not demand more from the financial industry. We saw the big banks once again get off the hook from doing the right thing of contributing and participating.

There are so many things we saw with the rollout of the commercial rent assistance program, including assigning the contract to administer the contract to MCAP, with $84 million for a broken design program.

What breaks my heart is seeing and reading stories about places like the Golestan Bakery in Vancouver. It has been running for 23 years, and it has just been evicted by its landlord. This what we are going to continue to see. This injustice is going to be carried on by the Liberals, who are refusing to fix this program.

I have to give a huge shout-out to all the small businesses that reached out to my office, and to MPs across this country, to organize labour to come together and stand in solidarity with the Canadian Federation of Independent Business and the local chambers of commerce. As I said, savesmallbusiness.ca, Startup Canada, various business organizations, indigenous organizations that were initially excluded from the subsidy because it excluded indigenous-led organizations, and Chief Dennis from Huu-ay-aht, have all stood together.

Here I am rising for the 40th time since the pandemic broke out to speak on small businesses and the commercial rent assistance issue, and it is bittersweet. I am glad to see the changes, but we need to save those businesses that are steeped in debt, in arrears and need help. I am urging and begging the government to get on board, and I am asking the Conservatives to also get on board in pressuring the government to force it to create an opportunity for those who were excluded get access to the funding they so deserve.

I appreciate the opportunity to raise these issues.

[The Deputy Speaker, Bruce Stanton]

The hon. member for Courtenay—Alberni will have five minutes for questions and comments when the House next gets back to debate on the question.

The House resumed consideration of Bill C-9, An Act to amend the Income Tax Act (Canada Emergency Rent Subsidy and Canada Emergency Wage Subsidy), as reported (without amendment) from the committee, and of the motion.

Income Tax Act

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, I listened carefully to the speech given by my colleague from Courtenay—Alberni.

There are some things we agree on but others we do not.

The Bloc Québécois supports Bill C-9. We think that the criteria for the Canada emergency wage subsidy should have been changed well before this in order to ensure greater stability.

With regard to the commercial rent assistance program, we already knew in May that it would not work. At the time, I called upon the Minister of Innovation, Science and Industry to make changes to that program, but it was easier for the government to shut down Parliament and prorogue than to change a program that we knew was ineffective from the start. Access to commercial rent assistance was on a voluntary basis.

My colleague from Courtenay—Alberni and I do not agree when it comes to political parties being able to receive the wage subsidy. We are trying to understand how on earth it is fair that political party employees are protected from being laid off when employees of other businesses that are suffering greatly are not. These businesses are on the verge of collapse too, and it is very difficult for them.

It is outrageous that the Conservative Party, which raised $13 million from its supporters in three quarters, collected close to $1 million from the emergency wage subsidy. The Liberals also took in $1.2 million in public funds from the emergency wage subsidy, and they raised $8.6 million from their supporters.

The NDP cashed in on the emergency wage subsidy starting in May. In June, we learned that the NDP would be getting about $60,000 per month. Yesterday, November 5, reporters asked the NDP how much money it would be getting. They did not get an answer.

My question is simple. Does my colleague support the Bloc Québécois's amendment to make the emergency wage subsidy off-limits for political parties?

[Gord Johns, NDP, Courtenay—Alberni, BC]

Mr. Speaker, we are all in this together, and I agree with my colleague that the delay in the rollout was absolutely horrible. So many people were let go from their jobs, whether they were working at a non-profit or charitable organization, a small business or even a political organization.

What we all set out to do was to make sure that we did not discriminate against anyone, wherever they worked. It was for all workers and their families. Including in projects that the NDP has raised concerns about, we decided that we were supporting all workers and their families to make sure that they had job security and also that they were not disconnected from their benefits. People were absolutely scared and they have been scared throughout this whole pandemic.

We would be absolute hypocrites to abandon staff, regardless of whether they work for the NDP or for a local charity or whatever. We cannot pick and choose. We have to support workers. Those are the values of our political party. We will support all workers to ensure that they get the support they need throughout this pandemic.

That is why we have been consistent in not being vocal and speaking out against anyone getting support. Everybody should get treated equally throughout this pandemic and very difficult time.