Minister of Finance Bill Morneau responds to a question during a news conference in Ottawa, Friday, March 27, 2020. THE CANADIAN PRESS/Adrian Wyld

Canada’s 75% wage subsidy is coming, but not for several weeks: finance minister

Subsidy will cost Canada $71 billion, but push down cost of emergency benefit, Morneau said

Businesses hoping to apply for Canada’s 75 per cent wage will have to wait several weeks to get that money, according to Finance Minister Bill Morneau.

Morneau unveiled more details about the wage subsidy that Prime Minister Justin Trudeau has announced, and then updated, in recent days.

The wage subsidy will provide 75 per cent of each employee’s salary for business – of any size – that has lost at least 30 per cent of its gross revenue since this time last year due to COVID-19. Companies will have to reapply every month and Morneau said there will be “severe” consequences for anyone who tries to take advantage of the system.

The subsidy will apply to the first $58,700 of each employee’s salary and provide up to $847 a week per employee for up to 12 weeks, with a possible extension if the crisis continues. The money is available to companies of all sizes, as well as charities and non-profits, and will be retroactive to March 15.

“Funds will be available in approximately six weeks,” the finance minister said Wednesday.

Businesses will be able to apply through a Canada Revenue Agency portal “soon,” Morneau said, and money is supposed to begin flowing in six weeks. For businesses that cannot show revenue from the previous year, the previous month’s revenue may be an option. Companies that are signed up for CRA direct deposit will receive funds faster.

Companies will be required to “show what the pre-crisis income was of an employee and show that they’re paying that employee an amount up to $847 and then they will get that money returned to them from the Canada Revenue Agency.”

Morneau urged businesses to rehire workers and to top up the extra 25 per cent not being provided by the wage subsidy.

“I know in the cases they can afford to pay their workers, they will do that,” he said. “We need to get through this intact.”

The point of the wage subsidy is to get employers to keep workers on the payroll, hopefully leading to a faster economic recovery, the finance minister said. It will not be available to those who receive the Canadian Emergency Response Benefit, which is for workers who remain laid-off, or are self-employed and have no income due to COVID-19.

The wage subsidy is expected to cost $71 billion. The CERB, which provides $2,000 to workers who’ve lost their jobs as a result of COVID-19, will cost an additional $24 billion. Altogether, Morneau said these direct measures will cost around $105 billion.

“As a result of this… the deficit will go up,” Morneau said, noting this equals to about five per cent of the country’s GDP.

READ MORE: Liberals delay release of 75% wage subsidy details, costs

READ MORE: Trudeau says Parliament needs to sit to pass expanded COVID-19 benefits


@katslepian

katya.slepian@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Coronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A second wave of COVID-19 is probable, if history tells us anything

B.C.’s top doctor says that what health officials have learned this round will guide response in future

Council talks trash: New garbage bylaw in the works

Draft bylaw to be voted on at Monday, May 25 council meeting

UPDATE: Police oversight agency investigating after shots fired Saturday night in Chilliwack neighbourhood

RCMP reported a ‘distraught male’ fired at police officers on Christina Drive – IIO is on scene Sunday

Prospera Credit Union, Westminster Savings lay off over 100 staff following historic merge

2020 merger was largest credit-union merger in Canadian history

‘Service beyond the classroom’: Gerry Palmer wins UFV award

Palmer has been involved with UFV for more than 30 years, starting as an instructor

Trudeau to seek 10 days of paid sick leave for Canadian workers, says talks are ongoing

Paid sick leave is key to keeping COVID-19 spread under control, prime minister says

Vancouver Island hasn’t seen a new homegrown case of COVID-19 in two weeks

Island’s low and steady transmission rate chalked up to several factors

Eight people arrested in Victoria homeless camp after enforcement order issued

Those living in tents were given until May 20 to move indoors

Andrew Weaver says he was ready to defeat John Horgan government

Independent MLA blasts B.C. Greens over LNG opposition

20 dead in COVID-19 outbreak at Langley Lodge

There were two new cases detected, according to the Lodge’s update

44% fewer passengers flew on Canadian airlines in March 2020 than in 2019

COVID-19 pandemic has hit airlines hard as travel remains low

UPDATE: One person dead, two in critical condition after Highway 1 collision in Langley

A man and woman were taken to hospital in critical condition

Commercial rent relief applications open as feds encourage landlords to apply

Program would see government cover 50 per cent of the rent

COVID-19: B.C. park reservations surge as campgrounds reopen

Keep trying, many sites not reservable, George Heyman says

Most Read