Prime Minister Justin Trudeau has announced a massive $82-billion aid package to help Canadians and businesses cope with the global COVID-19 pandemic, including income supports, wage subsidies and tax deferrals.
The package includes $27 billion in direct supports and another $55 billion to help business liquidity through tax deferrals.
Combined, the package represents more than three per cent of Canada’s GDP. Trudeau said the deep spending will not drive the country into recession, insisting “prudent” decisions made over the last five years have put Canada on a strong economic footing to weather the crisis.
“We will be able to make sure our economy gets back up to speed very quickly,” he said.
The supports aim to help Canadians pay for rent and groceries, to help businesses continue to meet payroll and pay bills, and to stabilize the economy. Supports could start flowing in weeks, Trudeau said.
“No matter who you are or what you do, this is a time where you should be focused on your health, and that of your neighbours, not whether you’re going to lose your job, not whether you’re going to run out of money for things like groceries and medication,” he said.
The emergency aid plan includes:
- A temporary boost to Canada Child Benefit payments, delivering about $2 billion in extra support.
- A new Emergency Care Benefit of up to $900 biweekly, up to 15 weeks, to provide income support to workers, including the self-employed, who have to stay home and don’t qualify for paid sick leave or employment insurance. The measure could disburse up to $10 billion.
- A new Emergency Support Benefit to provide up to $5 billion in support to workers who are not eligible for EI and who are facing unemployment.
- A six-month, interest-free reprieve on student loan payments.
- Doubling the homeless care program.
- Extending the tax filing deadline to June 1.
- Allowing taxpayers to defer until after Aug. 31 tax payments that are due after today and before September.
- $305 million for a new Indigenous Community Support Fund to address immediate needs in First Nations, Inuit and Métis Nation communities.
Other measures include a GST credit for low-income Canadians and special support for the homeless and shelters helping people escaping gender-based violence.
Trudeau said there is a “real” desire among opposition political parties to help Canadians, and he is confident that the measures can pass quickly in Parliament.
After the prime minister’s address, Finance Minister Bill Morneau outlined details of the government’s measures. Calling the impact of the pandemic “profound,” he said the government will do “whatever it takes” to help Canadians through the crisis.
He said today’s package is the “first phase” of planned measures.
“Usually, my job is to ensure we maintain our fiscal track, but right now as minister of finance, my only job is to make sure that Canadians can keep food in the fridge, that they can keep a roof over their heads, that they can afford the medicine that they need,” he said.
“We’ve entered this challenge in a very strong fiscal position. Canada’s balance sheet is the envy of the world and it means we have the fiscal firepower to respond. We’re now prepared to use it.”
The COVID-19 pandemic has wreaked havoc on the global economy, sending stock prices diving and forcing businesses to shut their doors as governments institute lockdowns and other social distancing measures to slow its spread.
Today, Canada and the United States reached an unprecedented deal to close their shared border to non-essential travel, as both countries try to restrict the spread of the coronavirus.
Trudeau announced Monday the government was closing Canada’s border to all travellers except for Canadian citizens, permanent residents and Americans, with exceptions for flight crew members, diplomats and some immediate family members of Canadians.
Canadian businesses of all sizes are feeling the pain from shutdowns, cancellations and public fear as the number of confirmed cases rises each day.
Trudeau said Tuesday that Parliament could be recalled to pass emergency economic measures.
The government is also considering invoking the Emergencies Act, which would grant it extraordinary powers to restrict movement and regulate and distribute critical supplies during the pandemic.
Today’s announcement is in addition to a $1 billion COVID-19 response package and supports for business already announced by the government.
Last week, Trudeau pledged $1 billion for increased public health measures. The package includes $275 million for additional research, such as vaccine development, and $200 million for federal medical supplies, supports for Indigenous communities and education efforts.
Another $500 million is going to support provincial and territorial governments.
The federal government has also waived the one-week waiting period for employment insurance.
Morneau also announced last Friday the establishment of a $10 billion credit fund to lend money to businesses to help them continue operations.