A small business grant program that is the centrepiece of the B.C. government’s economic recovery efforts is so underused that more than three-quarters of the money remains unspent several months after applications opened.
The small and medium-sized business recovery grant program, which offers non-repayable grants of up to $30,000 — or $45,000 for tourism-related businesses — is being heavily promoted by the John Horgan government as a main source of help for businesses struggling to stay afloat during the pandemic.
Yet only $65 million out of the program’s $300-million budget has been spent on grants to businesses since applications opened in October.
That leaves $235 million sitting unused at a time when the tourism sector is appealing for additional provincial help and warning its businesses are facing bankruptcy without financial assistance.
Economic Recovery Minister Ravi Kahlon told CHEK News he’s confident there will be an uptick in grants, and encouraged the tourism sector, in particular, to seriously consider applications. So far, 4,800 businesses have applied, he said.
“Over the weekend alone we got 300 applications,” said Kahlon.
“What we’re seeing is the amount of applications continues to ramp up. So I’m feeling cautiously optimistic about where things are going. And all our business stakeholder partners, all the associations that represent businesses throughout B.C., it’s all hands on deck.”
B.C.’s small business community says the program is still suffering from early application rules that were unreasonably restrictive, including a requirement businesses had lost 50 per cent of their revenue and had been open at least three years.
Kahlon eased those rules in December, lessening revenue loss to 30 per cent, operating time to 18 months and opening up applications to sole proprietors and seasonal businesses.
He also offered an extra $15,000 for tourism businesses, meaning they can access a total grant of up to $45,000.
“Seeing how much money has been accessed in the program it could signal that perhaps we need to open that program up a bit more,” said Muriel Protzer, a senior analyist at the Canadian Federation of Independent Business.
“The other side of this is, this is a grant program. When small businesses are applying for this grant there is a vetting process that goes on… and that takes time, unfortunately.
“So what CFIB is hoping to see is the next coming weeks we do see that number increase and businesses are able to access that funding. But if that’s not what we are seeing in the numbers, it will be integral for the ministry to go ahead and make some changes.”
The grants are only available to businesses with fewer than 142 employees, meaning some of Greater Victoria’s largest tourism-related businesses, such as Butchart Gardens and Harbour Air, aren’t eligible for the funding.
Businesses are also required to submit a plan to government that outlines how they will remain viable and open.
Kahlon didn’t rule out altering the grant program to get money out the door before the fund ends March 31.
“I know some voices may have raised around the dollars not being enough but I always remind folks that our program is double the size of all the other provinces,” he said.
“Every other province has $20,000, and we’re going up to $45,000 because we want to ensure we support as many businesses as we can. That being said, if more information comes, if we see significant challenges with the tourism sector or any other sector, we’re going to continue to work with them.”