With the end of the month coming up fast, half of Canadian business owners are worried they won’t be able to pay rent on June 1.
According to a new survey from Canadian Federation of Independent Business (CFIB), half the respondents feel they need assistance to afford the upcoming cost of rent and 55% of respondents felt that rent relief could make the difference between their business surviving COVID-19 or not.
Back on April 24, Prime Minister Justin Trudeau and the federal government unveiled details of the Canada Emergency Commercial Rent Assistance (CECRA) program, which is aimed at helping small businesses pay their landlords. The CECRA is available for businesses that pay less than $50,000 per month in rent and has experienced a drop in revenue of over 70% or more as a result of the COVID-19 pandemic.
Rent relief has been an issue that the CFIB has been pressing the federal government on amid pandemic, as a multitude of businesses have been forced to close their doors with significantly reduced revenue.
“We’ve been asking for rent relief since March. Even when CECRA applications become available we know that the program will leave businesses without the help they desperately need. The closer we get to June 1, the more stressful things are getting and the more business failures we will see. We’re begging governments to move quickly to create additional help outside of CECRA,” said Laura Jones, CFIB’s executive vice-president.
Earlier this week, Trudeau announced plans to expand the eligibility requirements of the Canada Emergency Business Account to provide more small businesses with access to interest-free loans, however, no timeline was given on when these newly eligible business owners could apply. That has Jones pressing for sooner rather than later.
“Expanding the Canada Emergency Business Account to cover many more businesses is a great start and it’s urgent this be implemented in time for June 1st. We would now like to see the government increase the forgivable portion of CEBA which would go a long way to cover the CECRA shortfall,” said Jones.
It seems that other respondents of the CFIB survey agree with Jones as 67% said that more CEBA money should be forgivable – currently set at 25% – and 65% of respondents felt governments have been too slow in providing rent relief.
While half of Canadian businesses are worried they won’t be able to make the upcoming June rent payment, it spikes to 70% within the hospitality sector.
According to the CFIB, 22% of small businesses are fearing evictions.
“We described April 1st as scary and May 1st as feeling like a nightmare on Main Street. I don’t want to think about the words we’ll have to find to describe June 1st if governments can’t get their acts together to help businesses at this crucial time. Even with reopening, too many businesses will go down with no rent relief,” Jones said.
The CFIB added it’s advocating for making the CECRA available as quickly as possible, allowing tenants to access the 50 per cent relief when landlords don’t intend to apply for the program, and increasing eligibility.
Trudeau announced earlier on Wednesday that applications for the CECRA will open on May 25.
Graham Cox
