Most B.C. restaurants will not qualify for the full amount of aid in the province’s new recovery program due to the way the program is structured, says the industry.
Economic Recovery Minister Ravi Kahlon announced a $50 million aid package Thursday with a promise of “up to $10,000” in non-repayable grants to help cover losses for businesses like restaurants harmed by new public health orders that ban in-person dining.
But buried in the fine print was a clause that only businesses with more than 100 employees – a rarity in the restaurant sector – can get the full amount. In actuality, most of the sector, with between five and 99 employees, only qualifies for $5,000.
“I don’t know of many restaurants with over 100 employees in Kamloops or elsewhere,” said Opposition Liberal critic Todd Stone.
“Most local mom and pop restaurants I’ve spoken to say they might get the one-time grant for $5,000, but that will barely cover their costs for patio expansion let alone the perishable food they couldn’t sell. Again, the NDP are too little too late with their supports for restaurants.”
The disparity between the announcement and reality has led to initial confusion.
“We’re impacting about 60 employees and so it becomes a question of how far does $10,000 go in supporting that number of people?” Spinnakers owner Paul Hadfield asked Thursday. Spinnakers, however, won’t even qualify for the amount it expected, according to the rules.
Other restaurants told CHEK News this week they were spending $10,000 alone just to build small temporary outdoor patios to try and stay open under the public health rules.
“Most of our restaurants are probably in that 25 to 50 employee range and they’ll get that $5,000 in grant funding,” said Mark von Schellwitz, vice-president of Restaurants Canada.
The sector has mixed feelings about the aid package. On the one hand, anything helps small business owners left reeling with the closures, plus the government has promised to get the grants out the door quickly to businesses that desperately need the cash, said von Schellwitz.
“Kudos to Mr. Kahlon, he listened to us and every little bit helps,” he said.
On the other hand, $5,000 is barely a drop in the bucket to the losses restaurants face, including spoiled supplies ordered before the shutdown Monday, plus, rent, wages, utilities and more.
“Let’s be clear, this is by no means going to make them whole,” said von Schellwitz. “There’s still going to be huge losses this month as a result of the shutdown. This is a little bit of a Band-Aid solution that will help us get through the next few weeks, but it’s certainly in no way compensates for the complete loss in revenue that restaurants will be suffering as a result of this latest on-premise lockdown.”
Kahlon said some B.C.-owned chain restaurant chains, like White Spot, have more than 100 employees under single businesses licenses, and it was important to find a way for them to qualify for the program.
“That was direct feedback from stakeholders and we took their advice seriously,” he said.
But he acknowledged the $5,000 may not provide enough help to most businesses, saying they will need to also access other provincial and federal government programs that help pay rent and wages.
“I appreciate how hard it is right now for businesses,” said Kahlon. “I’ve spent the last week talking to so many businesses and associations and I know this won’t solve all the problems.
“But combined with all the other measures we’ve put in, which is rent supports, tax credits for rehiring employees, subsidies of their wages from the federal government, there’s a whole host of measures we’ve put in to try and support businesses.”
B.C.’s public health order that bans in-person dining runs until April 20, however, case counts continue to rise and Provincial Health Officer Dr. Bonnie Henry has warned that the more contagious variants of COVID-19 are poised to become the dominant strain in B.C., worsening the risk of infection.
If B.C. does continue the restrictions beyond April 20, it needs to come back with more aid, said von Schellwitz.
“I’m sure there’s going to be a lot of pressure on the government, certainly from us, to extend this type of working capital funding as long as this on-premise dining lockdown continues,” he said. “We’re going to need that support and if you know that support isn’t coming. We’re going to see a lot more layoffs and a lot more business.”
With files from Kori Sidaway and Mary Griffin