Ottawa, ON – The Green Party of Canada is amplifying the calls of thousands of small businesses across Canada who face the threat of closure with the looming deadline to pay back the very pandemic relief loans meant to ensure their survival.
“These are the local businesses we rely on every day for groceries or a haircut, and it’s they who shouldered much of the burden of pandemic-related closures and restrictions while big box stores were allowed to stay open,” said Mike Morrice, Member of Parliament for Kitchener Centre. “Considering the restrictions stretched out longer than first anticipated, the federal government must step up and extend the timeline for them to repay these loans in full.”
The Canadian Federation of Independent Business reported that more than 250,000 small businesses across the country are at risk of closing should the Canadian Emergency Business Account (CEBA) repayment deadline not be extended, and their loan forgiveness portion not be maintained.
“The Canadian Federation of Independent Business (CFIB) welcomes the support of the Green Party to extend the CEBA loan repayment deadline,” said Dan Kelly, President and CEO of the CFIB. “The CEBA loan once served as a pivotal economic lifeline during the nearly two years of COVID restrictions but is now a source of immense stress and anxiety for small businesses. Having more voices asking the government to give small businesses more time is critical as we get closer to the repayment deadline. If nothing changes, the consequences will be serious not just for affected businesses, but also for their employees and the wider economy.”
These concerns were echoed at a recent roundtable Morrice hosted with representatives from some of the industries most impacted in his riding.
“We were operating very successfully prior to the pandemic, however, we’re also a very new business and were able to amass only a small amount of savings when COVID arrived and the lasting conditions of COVID lockdowns ate away at them relatively quickly,” said Graeme Kobayashi of Counterpoint Brewing Company. “The CEBA loan was a lifeline for our business.”
In order to maintain the interest-free condition of the loans, as well as the forgivable portion, businesses must repay the amount in full by the end of 2023, which business owners are saying is far too soon.
“The design and repayment terms of the CEBA loan were decided when the world was a different place,” said Ian McMullan, owner/operator of McMullan’s Pub and Pizzeria. “Inflation has driven costs much higher for business, and revenues and operations have not returned to pre-pandemic levels.”
The Green Party is amplifying their calls to extend the CEBA loan repayment deadline and the 0% interest period to help these businesses stay afloat.
“We strongly urge the governing party to provide these businesses with additional time to repay their CEBA loans, without losing access to the forgivable portion, by extending the current repayment deadline and maintaining loan forgiveness portions to December 31, 2025,” said Green Party Leader Elizabeth May.
For many, their plan to pay it back at the end of this year includes maxing out existing credit or taking on additional debt at higher interest rates that will hurt their businesses.
“As independent business owners trying to do the right thing, we often take on a lot of personal responsibility,” said Sam Nabi owner/operator of Full Circle Foods. “And yet, I can’t help but feel frustrated at federal grants given to massively profitable national grocery chains with no strings attached, while independent small businesses in our neighbourhood have to shut their doors.”
Jade Martindale, owner and operator of Big Bliss Yoga and Fitness took classes online during closures but is still working to bring people back to her studio.
“If the loan repayment deadline is not extended, this will have us operating at a loss, and I will likely be forced to take out another private loan to cover the previously forgivable loan portion of my CEBA loan,” said Martindale.
Morrice is advocating to both the Minister of Finance and Minister of Small Business, including through a letter that in part states:
“These are small businesses that: were operating profitably pre-pandemic; did the right thing by closing during the pandemic, unlike many big box stores; and are now disproportionately experiencing lasting impacts of longer than expected pandemic lockdowns. The prospect of additional debt being added through the elimination of their forgivable loan portion is a daunting prospect for many, with many businesses in my community voicing that this would almost certainly lead to the closing of their business. I worry about the well-being of my constituents and the vibrancy of my community if this is allowed to happen.”
Morrice’s full letter can be found on his website.
This effort is part of multiple national efforts to secure the extension for small businesses, including a joint letter the Greater Kitchener Waterloo Chamber of Commerce has signed onto (along with 280 trade associations across the country), the Better Way Alliance, the Black Business and Professional Association and the Canadian Women’s Chamber of Commerce.