Minister of Finance Bill Morneau responds to a question during a news conference in Ottawa, Friday, March 27, 2020. THE CANADIAN PRESS/Adrian Wyld

Canada’s 75% wage subsidy is coming, but not for several weeks: finance minister

Subsidy will cost Canada $71 billion, but push down cost of emergency benefit, Morneau said

Businesses hoping to apply for Canada’s 75 per cent wage will have to wait several weeks to get that money, according to Finance Minister Bill Morneau.

Morneau unveiled more details about the wage subsidy that Prime Minister Justin Trudeau has announced, and then updated, in recent days.

The wage subsidy will provide 75 per cent of each employee’s salary for business – of any size – that has lost at least 30 per cent of its gross revenue since this time last year due to COVID-19. Companies will have to reapply every month and Morneau said there will be “severe” consequences for anyone who tries to take advantage of the system.

The subsidy will apply to the first $58,700 of each employee’s salary and provide up to $847 a week per employee for up to 12 weeks, with a possible extension if the crisis continues. The money is available to companies of all sizes, as well as charities and non-profits, and will be retroactive to March 15.

“Funds will be available in approximately six weeks,” the finance minister said Wednesday.

Businesses will be able to apply through a Canada Revenue Agency portal “soon,” Morneau said, and money is supposed to begin flowing in six weeks. For businesses that cannot show revenue from the previous year, the previous month’s revenue may be an option. Companies that are signed up for CRA direct deposit will receive funds faster.

Companies will be required to “show what the pre-crisis income was of an employee and show that they’re paying that employee an amount up to $847 and then they will get that money returned to them from the Canada Revenue Agency.”

Morneau urged businesses to rehire workers and to top up the extra 25 per cent not being provided by the wage subsidy.

“I know in the cases they can afford to pay their workers, they will do that,” he said. “We need to get through this intact.”

The point of the wage subsidy is to get employers to keep workers on the payroll, hopefully leading to a faster economic recovery, the finance minister said. It will not be available to those who receive the Canadian Emergency Response Benefit, which is for workers who remain laid-off, or are self-employed and have no income due to COVID-19.

The wage subsidy is expected to cost $71 billion. The CERB, which provides $2,000 to workers who’ve lost their jobs as a result of COVID-19, will cost an additional $24 billion. Altogether, Morneau said these direct measures will cost around $105 billion.

“As a result of this… the deficit will go up,” Morneau said, noting this equals to about five per cent of the country’s GDP.

READ MORE: Liberals delay release of 75% wage subsidy details, costs

READ MORE: Trudeau says Parliament needs to sit to pass expanded COVID-19 benefits


@katslepian

katya.slepian@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Coronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Update: Power restored in West Kootenay, still out in Ymir

PHOTOS: FortisBC crews are working to fix power outages

Trail family rallies for Ronald McDonald House

“We always described it as our oasis in the middle of the desert.”

Update: Suspect in Montrose gas station stabbing new to the area

Police say the 30-year-old suspect stabbed a Montrose gas station employee

RDKB launches survey to address housing needs in the district

Communities in the district include Trail, Grand Forks, Rossland and Fruitvale

VIDEO: Injured bald eagle rescued in B.C. First Nations community

Bird suspected injured in fight, whisked off to Coquitlam rehab

Toronto Raptors’ Ujiri says conversations about racism can no longer be avoided

Thousands have protested Floyd’s death and repeated police killings of black men across the United States

‘I’m afraid’: Witnesses of wolf attack on senior near Prince Rupert worried about safety

Frank Russ shows where the unprovoked wolf attacked his father

Protesters prepare to rally against racism in front of Vancouver Art Gallery

Rally is in response to the deaths of black Americans and a Toronto woman

Protesters rally against anti-black, Indigenous racism in Toronto

Police estimated the crowd to be between 3,500 and 4,000 and said there was no violence

Feds earmark $1.5M to support recovery of B.C., Indigenous tourism

B.C. money will be split between Vancouver Island and Indigenous tourism

‘We’re sick of it’: Anger over police killings shatters U.S.

Tens of thousands marched to protest the death of George Floyd

Surrey mayor’s party under fire for ‘sickening’ tweet accusing northern B.C. RCMP of murder

Mayor Doug McCallum says tweet, Facebook post ‘sent out by unauthorized person’

Father’s Day Walk Run for prostate cancer will be virtual event this year throughout B.C.

The annual fundraiser for Prostate Cancer Foundation BC has brought in $2.5 million since 1999

Most Read