A man watches the sun rise over Niagara Falls in Niagara Falls, Ont. on Wednesday Nov. 4, 2020. Ottawa is rolling out a wave of new funding for pandemic-battered industries including tourism, the arts and regional aviation, with smaller companies top of mind — and large airlines notably absent. THE CANADIAN PRESS/Frank Gunn

A man watches the sun rise over Niagara Falls in Niagara Falls, Ont. on Wednesday Nov. 4, 2020. Ottawa is rolling out a wave of new funding for pandemic-battered industries including tourism, the arts and regional aviation, with smaller companies top of mind — and large airlines notably absent. THE CANADIAN PRESS/Frank Gunn

Ottawa beefs up loans for hard-hit sectors — but big airlines not included for now

The move aims to bolster an industry made up largely of small and medium-sized businesses

Ottawa is rolling out a wave of new funding for pandemic-battered industries including tourism, the arts and regional aviation, with smaller companies top of mind — and large airlines notably absent.

The Liberal government’s fiscal update sketches out a program that will provide low-interest loans of up to $1 million for badly hurt entrepreneurs.

The aid, dubbed the Highly Affected Sectors Credit Availability Program (HASCAP), comes on top of a newly expanded emergency loan program already in place for small businesses, and technically is not limited to certain industries.

Meanwhile the devastated tourism sector will have access to one-quarter of the more than $2 billion that Ottawa is doling out to regional development agencies through June 2021, including a $500-million top-up announced Monday.

The move aims to bolster an industry made up largely of small and medium-sized businesses and that accounts for roughly 750,000 jobs and two per cent of GDP, according to the government.

Another $181.5 million will flow to show business and performers via the Department of Canadian Heritage and the Canada Council for the Arts, the fall economic statement says.

Rent relief and nearly $700 million in capital investments are en route to airports over six years. About $206 million in further support is bound for regional aviation, including smaller airlines, via a new “regional air transportation initiative” overseen by development agencies.

But an aid package targeting big players such as Air Canada and WestJet Airlines remains in the works as talks with Ottawa drag on, with the lack of specifics in the fiscal update frustrating industry leaders.

“We had hoped to get a better sense of where the government was going. Instead they repeated the line that they’ve repeated several times over the past several months — that they’re ‘establishing a process with major airlines regarding financial assistance,’ ” said Mike McNaney, head of the National Airlines Council of Canada.

Countries around the world have given carriers US$173 billion in support, he said. Many have also required airlines to offer refunds for cancelled flights, something Ottawa says will be a condition of any bailout.

“We are very much a global outlier and are ostensibly stuck at Stage Zero on the government planning process,” McNaney — whose industry group represents Air Canada, WestJet, Transat and Jazz Aviation — said in a phone interview.

The regional aviation support comes with question marks, as well.

“A regional initiative, what’s that?” asked John McKenna, CEO of the Air Transport Association of Canada, which represents some 30 regional airlines.

“We have no idea. We have not been consulted,” he said in a phone interview. “Never mind new initiatives, try to support the existing services so they survive.”

READ MORE: Statistics Canada says economy grew at a record pace in third quarter of 2020

In a speech to the House of Commons, Finance Minister Chrystia Freeland stressed the benefits of the broader government-backed loan program for smaller companies.

“We know that businesses in tourism, hospitality, travel, arts and culture have been particularly hard-hit,” Freeland said.

“So we’re creating a new stream of support for those businesses that need it most — a credit availability program with 100 per cent government-backed loan support and favourable terms for businesses that have lost revenue as people stay home to fight the spread of the virus.”

The HASCAP credit program will offer interest rates below the market average, according to the fiscal update, with more details coming “soon.”

It also said the government is “exploring options to enhance” a federal loan program for big companies, little-loved by industry since its inception in the spring.

The Large Employer Emergency Financing Facility (LEEFF) offers loans of $60 million or more to large businesses facing cash problems, but comes with an interest rate that jumps to eight per cent from five per cent after the first year — far above typical private-sector lending rates.

Only two firms have been approved for LEEFF loans since the Liberals announced the program on May 11, according to the Canada Enterprise Emergency Funding Corporation: a casino company and a producer of metallurgical coal.

NDP Leader Jagmeet Singh criticized the government for failing to offer industry aid that includes explicit job protections.

“They have not rolled out any sector-specific supports, meaningfully, that are tied to jobs,” he said.

Bloc Québécois Yves-François Blanchet slammed the lack of “precision” in the fiscal snapshot.

“They basically say that there is no limit to what they will spend, without saying or without admitting how badly you spend it,” he said.

The $686 million in airport aid includes $500 million over six years, starting this year, to back infrastructure spending at large airports that would include massive transit projects, such as the new light-rail station at the Montreal airport.

The government is also proposing to extend $229 million in additional rent relief to the 21 airport authorities that pay rent to Ottawa, with “comparable treatment” for Ports Toronto, which operates Billy Bishop airport in downtown Toronto.

The supports unveiled Monday come on top of Ottawa’s pan-sectoral announcement to raise the wage subsidy to 75 per cent of company payroll costs — it was reduced to a maximum of 65 per cent in October — as well as an extension of the rent subsidy to mid-March from the end of 2020.

David Chartrand, Quebec coordinator for the International Association of Machinists and Aerospace Workers, applauded the wage subsidy, but lamented the radio silence on large airlines.

“After almost 10 months of crisis, still nothing,” he said in a release in French.

Christopher Reynolds, The Canadian Press


Like us on Facebook and follow us on Twitter.

Want to support local journalism during the pandemic? Make a donation here.

economyLiberals

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

Just Posted

A new fee structure for Agassiz’s Valley View Cemetery means that former residents will now be paying less for a plot than non-residents. (Grace Kennedy/The Observer)
Agassiz changes cemetery rates for locals

Former residents will now be able to pay slightly less than outsiders to have a plot at Valley View

Eva Pucci Couture in this file shot from May 29, 2019, when she came to Chilliwack asking for the public’s help in locating her missing son, Kristofer Shawn Couture. (Jenna Hauck/ Chilliwack Progress file)
Missing man’s mom still hopeful, 2 years after his car was found abandoned at Chilliwack trail

‘I wish someone would come forward with insight into your whereabouts,’ pleads mom of missing man

Chilliwack is expected to be among the province’s hottest real estate markets in 2021. (THE CANADIAN PRESS/Sean Kilpatrick)
Chilliwack housing market projected to be among B.C.’s hottest in 2021

B.C. Real Estate Association projects Chilliwack and District to grow by 17.1 per cent

District of Kent farmers brought truckloads of used plastic to the Schwichtenburg farm Oct. 26, 2018, for pickup by Kent Agricultural Plastics Recycling, a grassroots, farmer-initiated organization that collects and distributes used plastics for recycling. (Nina Grossman/The Observer)
Agassiz’s agricultural plastics program heading to the dump, unless province steps in

Kent Agricultural Plastics Recycling has nowhere to go, hopes B.C. will create a recycling program

Abbotsford tattoo artist Tanya Loewen has entered the Inked cover girl contest.
Abbotsford mother, tattoo artist enters Inked cover girl contest

Tanya Loewen, tattoo artist at Van Bree Tattoo, hoping to win big in magazine contest

Dr. Penny Ballem, a former deputy health minister, discusses her role in leading B.C.’s COVID-19 vaccination program, at the B.C. legislature, Jan. 22, 2021. (B.C. government)
B.C. holds steady with 407 new COVID-19 cases Tuesday

14 deaths, no new outbreaks in the health care system

A Cessna 170 airplane similar to the one pictured above is reported to be missing off the waters between Victoria and Washington State. Twitter photo/USCG
Canadian, American rescue crews searching for missing aircraft in waters near Victoria

The search is centered around the waters northeast of Port Angeles

Jonathon Muzychka and Dean Reber are wanted on Canada-wide warrants. (Courtesy of Victoria Police Department)
Convicted killer, robber at large after failing to return to facility: Victoria police

Dean Reber, 60, and Jonathon Muzychka, 43, may be together

B.C. Premier John Horgan listens during a postelection news conference in Vancouver on Sunday, Oct. 25, 2020. THE CANADIAN PRESS/Darryl Dyck
30% of B.C. recovery benefit applications held up in manual review

The province says 150 staff have been reassigned to help with manually reviewing applications

Join Black Press Media and Do Some Good
Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Adam Dergazarian, bottom center, pays his respect for Kobe Bryant and his daughter, Gianna, in front of a mural painted by artist Louie Sloe Palsino, Tuesday, Jan. 26, 2021, in Los Angeles. (AP Photo/Jae C. Hong)
Kobe Bryant’s presence remains strong a year after his death

Tuesday marks the grim anniversary of the crash that took their lives

Surrey RCMP are investigating after a pedestrian was struck and killed at 183 Street and Highway 10 Friday night. (File photo)
Modelling of predicted transmission growth from the B117 COVID-19 variant in British Columbia. (Simon Fraser University)
COVID-19 variant predicted to cause ‘unmanageable’ case spike in B.C: report

SFU researchers predict a doubling of COVID-19 cases every two weeks if the variant spreads

Most Read