The government has taken concrete action to help Canadians through this time of anxious uncertainty. Legislation for supplying cash directly to citizens and businesses, an action unthinkable even a month ago, has passed and the first deliveries are expected in April. If it’s enough to support the country until Covid-19 dissipates, Canada should be relatively well positioned for recovery.
The feds have granted $2000 a month for four months to people who wouldn’t normally qualify for EI. This includes those who are employed, but not making wages, which will save companies from laying off staff and enable a quick re-start at a moment’s notice. There’s also $55 billion in tax deferrals, providing liquidity for those who need it now. The government did a good job of passing this legislation quickly, restoring a modicum of confidence for people who will struggle to pay for housing and groceries.
These steps are similar to actions taken in other countries. The UK is providing employers with 80% of employee salaries, with Denmark offering very similar benefits. These actions will ensure people and businesses stay afloat, positioning economies for a quick rebound. Instead of solely making lucrative moves for business, or simply targeting one segment of society, swift action has been taken for the benefit of all.
In Alberta, finer points have been tuned, with utility payment deferrals, interest-free pauses on student loans, and delaying corporate income tax. The provincial government is also giving $1146 to those losing income because of Covid-19. It is meant to bridge the gap until federal relief is delivered.
There are many social philosophy’s underpinning these moves, borne of in-controvertible necessity. If people cannot make bill payments, they would be vulnerable to loan defaults, evictions, and credit losses affecting any further loans or mortgages. For those without savings, they would have to pay for groceries with high interest credit cards. For caregivers or those with families, this dearth would inevitably trickle down to their dependents.
This saga has been an affirmation of how financially ill-equipped people, and businesses, are for unexpected shocks to the system. In the future we may see better welfare programs, governments saving money for emergency support, stricter lending laws, and mandates for businesses to keep a float of money for unexpected shut downs. Some of these are more realistic than others, but we’ll need to re-evalutate support systems and our culture of debt going forward.
Most of these measures are aimed for the medium-term: 4-6 months. Even if Covid is still a threat after that period, society should know enough about it, and have enough isolation protocols in place, that a semblance of normal life can return and businesses can re-open.
If you have been affected by this legislation, canadNow would like to hear from you for follow-up articles.