March 18, 2020
OTTAWA—The federal government is once again cranking up its response to the COVID-19 pandemic, as Prime Minister Justin Trudeau kickstarted the most aggressive national measures yet to prop up the economy.
The government is rolling out a massive stimulus package worth $27 billion to support Canadian individuals and businesses, and another $55 billion in tax deferrals to ensure businesses have the credit they need to stay afloat.
This includes direct payments to workers without employment insurance who are ill, quarantined, self-isolating or caring for a family member, Trudeau said.
Businesses will also receive wage subsidies worth 10 per cent of wages paid to employees to discourage layoffs, Trudeau said.
And the government will boost its parental benefit payouts “in the coming months,” Trudeau said, increase GST tax credits for low-income Canadians, and doubling funding to a federal homelessness support program.
Canada will also expand its travel ban to the United States, with Trudeau “all non-essential” traffic with the country’s top trading partner will be suspended amidst the pandemic.
The move — unthinkable mere days ago — comes after the federal government barred all non-American visitors from Canada, limiting incoming travel to citizens, permanent residents, and their immediate families.
“In these extraordinary times, our government is taking extraordinary measures,” Trudeau said, rhyming off a long list of new measures in both official languages.
“I know it’s a hard time, but that’s exactly why we need to keep supporting each other. Our government is here for you,” he said.
Trudeau said he just spoke with U.S. President Donald Trump about the new border restrictions. They will not apply to trucking and other travel to ensure supply chains are not disrupted, he said.
“Travellers will no longer be permitted to cross the border for recreation and tourism,” Trudeau said.
It is the latest in a series of increasingly aggressive measures Ottawa is taking to combat the deadly coronavirus, which has now infected more than 200,000 people around the world and killed thousands — including eight deaths in Canada, as of Wednesday morning.
The new stimulus measures represent the second economic package Ottawa has rolled out as the deadly virus continues to spread in Canada and around the world. Last week, Trudeau and his top ministers announced a $1 billion fund aimed mostly at buttressing the health response, with $500 million to health care systems in the provinces and territories and $275 million to boost research into vaccines and anti-viral drugs.
Government officials have also opened the gates on bank loans, allowing major financial institutions to dole out an extra $300 billion to businesses across the country. At the same time, Crown lending agencies are freeing up $10 billion that Finance Minister Bill Morneau said last week will help boost small- and medium-sized businesses hit by the crunch of the pandemic slowdown.
Canada’s central bank has also slashed its overnight lending rate by a full percentage point since March 4. It now sits at 0.75 per cent.
Wednesday’s stimulus package is the largest federal injection of money into the economy since the 2008 financial crisis. Back then, the Conservative government in Ottawa pumped out more than $45 billion over two years, focussing on tax breaks, worker benefits, and infrastructure spending.
In recent days, as the number of infected Canadians has climbed by the hour, governments across Canada have imposed increasingly stringent measures to curb the spread of the virus.
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On Tuesday, Ontario Premier Doug Ford declared a state of emergency. The province ordered all bars and restaurants to be closed — they can still sell take-out — along with museums, theatres, cinemas and recreation centres.
At the federal level, officials have barred non-American visitors from entering Canada and urged all citizens and permanent residents who are abroad to come home while flights are still available. The federal government is also asking all Canadians to remain in the country, and stay home if possible during the crisis.
