Close X
Thursday, November 14, 2024
ADVT 
National

As pandemic business loan repayment deadline looms, calls for extending deadline grow

Darpan News Desk The Canadian Press, 11 Jul, 2023 09:58 AM
  • As pandemic business loan repayment deadline looms, calls for extending deadline grow

New Democrats and a business group are calling on the federal government to extend the deadline for small businesses to repay loans they received from a pandemic support program. 

But an economist is cautioning against the move, saying taxpayers shouldn't subsidize businesses that are still struggling to pay back the loans more than three years since the pandemic hit.

The Canada Emergency Business Account program provided about 900,000 small businesses and not-for-profits up to $60,000 in interest-free loans during the pandemic.

The deadline to repay these loans was extended last year to December 31, 2023 to ease pressure on businesses still recovering from the pandemic. 

But now, both the NDP and the Canadian Federation of Independent Business are calling for this deadline to be extended again, with the federation claiming nearly 20 per cent of businesses are at risk of closure without an extension. 

"While the NDP was glad to see the government listen to calls to extend the original repayment deadline, a second extension giving Canada's small businesses more time to get back on their feet is needed," NDP small business critic Richard Cannings wrote to Finance Minister Chrystia Freeland on Monday.

"There is a real risk that many will not be able to stay afloat, and a substantial portion of that debt will never be repaid."

Businesses that pay back their loans by the end of the year are eligible to have up to a third of their loans forgiven. Those that don't would see their debts converted to a two-year loan with interest of five per cent annually.

Miles Corak, an economics professor at City University of New York, said the request for another extension should give pause to policymakers interested in promoting productivity growth.

"If after three years, these firms are not in a position to repay loans that they took out voluntarily under a clear set of rules ... they clearly are not able to meet the rigorous demands of a competitive market," he said. 

MORE National ARTICLES

Prime Minister Justin Trudeau travelling to Latvia and NATO summit in Lithuania

Prime Minister Justin Trudeau travelling to Latvia and NATO summit in Lithuania
Prime Minister Justin Trudeau will travel to Europe next week for the annual NATO leaders' summit. The two-day summit in Lithuania starts July 11 and comes as the alliance has agreed to extend the term of Secretary-General Jens Stoltenberg by another year.  

Prime Minister Justin Trudeau travelling to Latvia and NATO summit in Lithuania

Several students stranded at Vancouver airport after Air India flight to Delhi cancelled

Several students stranded at Vancouver airport after Air India flight to Delhi cancelled
One of the students, speaking anonymously, stated, "On July 1, around 9 p.m., we received an email from Air India informing us of a five-hour delay, and the new departure time was set for 2.45 p.m. However, when we arrived at the airport, we discovered that the flight had been delayed for an additional hour."

Several students stranded at Vancouver airport after Air India flight to Delhi cancelled

Fierce blaze damages several businesses, forces evacuation in downtown Vernon, B.C.

Fierce blaze damages several businesses, forces evacuation in downtown Vernon, B.C.
The single-storey complex has been heavily damaged, prompting the owner of the Okanagan Eatery, one of the affected businesses, to post a photo of the flames online, writing, "Wow, no words. Guess that's it."

Fierce blaze damages several businesses, forces evacuation in downtown Vernon, B.C.

Evacuation alerts end for Kelowna, B.C., residents as wildfire under control

Evacuation alerts end for Kelowna, B.C., residents as wildfire under control
Residents in the Poplar Point, Knox Mountain, Magic Estates and Clifton areas near the fire were under an evacuation order on Canada Day that was later downgraded to an alert as crews fought the flames. Kelowna RCMP assisted with an evacuation of more than 400 properties.

Evacuation alerts end for Kelowna, B.C., residents as wildfire under control

Further negotiations won't bring end to B.C. port workers strike, employers say

Further negotiations won't bring end to B.C. port workers strike, employers say
The BC Maritime Employers Association released a statement Monday afternoon saying it had gone as far as possible on core issues and it doesn't think more bargaining is going to produce a collective agreement. Thousands of union members walked off the job Saturday morning. Both sides negotiated over the weekend and were at the table earlier in the day on Monday.

Further negotiations won't bring end to B.C. port workers strike, employers say

Man dies in Coquitlam shooting

Man dies in Coquitlam shooting
R-C-M-P officers were called to the Foster Avenue and North Road area shortly before 9:30 p-m, where they found a man with gunshot wounds. The man died at the scene.

Man dies in Coquitlam shooting