It's going to be a bumpy ride... are you ready?
Let's talk financial support for your business, employees and clients
Many of your businesses are now adapting daily business, and making additional preparations. Below I’ve summarized programs to help ease the difficulty of reducing your workforce and other measures to conserve cash, which is critical over the coming months:
1. Federal wage subsidy. This program just got updated today, offering subsidies of up to 75% or your payroll retroactive to March 15. I'll be posting details on qualification and how to apply as soon as they are available. This is potentially good news for those of you who are able to find work to keep you doors open.
2. Access to business borrowing As of today, you have two new options. Today's program offers qualifying small business to go to your bank and request a Federally guaranteed, zero interest loan (first 12 months) of up to $40,000. Up to $10,000 of which may, under some circumstances, become forgivable (ie. you don't need to pay back). Also, there is available through a new program administered by the BDC/EDC if regular banks will not provide additional commercial and business loans.
For many of my clients, you have improved your LOC’s already, but if these run low, you can contact the BDC or EDC: www.canada.ca/en/department-finance/programs/financial-sector-policy/business-credit-availability-program.html
Also, take note that the Bank of Canada dropper their prime to 0.25%. This is as close to free money as it gets. Now is the time to replace high-cost debt with the new low-cost borrowing options.
3. Payments you can defer. Although you will need to eventually pay them, for now you can keep the money in your pocket.
- Corporate Income Tax can be deferred to August 31. No application required.
- Provincial Property Tax can be deferred till end of September. No application required.
- WCB Premiums can be deferred up to one year. If you’ve already paid, you may be able to get a refund. When the payment is due, the government will pay 50% www.alberta.ca/release.cfm?xID=699045A66118C-FA03-F4F5-959455E3316B8564&utm_source=hs_email&utm_medium=email&utm_content=85146239&_hsenc=p2ANqtz--OC0YxugCRdyi9GTwWS4t1VRdMNNiJCmWCgBFFBTAi3uNJ62kizcY2nYwGvcdSE6KKuw-x6du9cIEo5oHL2NuIdKFCxg&_hsmi=85146239
4. Help for your employees to conserve cash:
- Income Tax owing (both personal and business) can be deferred to Aug 31
- Residential Utility Payments can be deferred for up to 90 days without being disconnected www.alberta.ca/assets/documents/covid19-90-day-utility-deferral.pdf
- Personal Mortgages and Loan Payments with Alberta credit unions and ATB can be requested to be deferred up to 6 months based on need. Some national banks are doing the same thing, but also only based on need. calgaryherald.com/business/local-business/atb-financial-offering-mortgage-loan-payment-deferrals-during-covid-19
- Emergency Isolation Payment for Albertans to have covid-19, returning from abroad or have been in contact with someone tested positive with covid-19 can get up to $1,146 until the Federal program is in place. This is currently time limited till the Federal program is able to replace it. www.alberta.ca/emergency-isolation-support.aspx
- Emergency Response Benefit for non-EI eligible Workers applies to any of your employees or their spouses are unable to work but do not qualify for EI. If they have been asked to self-isolate because they have covid-19, suspected to have covid-19 or need to care for someone with covid-19, they can apply for $2000 monthly for 4 months. Online application coming April 6.
- Student Loan 6-month deferral of payments. No application required. This is automatic.
- Child Benefit will automatically be increased by $300 in the May payment.
5. Reduce the pain of laying off employees by considering job-sharing program. This allows employees to work part-time for you and get a partial top-up of EI. If your business can stay open, this is a great way to drastically reduce your payroll and look after you valued staff. However, this program takes 30 days to be approved, so you must get your application in immediately! www.canada.ca/en/employment-social-development/services/work-sharing/apply.html
Let's talk supply chain considerations
The US is expected to be the next epicentre of Covid-19 spread.
The US is in very bad shape to control this and the President is implying that he is willing to consider accepting high loss of life to keep the economy open. If this happens, ANY SUPPLY COMING FROM THE US may be at risk. Please review your US-based supply and monitor your individual situations on a daily basis. However, China is starting to do phased re-opening of their economy and re-opening hospitals to the public. It took less than 2 months of lock-down and isolating people. Strict hygiene measures, quarantining the sick and social isolation/distancing have been the keys.
Please LEARN from this and take implementation of these measures in your work locations SERIOUSLY. It is the best way to keep you working!
Let's talk Alberta's covid-19 math
We all see the COVID-19 case numbers in Canada rising. How bad is bad?
Canada appears to be bracing for a worse case scenario of up to 15,000 cases. Although currently very unlikely, what if 4,000 cases hit Alberta? We would have to be adding about 115 new cases a day for the next month - almost double our current rate. Best info is that about 15% will need hospitalization or about 600 beds between greater Edmonton and greater Calgary (300 additional beds per city). In other places, about 20% of those hospitalized go into Intensive care (ICU) - about 120.
Back in February, we had 119 excluding special care (burn, cardiac, etc). Also, after a month, a bunch of people will be recovering or recovered. If we are adding less than 115 new cases a day, Albertans should be able to weather this storm.
Let's keep doing everything we can do to keep the spread of COVID-19 to a minimum so we don't need a lock-down and can keep working!