Coronavirus: Federal government supplements $ 600 million relief fund to help small and medium businesses

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OTTAWA – The federal government is adding $ 600 million to a fund to help small and medium-sized businesses weather the COVID-19 pandemic, Economic Development Minister Melanie Joly said on Friday.

This announcement brings the total support of the Regional Relief and Recovery Fund to more than $ 1.5 billion.

The government says the fund has already helped more than 12,000 businesses struggling with the pandemic, which has affected everything from major street shops to hotels and restaurants.

The relief and recovery fund, administered by federal regional development agencies, is intended to help businesses that may not be eligible for other aid related to the pandemic.

Of this new money, nearly $ 456 million will go to small and medium-sized businesses facing financial pressures to help them retain employees and cover costs.

An additional $ 144 million will provide businesses and rural communities with access to capital and technical support, and will be provided by community futures development companies across the country.

“What we learned is that in some hard hit sectors, it was more difficult for companies to access capital through financial institutions, and that is why they came to us,” Joly said in an interview.

For example, in northern Ontario, half of the businesses supported to date are in the tourism sector, she said.

“We are seeing this across Canada.”

The money has also gone to start-ups that need support to stay afloat, she added.

“It was essential because we have to keep our innovation and our competitive advantage, despite the pandemic.”

Joly said she was also aware that major city centers “are going through difficult times right now, and we are looking for solutions.”

The minister said she spoke this week with chambers of commerce in several major cities to see what the government can do to help.

Meanwhile, businesses have urged the federal government to further expand the commercial rent relief program, especially as rent was due on Thursday.

Earlier this week, the Canadian Federation of Independent Business warned that only a fifth of its members expected to stay open without rent relief.

Pressed this Friday, Prime Minister Justin Trudeau said the additional regional funding was needed because larger programs, such as the one for rent relief, had not helped everyone.

“There were still many small businesses, especially in rural or remote areas, that fell through the cracks of these particular programs,” Trudeau said at a press conference in Ottawa, where he appeared at alongside Joly to unveil the new financing.

Still, he said the federal government would have something more to say about “fixed cost support” in the near future.

This report by The Canadian Press was first published on October 2, 2020.

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