A group that represents small and medium-sized businesses in Canada fears a program to help pay commercial rent will come too late and not be enough to rescue those facing eviction.
The Canadian Federation of Independent Business surveyed its members about the Canadian Emergency Commercial Rent Assistance (CECRA) program over the long weekend to gauge how it will help businesses hang on during the pandemic.
Under the program, provincial and federal governments will cover half of a tenant's rent, while the tenant pays 25 per cent. Landlords will have to accept a 25 per cent loss.
The program is also aimed at landlords. They, not businesses, will have to apply for the relief through the Canada Mortgage and Housing Corporation when the portal opens on May 25.
The majority of those surveyed, 65 per cent, said governments have been too slow to roll out rent relief, and even with the program, 22 per cent fear eviction.
Last Friday, Premier Doug Ford pleaded with landlords to be flexible. He said relief would likely be available this week, and pointed out there is little demand for commercial space during the pandemic.
Prime Minister Justin Trudeau echoed his remarks Wednesday.
"We know if many businesses can't make ends meet and do go under at this point, it'll be a lot slower to pick up the economy," he said. "It'll be bad for building owners who will see a slower regaining of economic activity. With many people discovering we can work from home -- there may be a lot of vacancies in commercial buildings over the coming months and years. Who knows exactly what the post-pandemic world will look like?"
However, some businesses fear the program will not be enough. The survey showed 67 per cent also think a more generous amount of loans approved under the Canadian Emergency Business Account (CEBA) should be forgivable, and 70 per cent of those in the hospitality sector say they need more help.
"We've been asking for rent relief since March," said the CFIB executive vice-president, Laura Jones. "Even when CECRA applications become available, we know that the program will leave businesses without the help they desperately need."
Jones also said the closer we get to June 1 when the next rent cheque is due, more businesses will fail. Half of those surveyed said they would not be able to pay their June rent without further help.
The Ontario Commercial Tenancies Act allows landlords to evict tenants 16 days after the rent is due. The Ontario Chamber of Commerce has implored provincial and federal governments to block commercial evictions, but so far, Ford has declined.
Ontario has banned residential evictions during the pandemic.
"A moratorium on evictions will allow the Canada Mortgage and Housing Corporation the time required to implement the Canada Emergency Commercial Rent Assistance program, as well as time for Canada Emergency Wage Subsidy (CEWS) money to begin flowing," said President and CEO of the Ontario Chamber of Commerce Rocco Rossi on May 1. "Small business drives our economy, employs millions of Canadians, and has done so much to support our communities. In this dire moment, we must have their backs."
A previous survey by the federation suggested 68 per cent of its members supported policies to prevent commercial evictions.
"We described April 1 as scary and May 1 as feeling like a nightmare on Main Street," added Jones. "I don't want to think about the words we'll have to find to describe June 1 if governments can't get their acts together to help businesses at this crucial time. Even with the reopening, too many businesses will go down with no rent relief."