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Results: 16 - 30 of 206
Daniel Kelly
View Daniel Kelly Profile
Daniel Kelly
2021-05-20 16:19
Just moments ago Ontario announced another two weeks of lockdown on top of another two weeks on top of another two weeks, so I was just blasting the Ford government seconds ago.
Let me switch gears to the federal budget. There is a lot in the budget that we commend and endorse and some pretty serious gaps that I want to highlight. I did send, through the clerk in both French and English, a side deck of some data from CFIB, as I have done several times in the past to the finance committee, just to give the latest on where small businesses stand.
Right now, at this late stage, 14 months into the pandemic, only 51% of small and medium-sized firms across Canada are fully open. That's 51%. It's a pretty serious situation. If you look at the normal levels of staffing, fewer than 40% of businesses have attracted back all of their workers at this stage—in most cases because they do not need them as they are locked down. Most worrisome of all, only about a quarter of small firms are actually at normal or better levels of revenue than they were at this point before. I reiterate: Only a quarter of small businesses are at normal levels of revenue.
I want to share with you some of the measures that we did like in the budget. It did do several things. It allowed small business owners the deduction of up to $1.5 million. That's a very positive measure. We're quite pleased to see that the government did include that. It was a surprise, and a positive one for business owners across Canada. There's a reference to further progress on reducing credit card processing fees. That's also something that we're quite pleased with. That is good news.
Beyond that, we were pleased with the extension of the rent and wage subsidies until the fall. I will note though that there is great consternation right now about the planned reductions in the subsidy levels in the summer months. Here I want to remind this committee that the rent and wage subsidies automatically adjust depending on the level of business losses that a business is incurring, so the subsidies aren't there for businesses that are not in serious jeopardy. There are so many businesses, especially given that we've got ongoing lockdowns, renewed lockdowns and fresh lockdowns in Nova Scotia and Manitoba, they are really worried about the intended reduction in both the CEWS and CERS.
We did like the new Canada recovery hiring program. That new hiring incentive, we believe, is a real positive and we compliment the government for listening to the advice of my organization and others that have called for such a measure. We believe that it will be a way to help wean businesses off of the wage subsidy and allow that to be eliminated over time, but our overall advice is that governments really can't start to withdraw these subsidy programs until such time as governments themselves—federal, provincial and local—can tell Canadians that it's time to go back to work, time to return to the office and time to go dining and travelling, including with an open border.
One of the other measures that does worry us.... One thing I just do want to highlight is that for Liberal MPs on this committee, I urge you to get the message to Minister Freeland, the Deputy Prime Minister, and to the Prime Minister that the government needs to make good on the latter's promise to new business owners in May 2020 to deliver support to them. That was something that I know the finance committee has talked about already, but it hasn't happened. It's a year into an emergency program and I believe it's deeply shameful that the government has not moved to allow new business owners to gain access to the wage and rent subsidies. That needs to be fixed.
The rent subsidy, while working well, also sadly excludes thousands of business owners, as it does not include those who have a holding company and an operating company. Even the previous CECRA program had a fix for that, and this one does not.
We've made a series of recommendations.
The other big worry that we have right now is the rising levels of debt on the books of small and medium-sized businesses. They have, on average, $170,000 in COVID-related debt to deal with. We urge the government to consider increasing the amount of the CEBA loan and increasing the percentage that is forgiven to 50%, and adding a forgivable percentage to the HASCAP program. These are some of the ways that we'll be able to lift some of the debt burden that businesses are facing and help them into the recovery.
There's lots more to unpack, but I'm happy to do that in response to the questions.
Thank you very much, Chair.
View Ed Fast Profile
CPC (BC)
View Ed Fast Profile
2021-05-20 16:43
Okay. Thank you for that clarification.
I'm going to go to Mr. Kelly.
Dan, I've never heard so exercised about an issue, namely, with how this government has shamefully treated new businesses. You rarely go out on a limb like that. Therefore, obviously this is something that represents a bit of a betrayal on the part of the government.
Could you just expand a little more on why this is so important to new businesses?
Daniel Kelly
View Daniel Kelly Profile
Daniel Kelly
2021-05-20 16:44
Yes. I've been telling new business owners who have been contacting me in huge numbers to just stick with it, that the government is serious about this. The Prime Minister himself promised to do something for new business owners back in May of last year.
A full calendar year later, during a worldwide pandemic, the government has not moved on this measure. Meanwhile, most of the provincial support programs, many of them admittedly with tons of problems, from the NDP in British Columbia to the Conservatives in Ontario, have fixed this issue and allowed access to new business owners.
It is more complicated, but it's not impossible. We've laid out several ways that the government can do that: removing the requirements for a business number before March 1, a payroll account number before March 1. If they don't have a comparable month in 2019 because they weren't around in 2019, allow them to at least compare themselves against the industry average, say for a restaurant in Manitoba, and use that as the amount to get the subsidy.
These are businesses not set up with the full understanding of the pandemic behind them. These are business owners that often started in 2019. Some of them have laid out $400,000 or $600,000 to invest in a brand new 100-seat restaurant that was supposed to open in March 2020, but delayed because of pandemic restrictions until June, and opened with a trickle of business income, and have not had a nickel of federal support despite the Prime Minister's personal commitment to do that. That's why I'm so unhappy about this.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you, Mr. Chair.
Good afternoon. Once again, we have a fascinating panel.
My questions are for Ms. Lamonde.
Thank you for your presentation. It was very clear and well put together. You explained that the government had taken meaningful steps to support start-ups, but you were also critical of certain things, and that is what I would like to discuss.
What is the federal budget missing in terms of specific measures to help start-ups in the greater Montreal area?
Liette Lamonde
View Liette Lamonde Profile
Liette Lamonde
2021-05-20 16:56
Thank you for your question, Mr. Ste-Marie.
My main reason for being here today is to make parliamentarians aware that start-ups face a different reality, one that government programs need to take into account. For example, initially, the Canada emergency wage subsidy did not factor in the reality of start-ups. We spoke up quickly, and that changed.
What I'd like to see the government do is adopt a mindset, and consider how each program it introduces to support business is really going to help start-ups and how the program can be improved to do just that.
One of the missing government measures is support for a scale-up platform. That's what we need to move into the second phase, to grow and to benefit economically. It's simple: start-ups need funding, talent and customers. A range of services are available to help start-ups in the development phase, which can last two or three years. After that, though, they are on their own. That is when they need new skills, new funding and new markets in order to succeed.
That is why building a scale-up platform for Quebec is so essential. Without it, Quebec's ecosystem will remain one of small start-ups, and that's not what we want. We have much bigger plans for the future of our start-ups.
I mentioned customers, and the government has the ability to be a tremendous customer for start-ups. For that to happen, however, the government needs to make changes to its tendering process. It needs to listen to start-ups, taking the time to help them improve their technologies and adapt them to government requirements. Imagine what a boon it would be for a start-up to have the government as a customer. Landing a contract with the Government of Canada would give the start-up a reputation that would help it acquire more customers.
Those are two areas where improvement is needed.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you. Those are two very interesting recommendations. First, you want a scale-up platform for start-ups in Quebec or Montreal, and second, you want better access to government contracts. That is duly noted. Let's hope the government incorporates your recommendations into its plan soon.
Obviously, the past 14 months have been extremely tough on just about every business, including start-ups.
How would you say the landscape has changed since the pandemic began? Are things better or worse? Do you know what the mood is on the ground?
Liette Lamonde
View Liette Lamonde Profile
Liette Lamonde
2021-05-20 16:59
That's a great question. Thank you, Mr. Ste-Marie.
At the very beginning of the pandemic, in March, a survey revealed that 60% of start-ups had less than three months' worth of cash. Of course, we feared the worst. By mid-April, though, nearly two-thirds of start-ups had reprioritized and adjusted their business model. That's the beauty and strength of start-ups: they can pivot, adapt and reinvent themselves quickly. Not having a cumbersome structure means they can turn on a dime, as the saying goes.
That ability is the strength from which their innovation flows and has helped them survive the pandemic. Instead of being decimated, many start-ups have seized the opportunities created by the pandemic and are meeting new needs. For instance, MEDTEQ, in Montreal, is involved in a bunch of new projects aimed at solving problems that have emerged during the pandemic. Solutions are also materializing to help restaurants take orders and become take-out operations overnight.
I think start-ups will come through the crisis, but there's no doubt the wage subsidy has a lot to do with it. We are eager to see what comes next. That's when we will be in a position to get a better read on things.
View Gabriel Ste-Marie Profile
BQ (QC)
All right.
An owner of a start-up told us it worried him that the NRC's industrial research assistance program, or IRAP, had not been renewed in the budget. He was concerned about what would happen to his company; he had relied on IRAP funding to run and grow his business in the months to come. He said it would be very unfortunate if he had to close his business right before he could carry it over the goal line.
Do you see a lot of start-ups in that boat, or is this an isolated case?
Liette Lamonde
View Liette Lamonde Profile
Liette Lamonde
2021-05-20 17:01
I'm a bit surprised by the question. It seems to me the government had put additional funding towards IRAP, so I don't think the issue is widespread.
View Peter Julian Profile
NDP (BC)
Thank you.
Ms. Lamonde, I'll ask you the same question. Under Bill C-30, the government will be drastically cutting supports for individuals and businesses, including start-ups, in the next few weeks. How is that going to affect start-up ecosystems in Quebec and other parts of Canada?
Liette Lamonde
View Liette Lamonde Profile
Liette Lamonde
2021-05-20 17:07
Ending those supports clearly puts start-ups and small businesses alike at risk. I'm not sure who, but someone put it well earlier. They said what mattered was the business's drop in revenues, whether it continued or not. That is what the government needs to keep an eye on; that is where help is needed to offset the impact. Obviously, businesses are not going to bring in the same amount of revenue they did pre-pandemic as soon as the supports come to an end.
Yes, there is no doubt that the end of the supports puts businesses at risk. As I said, luckily, many start-ups have managed to find other sources of revenue, but those may not be enough.
View Pat Kelly Profile
CPC (AB)
Thank you, Mr. Easter. I will address my questioning mostly to the other Mr. Kelly with us today.
I'm really glad that you mentioned the lack of response to new businesses so stridently in your opening statement. This is something that all opposition parties have raised repeatedly at committee and in the House of Commons. Back in February, or March, I think it was, the parliamentary secretary for small business claimed in a response to my question, that they were just on the edge of coming up with a response for new businesses, and then nothing happened. Now they're back to just completely ignoring new businesses that have fallen through the cracks of all the aid measures.
We're going to have questions in a moment from Mr. Fraser. He, as the parliamentary secretary, has been part of this ignoring or pretending that there is something out there.
Do you want to comment further about the way new businesses are not being reached?
Daniel Kelly
View Daniel Kelly Profile
Daniel Kelly
2021-05-20 17:09
Yes, this has been a giant issue right from the very start of the pandemic.
I will say I do believe that most members of government, most ministers, are quite sympathetic to this. All of them have said to me many times that they're working on it; they're thinking about it; and they need a solution here. However, it does feel like the energy in fixing government support programs for small businesses has ended.
There was good energy in the fall, especially when the Deputy Prime Minister took the reigns at Finance. She did fix many of the gaps in some of the programs she inherited. There was progress being made, but when the new year hit, it felt as though the federal government said, “We're done. Businesses: you have what you have. We'll renew these programs a little bit longer, but—”
Daniel Kelly
View Daniel Kelly Profile
Daniel Kelly
2021-05-20 17:10
There are huge swaths of the business community—not just those new businesses, but others too—that when they hear the Prime Minister and others say, “We've got your back, small business owners,” it really burns them because they are not getting any of the support that they need.
It's not just the federal government. It's the provinces, too. There are lots of holes in all the provincial programs, including those run by Conservative governments. We have to fix them. This is an emergency, for goodness' sake.
View Gabriel Ste-Marie Profile
BQ (QC)
Thank you, Mr. Chair.
My question is for Ms. Lamonde.
Can you provide a few examples of start-ups that have thrived, that are performing well, that have been successful? Can you talk about how the start-up cluster is affecting the economy and describe how the scale-up platform is enabling start-up development?
Results: 16 - 30 of 206 | Page: 2 of 14

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