March 15, 2023
Small-business groups are asking the federal government to further extend the deadline for repaying Canada Emergency Business Account loans when the budget is tabled later this month, as few of the loans have been paid back.
Ottawa announced the creation of the CEBA program on April 9, 2020, and sent more than $49-billion to almost 900,000 businesses. It was the first and most widely used pandemic support program for businesses.
The original repayment deadline for the interest-free, partially forgivable loans was Dec. 31, 2022; after that, businesses would start paying interest and forfeit the forgivable portion of the loans. Last year, citing the challenges posed by the Omicron variant, Ottawa extended the deadline by 12 months.
Olivier Bourbeau, Restaurants Canada’s vice-president of Quebec and federal affairs, said his association recently surveyed its members and found that 20 per cent of those who had not yet repaid their CEBA loans were not sure they ever could. About 30 per cent of its members reported having pandemic-related debt of more than $100,000.
Restaurants Canada has proposed the government phase out the loan forgiveness over six-month periods, so that even financially strapped businesses that can’t meet the 2023 deadline can still benefit from some forgiveness. Under that schedule, a business could still see $14,286 of a $60,000 loan forgiven if it is repaid by Dec. 31, 2024.
Mr. Bourbeau said this would help resolve one of CEBA’s problems – namely, that businesses in the best financial shape right now are more able to reap the benefits of the program than those that need help the most.
