QUESTION PERIOD — Finance
COVID-19 Pandemic--Impact on Tourism
December 15, 2020
My question is for the Leader of the Government in the Senate.
Leader, as you know, although vaccinations against the coronavirus started this week, we will still be dealing with this virus for many more months. The Government of Quebec plans to announce strict lockdown measures later today.
Even in the most optimistic of scenarios, we are not expected to return to normal by summer 2021, especially in the hospitality, restaurant and tourism industries, which primarily employ women and young people. These industries bring in 60% of their revenues during the summer. A plan to help these industries is needed more than ever.
Last Friday, the government released the Leroux report, which provides a framework for Canada’s economic recovery. According to the Industry Strategy Council, 80% of businesses in the tourism and hospitality sectors are at risk of failure without significant intervention from the government. The Leroux report proposes some creative and aggressive solutions for these sectors, such as providing patient capital to anchor firms and developing new financing models beyond traditional debt-based instruments.
The government has had this report since October, but all it’s offering to businesses in these sectors is the opportunity to go into debt. Will workers and businesses in the food services, hospitality and tourism sectors have to stand by until the federal budget and wait two more long months for the government to come up with a plan to help their sectors?
I thank the senator for his question, which raises an issue that’s important to many Canadians, municipalities, and businesses.
As you know, the government has invested over $7.7 billion in Canada’s tourism sector since the start of the pandemic. It extended the Canada Emergency Wage Subsidy, the CEWS, until the summer of 2021. The government also expanded the Canada Emergency Business Account, the CEBA, and introduced the new Canada Emergency Rent Subsidy, the CERS.
In addition, in the economic update, the government announced new credit programs for the hardest-hit sectors. These programs will provide low-interest loans of up to $1 million for the businesses that need it the most.
Lastly, the government added $500 million to the $1.5-billion Regional Relief and Recovery Fund, the RRRF, a quarter of which is earmarked for tourism businesses.
So the answer to your question is no.
Government Representative in the Senate, it’s easy to say no. You listed a series of universal programs, with the exception of one quarter of the specific budget for tourism. However, the fact remains that Canada’s tourism industry is mainly made up of SMEs, and they are getting shortchanged. The government is weakening the entire structure of the tourism sector, an industry that has a major impact. It may not be able to work miracles, but the great thing about tourism is that it brings the consumer to us, increasing economic spinoffs and the GDP. Rather than exporting our raw materials, it imports consumers. I believe that the government needs to pay special attention to the tourism industry by developing a sector-specific plan.
Senator, perhaps you misunderstood me. I completely agree with you. Tourism is an extremely important sector of the economy. What I was trying to point out is that money has already been distributed and that large sums have been put toward helping this industry. I will go even further than that. As the government announced, it is in the process of developing a whole suite of programs targeting individual sectors that were hit particularly hard by the pandemic, including the tourism industry. Announcements will be made in the coming weeks and months.
Thank you.
