Federal budget notes for the rental industry

The federal government released its 2021 budget on April 19. Here are some highlights of special interest to the equipment and event rental industry.

Minimum wage

The Government of Canada is announcing its intention to introduce legislation that will establish a federal minimum wage of $15 per hour, rising with inflation, with provisions to ensure that where provincial or territorial minimum wages are higher, that wage will prevail. This will directly benefit over 26,000 workers who currently make less than $15 per hour in the federally regulated private sector.

COVID relief and stimulus

Budget 2021 proposes to extend the wage subsidy until Sept. 25. It also proposes to gradually decrease the subsidy rate, beginning July 4, in order to ensure an orderly phase-out of the program as vaccinations are completed and the economy reopens. It proposes to extend the rent subsidy and Lockdown Support until Sept. 25. It also proposes to gradually decrease the rate of the rent subsidy, beginning July 4. The government recently extended the application deadline for Canada Emergency Business Account to June 30. The government proposes to provide up to 12 additional weeks of Canada Recovery Benefit to a maximum of 50 weeks. The first four of these additional 12 weeks will be paid at $500 per week. As the economy reopens over the coming months, the government intends that the remaining eight weeks of this extension will be paid at a lower amount of $300 per week claimed. All new Canada Recovery Benefit claimants after July 17 would also receive the $300 per week benefit, available up until Sept. 25. Budget 2021 proposes to introduce the new Canada Recovery Hiring Program for eligible employers that continue to experience qualifying declines in revenues relative to before the pandemic. The proposed subsidy would offset a portion of the extra costs employers take on as they reopen, either by increasing wages or hours worked, or hiring more staff. This support would only be available for active employees and will be available from June 6 to November 20, 2021. Eligible employers would claim the higher of the Canada Emergency Wage Subsidy or the new proposed subsidy. The aim is to make it as easy as possible for businesses to hire new workers as the economy reopens.

The budget also proposes many long-term changes to EI, saying “Canada needs a more effective income support system for the 21st century.”

Boosting events

Budget 2021 proposes to invest $200 million through the regional development agencies to support major festivals. To support Canada’s many local festivals, celebrations, and amateur sport events that draw visitors to our communities Budget 2021 proposes to invest $200 million through Canadian Heritage to support local festivals, community cultural events, outdoor theatre performances, heritage celebrations, local museums, amateur sport events, and more.

Budget 2021 proposes to provide $80 million over two years to Canadian Heritage to remove barriers to participation in sports programming and to help community organizations kick-start local organized sports that are accessible to all. Budget 2021 proposes to provide $49.6 million over three years to Canadian Heritage for the Building Communities Through Arts and Heritage Program ($14 million over two years, starting in 2022-23), the Canada Arts Presentation Fund ($16 million over two years, starting in 2022-23), and the Celebration and Commemoration Program ($19.6 million over three years, starting in 2021-22). To help Canadian musicians, concert venues, producers, and distributors Budget 2021 proposes to provide $70 million over three years to Canadian Heritage for the Canada Music Fund. This includes up to $50 million in 2021-22 to help the live music sector, including music venues, weather the pandemic.

Small business financing

Budget 2021 proposes to provide up to $101.4 million over five years to Innovation, Science and Economic Development Canada for the Small Business and Entrepreneurship Development Program. To provide affordable financing, increase data and strengthen capacity within the entrepreneurship ecosystem, Budget 2021 proposes to provide up to $146.9 million over four years to strengthen the Women Entrepreneurship Strategy. Women entrepreneurs would have greater access to financing, mentorship, and training. Funding would also further support the Women Entrepreneurship Ecosystem Fund and the Women Entrepreneurship Knowledge Hub. Budget 2021 proposes to provide up to an additional $51.7 million over four years, starting in 2021-22, to Innovation, Science and Economic Development Canada and the regional development agencies for the Black Entrepreneurship Program.

Training

Budget 2021 proposes to provide $960 million over three years to Employment and Social Development Canada for a new Sectoral Workforce Solutions Program. Working primarily with sector associations and employers, funding would help design and deliver training that is relevant to the needs of businesses, especially small and medium-sized businesses, and to their employees. This funding would also help businesses recruit and retain a diverse and inclusive workforce. Budget 2021 proposes to provide $470 million over three years to Employment and Social Development Canada to establish a new Apprenticeship Service. The Apprenticeship Service would help 55,000 first-year apprentices in construction and manufacturing Red Seal trades connect with opportunities at small and medium-sized employers. Employers would be eligible to receive up to $5,000 for all first-year apprenticeship opportunities to pay for upfront costs such as salaries and training. In addition, to boost diversity in the construction and manufacturing Red Seal trades, this incentive will be doubled to $10,000 for employers who hire those underrepresented, including women, racialized Canadians, and persons with disabilities.

Employee ownership

Budget 2021 announces that the government will engage with stakeholders to examine what barriers exist to the creation of employee ownership trusts in Canada, and how workers and owners of private businesses in Canada could benefit from the use of employee ownership trusts.

Credit card fees

The budget promises to work with stakeholders to lower the average overall cost of credit card interchange fees for merchants, ensure that small businesses benefit from pricing that is similar to large businesses and protect existing rewards points of consumers.