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How to help workers and the economy during the COVID-19 crisis

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It’s crystal clear we have to act fast to “flatten the curve,” the public health experts’ term used to describe the importance of reducing the pace of infection with COVID-19 to avoid overwhelming health systems. It’s also becoming clear that flattening the curve of the health crisis will reduce the associated economic crisis. What “act fast” steps can we take?

Governments have shut down schools, organizations have cancelled big gatherings, travel is being sharply cut back. Now the toughest, most critical step is to prevent contagion through the workplace. This disruptive phase of flattening the curve will cost businesses and workers alike. Telework will be the new normal for those who can stay home for a bit.

But millions of workers in stores, restaurants and Uber/taxi drivers don’t have that luxury, nor do people providing care for the young, the sick and the elderly. We have to make sure every sick worker can afford to stay at home. The federal government has already acted quickly to improve sickness benefits in Employment Insurance. This is a good but far-too-modest start.

Millions of low-income workers in Canada can’t afford to lose any hours of work. Among modest-income self-employed workers, almost no-one will be able to claim EI benefits. More than 1 in 10 of Canada’s 19 million workers are independent contractors without paid help. Among Canada’s 16 million employees, 12 per cent have temporary jobs, a share that rises to almost 1 in 3 for workers under 25. While they don’t get as ill, young workers needing to replace lost hours are more likely to spread COVID-19. Millions of people also provide low-wage work in child, elder and health care fields, making them prime carriers of contagion.

The federal government can do five things, unilaterally and immediately, so Canadians can reduce work-related contagion as quickly as possible, wherever they live and whatever kind of work they do.

 

1. Improve EI: One in 10 workers making less than $15 per hour pays into Employment Insurance but won’t have enough hours to qualify for sickness benefits. The act permits the government to lower that hourly threshold qualification temporarily. Increasing the income replacement rate from 55 per cent of insurable earnings to 80 per cent for lower-waged earners (like we had in the 1940s) would also reduce people’s desperation to pick up extra hours of paid work. To support those not currently EI eligible, the federal government could fund a temporary unemployment assistance program, as sketched by an April 2019 Public Policy Forum report. A flat weekly benefit to those who don’t have enough work or a forgivable “jobseekers loans” with repayment tied to income reported to the tax system would revitalize the feds support for the hard-to-serve unemployed, a role it played by funding extended regional jobless benefits until 1991.

2. Expand Paid Sick Leave: The tax system could aid small and medium employers with cash flow to provide or expand paid days of leave for the rest of 2020. Subject to a reasonable maximum, the additional payroll costs associated with new paid leave days could be made deductible from 2020 corporate income taxes.

3. Limit deepening debt: A single cheque via GST credits, Guaranteed Income Supplement or Canada Worker’s Benefit may not be enough to live on for two weeks, but would ease the financial stress of upfront out-of-pocket costs triggered by self-isolation. One-time supplemental payments of these income-tested federal credits could help households least likely to have emergency savings or access to affordable credit.

4. Secure housing: The Canada Mortgage and Housing Corporation could immediately provide a pool of capital to existing or new rent banks across the country so that those who can’t make the rent because of falling incomes or illness don’t lose their housing too. The federal government could also broker a deal with banks and major lenders to extend the mortgage default period and/or defer mortgage payments over the next six months, as Italy has done.

5. Prepare our social infrastructure for post-crash demand: People turning to key community services like food banks and child care after this period may find non-profit services have been hobbled by the triple whammy of losing fees for service and donation revenues even as demand rises. These agencies can’t weather the storm like small businesses because they are less able to access lines of credit. Capital for low-interest lending could be handed to the Business Development Bank of Canada, or funded through the Social Innovation Social Finance sector.

 

As the public health and economic crises become more clearly intertwined, all federal parties should collaborate not just to suspend Parliament, but to support a package that works for all Canadians, especially those who need it most.

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Business

A timeline of events in the bread price-fixing scandal

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Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.

Here’s a timeline of key events in the bread price-fixing case.

Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.

Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.

Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.

Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).

Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.

June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.

Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”

Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.

July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.

Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)

The Canadian Press. All rights reserved.

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Economy

S&P/TSX composite up more than 250 points, U.S. stock markets also higher

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TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.

The S&P/TSX composite index was up 254.62 points at 23,847.22.

In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.

The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.

The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.

The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.

This report by The Canadian Press was first published Sept. 19, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Construction wraps on indoor supervised site for people who inhale drugs in Vancouver

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VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.

Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.

The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.

“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.

“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”

Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.

The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.

The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.

Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.

More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.

Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.

“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.

Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.

“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.

Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.

Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.

Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”

“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.

This report by The Canadian Press was first published Sept. 18, 2024.

The Canadian Press. All rights reserved.

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