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As COVID-19 relief programs wind down, bankruptcies are starting to spike again –



After a lull in the early days of COVID-19, more and more Canadians are starting to declare bankruptcy again, and experts in the field say government has to do more and soon or the economy could face a tsunami of insolvencies in the coming months.

The Office of the Superintendent of Bankruptcy Canada reported this week 7,658 Canadians filed insolvencies in September, an increase of almost 19 per cent from the previous month’s level and the highest since the COVID-19 pandemic began in March.

Despite the economic hardship that the pandemic has brought, bankruptcy proceedings actually slowed to a crawl for most of 2020 because the unprecedented slew of support programs gave many Canadians a boost to their incomes — and often a temporary respite from their debts, enough to keep their heads above water.

“In the early days of COVID, everything went on pause, including collections,” licensed insolvency trustee Andre Bolduc said in an interview. “Finances went on the back burner but things are slowly getting back to the new normal.”

The insolvency rate is actually about a third lower than it was this time last year, but experts like Bolduc expect it to multiply over the coming winter months and likely eclipse previous highs. “Before COVID a majority of households were living paycheque to paycheque,” he said. “[Their] debts didn’t go anywhere, [so] they will still be there after COVID.”

Liz Mulholland, CEO of Prosper Canada, a charity dedicated to expanding economic opportunity for Canadians living in poverty, describes the situation as “a slow motion train wreck that’s going to unfold over the next six months.”

Very few people who undergo credit counselling need to go through the process again, which is a sign it works, Michelle Pommells says. (Credit Counselling Canada)

That’s because while many parts of Canada’s economy have largely recovered, that isn’t the case for low-income Canadians, who were the most likely to lose a job to the pandemic and the least likely to have recovered one by now.

While many Canadians have managed to make ends meet, Mulholland estimates that as much as 25 per cent of the population are watching their financial position “worsening by the week. They are moving inexorably toward that financial cliff of insolvency and they will go over it sometime this winter,” she said.

Government programs such as the Canada Emergency Response Benefit (CERB) were a lifeline for many of them, but with that program finished and now transferred into the less generous Canada Recovery Benefit — which is itself set to expire next year — the number of Canadians on a financial knife’s edge is set to grow.

Michelle Pommells, CEO of Credit Counselling Canada, says those income support programs certainly helped, as did much publicized mortgage deferral programs that gave roughly one in six Canadian borrowers a temporary reprieve on interest payments. But those programs are also winding down now.

“For families that got into trouble, deferrals have helped but there’s no such thing as a free lunch,” she said in an interview.

Credit counselling

Pommells says even before the pandemic many people were not taking advantage of credit counselling services that can often help them find a path out of a financial quagmire.

She says the typical person going insolvent tends to have between four and six revolving lines of credit and is often shuffling debt from one into the next. “They are just moving the ball along until finally they can no longer acquire credit and then at that point it’s pretty dire,” she said. “Every month the pit of debt gets deeper [and it can be] tremendously difficult to get out of.”

Insolvencies can take the form of a bankruptcy, where a borrower gets their debt wiped out but at the cost of losing any of their assets — and also find it next to impossible to borrow in the future. Or they can be what’s called a proposal to creditors, where the borrower agrees to pay back a portion of what they owe, with the creditor’s OK.

Credit counselling aims to give borrowers the tools they need to not slip beneath the waves again. Pommells said the recidivism rate (the number of people who end up going through the process again) is 0.01 per cent. “It works,” she said.

Mulholland agrees that a big part of stemming the tide of insolvencies will be credit counselling programs. That’s why  she worries about other useful programs that were cut off at the knees by the pandemic.

Beyond the emergency programs created during the pandemic, low income Canadians are at risk of missing out on regular benefit programs because of shutdowns. Nearly three-quarters-of-a-million low income Canadians rely on free tax clinics to file their taxes. About 400,000 did so before lockdowns in March closed them all. A small number have since reopened, but she says it’s likely that many people who use them still haven’t filed their 2019 taxes yet.

Liz Mulholland says she’s worried about people whose finances were in bad shape even before COVID-19. (Prosper Canada )

That means 35,000 low-income seniors aren’t eligible for the Guaranteed Income Supplement they would otherwise be entitled to. That’s up to $917 a month. And the Canada Child Benefit pays out up to $6,000 a year per child to Canadian families, but it too depends on tax filings. Even beyond emergency programs, those two could be “paying rent and putting food on the table,” Mulholland said.

It’s why Prosper is asking the federal government to restart funding for a whole slew of programs that target those who need it most. Against the backdrop of a $343-billion federal deficit, the ask is a relative pittance — $15 million to help 750,000 Canadians most in need access financial health services they likely already qualify for.

Mulholland says other countries, including the U.K., Australia and New Zealand, have spent far more on similar initiatives, because the cost of inaction far outweighs the cost of the programs themselves.

“If 20 per cent of your population is in this boat, that’s a real brake on your recovery [because] there is no consumer confidence. They are not going to be out there spending money,” she said.

“As my mother would say, you’re being penny wise and pound foolish.”

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Doug Ford rebuffs calls to reopen retail shops at 25 per cent capacity in Toronto, Peel region – The Globe and Mail



A man stands in front of the Nordstrom store, closed for in-store shopping in downtown Toronto, on Nov. 23, 2020.


Ontario Premier Doug Ford is rejecting a push from prominent retailers to reopen non-essential stores in Toronto and Peel, a day after they published an open letter urging the government to allow 25 per cent capacity in retail shops in lockdown regions.

Mr. Ford on Wednesday said he feels the pain of business owners who are forced to close until at least Dec. 20 during the lockdown, but said he is listening to the province’s Chief Medical Officer of Health and others guiding his government during the COVID-19 pandemic.

“I’d switch those things open in a heartbeat. But I can’t. I have to listen to the health experts,” Mr. Ford said during his daily press briefing at Queen’s Park.

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“I’m a businessperson. I don’t want to close these down. But health trumps my personal belief.”

As part of the lockdown, big-box stores selling essential items – such as Costco and Walmart – are allowed to open at 50 per cent capacity, while other retail stores and small businesses cannot offer in-store shopping and are forced to sell items for delivery or curbside pickup only.

A coalition of nearly 50 retailers, including Canadian Tire, Indigo, Hudson’s Bay and others, this week called on the Ontario government to lift the COVID-19 restrictions that have shuttered stores just in time for the crucial holiday shopping season.

In an open letter released on Tuesday, the group said that the closing of retailers deemed non-essential in Peel Region, which includes Mississauga and Brampton, and in Toronto is “an ineffective policy” that puts retail businesses at risk of failure. The group called for Ontario to implement store capacity limits at 25 per cent of the building capacity for all retailers – not selective lockdowns with big-box stores open at 50 per cent capacity.

Signatories pushing for the changes said Wednesday they felt unfairly targeted by the government’s rules.

“[Retailers] feel undeservedly singled out as an initiative to stop the spread of COVID-19, when in fact the government’s own statistics indicate that retail is not a significant source of spread,” Leon’s Furniture Ltd. president and chief executive officer Edward Leon said in an e-mail on Wednesday.

David Bensadoun, CEO of the Aldo Group Inc., said the decision to keep non-essential stores shuttered would drive customers to American stores.

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“Every time we do a lockdown of specialty stores, we’re hurting Canadian retail,” he said.

“Even though Canadian retailers have terrific online experiences, they cannot compete with the big American players for ad dollars, so when we shift consumers online, we’re largely shifting them to Amazon, Walmart and other American mega-players. I don’t envy Ford’s position, I don’t think it’s easy. But in this case I think he’s made a mistake, and the sooner he corrects it the better, because these are the biggest weeks of the year for shopping.”

Heather Reisman, CEO of Indigo Books & Music Inc., said by funnelling more people into fewer stores, “you actually cause longer waiting lines with chance for closer contact. … This could create higher health risk while doing devastating damage to hundreds of businesses.”

Mr. Ford acknowledged that keeping big-box stores open for in-store shopping is “not fair,” but said they are intended to be a one-stop shop for groceries and other essential items. However, those stores also sell non-essential goods such as clothing, toys and gifts.

Ryan Mallough, director of provincial affairs for Ontario at the Canadian Federation of Independent Business, said small businesses are also calling for the government to present data that back up the need to keep independent retailers shuttered. His group has called for limited in-person and appointment-only shopping during the holiday season.

“If there’s any evidence that shopping at a busy big-box store with a couple hundred other people, even at 50 per cent capacity, is safer than at a small business with two or three other people, then show that data. Because right now that is one of the immensely frustrating things,” he said.

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Ontario reported 1,723 new cases of COVID-19 on Wednesday, as well as 35 new deaths owing to the virus. Toronto and Peel account for more than half of the new infections, with 500 cases reported in Peel and 410 in Toronto. There were 196 new cases in York Region, north of Toronto, which is not in lockdown and still allows in-person shopping in malls and stores.

Our Morning Update and Evening Update newsletters are written by Globe editors, giving you a concise summary of the day’s most important headlines. Sign up today.

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Charity tree festooned with Dr. Strang's ties fetches $8K at auction –



As Nova Scotians get ready for Christmas, one anonymous person is celebrating with a tree like none other after winning it at auction for $8,250.

Instead of snowflakes or angels, this tree is adorned with ties from Nova Scotia’s chief medical officer of health, Dr. Robert Strang.

Strang’s eclectic tie collection has been thrown into the spotlight during the province’s regular COVID-19 updates, which are streamed online. It was his wife’s idea to wear a different one every day.

“It became a part of the briefing, me wearing a different tie each time,” said Strang, who started receiving ties as gifts from people as he became a household name among Nova Scotians. 

“I don’t think of myself as famous. In some ways, it’s kind of embarrassing. I just happen to be, because of my job, I’m the front face of this.”

‘Light bulb’ idea

A few months ago, Strang was at a book launch and ran into Starr Cunningham, president and CEO of the Mental Health Foundation of Nova Scotia.

Cunningham said she’s always trying to come up with ideas to decorate items for the charity’s big Festival of Trees fundraiser. That encounter led to what she called a “light bulb moment.”

“I thought, ‘Wow, what if we got those ties and got them on a tree?'” she said. “I just reached out to him on a whim and he replied immediately and said, ‘How many do you want?'”

This Christmas tree features 22 ties from Dr. Robert Strang, as well as several bottles of hand sanitizer. (Fabink Photography)

Strang dug through his collection and found 22 ties, each with their own story. One was from Sawyer Burke, an 11-year-old from Hatchet Lake who has become Strang’s penpal.

“He was very excited that what he’s given to me, I was then giving forward to contribute to the fundraiser for broader contributions to mental health,” said Strang.

The tree, trimmed with ties and bottles of hand sanitizer, was placed on the auction block where Cunningham said it received an immediate response.

“We were amazed,” she said. “We were watching the bids all night, because the auction closed at 8:30 and it just kept growing and growing and growing.”

The final price tag was $8,250 — the highest price for any item in the auction.

A timely cause

Strang said the tree was the first direct request he’s received to support a charity, and he was particularly interested in the cause.

“As part of our pandemic response, we need to be paying attention to the mental health impact,” he said. “There’s significant increases around stress, anxiety, depression — particularly in young people.”

Cunningham said the money raised from the tree’s sale will be used to create grants for various programs. This year, the foundation has helped connect people to their families and clinicians during the pandemic through technology.

“Something as simple as a phone in their hand has helped them cope in the pandemic,” said Cunningham.

So far, she is tight-lipped about the tree’s anonymous buyer. But she said people will soon know who spent thousands on Strang’s ties.

“We’re not able to say at this point in time, but it will certainly be shared with the community very soon.”


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Pfizer cuts COVID-19 vaccine delivery by half for 2020 due to supply chain issues – Global News



Pfizer has confirmed to Global News that it will be distributing half the amount of COVID-19 vaccines that it had originally proposed for 2020 due to supply chain issues.

In an emailed statement to Global News, the pharmaceutical company confirmed what was first reported by the Wall Street Journal, that it will be delivering up to 50 million doses of the COVID-19 vaccine by the end of 2020 worldwide, down from the 100 million doses previously promised.

Read more:
Canada’s review of Pfizer coronavirus vaccine will be completed ‘soon,’ health minister says

“Based on current projections we expect to produce globally up to 50 million vaccine doses in 2020 and up to 1.3 billion doses in 2021,” Pfizer said in a statement.

Pfizer said there are two reasons the number of doses expected has changed.

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“For one, scaling up a vaccine at this pace is unprecedented, and we have made significant progress as we have moved forwards in the unknown,” the company said.

“Additionally, scale up of the raw material supply chain took longer than expected.”

Click to play video 'Coronavirus: Canadian officials expect Pfizer vaccine ‘likely’ to arrive first'

Coronavirus: Canadian officials expect Pfizer vaccine ‘likely’ to arrive first

Coronavirus: Canadian officials expect Pfizer vaccine ‘likely’ to arrive first

Pfizer also noted that results of its clinical trial were received later than expected.

The company said finished doses are currently being made at a “rapid pace.”

“We are confident in our ability to supply at a pace of approximately 1.3 billion doses by the end of 2021,” Pfizer said.

Pfizer had adjusted its supply outlook in 2020 from 100 million to 50 million in November in publicly available statements, but had promised up to 100 million doses as late as September.

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Read more:
Britain approves Pfizer coronavirus vaccine for use, 1st in world to do so

The vaccine has been found to be 95 per cent effective against COVID-19 in recent tests, and the United Kingdom became the first country to approve the vaccine on Wednesday.

Canada is set to receive up to four million doses of Pfizer’s vaccine between January and March 2021, and will finish its review of the vaccine “soon,” according to Health Minister Patty Hajdu.

© 2020 Global News, a division of Corus Entertainment Inc.

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