Transport Minister Marc Garneau says that Canadian airlines could go bankrupt if the ailing industry is compelled to refund passengers billions of dollars for flights cancelled due to the pandemic.
“I have said many times that I have enormous sympathy for those who would have preferred to have a cash refund in these difficult circumstances. It is far from being an ideal situation,” Garneau told a press conference earlier today.
“At the same time, if airlines had to immediately reimburse all cancelled tickets, it would have a devastating effect on the air sector, which has been reeling since the COVID 19 pandemic started.”
Garneau was doubling down on a message he delivered to the House of Commons’ pandemic committee on Thursday, when he warned MPs that if airlines “had to reimburse at this time, some of them could fail.”
The minister said today it’s his responsibility to help Canada’s airlines survive the pandemic.
“It is so essential for this country,” he said. “This is the second largest country on Earth, with its distances and remote areas, and we expect and need an airline industry in this country.”
<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”Watch | Reporters question Marc Garneau about airline ticket refunds” data-reactid=”38″>Watch | Reporters question Marc Garneau about airline ticket refunds
But his response isn’t sitting well with Canadians struggling financially during the pandemic who argue it’s their right as consumers to get their money back for flights they never took.
“It’s very disappointing and frustrating,” said Tammie Fang, a health care essential worker in B.C. “My rights as a consumer have been put aside to help balance the airline industry.”
Fang works at a New Westminster hospital assisting with open-heart surgeries. She said she spends much of her spare time calling and emailing Air Transat seeking a refund of roughly $500 for a flight to Toronto she never took. She describes it as an extra burden during an already stressful and financially challenging time.
“It’s disheartening,” she said. “It’s unbelievable how much effort we have to put in.”
<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”Airlines’ survival versus consumers’ rights” data-reactid=”43″>Airlines’ survival versus consumers’ rights
Canada’s airline industry has been hit particularly hard by the pandemic, and most of the country’s airline fleet is sitting idle at airports across the country. Airlines are losing 90 per cent of their normal revenue streams and some have put their operations completely on pause.
At the same time, pressure is mounting on the federal government to step in and force airlines to pay back passengers who also are struggling financially. Two petitions with more than 30,000 signatures combined have been submitted to Parliament in recent weeks calling on the government to demand that airlines tapping into taxpayer-funded government supports reimburse grounded passengers.
<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”Billions tied up in refunds” data-reactid=”66″>Billions tied up in refunds
For the most part, Canadian airlines are offering those passengers travel vouchers redeemable for two years. Air Canada also announced last week that it’s allowing people to transfer their tickets to others, which could permit ticket holders to sell them. The Canadian Transportation Agency has said offering vouchers could be a reasonable measure in the current circumstances.
Garneau’s office said it would cost airlines billions of dollars to refund customers. When CBC asked Transport Canada for specific numbers, it was told the figures the government receives from airlines amount to proprietary information that it isn’t authorized to release.
Air Canada’s books are open, since it’s a publicly traded company. It has about $2.6 billion tied up in ticket sales for future travel over the next year.
On March 16, the airline said its current liquidity level was $6.3 billion — a record level — and its balance sheet was solid. Since then, Air Canada has said it’s burning $22 million a day in operating costs and plans to reduce its workforce by 50 to 60 per cent. The company said a dramatic drop in demand during the pandemic caused the airline to slash its flight capacity by 95 per cent.
<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”Government in talks with airlines and consumers” data-reactid=”75″>Government in talks with airlines and consumers
Outside Rideau Cottage today, Prime Minister Justin Trudeau repeated a message he’s delivered in the past — that the government has to strike the right balance between keeping airlines afloat and preserving consumers’ rights.
“I hear clearly the concerns that Canadians have around their air tickets,” said Trudeau. “We will continue to work with the industry and with concerned groups of Canadians to ensure that we find a fair way through this.
“But I know Canadians at the same time want to make sure we continue to have an airline industry after this very difficult pandemic.”
The government is in talks with airlines and is looking to see what other countries have done with travel refunds. It’s expected to deliver an update on the file in the coming weeks.
Source: Yahoo News Canada
Edited By Harry Miller
North American markets gain ground to start the week – BNNBloomberg.ca
North American equity markets clawed back ground into the close of Monday’s trade, with the S&P/TSX Composite Index up 0.29 per cent, the S&P 500 gaining 0.38 per cent, the Dow Jones Industrial Average rising 0.36 per cent and the Nasdaq Composite Index up 0.66 per cent.
Equity markets had been mixed in earlier trading, as investors weighed the competing factors of economic reopenings and the rising tensions between the United States and China.
In Toronto, four of the 11 TSX subgroups closed in positive territory, with consumer discretionary, financials and materials leading the way. Consumer staples, information technology and health care were the lead laggards.
A big part of the weakness in health care stocks was the underperformance of Canopy Growth Corp., which finished the day as the worst performer on the index after a string of analyst downgrades. The analyst community has expressed concerns over the company’s lack of a clear path to sustained profitability after it withdrew its forecast last week.
Oil prices fluctuated throughout the day, with U.S. benchmark West Texas Intermediate up 0.1 per cent to US$35.53 per barrel. Alberta’s Western Canadian Select was up 3.16 per cent to US$29.08 per barrel.
The Canadian dollar gained more than a full cent against its U.S. counterpart to trade at 73.68 cents U.S., though the greenback was weaker against all of its major-market peers.
1:00 p.m. ET: North American equity markets rebound, oil pares losses
North American equity markets rebounded into the midday trade, with the S&P/TSX Composite Index and Dow Jones Industrial Average up 0.3 per cent each, the S&P 500 gaining 0.4 per cent and the Nasdaq Composite Index up 0.66 per cent.
In Toronto, only four of the 11 TSX subgroups were in positive territory, led by consumer discretionary, financials and materials stocks. Information technology, consumer staples and health care were the lead laggards.
120 of the index’s 230 members were higher with a pair of cannabis stocks bookending the composite. HEXO Corp. was the lead gainer on the TSX, up 10 per cent after Health Canada approved its facility in Bellville, Ontario. On the flip side, Canopy Growth Corp., was the biggest percentage loser, down nine per cent, after a slew of analyst downgrades after the company shelved its forecast for a path to profitability late last week.
Oil pared some of its earlier losses, with U.S. benchmark West Texas Intermediate down a little more than one-and-a-half per cent to trade at US$34.90 per barrel. Alberta’s Western Canadian Select was essentially unchanged at US$28.16 per barrel.
10 a.m. ET – North American stocks slip, oil falls as U.S.-China tensions escalate
North American equity markets kicked off the week in modestly negative territory, with the S&P/TSX Composite Index down a tenth of a per cent, the Dow Jones Industrial Average and S&P 500 both falling 0.4 per cent and the Nasdaq Composite Index down 0.2 per cent.
Markets were under that modest pressure amid signs of a re-escalation of tensions between the United States and China, with Bloomberg News reporting Beijing has ordered a halt to imports of some American farm goods. Meanwhile, the U.S. is also facing a wave of civil unrest as demonstrators take to the streets to protest the killing of George Floyd by Minneapolis police, which has prompted some American cities to implement curfews.
Oil prices fell in the wake of those tensions, outweighing the impact of speculation the OPEC+ group of producers could be poised to implement a short extension of its output cuts in order to put some upward pressure on crude prices. U.S. benchmark West Texas Intermediate fell 2.5 per cent to US$34.60 per barrel, while Alberta’s Western Canadian Select dropped three per cent to US$27.34.
In Toronto, that weakness in crude weighed on the energy sector in early trading.
Another point of weakness was Canopy Growth Corp. The company’s shares fell about seven per cent after the firm was downgraded by four analysts following the cannabis producer’s disappointing quarterly results late last week.
The Canadian dollar rose a third of a cent against its American counterpart to 72.93 cents U.S., though the U.S. dollar was broadly weaker against its major global peers.
B.C. protects small businesses from evictions – CityNews Vancouver
VICTORIA (NEWS 1130) — The B.C. government is banning commercial landlords who refuse to apply for federal assistance from evicting small businesses that can’t pay rent due to the pandemic.
The order is meant to support the Canada Emergency Commercial Rent Assistance program and restricts the termination of lease agreements and the repossession of goods and property, says a government release.
“The federal launch of the Canada Emergency Commercial Rent Assistance program has been a welcome step in B.C., but we heard from small businesses that they need us to help fill a gap that has left some of them unable to get the support they need,” said Carole James, Minister of Finance.
“We’re listening to small businesses and have their backs. Preventing landlords who are eligible for CECRA from evicting tenants can encourage landlords to apply for the program and give some temporary relief to businesses who have been hardest hit by the pandemic.”
Encouragement is what we are doing with this order @carolejames says
We need small biz to restart – we need them to to recover the economy.
To landlords she says: Having a long-term, dependable tenant is a benefit – the commercial rent relief will help#bcpoli @NEWS1130 #covid19
— LizaYuzda (@LizaYuzda) June 1, 2020
The emergency order restricting evictions is effective immediately and will continue for as long as the federal program is in place, which is currently until the end of June.
B.C. could extend the order if the federal program is, as well, James added.
The federal program is offering forgivable loans to eligible commercial property owners to reduce the rent for small business experiencing severe financial hardship due to COVID-19.
Property owners must offer a minimum of a 75 per cent reduction for the months of April, May, and June. The federal and B.C. governments will cover 50 per cent of the rent payments, while the tenants are responsible for 25 per cent of the rent, and landlords cover the remaining 25 per cent.
The federal program loans to landlords will be forgiven if they comply with program terms and conditions, including an agreement to not recover forgiven rent amounts when the program is over.
Should small businesses be protected from eviction? – Poll – Castanet.net
Small businesses in B.C. that have suffered significant revenue losses during the COVID-19 pandemic will be protected from eviction effective June 1.
The provincial government announced Monday new measures to protect small businesses that are eligible for federal commercial rent assistance, but are unable to access that assistance because their landlords won’t apply to the program.
“There are certainly some tenants who their landlords have been very clear that they don’t want to bother, they don’t want to take the time to apply for the federal program, and that then hurts the tenant, because the tenant doesn’t have the opportunity to be able to have that relief to help them,” said James.
“I expect that it will, I hope, make a difference in encouraging those landlords to apply now that they won’t be able to evict those tenants.”
Under an emergency act order, commercial landlords will be restricted from evicting tenants who have lost at least 70% of their revenue, and are thus eligible for Ottawa’s Canada Emergency Commercial Rent Assistance (CECRA) program, which can only be applied to by landlords.
Have an opinion? Send it to [email protected]
Xiaomi Mi Band 5 launch date set for June 11: All you need to know – Android Authority
Testing for COVID-19: Your questions answered – CBC.ca
Theatre and film are inherently political, say art critics – CBC.ca
- Health20 hours ago
Employees at St. Catharines greenhouse test positive for COVID-19
- Sports19 hours ago
Morning Report: John Oliver reacts to Dana White trademarking ‘UFSea’ – MMA Fighting
- Sports8 hours ago
Judge dismisses Dykstra’s suit against ex-teammate Ron Darling
- Health18 hours ago
NB health authority CEO says COVID-19 outbreak is 'worst possible scenario' – OHS Canada
- Science7 hours ago
SpaceX captures the flag, beating Boeing in cosmic contest
- Sports18 hours ago
Video shows Jon Jones confront vandals during George Floyd protest in Albuquerque – MMA Junkie
- Tech22 hours ago
Wallpaper crash explained: Here's how a simple image can soft-brick phones – Android Authority
- Media8 hours ago
Citizens use police tracking apps and social media to expose US attacks on peaceful protesters