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Pandemic benefits were too generous with businesses, stringent with workers: experts

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OTTAWA — Benefits rolled out at the onset of the COVID-19 pandemic allowed vulnerable Canadians to stay healthy while maintaining an income, but business supports were excessive and show the outsized influence of business groups on public policy, economists say.

Nearly two and a half years ago, the federal government faced an unprecedented task of shutting down the economy to slow the rapid spread of COVID-19. That shutdown led to a series of pandemic relief benefits aimed at softening the blow to workers and businesses, with the two most prominent programs being the Canada Emergency Response Benefit and the Canada Emergency Wage Subsidy.

Recent analysis from Statistics Canada based on census data shows two-thirds of Canadian adults received pandemic benefits in 2020, with these benefits cushioning income losses and reducing inequality.

Previous analysis from the federal statistics agency also found that, as was expected, usage of the wage subsidy program correlated with a lower probability of closure and fewer employee reductions.

While there was little time to spend on crafting the benefits and fine-tuning the details in March 2020, economists are now assessing the successes and failures of these programs in retrospect.

City of New York University economics professor Miles Corak, who has written analyses on these programs, says any evaluation needs to account for the uncertainty people and governments were facing at the time and the urgent need to keep people healthy.

That said, Corak said while the CERB was “terribly successful,” the Canada Emergency Wage Subsidy was a “huge failure.”

“The Canada Emergency Response Benefit got money out the door quickly in time to keep people at home, which is what we wanted to do to save lives,” he said.

On the other hand, Corak said the CEWS “came too late, it wasn’t well-targeted and dramatically over-insured (businesses).”

The CERB was quickly announced in March 2020 and $2,000 monthly to Canadians who lost income because of the pandemic shutdown. That was followed soon after by the CEWS, which subsidized businesses’ employee wages by 75 per cent in hopes of encouraging companies to hold on to their staff.

Corak says that by the time the wage subsidy was introduced, many businesses had already parted ways with their employees.

Another source of criticism for the wage subsidy program was that it subsidized wages for all workers at affected businesses, rather than simply those whose jobs were at risk of being lost, making it especially costly.

Jennifer Robson, an associate professor of political management at Carleton University, also pointed to the wage subsidy program as being unsuccessful. Robson said businesses that would have otherwise closed down for reasons unrelated to the pandemic remained artificially afloat because of the wage subsidy.

“These were not businesses that were going to return to profitability,” Robson said.

Statistics Canada data shows the number of business closures spiked dramatically in April 2020, but a sharp decline followed, bringing monthly closures to a lower level than pre-pandemic.

About 31,000 businesses closed in August 2020, while nearly 40,000 had closed in February 2020.

In hindsight, Corak said the wage subsidy program should have been smaller in scope and targeted to larger businesses with specialized needs where it would be important for companies to hold on to the same employees, such as the airline sector.

The Canadian Federation of Independent Business has said the wage subsidy was “crucial” for small business owners and noted in April this year that only two of five of its members reported being back to normal sales.

Adrienne Vaupshas, the press secretary for Finance Minister Chrystia Freeland, said in a statement the focus of the government at the onset of the pandemic was to protect jobs and ensure a strong economic recovery.

“Today we have recovered 114 per cent of the jobs that were lost during the darkest months of the pandemic,” Vaupshas said.

In contrast to what some economists have characterized as excessively generous supports for businesses, some low-income Canadians have experienced clawbacks to social assistance benefits because they collected CERB. The Canada Revenue Agency is also hoping to recoup benefits paid out to over 400,000 Canadians whose eligibility was questioned.

In response, anti-poverty group Campaign 2000 has called for CERB amnesty.

Corak said while it’s reasonable to ask those who fraudulently collected benefits to pay them back, businesses should be held to the same standard.

“The concern I would have is the asymmetry in this response between individuals and businesses,” Corak said.

The CFIB has called for more loan forgiveness for small businesses who accessed loans through the Canada Emergency Business Account. The federal government is already offering partial loan forgiveness if repayments are made by the end of 2023.

Robson said when it comes to shaping public policy, business interest groups have well-resourced public relations teams to further their interests.

“There is nothing like that for individual low-wage workers,” said Robson.

Corak noted that at the start of the pandemic, there was a focus on the role of front-line workers, but with time, this shifted to small businesses.

“I think the small business lobby was very effective in informing individual MPs and putting pressure on cabinet and the government to respond in a way that many unseen and unheard mothers, fathers workers and families just didn’t have that same voice,” Corak said.

The danger of the wage subsidy program, Corak said, is that it sets a precedent for providing excessive subsidies to businesses and thereby stifling innovation.

“We’re almost moving towards a basic income for small business rather than a basic income for individuals,” he said.

This report by The Canadian Press was first published Aug. 6, 2022.

 

Nojoud Al Mallees, The Canadian Press

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A year after the fall of Kabul, Canadian veterans urge Ottawa not to abandon Afghans trying to flee – CBC News

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It’s been one year since Kabul fell to the Taliban after American and allied troops — including Canadians — left the country.

Video footage showed Afghans streaming onto the tarmac at the Kabul airport, desperate to escape, as a U.S. air force plane took off. Some fell to their death trying to hold on.

“We watched that terrible situation unfold … we saw that tremendous catastrophe that happened in Kabul,” said Brian Macdonald.

A Canadian veteran who served in Afghanistan, Macdonald leads the non-profit Aman Lara, which is Pashto for “Sheltered Path.” The collective of Canadian veterans and former interpreters has been working over the last year to bring refugees to safety in Canada.

“When we were unable to get them out a year ago, it was devastating. But since then we’ve come together, we’ve doubled down and been able to get 3,000 people out,” he said.

But it’s been a slow and dangerous process when those refugees need to go through the Taliban to get a passport.

“These people that have helped Canada now have to stand up and go to an office that’s controlled by the Taliban and give their name and address and the dates of birth of their children,” Macdonald said.

“It’s a very dangerous thing to do.”

Brian Macdonald, the executive director of Aman Lara, says the non-profit has successfully helped more than 3,000 Afghan refugees to safety in Canada since Kabul fell to the Taliban one year ago. (Derek Hooper/CBC)

There was hope this June, when Pakistan agreed to temporarily allow Afghan refugees approved to come to Canada across its border, without a passport or visa.

But Macdonald says they’ve hit roadblocks bringing those refugees to Canada.

“We were hoping it would be thousands, and it ended up being dozens,” he said.

“We’re dealing with the Afghan-Pakistani border, and it’s a very wild place. And so messages aren’t always clearly communicated, but we believe the window may still be open.”

Ottawa promises to speed up application process

A spokesperson for Immigration Minister Sean Fraser said Canada has added more employees on the ground to process applications as quickly as possible, including in Pakistan.

The department did not say how many undocumented Afghans have successfully made it to Canada through the arrangement with Pakistan.

In this photo provided by the U.S. Marine Corps, Italian coalition forces assist and escort evacuees for onward processing during an evacuation at the Kabul, Afghanistan airport on Aug. 24. (Staff Sgt. Victor Mancilla/U.S. Marine Corps/The Associated Press)

Canada initially said it would bring 40,000 Afghan refugees to Canada — focusing on Afghans who were employed by the Canadian government and military. The federal government says that, to date, it has welcomed 17,300, with more still to arrive “in the coming weeks and months.”

“We remain steadfast in our collective resolve to bring vulnerable Afghans to safety in Canada as quickly as possible,” says a joint statement released Monday by Fraser, Foreign Affairs Minister Mélanie Joly and International Development Minister Harjit Sajjan.

The statement does not indicate when Ottawa expects to reach its target of resettling 40,000 Afghans.

In the statement, the ministers lamented what they called the “steady deterioration” of human and democratic rights in Afghanistan since the Taliban seized power last year, citing the reintroduction of severe restrictions on the ability of women and girls to go to school and to move freely within the country.

‘We can hold our heads high,’ says deputy PM about evacuation

But the federal government has been criticized for not doing more to help Afghans who assisted Canada in the NATO-led effort and are now at risk of being killed by the Taliban for their ties to Western nations.

Deputy Prime Minister Chrystia Freeland said “we need to not think in the past tense” when asked if Canada could have done more a year ago.

“We can hold our heads up high when we think about our response compared to that of our allies. There is a lot more work to do,” Freeland said in Toronto on Thursday.

“We need to keep on working to bring more people from Afghanistan to Canada, and that’s exactly what we’re doing.”

Deputy prime minister answers questions about Afghanistan

4 days ago

Duration 2:23

Deputy Prime Minister Chrystia Freeland says Canada’s priority is to focus on the women and children of Afghanistan ‘who have suffered real setbacks.’

Last month, Canada stopped accepting new applications to its special immigration program, a move that advocates say amounts to the abandoning of Afghans desperate to come to this country.

Macdonald hopes the federal government reconsiders its approach and commits to welcoming every Afghan who helped the government into Canada.

“A year ago, we were panicking to get as many people out as possible,” Macdonald said.

“We all thought — as veterans and other interpreters — that that window had closed, that the people we didn’t get out were stuck in Afghanistan.

“But what we’ve learned over the last year is we can still move them out. It’s at a snail’s pace. It’s not as many people as we’d like. But we are still grinding away every day, moving people out of Afghanistan.  And we’re just going to keep doing that until we get as many people out as we possibly can.”

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Maritime veterans working to bring Afghans to Canada – CTV News Atlantic

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John Monaghan’s connection to Afghanistan has withstood the 13 years since his tour there.

The Nova Scotia man and his family keep in constant contact — daily — with a man he met there, who worked with the Canadian military. A man he refers to as “Mr. Jones,” to keep his identity hidden from the Taliban.

The Monaghan’s have been lobbying and fundraising to bring Mr. Jones, his wife, his four older siblings and their large families to Nova Scotia.

But he says, at this point, one year after the Taliban takeover of Kabul, they’re still in limbo.

“You can tell that he’s worried, he’s definitely worried about everything that’s going on,” Monaghan said. “It’s just really frustrating. They need to move these people out of danger and here to Canada, to safety.”

Aman Lara — Pashto for “Sheltered Path” — is an organization that was born after the takeover a year ago, to try and bring as many Afghan interpreters to Canada as possible.

Its executive director is New Brunswicker Brian Macdonald, who also served in Afghanistan. Macdonald says it’s become an urgent passion project for many veterans across the country.

“A year ago, we saw those terrible scenes of people getting crushed trying to leave Kabul. At that time, we thought the window had closed, we weren’t going to be able to get any more people out. But in that year, we’ve doubled down, and we’ve now got 3,000 people out of Afghanistan,” he said.

He says they’ve been working with teams in many different locations, but the bureaucracy in several countries — including Canada — is high.

Their focus is on securing the safety of another 3,000 people, and believe the work will take years to complete.

“There’s some people on our team who still haven’t gotten their families out. We work with these interpreters very closely, they’re here in Canada but their families are still stuck in Afghanistan. So there’s a lot left to do for sure,” he said.

Macdonald believes there are about 8,000 people in Afghanistan right now, who’ve been approved to travel to Canada. But there are thousands more who are eligible, but have yet to be accepted.

“For the Government of Canada, we want them to extend the special immigration measures program, and that will allow us to get everyone that served Canada out of Afghanistan,” he said. “So we don’t think there should be a cap on that in terms of numbers, and we don’t think there should be a timeline on that. Let’s take as long as it takes to get everyone who helped Canada out of Afghanistan.”

On Monday’s difficult anniversary, Monaghan hopes Canadians take a moment to think about the people of Afghanistan.

“Mostly, I would like people to think about how comfortable and happy and safe they are and then in comparison think about the lives that these families are living in Kabul, in terror, where they are afraid for their lives.”

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Public hearings in Emergencies Act inquiry to start in September

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OTTAWA — The inquiry into Ottawa’s unprecedented use of the Emergencies Act during protests in February will start its public hearings next month.

The Public Order Emergency Commission announced today that it expects the hearings to run from Sept. 19 until Oct. 28 at Library and Archives Canada in downtown Ottawa.

Commissioner Paul Rouleau said in a statement that he intends to hold the government to account and wants the inquiry to be as “open and transparent” as possible.

Hearings will be livestreamed online and members of the public will have opportunities to share their views, with a final report expected early next year.

Parties to the inquiry including “Freedom Convoy” organizers, police forces and all three levels of government are expected to testify and contribute documentary evidence on the invocation of the act in February.

The federal Liberals made the move amid border blockades and the occupation of downtown Ottawa by protesters demonstrating against COVID-19 vaccine mandates.

This report by The Canadian Press was first published Aug. 15, 2022.

 

The Canadian Press

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