Mixed reactions were sparked in response to the federal government’s spring budget Monday, highlighting that while there are several “wins” to look forward to, a number of challenges and uncertainty remain in the long-term recovery of the industry.
Most industry leaders Open Jaw spoke with expressed relief at the extension of several financial support programs — namely the Canada Emergency Rent Subsidy (CERS), the Canada Emergency Wage Subsidy (CEWS) and Employment Insurance (EI) — past their current JUN deadline to 25SEP. Many of these extensions are measures travel industry advocates, including ACTA and ACITA, have been lobbying for strongly.
But the simple extension of these broad programs doesn’t go far enough to help the travel industry, industry leaders warned.
“I would have been much happier if they were clear with the rate 75%. I’d like to see it at 85% max $1041 like they had last summer – it’s arguably worse than last summer now,” Richard Vanderlubbe, President of Tripcentral.ca, told Open Jaw.
“Instead of fixed dates, the budget needs to tie the end of these programs with the lifting of travel restrictions and not these arbitrary dates that we sit on pins and needles before they expire. If the travel restrictions and quarantine are still in place, there will be a big disconnect there, forcing more people to EI.”
Vanderlubbe says he is “not hopeful” that travel restrictions will be eliminated before SEP.
“They are still concerned about variants and will likely leave international restrictions in place, and at the same time squeeze us with declining CEWS? Doesn’t make sense,” he said.
Zeina Gedeon, CEO, TPI, highlighted the need for “long term help and assistance our industry will need”, which the budget fails to address directly.
“It is a good sign to see $424 million earmarked towards re-opening borders. However, we are still without a clear path to recovery for our industry and at first glance, the supports outlined for our industry falls short,” Gedeon said, adding it is “imperative” that the government supports ACTA’s 7-point recovery plan.
She also condemned the reduction of CRB from $500 to $300 a week, saying it will be “problematic for independent travel advisors, many of whom are still working full time in their business and don’t have the ability to secure other income which may be needed to offset continued financial loss brought on by this pandemic.”
For Rocky Racco, CEO of TTI Travel, a huge gap in the government’s budget is that “the special needs and the overbearing challenging circumstances of the hospitality and tourism sector have not been granted special support” and the extension of support programs, while positive on the surface, are on a downward sliding scale, he pointed out.
“This will continue to be a work in progress for ACTA and other supporting associations to overcome. Freeland acknowledged that the hospitality and tourism sectors present disproportionate challenges but I didn’t pick-up that there are any special concessions for our sector offered up at this time,” Racco told Open Jaw.
Racco said the biggest disappointment remains that the government “still hasn’t given us the sense that they have a plan in mind to safely re-open the economy and restart travel in a meaningful way.”
“This lack of foresight, and keeps our hands tied and stress level percolating. As the saying goes, ‘We are still firefighting and not practicing fire prevention!’” he said.
Mike Foster, President of Nexion Canada, says the CEWS and CERS benefits need to be extended past 25SEP, and additional relief is needed for people or businesses who don’t qualify for CEWS.
“In our industry, as it is for an increasingly large segment of the workforce, there is no one-way to provide assistance. While our industry does appreciate the assistance, we must continue to lobby the government for ways to provide support for more affected businesses, and for longer,” concluded Foster.
Christine James, Vice President, Canada, TL Network called the extension of the CRB “clearly welcomed news” but, like Gedeon, expressed disappointment at the reduction from $500 to $300. She added extending the support benefits through year-end is “critical” for the long-term survival of the retail industry.
Cyrus K, Rustamji, owner of The Premiere Travel Group, said there need to be “specifics on how budget initiatives will help the retail travel industry.”
“Programs need to support employees as well as independent contractors within our industry till at least the time advisories against travel to the US, the Caribbean and Europe are lifted,” he told Open Jaw, adding that “as we are now more than 12 months into this crisis, the baseline to compare sales and revenue numbers needs to be set at the same month in 2019, and not just a year-over-year comparison.”