Canadian businesses lost $60 billion in revenues during the infamous lockdowns of 2020. To make matters worse, billions more were wasted on interest-free loans to ineligible entrepreneurs.

“From 2019 to 2020 approximately 47 percent of all small and medium sized businesses, those with annual salary expenses of less than $1.5 million, experienced a drop in gross profits totaling a loss of nearly $60 billion,” Statistics Canada revealed yesterday.

Private sector analysts put losses at twice as much, reported Blacklock’s. In 2021 calculations by the Canadian Federation of Independent Business (CFIB), losses were tabled at $139 billion.

Revenues for restaurateurs and hotelkeepers fell as much as 60%, and roughly 25% for retailers, builders and manufacturers.

“This was due in part to successive waves of health restrictions,” said the report Borrowing, Repayments And Bankruptcies By Industry: Results From The Canada Emergency Business Account Program. 

Parliament tabled reprieve 16 days into the pandemic, approving $49.2 billion in loans to 898,271 businesses, of which $3.5 billion went to ineligible operators.

“Many of the businesses that applied for and received funding were in client-facing industries,” wrote analysts. It covered expenses including patio expansions, personal protective equipment and other pandemic-related needs. 

As of January 26, 2022, the federal government gave $49.2 billion in Canada Emergency Business Account (CEBA) loans to 898,271 businesses.

MORE: https://t.co/9oeHIcBqR5 pic.twitter.com/85alPT2QQ0

— Rebel News Canada (@RebelNews_CA) June 23, 2023

The Canada Emergency Business Account (CEBA) gave entrepreneurs interest-free loans to mitigate losses from business closures during the pandemic.

Of 898,271 borrowers only 6,343 filed for bankruptcy, said StatsCan. The agency figure is subject to increase by the December 31, 2026 deadline.

Only 10% of Canadian businesses would file for bankruptcy if they could not keep their doors open, according to a prior CFIB report.

“We need to keep businesses going so they can keep employees on staff,” then-Finance Minister Bill Morneau said at the time. “We can’t know the full impact or the duration of the challenge we’re facing.”

He later acknowledged the feds splurged too much on pandemic aid.

Federal auditors have their work cut out for them following another investigation involving millions in payments to a federal contractor.

MORE: https://t.co/liFEYsG4Pi pic.twitter.com/sawwiteKDs

— Rebel News Canada (@RebelNews_CA) March 5, 2024

Then-finance minister Chrystia Freeland ignored an audit of the program by the Auditor General, noting critics should be lenient as it was “designed and delivered during a global pandemic.” 

“Covid is not an excuse for ignoring the rules,” Conservative MP Kelly McCauley told the Commons public accounts committee last year.

The firm poorly monitored the taxpayer loans, reads the audit, citing a “failure to exercise basic controls.” All loans are due by 2026, with repayment underway.

An earlier Access to Information request revealed Export Development Canada (EDC), a Crown bank, outsourced most of the IT work to Accenture and its Brazilian subsidiary.

The firm’s CEO had ties to former finance minister Chrystia Freeland, with both heavily involved with the World Economic Forum.

"That sounds like fraud," Tory MP Kelly McCauley said after hearing the Auditor General speak on Accenture basically awarding a contract to itself:
"EDC and Finance and Global Affairs had identified the need to move to a competitive process because they were concerned about the… pic.twitter.com/jVvCumBJn6

— Noé Chartier (@NChartierET) December 2, 2024

CFIB President Dan Kelly earlier said businesses who accessed the loan were feeling the weight of their debts, panicking over their prospects should they be unable to repay the loan.

“One fifth or 19.9 percent of businesses reported not knowing if they would have the liquidity or access to credit to repay the loan,” said Repayments And Bankruptcies. That is down by more than half from 43% just three years ago.

Analysts contend that many of the businesses that declared bankruptcy were likely struggling due to the “prevailing economic climate” and may be “unable to cope with servicing … interest-bearing loans.”

Another 14.5% will not have sufficient cashflow to repay the loans now charged at 5% interest, reported Blacklock’s.

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