Ho-Ho-Hold the Repayment Deadline: Owner-Operators Need CEBA Extension

As the deadline to repay Canadian Emergency Business Account (CEBA) loans and receive partial forgiveness approaches, enterprise owners are still hoping the federal government will reverse course and extend it until December 31, 2024.

In the Economic Support Proposal FFAW-Unifor presented to federal government in June 2023, deferral of CEBA interest accumulation and payments for an additional calendar year for owner-operators was a key area of support that would ensure members are protected through this period of economic hardship. This period of hardship will continue into 2024 as thousands of EI claimants are also trying to survive on a significant reduction in benefits due to anomalies in the unemployment rate that effected eligibility criteria at the end of the fishing season.

“Extending the CEBA repayment deadline was the low hanging fruit in our Economic Support Proposal,” says Greg Pretty, FFAW-Unifor President. “With less than a week before Christmas, we’re hearing from owner-operators that are getting their boats seized by banks. For many, the monies that they had allocated to CEBA repayments had to be reinvested into operational costs in 2023. Together with EI inadequacies, federal government remains outrageously disconnected from the harsh realities facing workers and small business owners in our industry, our province, and across our country.”

Thousands of independent owner-operators applied for and received a CEBA loan during the COVID-19 pandemic with an initial repayment deadline of December 31, 2023. Hundreds of organizations in Canada representing small businesses expressed concerns for the initial repayment date and on September 14, 2023, the Prime Minister announced that up to one third of the loans can be forgiven if businesses pay back the outstanding amount by January 18, 2024. Those that miss that deadline would lose out on the forgivable portion and see their debts converted to a three-year loan with interest of five per cent annually. Given the added challenges of inflation, the announcement was criticized for being cruel and unsympathetic instead of being celebrated.

Providing an additional year for term loan repayment, and additional flexibilities for loan holders looking to benefit from partial loan forgiveness would help business owners deal with the looming CEBA repayment deadline. It was anticipated that the federal Fall Economic Statement in November 2023 would include such relief measures, but none were announced.

“As small businesses on the water, this has been a year of suffering for enterprise owners. From recessionary market pressures to the failure of EI, and now CEBA will surely cause many owner-operators to sink into insolvency. We’re not asking for these loans to disappear; we are asking for time. Federal government has a responsibility, moreover, an opportunity to make sure that there is a positive chain-reaction in our economy in 2024. Maintaining the January 18^th deadline will start the new year with thousands of valuable independent businesses going bankrupt,” concludes Pretty.