In a sector already shaken by hundreds of layoffs, the COVID crisis has only exaccerbated the situation. In response, representatives from 74 regulated companies (LPs and REC retailers) signed a letter to finance minister Bill Morneau and industry minister Navdeep Bains calling for access to federal wage subsidies available to non-cannabis businesses through the Business Development Bank of Canada (BDC) and Export Development Canada.
Huffington Post, Twitter–@Ottawa_Cameron, BNN Bloomberg
- BDC assistant vice-president Shawn Salewski responded by reiterating $95B in loans, tax deferrals, and wage subsidies would only be open to “businesses that qualified for BDC financing prior to the downturn.”
Globe and Mail
- These do not include, per the BDC website, “businesses that are […] inconsistent with generally accepted community standards of conduct and propriety.”
- Businesses must also be at least two years old to qualify for BDC funding.
Response to the dismissal was swift and shocked.
- Tantalus Labs CEO Dan Sutton warned the BDC’s intransigence risked creating supply shortages so massive they’ll “take years to build back,” and Organigram VP public affairs Cameron Bishop publicly shamed the bank.
- Eve & Co VP government relations Ivan Ross Vrána wondered how an industry declared an essential service by all provinces could be ineligible for federal stimulus.
BDC’s stance is inconsistent with Finance Minister Bill Morneau’s statement last week that the government’s COVID-19 support “won’t discriminate between businesses.” Emergency financing programs should not be used to pick winners and losers. https://t.co/y1jUIscroO
— National Cannabis Working Group (@CCC_Cannabis) March 30, 2020
The Canadian Chamber of Commerce’s National Cannabis Working Group noted that stimulus funding was announced “nearly three weeks ago,” and to date the BDC has answered calls from the sector by repeating that it was “exploring broadening our support” without doing anything more.
The rejection sparked the creation of Legal Tender, a new lobby group of industry figures, associations, and companies advocating “for equitable treatment by the Business Development Bank of Canada (BDC) and federal government.”
- Legal Tender’s first act was to launch a petition calling for equitable access to federal banking funds for the cannabis industry.
Outside the sector, Scott Reid, speechwriter to former prime minister Jean Chrétien–called for reevaluation of BDC eligibility criteria, if not a shift in policy.
On Monday evening, prime minister Justin Trudeau appeared to answer the appeals of industry when he announced the expansion of the initial COVID wage-subsidy program to all businesses large and small who’ve lost significant revenue due to COVID.
Early industry responses indicated great relief.