Ontario announced on Monday that all non-essential retailers across the province will go into lockdown as of Boxing Day, a move that retail associations say could lead to the death of thousands of small businesses.
The province-wide shutdown will begin at 12:01 a.m. on Dec. 26. The restrictions will be in place for 14 days in northern Ontario, and 28 days in the rest of the province.
“This difficult action is without a doubt necessary to save lives and prevent hospitals from being overwhelmed in the coming weeks,” Ontario Premier Doug Ford said Monday.
“Make no mistake, thousands of lives are at stake right now. If we fail to take action now, the consequences would be catastrophic.”
As it announced the new lockdown, the government also unveiled a new Ontario Small Business Support Grant that will provide between $10,000 and $20,000 for struggling business owners. The one-time grant will be offered to businesses employing fewer than 100 people, and that have been required to close or significantly restrict service due to the shutdown, and experienced a minimum revenue decline of 20 per cent.
Ford also pointed to other government programs, including previously introduced tax rebates and the rent relief program covered in partnership with the federal government.
“We’re there for you. We’re going to get through this,” the premier said.
They will not survive this. Many businesses have been hanging on by a thread and unfortunately, the province just cut it. Dan Kelly, president, CFIB
Still, Dan Kelly, president of the Canadian Federation of Independent Business (CFIB), warns the new supports will not be enough and that many businesses “will lose everything.” He said in an interview that the decision to lock down the province “will lead to the certain death of thousands and thousands of businesses.”
“They will not survive this. Many businesses have been hanging on by a thread and unfortunately, the province just cut it,” Kelly said, adding that one third of CFIB’s members in Ontario said they will not survive a second COVID-19 lockdown.
“Regardless of whether you support or oppose the lockdown measures themselves, the impact of this is unquestionable. It is going to lead to business failures like we’ve never seen.”
Kelly said the CFIB wants the government to provide data to support extending the lockdown to additional regions, as well as deeper financial aid for those businesses that are being forced into lockdown.
Ontario’s Chamber of Commerce, which had also called for additional financial support from the province, welcomed the small business program announced by the Ford government on Monday.
“The small business supports announced by the Ontario government today provide struggling small businesses with a chance at surviving the second wave,” Rocco Rossi, the chief executive of the Ontario Chamber of Commerce, said in a statement.
“We have been deeply concerned about the pandemic’s impact on small businesses and their employees, who are in jeopardy through no fault of their own.”
The group also called on the government to provide adequate contact tracing and testing that will help track community spread and virus hotspots.
Ford announced last Friday that the 28-day lockdown in Toronto and Peel Region would be extended until at least Jan. 4 as the areas grapple with rising cases of COVID-19.
Hours before Ford announced the province-wide restrictions on Monday, Ontario’s health officials said their ability to control a second wave of COVID-19 was precarious and made clear a “hard lockdown” of four to six weeks was needed.
“Our ability to control case growth is still precarious,” said Adalsteinn Brown, co-chair of Ontario’s COVID-19 science advisory team.
“Based on experience in France and Australia, ‘hard lock-downs’ of four to six weeks can reduce case numbers in Ontario to less than 1,000 per day,” he said in a presentation to media.
But retail groups are urging the government to avoid a hard lockdown. The Retail Council of Canada (RCC), an industry group that represents more than 45,000 large and small retailers in the country, wants the government to allow non-essential retailers to re-open with significant capacity restrictions in place.
“This is devastating for retailers,” RCC chief executive Diane Brisebois said in an interview, adding that the restrictions will hurt mid-to-large retailers, as well as small businesses.
“This is the No. 1 market for retailers, and many have more than a couple of stores, so that’s going to have a huge impact on their ability to survive in 2021,” she said.
“If we’re going to keep the retail sector alive and well, the government has to look at more than just small business grants.”
With files from Reuters
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.