Canada should copy bold programs in countries like Denmark

EDMONTON – Alberta’s largest advocacy organization for working people is urging governments to take further steps to support Canadian workers through wage subsidies.

Yesterday, the Government of Canada announced major changes to The Canada Emergency Response Benefits to streamline the application process and benefits for Canadians needing support.

“We applaud yesterday’s federal announcement of The Canada Emergency Response Benefit changes made to streamline and simplify income supports for Canadians in need during the COVID-19 pandemic,” said Gil McGowan, president of the Alberta Federation of Labour. “This demonstrates that the Federal Government is listening to feedback and responding to the real needs of working Canadians and businesses.”

“However, even with this improved program and application system, more needs to be done to help and protect hard-working Canadians. What’s on offer is a very good start, but it’s still not enough to cover costs for most Canadian households,” said McGowan. “With that in mind, we need to think bigger. In particular, we should consider copying Denmark.”

The Denmark program is designed to keep people working and connected to their employers, with the state providing wage-subsidies that cover 75 per cent of employees’ salaries, with the employer contributing the remaining 25 per cent. Currently, the new Canadian wage subsidy program covers only 10 per cent of workers’ wages.

“There are several advantages to a Denmark-style wage subsidy program for working Canadians and businesses,” said McGowan. “This kind of program keeps workers connected with employers and will keep many workers out of The Canada Emergency Response Benefit and Employment Insurance applications, freeing up time and resources for Canadians who need this support.”

“A wage subsidy program is able to leverage the payroll systems that employers already have set up, which reduces bureaucracy for workers to navigate, eliminates any language or technological barriers workers may face, and would ideally deliver money to Canadians faster,” concluded McGowan.

McGowan also says the government should consider another approach that’s getting support from all sides of the political spectrum: no-strings-attached cheques of $2000 per month to all Canadians for three months.

“The problem with application-based programs is that they take time, which we don’t have. With that in mind we should send cheques to everyone to make sure they can cover costs and then tax it back next year from those who didn’t need it. With deadlines for rent and mortgage payments looming, the priority needs to be on getting money out the door to Canadian families as soon as possible.”

Earlier today McGowan wrote a letter to the Federal and Alberta Ministers of Labour outlining his suggestions. You can see the letter here with a more detailed explanation of the AFL’s proposals.

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MEDIA CONTACT:
Gil McGowan
President, AFL
Email: gmcgowan@afl.org
Call: (780) 218-9888