The federal government announced a new wave of funding for businesses on Friday, including a $250 million funding increase for NRC IRAP and almost $1 billion for regional development authorities.
While most business groups have applauded the federal government’s economic response to the COVID-19 crisis, there have been complaints that some companies are ineligible for the programs. It’s been difficult to tailor programs to benefit a broad swath of startups because they often have irregular cash flow or are at varying stages of development.
The announcement on Friday of additional funding for small businesses and heritage groups is an attempt to ensure that federal support reaches some of the groups that have missed out so far.
“The COVID-19 pandemic has had a profound impact on the Canadian economy,” said Finance Minister Bill Morneau in a statement. “That is why we are taking unprecedented measures today to protect Canadian jobs. We are working in close consultation with all impacted businesses across the country to take action where it is required, and are prepared to take further targeted action as needed.”
NRC IRAP – short for the National Research Council of Canada’s Industrial Research Assistance Program – provides grants to industries to support research and development projects. IRAP usually has an annual budget of about $310 million, so the extra funding announced Friday represents a boost of 80 percent.
Innovation Minister Navdeep Bains told the Globe and Mail on Friday he hoped the additional IRAP funding would help 1,000 companies protect 10,000 jobs, adding: “If we need to do more, we will do more.”
The funding announcements on Friday also included:
- $675 million in additional funding for Canada’s regional development agencies, which includes the Atlantic Canada Opportunities Agency;
- $287 million to support rural businesses and communities through the Community Futures Network;
- And $20.1 million in support for Futurpreneur Canada to support young entrepreneurs across Canada.
ACOA supports a range of startups throughout the East Coast, mainly through the federal government’s Regional Economic Growth Initiative. One of REGI’s functions is to lend businesses money at attractive terms.
In response to the announcement Friday, the Council of Canadian Innovators tweeted: “Today’s announcement shows the government has listened to our calls to increase funding to existing programs so Flag of Canada technology entrepreneurs can stay afloat.”
