TORONTO — Knowing that travel agents and commission recalls are on the radar for the federal government amid the airline bailout talks – and hearing from ACTA that it’s a matter of ‘how’, not ‘if’, commissions will be protected – is a significant light at the end of the tunnel after a very long 11 months for Canada’s travel agents.
As reported yesterday, ACTA is currently in talks with the Ministry of Finance. The Ministry of Finance has taken over the airline industry bailout file from the Ministry of Transport. “Our talks have moved on from asking that travel agents and travel agencies be protected from commission recalls, to HOW to achieve that in whatever aid package is arrived at,” said ACTA President Wendy Paradis yesterday. “We are very encouraged by this and it is becoming clear that negotiations are at a critical stage and that decisions are expected very soon.”
Now feedback sent to Travelweek from the Office of the Deputy Prime Minister and Minister of Finance, has underscored that positive news.
Earlier this week we sent several questions about the bailout and travel agents to the federal government.
We wanted to know, with Canadian travel agents looking at potentially $200 million in recalled commissions in the face of mass refunds from Canada’s airlines due to the pandemic, what if anything is the federal government doing to protect travel agent commission as part of the airline bailout, one that’s contingent on refunds?
Says Katherine Cuplinskas, Press Secretary for the Office of the Deputy Prime Minister and Minister of Finance: “We remain committed to supporting Canadians airlines, people who work in the air sector, and travel agents who have been especially hard-hit during this unprecedented and difficult time.”
According to reports in the Globe and Mail, discussions between the airlines and the government to finalize the financial assistance package, first announced back in November 2020, are now in the home stretch.
Cuplinskas goes on to note that since the beginning of the pandemic, the air sector has received more than $1.7 billion in support through CEWS, and that in the Fall Economic Statement, more than $1 billion was committed in support for airports and smaller airlines.
“Any further taxpayer support will prioritize (1) refunding Canadians for cancelled flights; (2) retaining and reinstating regional routes in Canada; and (3) protecting jobs across the air sector. We continue to emphasize this in our ongoing conversations with the airlines. In a country as vast as Canada, it’s essential we maintain connections between people and our communities. Maintaining a vibrant, competitive Canadian air sector and Canadian airlines is a priority,” says Cuplinskas, reiterating the federal government’s messaging since talk of a potential bailout began back on Nov. 8, 2020.
ONE AGENCY OWNER’S 5-POINT PLAN
Jamie Milton with Uniglobe Carefree Travel in Saskatoon, SK says there needs to be a multi-pronged approach to be effective and to get the assistance where it needs to go.
Milton adds: “I am heartened by ACTA’s thoughts that a commission protection fund is getting closer to a reality.”
Here’s Milton’s 5-point plan for how best the federal government can help travel agents, especially with the potential bailout …
“Step 1 would be to ensure that any future refunds by airlines and tour operators protected travel agent commissions and that those commissions that were rightfully earned would not be recalled,” says Milton.
“Step 2 would be to have a fund where travel agencies and independent consultants would be able to claim for commissions already recalled over the past 12 months. There would need to be criteria set up to ensure that there were checks and balances in place (commission recall notices, proof of commission recall, etc).
“Step 3 would be to offer the 90% CERS (Canada Emergency Rent Subsidy) to all travel agencies. Travel agencies have, effectively, been shut down by the government since March of 2020. With all of the travel restrictions in place, we cannot perform our services and the government is actively asking us NOT to perform our services.”
Milton says that in Saskatchewan, her agency storefront is still open, so she only qualifies for 65% CERS, yet she’s down 95% in sales, just like agencies in Ontario who closed their storefronts. “We all face the same restrictions on our product – we should all qualify for the higher CERS” and it should be backdated to October when the program came out, she notes.
“Step 4 is that the CRB (Canada Recovery Benefit) needs to be continued beyond 26 weeks,” says Milton. “There are travel agents and independent consultants whose time on CRB will be running out in March. The economy and travel restrictions are worse than they were in September when this program was announced. To end the CRB now would mean that many self employed travel consultants or independent travel consultants would be left with ZERO income. They would be ineligible for EI and many are having great difficulty finding alternative work during this time.”
Finally, says Milton, Step 5 is that the CEWS (Canada Emergency Wage Subsidy) needs to be continued at 75% or higher through June 2021 and beyond.
“With travel restrictions in place until the end of April, there is no chance that travel will be ‘back’ and travel agencies will be in a place to support full wages by June,” she says. “The government needs to take all of these factors into account and come up with a well-rounded approach.”
Further assistance is essential, says Milton. “The travel and tourism industry is so critical to a strong economic recovery and the government has invested in supporting us this long. To let us fail now would be a tragedy.”