The Canadian Construction Association (CCA) has issued a call to action, asking members and colleagues to support a request to the federal government to create an Emergency COVID-19 Construction Cost Relief Program.
The program would alleviate the financial pressure the industry is facing due to the pandemic.
“Our most significant concern is that we have viable businesses who are ready to lead the economic recovery and to do that they need the cash flow now,” explained Mary Van Buren, CCA president.
“They can’t wait three or four months from now, they need it now to keep their operations moving. We’ve asked for a fund that would be set aside to look after all these costs that have been unexpected and to make sure that it’s fair for the owner and the contractor.”
CCA is recommending eligible costs be reimbursed up to five per cent of the contract value as a starting point, subject to adjustment as the duration and full impact of COVID-19 becomes clearer.
People have to spend more time cleaning or they are social distancing…all these things are slowing down the productivity,
— Mary Van Buren
Canadian Construction Association
Owners need to be flexible on not just the delays but also the costs associated with health and safety, said Van Buren, adding this is something that can be done at every level of government — federal, provincial and municipal and by private owners as well.
“In compliance with local health authorities, businesses have been buying more personal protective equipment including masks and gloves, sanitation supplies, installing more bathrooms, more running water, the extra site security and maintenance costs,” she said. “If the site has been shut down, they still have to make sure that it’s safe so that the public can’t get in and they’ve got extra insurance and bonding.”
Productivity is another challenge.
“People have to spend more time cleaning or they are social distancing…all these things are slowing down the productivity,” said Van Buren. “There is quite a long list of impacts to the projects that we need support on and we need the funds flowing sooner not later. You may have to rent equipment for a longer period of time than you were expecting, the cost of shutting down your site and getting back up and running again.”
The Mechanical Contractors Association of Canada (MCAC) said it supports any measures to help contractors access financial support to get through the crisis.
“Whether it is the necessary but added costs of health and safety to protect workers, losses in productivity as we adapt to the changing requirements for jobsites, or supply chain and payment problems as a result of shutdowns or delays, the COVID-19 pandemic has already proven to have far-reaching consequences,” said Dave Holek, MCAC president and chair, in a statement.
“The request to establish an Emergency COVID-19 Construction Cost Relief Program reinforces the fact that contractors across Canada are facing unprecedented challenges. We look forward to working with governments at all levels to ensure our industry is fully prepared to help rebuild the Canadian economy when the dust settles on COVID-19.”
The National Trade Contractors Coalition of Canada (NTCCC) also wrote a letter to Prime Minister Justin Trudeau requesting relief for members.
“Trade contractors have costs that cannot be deferred, especially when it comes to their workers, and many will not be able to sustain working over the next few weeks without these issues being addressed,” the letter states.
“Any project that has been tendered prior to this needs to have some consideration of not only relief of the timeline and scheduling but there are also costs that were never anticipated by anybody in the construction chain,” said Sandra Skivsky, chair of the NTCCC. “It has to be a shared and equitable approach to this and in some cases we would look to the government to help out the industry to make it out of the other side of this pandemic.”
The General Contractors Alliance of Canada also said it supports CCA’s position on contract relief.
“The construction industry is now facing a very significant financial crisis with projects shut down,” said Matt Ainley, chair of the GCAC.
“General contractors, trades and suppliers have seen their revenues drastically reduced or stopped as a result and still have bills to pay. Many of these firms are experiencing unmanageable cash flow problems and the longer the shutdown goes, there will be a large amount of bankruptcies that will hurt a quick economic recovery.”
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