The Globe and Mail reports in its Tuesday edition that more than 100 licensed cannabis companies and their subsidiaries have received tens of millions of dollars in payments from the Canada Emergency Wage Subsidy program, raising new questions about the policy intentions of the program and whether it meant to subsidize a sector that was already in the throes of consolidation. The Globe's Vanmala Subramaniam writes that at least 20 publicly traded cannabis companies cumulatively collected more than $40-million in CEWS payments, while dozens of others received the subsidy but chose not to disclose the amount in their financial filings.
For the cannabis industry, 2020 was the year of bankruptcies, mergers and acquisitions, exposing the winners and losers of the sector after years of overspending.
CEWS was first introduced by the federal government on March 27, 2020, to help businesses that had seen a drop in revenue owing to COVID-19 cover part of their employees' wages. The goal was to prevent further job losses and allow firms to rehire workers that had been laid off. About 20 publicly traded cannabis companies including Organigram, Zenabis, Auxly and WeedMD, have cumulatively received almost $40-million in CEWS.
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