Canada’s parliamentary budget officer says a three-week repayment extension for emergency pandemic business loans will cost the federal government $52 million.

Last month, Ottawa extended the partial loan forgiveness deadline for Canada Emergency Business Account recipients from the end of 2023 to Jan. 18, 2024, while also extending the loan repayment deadline without forgiveness until the end of 2026.

In a report issued Tuesday, the PBO said the added cost would come as the government delays its own debt reduction by extending the grace period of the loans.

“While there was no evidentiary basis to assess that the extension would increase or decrease the share of loan holders who make sufficient repayments to qualify for forgiveness, even a slight increase in the share of loans forgiven would dwarf the costs identified in this estimate,” the report said.

During the height of the pandemic, CEBA offered nearly 900,000 affected businesses interest-free loans of $60,000, with a third of the loan forgivable if repaid by the deadline.

The partially forgivable deadline was initially set for the end of 2022, but was extended to the end of 2023 and then again to Jan. 18, 2024.

A spokesperson for the PBO said the office did not release a costing note for the first extension from 2022 to 2023.

Business leaders and politicians have been pushing for further loan extensions, as high costs and staffing shortages have stunted the pandemic rebound.

Last week, NDP Member of Parliament Taylor Bachrach petitioned the House of Commons to further delay the partially forgivable deadline until the end of 2024, while the Canadian Federation of Independent Businesses has issued its own similar petition.  

In a statement to BNNBloomberg.ca last week, a spokesperson for the Office of Finance Minister Chrystia Freeland said businesses still have plenty of time to repay their loans.

“The bottom line is that, if you are a small business and do not currently have the funds to repay your CEBA loan, you now have three years to repay it in full,” the spokesperson said.

“The additional flexibility that we announced is significant support for small businesses who might still be struggling to make ends meet.”