According to a source familiar with the package’s details, the agreement will not be a straight bail-out for the airline.
News of the package’s finalization was first reported by CBC Monday afternoon.
The package’s confirmation also comes as airlines were made to bear much of the brunt the COVID-19 pandemic wrought on the Canadian economy. Many airlines including both Air Canada and WestJet were either forced to cancel or refund their flights due to the virus.
In March, Global News confirmed comments from Unifor President Jerry Dias, who said then that Air Canada had “absolutely agreed to Ottawa’s demands that the airline repay customers who weren’t reimbursed for their plane tickets.”
Speaking with Global News, Dias also clarified then that a poised agreement between the airline and Ottawa — which would focus on customer refunds or exchanges — would be in exchange for a loan, not a bail-out.
Unifor says Air Canada will refund flights in exchange for government bailout
He also said then that the loan they were originally going to take would be that of $7 billion that would be paid back on a one per cent interest rate per year over 10 years, but later added that the $7 billion “should now be the floor — not the ceiling.”
Both Deputy Prime Minister Chrystia Freeland and Transport Minister Omar Alghabra are expected to speak about the package at a press conference in Ottawa at 7 p.m. Monday.
More to come…
— With files from Global News Mercedes Stephenson, Hannah Jackson and Emerald Bensadoun
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