Evidence of meeting #15 for Procedure and House Affairs in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was prorogation.
A recording is available from Parliament.
11:55 a.m.
Conservative
The Chair Conservative Joe Preston
Thank you very much.
Mr. Lukiwski, you can have a quick question.
11:55 a.m.
Conservative
Tom Lukiwski Conservative Regina—Lumsden—Lake Centre, SK
Thanks very much, Mr. Chair. I appreciate your giving me a question.
Brian, I just want to talk to you very briefly about the definition of confidence, which you've mentioned several times, particularly as the government deems confidence. You've mentioned that governments more than opposition over time have used confidence votes for their own purposes.
Our government has basically gone by the...I wouldn't even say it's a definition, but more of a rule of thumb, that for something to be deemed confidence, it has to be of national importance. I'll give you a clear example and one I know, being a former Saskatchewanian, you would be very familiar with, and that's the Canadian Wheat Board.
I personally get a lot of my strong supporters who are anti-Wheat Board phoning up and giving me hell all the time and saying, “Look, I know you're in a minority government so you can't get changes made and all this sort of thing. Why don't you just make it an issue of confidence and force these guys on the other side?” I just answer them back by saying, “It's because it's not of national importance.”
I mean, as important as it is to western Canadian grain farmers, it doesn't have importance throughout the country. It's not important in Ontario, Quebec, or Atlantic Canada. So we cannot, and we will not, make it an issue of confidence.
But my question to you is this. If governments guide themselves by that rule of thumb, is that sufficient, or do you think there needs to be more clarity on what actually deems confidence measures, brought in either by the opposition or by the government?
Noon
Former NDP National Campaign Director, As an Individual
Well, slavery having been abolished in Canada, no one, not even parliamentarians, can be compelled to be in government if they do not wish to be. If the government says, “This measure must pass”, whatever it is, and it does not, then it is in the power of the government to resign.
So I'm not sure that turning from a political convention, perhaps, which will morph over time, to a constitutional rule or a piece of legislation, or a House standing order defining a confidence vote as being a bill of national importance as deemed by the government, is particularly useful. It's a political issue, over time, and it is a fine calculation, as you know well.
If we create a crisis over issue X, and the opposition dares to take us down, do we think we'd do well in the politics...? That is a calculation that should remain in the realm of politics. That's why I said in my little opening comments that at the end of the day, the government can choose to resign any time it wants to. I'm not sure how much you can “pre-can” that and write rules about it that are going to be all that helpful in the future. I suggest that you go to the other end of the issue, which I would submit is in our tradition, and address a specific issue where you know there is an issue--namely, do you have responsible government or not, and can the House of Commons determine who is the executive or not? Write a rule about that, and then let convention and practice determine other issues.
Noon
Conservative
The Chair Conservative Joe Preston
Thank you.
Mr. Topp, I apologize for forcing you to put a tie on today, but I thank you for your open and honest answers. You've been a great help to this committee.
Mr. Reid, do you have a point?
Noon
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
On a point of order, I wonder if we could ask Mr. Topp to submit his sections of those constitutions. I'm aware that they're just Internet translations. Nevertheless, if he could submit them, we perhaps could get our analyst to dig up the formal translations.
Noon
Conservative
The Chair Conservative Joe Preston
Yes, we'd love to have them. It would save us a bit of work, if you could give them to us.
You'll do that? Thank you.
Thank you very much.
Noon
Conservative
The Chair Conservative Joe Preston
We will suspend just for a moment while we bring in our other witness.
Thank you.
12:05 p.m.
Conservative
The Chair Conservative Joe Preston
I will call the meeting back to order so that we can get in as much questioning as we can.
I recognize that some of you are still gathering your lunch.
Mr. Sproule, I'm going to apologize ahead of time for the rest of the committee. We will be eating in front of you. This meeting takes place from 11 a.m. to 1 p.m., and often this is the only way we can get some midday lunch.
12:05 p.m.
Donald Sproule National Chair, Nortel Retirees and former employees Protection Canada
I appreciate how hard-working the MPs are.
12:05 p.m.
Conservative
The Chair Conservative Joe Preston
Well, thank you. Can I get a note?
As per normal, as you and I have discussed, please make an opening statement, and then we'll get to questions. We'll try to get in as many as we can.
We would like to stop at about five minutes to the hour, because I have a little bit of committee business, just a quick discussion, before we're done today.
Thank you very much. Please start with your opening statement.
12:05 p.m.
National Chair, Nortel Retirees and former employees Protection Canada
Thank you, Mr. Chairman. Merci, monsieur le président.
I'm Don Sproule, and I'm the national chair of the Nortel Retirees and former employees Protection Canada. I represent some 17,500 pensioners and 1,500 former employees, and we're located all across Canada: London, Calgary, Toronto, Belleville, Kingston, Montreal, Halifax, and points in between. With the layoffs that are now under way at Nortel, we expect the pensioner numbers to increase to around 20,000 Canadians.
Nortel filed for creditor protection in January 2009, and by June 2009 it was patently clear that Nortel was not going to restructure. In fact, they were going to proceed to wind up.
In January of last year, I woke up to the fact that my pension was not secure. I just did not believe it. I read several statutes and thought I'd found umbrage in the WEPPA legislation, only to find out that unpaid contributions are not protected under bankruptcy laws. In our case, there is an underfunding of the pension plan of about $1.1 billion. That means that when the cutbacks happen to the Nortel pensioners, we'll be cut back to something like 69% of our pension plan.
On September 30 of this year, the pension plan will be handed over to the provincial government, to FSCO, and probably cut back to the 69% level. In December of this year, our health plans will be cut back--terminated, in fact--so the combined cutback to Nortel pensioners will be in the order of a 40% haircut in terms of our payments from Nortel.
So how did we arrive at this situation? As I said, many people were surprised that we were not protected under bankruptcy, and many of our friends and families were equally surprised. We had no inkling that pension deficits were unsecured claims on the estate.
On deeper analysis, we found out that, as unsecured creditors, we're going to be pitted against the junk bond holders and foreign government agencies. We consider this to be a grossly unfair playing field, and if you look at the situation, the bondholders worry about a company going bankrupt. They actually say, “Is Nortel going to go bankrupt? If it is, I'll shorten the duration of the bonds I'll sell them; I'll raise the interest rates. In fact, I'll protect myself by actually cross-licensing my bonds between Canada and the United States in terms of the Nortel estate.”
They are skilled money managers, and they can buy a form of insurance called a “credit default swap”. If anybody's been reading the press lately, they'll know about the credit default swap and what it's doing to countries like Greece.
Credit default swap is a form of insurance, but it's not just like any insurance. You can actually go and buy.... It's like buying insurance on your neighbour's house and worrying--or maybe hoping--that your neighbour's house is going to buy down. That's the nature of the marketplace.
I, as a Nortel pensioner, will never be able to prove that there is a linkage between the credit default swap market and Nortel's demise. It's a very opaque marketplace. But I do believe there is something happening in terms of what's caused Nortel's demise, and I do believe that the junk bond holders are going to make out like bandits in terms of Nortel's demise, and they'll do it on the back of Nortel's former employees, both pensioners and people who were terminated without severance.
If you think about the pensioners on the other hand, the bondholders look at risk and they manage risk. The pensioners took a pension to avoid risk. My concern was, “Am I going to live too long?”, because--
12:10 p.m.
Conservative
12:10 p.m.
Liberal
Marcel Proulx Liberal Hull—Aylmer, QC
On a point of order, Mr. Chair, I appreciate that this is a very fragile, delicate territory, but I have been listening to Mr. Sproule since he started four minutes ago, or seven minutes ago, and up to now, anyway, it sounds as though he's addressing the wrong committee.
12:10 p.m.
Conservative
The Chair Conservative Joe Preston
Yes, I was about to get there too.
Mr. Sproule, love your presentation, but this is a study on prorogation.
12:10 p.m.
National Chair, Nortel Retirees and former employees Protection Canada
Understood.
12:10 p.m.
Conservative
The Chair Conservative Joe Preston
I recognize that you have been before finance committee, and certainly at pension round tables and other things. Let's get to the prorogation piece, please, if you wouldn't mind.
12:10 p.m.
National Chair, Nortel Retirees and former employees Protection Canada
Okay. I certainly will.
Basically, on prorogation and where we stand on prorogation, we thought we were making progress in terms of the Parliament of Canada. We brought forward our ask in terms of amending bankruptcy laws to help protect pensioners. We thought we were making progress with NDP bills tabled in the House of Commons, and also Liberal bills tabled in the Senate. Momentum was being gained, and all of a sudden we found out, in this slow-motion train wreck, that the House was prorogued, and prorogued for a period of six weeks, I believe it was. The way we felt as Nortel pensioners was that it wasn't so much the government's right to prorogue; it was the duration.
So we're on a track--hopefully--to have amending legislation for the Nortel pensioners. We see the switchman at the end of the track, and they have the ability to pull the switch and save us. And then somebody decides, “Oh, it's time to go on coffee break. We want to recalibrate what's happening with the switch.”
That's what the galling piece was in terms of--
12:10 p.m.
Conservative
12:10 p.m.
Conservative
The Chair Conservative Joe Preston
You want to be put on the list? Okay.
I'm very sorry. I misinterpreted the way he raised his finger. It won't happen again.
12:10 p.m.
National Chair, Nortel Retirees and former employees Protection Canada
Okay.
So that's just cutting to the chase, right? The hiatus did us no favours. Time is not our friend in terms of the bankruptcy proceedings. They're continuing at their own pace. We spent something close to 100,000 hours of volunteer work in NRPC, working to see if we could better the outcome, and it was galling for us to have the government go into hiatus for that period of time.
That's the end of my remarks.
12:10 p.m.
Conservative
The Chair Conservative Joe Preston
Super. Thank you very much.
From the official opposition, Mr. Savage.
12:10 p.m.
Liberal
Michael Savage Liberal Dartmouth—Cole Harbour, NS
I'm more interested in the issue that was on before, because that relates more to my own committee. Having met with a number of the Nortel workers, and particularly people who are suffering from conditions like MS who are going to see their monthly living allowance, what they live on, reduced in some cases from $3,000 to $300 or $400 a month, I have a significant concern about that.
In terms of the prorogation, I'm not sure I really have any questions for you. It seems to me that prorogation slowed down a lot of what Parliament is meant to do. Whether people like the way the House of Commons acts or not, they see their members of Parliament as their voice. I think perhaps what you're getting at is that at a critical time for you and for the people working at Nortel and other people who were facing serious problems because of the lack of protection--change that could be made to the BIA and other things like that--that was shut down; and that's not the role that people see their parliamentarians having.
I don't specifically have a question, but I wish you well, and that goes for the folks you work with.