An Act to amend the Bankruptcy and Insolvency Act and other Acts and Regulations (pension plans)

Status

Second reading (Senate), as of Nov. 22, 2018

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Elsewhere

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Pension Benefits Standards ActPrivate Members' Business

October 17th, 2018 / 5:45 p.m.
See context

NDP

Scott Duvall NDP Hamilton Mountain, ON

Mr. Speaker, I rise today to speak to the private member's bill, Bill C-405, an act to amend the Pension Benefits Standards Act, 1985 and the Companies’ Creditors Arrangement Act, pension plans, sponsored by the member for Oshawa. I want to thank the hon. member for acknowledging the bankruptcy and pension benefits act needs to be changed. However, this is the only thanks I will be giving him on this issue.

Over the last 10 years, we have seen an increased focus in the province with Canada's inadequate bankruptcy and insolvency laws. The cases of Nortel, Wabush Mines, Stelco and, most recently, Sears have brought into national focus the fact that workers at large companies that go bankrupt are offered very little protection from investors and banks. Sometimes international hedge fund operators make out like bandits.

As a solution to this problem to fix Canada's inadequate bankruptcy and insolvency laws, the measures outlined in the bill are in complete opposition to NDP proposals, policies, initiatives and values. The bill helps to make clear that the approach favoured by the Conservatives and ironically by the Liberal government is to protect the interests of large business and their investors, while throwing Canadian workers under the bus.

There are presently four private members' bills in Parliament that address the legislative crisis and present solutions for fixing those problems. Three are in favour of increasing protection for workers and retirees in the Canadian public. The bill stands alone as it focuses on protecting and increasing the advantages enjoyed by big business, the financial sector and well-off company executives.

Chris Roberts, policy director for the Canadian Labour Congress, sums it up neatly when he says, “Right now a number of private member bills in the House and Senate are trying to honour the pension promises made to workers and retirees. Bill C-405 is not one of these. This bill would make it easier for employers to walk away from their obligation, with the consent of only a minority of beneficiaries. This legislation goes in precisely the wrong direction.”

Many Canadian companies use our inadequate bankruptcy laws to effectively gain concessions from their employees and escape responsibility for often huge pension deficits they themselves have created. Workers are then left with the threat of reduced pension and health care benefits.

The bill would make it easier for employers to manipulate laws by allowing those with existing defined benefit pension plans to convert those plans to target benefit or defined contribution plans, which would transfer all the risk onto the employees. Employers would let off the hook and allowed to walk away from their responsibility to provide secure retirement benefits to their employees.

Workplace pensions are deferred wages that employees agree to put aside until their retirement. This is critical to understand. Allowing companies to walk away with these funds is theft, pure and simple. The measures in the bill are in stark opposition to the approach proposed by the NDP to fix Canada's flawed bankruptcy and insolvency laws that would actually protect the pensions and benefits of Canadian workers and retirees.

My bill, Bill C-384, Liberal Senator Art Eggleton's bill, Bill S-253, and the Bloc's bill, Bill C-372 present solutions that would actually protect the pension funds of Canadian workers and retirees when a large Canadian company goes bankrupt. Chief among the proposals presented in the two bills are measures to heighten the priority of paying back deficits to workers' pension funds to the same level as secured creditors. Currently those payments are only considered at the same level as unsecured creditors who often only receive pennies on the dollar for any monies they are owed.

One the most offensive things that happens during the bankruptcy proceedings is that executives give themselves huge bonuses. The very people who ran the company into the ground get big rewards and it is done because the law allows it to happen.

Nortel executives got over $200 million in bonuses. Sears executives got $9.2 million. Stelco executives got $1.2 5 million. When I tell that to people at the town halls I have been doing when I go across the country, people ask me if I am kidding them. I have to tell them that I am not, that this really happens because the law allows it to happen.

Canadians know this is not right and they are demanding that the laws be changed. Remember that this all happens while workers and retirees get their benefits cut off, employees lose vacation, severance and termination pay, and small suppliers get stiffed on money they are owed.

The proposals in this bill dealing with executive compensation would do nothing to prevent the excessive rewards handed out during bankruptcy proceedings. The many executives who are paid largely through stock options and bonuses would not be affected by the new rules laid out in this bill. Executive bonuses during bankruptcy proceedings should be outlawed, pure and simple. Why should executives get bonuses to begin with when workers are, at the same time, being asked to make concessions? This is so obvious to the majority of working Canadians and it is time that we change the laws to make this happen.

It is also time for the government to get serious about changing the laws it knows are hurting workers and retirees and are threatening the retirement security of Canadian seniors. This is not a new issue. The problem has been happening for decades. The Liberal Party even went so far as to pass a resolution at its last policy convention calling on its own government to provide pension security.

In 2009, at the height of the Nortel mess, the leader of the Liberal Party stood outside this building and told workers that he would do everything he could to make sure this kind of problem did not happen again, and during the 2015 election campaign, the current Prime Minister came to my city of Hamilton and told workers that he would use every tool in the tool box to change the laws and fix the problem. The Liberals did not tell the truth. They did not live up to their promises.

The disconnect between the government and the needs of Canadian workers is hard to understand. The innovation minister tells workers that he cares, but does nothing; the seniors minister tells Canadians she wants to come up with the right solution, but then refuses to consult anyone; and the Prime Minister has a “let them eat cake” moment and tells the Sears pensioners, who are losing 30% of their pensions, that they can rely on the CPP and El. They should be ashamed of themselves and the Conservatives should be embarrassed and ashamed to offer legislation that would further threaten the well-being of Canadian workers and retirees.

We were elected to the House to protect Canadians, not to allow their pensions to be stolen because of inadequate legislation. It is in our interest to prioritize the interests of Canadians when it comes to these bankruptcy proceedings to ensure that the company pays, not the pensioner and not the Canadian taxpayer. This bill would not do that, which is why the NDP cannot support Bill C-405.

PensionsStatements By Members

October 4th, 2018 / 2 p.m.
See context

NDP

Scott Duvall NDP Hamilton Mountain, ON

Mr. Speaker, after three years the government has done little to help Canadian seniors and retirees.

The Prime Minister promised during the election campaign to use every tool in the toolbox to fix Canada's flawed bankruptcy and insolvency law to protect workers' pensions, but so far has done nothing.

After news that 18,000 Sears retirees would lose 30% of their pensions, we still heard nothing from the government.

The government made a promise to consult in its last budget, but clearly Liberal promises are not worth the paper they are written on.

Changing the laws to protect workers' pensions is not hard. My Bill C-384 and Liberal Senator Art Eggleton's Bill S-253 lay out straightforward measures to fix the problems. Still, the government refuses to act.

For three years I have been asking the government to change the laws and protect Canadian pensioners. Every time I get back the same non-answers. This lack of respect is insulting to Canadian workers and retirees.

Let us stop the pension theft.