Bill C-253 (Historical)

An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act (pension plans and group insurance plans)

This enactment amends the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act to ensure that claims in respect of unfunded liabilities or solvency deficiencies of pension plans and claims relating to the cessation of an employer’s participation in group insurance plans are paid in priority in the event of bankruptcy proceedings.

Bankruptcy and Insolvency Act

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Madam Speaker, I apologize for the hiccup. I hope I will be forgiven, as it is my birthday today.

I am pleased to participate virtually in the debate surrounding Bill C-253, proposed by the hon. member for Manicouagan, of the Bloc Québécois. The purpose of this bill is to amend the Companies' Creditors Arrangement Act and the Bankruptcy and Insolvency Act. Bill C-253 is the logical continuation of Bill C-372 that the hon. member for Manicouagan introduced in 2016, during the previous Parliament.

At the time, this bill was only debated for an hour before it died on the Order Paper because the Liberal government did nothing. The purpose of the bill was to prevent other retirees from unfairly losing their pension funds that they have worked all their lives for, which is what happened to the workers at Cliffs Natural Resources.

Let us set the scene for a moment. In 2015, this U.S. company wants to place its two Canadian subsidiaries under the protection of the Companies' Creditors Arrangement Act. Meanwhile, Cliffs Natural Resources announces plans to restructure its activities with a view to shutting down its operations in eastern Canada. However, the restructuring had quite dire consequences, not only for existing employees, but also for pensioners, who lost much of their pension fund and group insurance.

That tragic situation was the impetus for the bill, which was intended to make legislative fixes, which my colleague will be much better able to confirm since I was not yet in the House at the time. Had Bill C-372 become law when the events had taken place a year earlier, the Cliffs Natural Resources pensioners would certainly have been given a bigger piece of the pie, namely the claim that was owed to them.

By proposing to amend the Companies' Creditors Arrangement Act and the Bankruptcy and Insolvency Act, I think that we are calling today for legislation that will ensure fairer treatment for retired workers while maintaining fair treatment for creditors.

The purpose of the bill is therefore to prevent other creditors from getting access to what, in the end, amounts to the workers' life savings in the case of bankruptcy or restructuring. That seems logical. Since seniors are more financially vulnerable than other demographics, today, we would like this bill to fill a gap that has been created by the Liberals' silence on the matter by providing proper, fair and equitable legal protection centred on two main initiatives.

First, before the court approves a business's proposal for bankruptcy or restructuring, it must account for the total amount of special payments, as well as the amount needed for the liquidation of unfunded liabilities or solvency deficiencies of pension plans.

In plain language, the company's proposal must provide for a pension fund bailout if the court is convinced the company is capable of doing that. This rule would protect workers' pensions from being cut off, and we think it is crucial to protecting workers' savings.

Second, a reread of the Bankruptcy and Insolvency Act reveals six categories of creditors: first, creditors whose claims are deemed to be held in trust; second, unpaid suppliers; third, super-priority creditors; fourth, secured creditors; fifth, preferred creditors; and sixth, ordinary, unsecured creditors.

Bill C-253, which we are arguing in favour of today, would add other payments and indemnifications to these six categories of creditors. For example, special payments would get preferred claim status. The same goes for indemnification for beneficiaries of group insurance plans in which the company participated as an employer. The total amount of special payments, as well as any amount required to liquidate unfunded liabilities or solvency deficiencies, would also be secured claims against the bankrupt's assets as of the date of bankruptcy.

In keeping with our principles and our values, my Bloc Québécois colleagues and I support this bill, which has been introduced for the second time by my colleague from Manicouagan, and we support it for many reasons. First, the bill will recognize that a pension plan is a form of deferred wages, and second, it will cushion the financial blow to pensioners when their former employer declares bankruptcy. I was just talking about that a moment ago. With our bill, bankrupt companies or ones that are restructuring their operations will have to provide the total amount of any special payments and the total amount needed to liquidate their unfunded liabilities or solvency deficits in the pension plan fund. In this same spirit, this bill is beneficial because it will protect retired workers' group insurance plans. It will also compel businesses to better fund their pension plans. Finally, it will enable the Standing Committee on Industry, Science and Technology to study this important social issue. That will surely please my Bloc Québécois colleague who sits on that committee, as well as all other members of the committee.

In closing, dear colleagues, if passed, our proposed Bill C-253 would protect workers and retirees so that they would never again lose the pensions that they earned after a lifetime of hard work. We find such injustices unacceptable. It is our moral duty to defend and respect active workers and retirees who, generation after generation, have slowly forged and are still forging the way of life we are fortunate to cherish today.

Ottawa's wait-and-see attitude and inaction have gone on long enough, and while this is the position that requires the least effort, it remains the least honourable. If we do nothing, history will judge our politicians by the way we let down the citizens, who spend more time looking backward than forward.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Madam Speaker, I am pleased to put some thoughts on the record today regarding Bill C-253. This bill would put pension plans in priority to secured creditors in the event of bankruptcy proceedings.

Prior to my life in politics, I practised commercial law for over 20 years as a partner in a downtown Winnipeg law firm. Much of my practice involved doing commercial loan securitization for financial institutions. For the most part, it was my job to ensure that proper legal documentation was in place to ensure a first charge against the assets of the borrower on behalf of the lender. A first charge was always essential to the security requirements of the lender.

The concept of a secured creditor having a first charge is also fundamental to the functioning of our economic system. Without that guarantee, lenders would be far more reluctant to make loans and would view this as a major risk in their security position. Many businesses require debt financing to function, do business, provide jobs for their communities and hire employees.

When I saw this bill, my first concern was what would financial institutions do if this law was changed, in other words, if pension funds had priority over the secured position of lending institutions. How would it affect existing indebtedness? In other words, that would be loans that have already been made predicated on a first charge against the borrower's assets.

I suspect many financial institutions would be very concerned and we could see some instances where they might say that if pensions were to come first, they could no longer take the risk and call in their loan. This is a likely outcome of this legislation as it is currently presented and could pose a serious threat to businesses that fall under federal jurisdiction for pensions and result in challenges for them. In other words, the bill could have the exact opposite effect from what it intends. It could force businesses to close if the lenders see this as an increase in the risk profile, an unacceptable risk, jeopardizing pension plans and pensioners.

On the other hand, one could also argue that this law would incentivize banks for new loans to insist that pension funds were secured and in solid shape by the company before they would agree to make a loan. The problem with this approach is that in the case of defined benefit plans, if there is a precipitous drop in the value of the assets of the fund or of the company after the loans are made, then it may still be difficult for the company to pay back the bank if it must first satisfy the pension plan. This could create a drive toward conversion of many plans to a defined contribution model.

Another problem can occur where a company is failing and needs to restructure its debt but cannot find a lender to take on the additional risk if it is forced to subordinate to pension obligations.

It is clear there are serious issues with any bill that has, as its goal, a fundamental shift in security prioritization away from lending institutions. However, as a society, we must also recognize the importance of labour. I can see the argument being made of why a bank should have priority over people who have worked their entire lives for the company. It is not the fault of those workers that the company went bankrupt and so their pensions should be protected. It is here that we have a conundrum. If lenders cannot be first, they may not lend. If they do not lend, there may not be a job. If pensioners do not receive their pensions in the event of a corporate bankruptcy, workers might not work and, again, there may not be a job.

This is a difficult predicament and as I was writing this speech, it made me think of the biblical tale of King Solomon’s baby. In that tale, two women claimed to be the mother of the child. To settle the dispute, Solomon decreed that the child be cut in two, upon which the true mother revealed herself by insisting the baby be given to the other woman to save its life.

I do not have any such Solomonesque wisdom in the case of pensions, banks and public companies, but I do think this bill, as it is presently constituted, could result in the end of some companies for lack of willing bank capitalization.

What this debate does make clear is that we must find a better way to support businesses and their employees, and I think we would be hard pressed to find anyone who disagrees with this idea. When bankruptcies occur, far too often there is a long list of creditors and individuals who need to be made whole and there is unfortunately not enough money to go around in many instances.

We also must consider the effects on the supply chain of a company that is unable to restructure its debt. What happens to the employees that work for the suppliers? There are all kinds of small business suppliers that could be shut out in the event of a bankruptcy.

A working paper by the OECD regarding priority creditor rights for pension funds discusses this issue. One of the arguments against measures like what Bill C-253 proposes is that, if this were allowed, a range of social issues could come forward claiming priority rights, such as health benefits or environmental claims to name a couple. Would these be prioritized over pensions? How would we decide that?

The OECD working paper makes also makes a strong case against changing the position of pension claims within the creditor rankings. This argument centres upon the fact that, aside from the complications of changing bankruptcy legislation, doing so may be harmful to capital markets and damaging to the investment climate.

If pension funds are given superpriority status, other creditors, who may be small trades and personal creditors, would be bumped down the line, increasing their credit risk. These suppliers may also be hesitant to provide their services in a pension superpriority environment. Also, lenders, given the additional risk, could in turn pass this risk on to businesses in the form of more expensive interest rates and capital. As well, the marketplace could be adversely impacted with increased bad debts and potential failures. This could result in less confidence in our financial markets. It could also make Canadian businesses less competitive vis-à-vis foreign jurisdictions that do not have such a law.

It could also be argued that any change in the ranking of pension obligations would have a negative impact on credit cost and availability. One alternative to help address the issue might instead be to make it illegal for shareholders to strip a company of its cash in the form of dividends when there is a pension shortfall. If we look at what happened with Sears Canada, it is an example of where this type of change would have benefited pensioners.

Its majority shareholder, an American hedge fund, took out billions in cash from the company. In 2005, the hedge fund took out $1.5 billion. In 2010, it took out $750 million, and in 2012, it took out $100 million. However, in 2007 there was already a pension shortfall of $36 million and that shortfall continued to widen, reaching $267 million by 2015. There would have been more than enough cash available to Sears Canada to cover its $36-million pension shortfall in 2007, and any other future shortfall, if cash were not being withdrawn from the company at a challenging time, so rules to prohibit dividend stripping when a pension is in a shortfall could be beneficial by allowing a company access to more cash to cover its losses. As a result, that could serve as an effective tool.

Another option could be pension plan insurance, which companies would pay into in the event a pension is unfunded and a company faces insolvency.

There are different alternatives to solving the problem this bill proposes to address. I believe at committee there will be more alternatives discussed. There we will have a chance to have a full discussion of the benefits and pitfalls to be brought forward and addressed by hearing from witnesses, such as workers, employers, academics, financial institutions and others. I think as we work toward a solution on this issue, we must remain focused on ensuring there is a balanced approach.

The security of pension plans for workers must remain top of mind, but we must also avoid measures that could discourage investors and lenders from trying to save a company in despair. King Solomon would expect nothing less of us.

The House resumed April 23 consideration of the motion that Bill C-253, An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act (pension plans and group insurance plans), be read the second time and referred to a committee.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Madam Speaker, I want to remind the House of a historic moment. On May 20, 2016, during oral question period in the House of Commons, my dear Bloc Québécois colleague, the member for Manicouagan, asked the federal government if it would ensure that retirees are considered preferred creditors when companies go bankrupt.

The member asked this question after great misfortune struck the workers and pensioners of Cliffs Natural Resources. On January 27, 2015, the company announced that the affiliate operating its Bloom Lake facility on the North Shore had filed for protection under the Companies' Creditors Arrangement Act.

Since asking the federal government that question, my colleague has continued to work on this file, and I commend her for that. Her bill, which we are debating today, is so important.

Even so, the federal government has been sitting on this issue for around five years, all while companies like Cliffs, Sears, White Birch Paper and Groupe Capitales Médias went through restructuring. Anger is brewing among these companies' workers and pensioners, who feel like shareholders and senior executives walked away with their pension funds. It is a sad situation.

This has been going on for a long time. Conservatives and Liberals alike across several Parliaments propose bills, but the federal government never passes legislation and never protects pensions for workers and pensioners. The profits of executives and shareholders always come first.

I am sure that the vast majority of members in the House of Commons agree with the principle of protecting workers' pensions and the absolute need to end this injustice. Yes, I am calling it an injustice. Not protecting the pensions of workers and pensioners is nothing short of abetting an injustice in plain sight.

We need to put an end to this injustice with Bill C-253. We have to prevent other tragedies. Pensioners are in no position to go earn extra income. They are counting on a pension they paid into for their entire lives to ensure a certain quality of life. Since this is an injustice, we must stand together in solidarity and put mechanisms in place to protect them.

Canada is one of the most irresponsible countries in the world when it comes to protecting the pensions of workers and pensioners. This needs to change. The members of the House must seize this opportunity and pass Bill C-253. As MPs, we have a duty to fix the situation and amend the legislation to protect the pensions of workers and pensioners.

We need to do this for workers, pensioners and seniors, of course, but also for younger people who may not have access to the same social safety net. Unfortunately, things are not changing, and these tragedies will keep happening again and again in this globalized financial and industrial world. This world is going through a radical digital transformation, with more and more companies going through restructuring and the biggest, strongest players still crushing the smallest and weakest. It is the law of the market, the very essence of capitalism.

That is why we need to ensure that pension funds are bailed out and retirees' pensions are paid out in full. That is why we need to protect group insurance. That is why we need to take action to fix the situation and correct this injustice. If the responsibility is shared among everyone, it will be easier to bear.

We currently have two bankruptcy acts, one for businesses and one for individuals: the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act. These acts do not adequately protect workers' and retirees' pensions. Actually, they do not protect them at all. They do not protect group insurance either.

Currently, the law does not say anything about workers' group insurance. It is hard to see workers' and retirees' group insurance as a debt under the current regime if nobody tries to claim an amount to compensate pensioners for this loss.

The status quo is not an option for retired workers who have lost a significant chunk of their pension fund and their group insurance. Their rights were violated, and their anger must be appeased. This is a matter of dignity. I cannot imagine how angry a person would be if their hard-earned money were stolen. Injustice causes anger, and these retired workers feel that their days, their work, their creativity, their skill, their dedication and their trust were stolen from them. Their happiness and dignity were stolen from them.

Pensions are a major source of income for seniors. That financial flexibility completely changes the situation. It means more financial security and less stress for seniors in a world where everything seems to move so fast and, sometimes, in the wrong direction. This financial flexibility is essential to everyday life to pay for food, transportation, personal items, clothing, rent and fixed expenses.

This week, in the context of the budget, we spoke about the vulnerability of seniors. The budget does not solve everything. I recognize that there is something in the budget for seniors, but only for those 75 and over. Why create two classes of seniors? Why create unfairness? This bill also reminds us that not everyone has access to the same type of retirement. Perhaps the government should have been more generous to seniors in the budget by giving them additional ongoing assistance of $110 per month as of age 65. That would have helped them increase that financial flexibility that is so essential to their dignity and to the much-deserved pleasure of living the last years of their lives to the fullest after all their hard work.

What would Bill C-253 do? It would ensure fairer treatment for retired workers while maintaining fair treatment for creditors. It would amend the existing Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act such that, in the case of bankruptcy or restructuring, other creditors will not get access to what should be the workers' pension fund.

If the House of Commons passes this bill, there will finally be a law protecting workers and pensioners so they will never again lose their pension, which they earned by dint of hard work and dedication, sometimes at the cost of their physical and mental health. That last point is worth emphasizing.

The Bloc Québécois is obviously in favour of this bill, since it was introduced by one of our own. It is nearly identical to Bill C-372, which was introduced by the member for Manicouagan in 2016. This bill is the culmination of consultations with the people of the North Shore and with businesses and organizations in Quebec. The Bloc Québécois recognizes that a pension plan is a form of deferred wages and that it can help pensioners deal with the financial blow they are dealt when a former employer files for bankruptcy.

The bill would protect retired workers' group insurance plans, compel businesses to better fund their pension plans and enable the Standing Committee on Industry, Science and Technology to study this important social issue.

I want to acknowledge the chair and co-chair of the committee. The co-chair just spoke on behalf of the Conservatives. This is an issue we must consider very carefully and diligently. I serve with some amazing colleagues on this committee and the clerk and analysts do excellent work, so I know that the study called for in Bill C-253 will be both thorough and meaningful and that it will help resolve any impasses on this issue. The committee will have to find the time in our busy schedules to conduct this study.

The Bloc Québécois supports Bill C-253 because it is a reasonable improvement that will help achieve the goal of protecting the pensions and group insurance of employees and pensioners. It will also improve the quality of life of our seniors, who, I should point out, are the most vulnerable members of the population.

Let us also not forget that pensioners use their pensions to spend hundreds and hundreds of millions of dollars in the businesses located in the towns and villages of our regions, and are therefore at the very heart of the Quebec economy. Bill C-253 is a step in the right direction and must pass.

As a final point, I would like to mention that I used to sit on the board of directors of the Quebec pension plan. I will therefore be very pleased to dive back into the issues surrounding the dignity of employees and people's quality of life.

I invite our colleagues to support this bill, and I truly hope they do.

[Scott Duvall, NDP, Hamilton Mountain, ON]

Madam Speaker, I rise in the chamber as the NDP critic for pensions on what I believe is one of the most important matters in the pension portfolio before us today. The subject matter of the private member's bill, Bill C-253, regards protections of the employer-sponsored pensions for workers in the case where the employer is undergoing bankruptcy proceedings.

I would like to sincerely thank my Bloc colleague for using her spot in the priority list of Private Members' Business to bring forward these measures. As she knows, I feel strongly about the necessity of these protections put forward, so much that my bill, Bill C-259 contains equivalent measures to every article contained in this bill. I would like to let her and the House know that I am calling on all my NDP colleagues to support the bill at second reading and I hope to see it get to committee.

What I would like to talk about in the short amount of time I have is: first, the importance of pensions and the types of pensions we are talking about; second, the current situations by way of the acts of Parliament and some real accounts of the problem at hand when companies go bankrupt; and third, what Bill C-253 does and does not do.

My speech today will be as much for those at home as it is for those present in the chamber. It is important for all Canadians to know clearly what is at stake here in simple terms so they can ensure that their MP is doing the right thing when they cast their vote on this.

Pensions have become so commonplace in society that some may take their existence for granted. While the administration and accounting of the pension plans by those who manage them may be complicated, the concept is pretty simple and makes their importance clear.

During our working years, we put money away in regular amounts so that we can draw on that fund of money in our retirement years in order to live. Canada's government, like many other governments, has a segment of our pension sector which is socialized. For those of us who are fortunate enough to have contributed to the workforce, we pay into the Canada retirement income system that is made up of, among other things, the old age security, the guaranteed income supplement, the Canada pension plan and in Quebec, the Quebec pension plan.

While I go on about the importance of these retirement incomes and the necessity for their reform, this is not the matter of Bill C-253. The bill instead touches on what I call employer-sponsored pensions. Employer-sponsored pensions are those whereby in an agreement there exists an employer's obligation with respect to a pension plan that it sponsors for its employees. The employer agrees to deduct from their wages an agreed amount to remit to the pension plan fund and agrees to also remit an amount of its own, oftentimes equal to the employee's contributions.

This brings me to talk about the defined benefit pension plan versus defined contribution pension plan and it is important that we distinguish these in order to talk about Bill C-253.

With a defined contribution pension plan, the amount of income we receive is not set but rather depends on how much we happen to contribute and in fact, can drastically be reduced depending on how the investments in that fund were managed by the employer.

On the other hand, with the defined benefit pension plan, the amount of income we receive is set and the administrator of the fund is compelled to be responsible in investing our money. In this type of pension, there could be a pension deficit. This is considered unfunded liability.

We can discuss the problem that Bill C-253 proposes to fix, the situation where an employer is facing bankruptcy and who has obligations under an arrangement to provide an employer-sponsored pension plan. The bill proposes to change the existing laws that deal with such a situation. The Bankruptcy and Insolvency Act, BIA, covers the treatment of a bankrupt employer's obligations with respect to a pension plan and its sponsoring for its employees. The Companies' Creditors Arrangement Act, CCAA, provides a restructuring framework for insolvent companies. The BIA and CCAA provide for priority for the employer to pay both. The employer's contribution is deducted at source, but not remitted to the pension plan fund and employees' contributions owed, but are not remitted to the pension plan fund. In fact, under these laws, a court is disallowed from approving a proposal or plan unless these two are paid.

Here comes the problem. Unfunded liabilities like pension deficits in the case of defined benefit plans that are accrued and due to the pension plan's fund on the date of the bankruptcy come after secured creditors. This means that banks, investors and parent companies would be paid before the shortfalls in the pension plan are covered.

Pensions and benefits earned by workers are deferred wages, plain and simple. Denying workers what they have earned should be illegal, yet under these laws, corporations are allowed to take money meant for workers' pensions and divert them to pay off their secured creditors, like banks. Bill C-253 would stop this practice.

In recent years, workers have suffered significant losses to their pension plans in insolvency proceedings under the CCAA.

For example, Sears Canada initiated proceedings June 2017. The pension plan deficit was $206 million, with an expected recovery of only 8% to 10%, and would leave $200 million unrecovered.

Co-op Atlantic initiated proceedings in June 2015. The pension plan deficit was $63 million and only $7.7 million was recovered, leaving $54.3 million unrecovered.

Wabush Mines initiated proceedings in May 2015 and of the $55 million of the pension plan deficit, only $18 million was recovered, leaving $370 million unrecovered.

Nortel Networks Corporation, which we all know very well, initiated proceedings in January 2009 and of the $1.84 billion of the pension plan deficit, only a little over half was recovered, leaving $841million unrecovered.

For those who follow legislation closely, I would like to state, technically, what Bill C-253 would achieve if passed: it will amend the BIA to prohibit a court from approving an employer's proposal for bankruptcy if there are any unfunded liabilities or solvency deficiency in the associated pension plan of workers; it will require that any unfunded liability within the pension plan be paid in order for a court to approve an employer's bankruptcy plan and given them “super priority” status; it will amend the CCAA to require that an insolvent corporation entering into a “compromise”, which reprioritizes the payment of certain debts and liabilities over others, must pay unpaid amounts of any severance pay or compensation in lieu of notice.

There are some protections that Bill C-253 would not provide, and I would like to cover these.

My bill, Bill C-259, includes a provision that would prevent a judge, during a proceeding under the CCAA, from suspending benefits to employees or pensioners during the course of the proceedings. I think this is important and fair.

Another thing that Bill C-253 would not do is something new that I added to my version of the bill in this Parliament. It proposes to change the Pension Benefits Standards Act to allow the Superintendent of Financial Institutions to determine that the funding of a pension plan is underfunded and can order measures to be taken by the employer in order to correct the impairment.

I want to pass on some reflections on some commentary and quotes from the recent past on measures of these bills. For example:

I like the fact that the word “pension” means deferred income. When we go to work, work an eight-hour day or however many hours we put in, a great deal of consideration is given to the benefits that go beyond that hourly, weekly or monthly rate paid to us. A pension is a deferred income.

Who said that? It was the Parliamentary Secretary of the Leader of the Government in the House of Commons, the member for Winnipeg North.

The Liberals campaigned on a promise to improve the income retirement security for all Canadian seniors. It is time for the government to put a stop to this organized theft.

I encourage Canadians watching to call their members of Parliament and ask them to vote in favour of Bill C-253 at second reading and help start the process of ending pension theft by large corporations.

We can also talk about Laurentian University, which is going through the same problem right now. This is devastating. The whole process is being abused and it must be fixed. People's lives are going to be turned upside down on this one. The government must step in and change legislation.

I thank hon. members for their time, and I hope the bill will be given the important consideration that it warrants. I recommend to everybody to send Bill C-253 to committee.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, let me digest that for about five seconds. That is ridiculous. I just finished commenting on something that the member just provided an answer to a question on the bill.

Let me get right to the point of the legislation itself. I asked the member a question on how Bill C-253, in its current format, would provide an incentive for companies to liquidate as opposed to restructuring. In response she suggested that I needed to read the bill. It is not a question of reading the bill as much as it understanding the potential consequence of the legislation. She has not been able to alleviate those concerns as she has indicated in her response to me that she is already somewhat aware of this.

Pensions do matter. Pensions are very important to Canadians. The Liberal Party talked about retirement plans at the last AGM. Retirement plans are a deferred future income. We need to be there for Canadians in a very real way. The Government of Canada has been there, dealing with and continuing to work on ways we can enhance pensions.

In fact, as was referred to earlier, I would remind the hon. member that the national government worked with different provincial and territorial governments to get increases to CPP, which will ensure that all workers contributing to CPP will have that much more when it comes time to retire.

We recognize how important pensions are. We also need to realize that pensions come in different forms. When I think of pensions, it would be wonderful if all pensions were funded pensions, that the money associated with those future expenditures would be put aside and protected so pensioners would have no issues whatsoever.

Unfortunately that is not the reality. That is not just within the private sector, but it is in the public sector as well. Often what we find is that employers, and governments, will create unfunded pension plans. Those pension plans are based on revenue or income. There can be hybrid pension plans. A good example of that is in fact the CPP.

There are many different forms of pensions out there. Personally, I like the hybrid version because I believe that is very workable, even though it is not necessarily the ideal.

When I look at the bill, the employee group benefit claims would be weakened and that could ultimately weaken companies in their ability to restructure and affect that sense of competitiveness of firms with respect to defined benefit pension plans as well as group insurance benefit plans, which would not necessarily help pensioners and workers in all cases. It has the potential to threaten the existence of defined pension plans.

That is why I am a bit surprised. The Conservatives seem to want to support the legislation. I do not quite understand their arguments and will wait to hear from the Conservative members. Maybe they could address that specifically. Do they not have any fears with respect to companies that might, as a result, want to liquidate over restructuring? It is a very serious issue.

We recognize that after a lifetime of hard work, Canadians do deserve to have that peace of mind when it does come time for security. Many years ago, I can remember walking on a picket line out in Transcona. Today's industries have modified significantly, but there is still a lot of work that needs to be done. When I was walking this picket line in the early nineties, I was amazed to find that there are workers who have been working for over 30 years and they are getting $400 or $500 as a pension after that long commitment to a business. That is not rare, unfortunately.

We have seen significant improvements over the years, but it is important for all of us to do what we can to advocate because we all have a responsibility to ensure that people have that disposable income when it comes time for retirement. On that issue alone, I could speak extensively on why we have some programs, particularly in Manitoba, that will start off financial supports for seniors at age 55 and why some seniors at an older age require additional support. That will be for another day, but the bottom line is we do need to recognize that after a lifetime of hard work, there is a need to ensure peace of mind for Canadian workers. If I genuinely felt this legislation that was going to be achieving that, I would be far more open to supporting it, but I am not convinced of that now.

We are taking, I believe, as a government, a holistic approach, one that is based on evidence in terms of addressing retirement security for all Canadians. As a government, we have held national consultations, heard from pensioners, workers, lenders and companies on these very important issues. As I said, over the years, there has been CPP enhancement, working with different stakeholders, working in consultation with seniors, increases to the guaranteed income supplement and the budgetary announcement, most recently, in regard to 75 and over, in fulfillment of that election campaign.

We have taken these steps also to make insolvency proceedings fairer and more transparent. That ensures there is a higher likelihood of oversight over corporate behaviour; for example, by giving courts greater ability to review and claw back unreasonable executive pay that leads up to insolvency. Nothing really gets to the core of the problem and causes a great sense of frustration when workers feel that their pensions, and justifiably so, are being squandered or not being given enough attention, and yet there are huge bonuses going toward corporate greed. We have been taking steps. I appreciate my time is running out. We will continue to advocate for pensions for workers any time of the day.

[Marilène Gill, Bloc, Manicouagan, QC]

moved that Bill C-253, An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act (pension plans and group insurance plans), be read the second time and referred to a committee.

Madam Speaker, I am pleased to rise today in the House to speak to my bill, Bill C-253. I want to start by thanking my colleague from Thérèse-De Blainville for her invaluable support, both practical and symbolic, in the development and drafting of this bill.

I must admit I am experiencing some déjà vu. In 2017, during the previous Parliament, I introduced Bill C-372, which was very similar to the one we are debating today. The House was unfortunately dissolved before Bill C-372 could be put to a vote, but I hope to see this new version get passed.

For a bit of background, I will have to go back in time to talk about how Bill C-253 came to be. Cliffs Natural Resources, a wealthy U.S. multinational mining corporation, once had affiliates in my riding, in Sept-Îles and at Bloom Lake near Fermont. The company employed many of my constituents and people from Labrador, and it was part of the lives of many North Shore workers for many years.

In 2015, the company filed for creditor protection for its Sept-Îles and Bloom Lake affiliates under the Companies' Creditors Arrangement Act. After declaring bankruptcy for these affiliates, the company announced it was ending group insurance for its pensioners and slashing their retirement fund. By discontinuing contributions to the pension fund, Cliffs Natural Resources ran up a $30-million solvency deficit, which was taken from the workers.

Some 700 pensioners, people from my region and from my riding, lost their group insurance and nearly 25% of their pension fund in the Cliffs Natural Resources disaster, but that is not all. These people were forced into an extremely tenuous situation. They expected a peaceful, secure retirement but suddenly found themselves on the brink of ruin. They had no inkling that financial worries and trouble would come back to haunt them.

Fortunately, the Cliffs Natural Resources pensioners, or their widows or spouses, as the case may be, did receive compensation. It was thanks not to the House's legislative efforts but to the tenacity of the Cliffs pensioners' association and the support of United Steelworkers that they were partially compensated for the money that was stolen from them.

The purpose of Bill C-253 is to make sure we never see another tragedy like the ones that have happened in our community, or with other companies, such as White Birch, Mabe Canada and Sears Canada, or even like the ones that the COVID-19 crisis is causing right now.

Canadian law does not adequately protect workers' rights, so it is our duty to end this injustice as soon as possible before history repeats itself and the rights of workers and pensioners are once again trampled upon.

The Bloc Québécois has always been a voice for workers and defended their rights in the House. Bill C-253 reflects our commitments and our actions. Driven by a relentless sense of justice, the Bloc Québécois will never stop stepping up to protect the rights of workers and to prevent them from being cheated, particularly through such unfortunate bankruptcies.

The solution to the problem is perfectly simple. I would like to draw the attention of the House to two points that are the very pillars of my bill.

First, it is vitally important to recognize pensions for what they are: deferred wages, negotiated between the employer and employees through the union and recognized by both parties. Accordingly, pension plans must be considered preferred claims, and paying them out must be considered a priority. To stop the looting, companies must be forced to live up to their commitments to workers.

Second, pensioners must be compensated for the loss of their group insurance, which has obvious negative repercussions for them and their families. Going back to the example of Cliffs Natural Resources, the workers and pensioners were unfairly penalized for a bankruptcy for which they were in no way responsible. They were deprived of money they had worked for. It was their due.

The Liberal Party of Canada just held their convention. I was pleasantly surprised when the Liberals adopted a resolution recognizing that pensions are deferred wages. I hope they will also be pleased when they remember that this was in both Bill C-253 and its previous version, Bill C-372. Logically, the Liberals cannot deny that slashing pension plans during a company bankruptcy constitutes theft, so they will surely vote for Bill C-253.

Of course, Bill C-253 was drafted with the Cliffs pensioners and their spouses in mind. The bill reflects their life stories and the misfortunes they had to contend with.

I want to sincerely thank the Cliffs pensioners' association, which demonstrated ingenuity, empathy and tenacity in the face of the colossal problems that their former employer's bankruptcy caused for them. I want to give a huge thank you to Gordon, Cécile, Daniel, Rodrigue, the other Rodrigue, Serge, and also Nico, as well as all of the others I cannot name in the House, for their invaluable contributions. They know who they are. Their hard work served as the inspiration for this bill. They are proof that the voice and will of the people can be heard loud and clear in Parliament. This is their space, and I sincerely hope that their fight will inspire others, so that no one else has to go through what they did.

Before I conclude, I want to comment on another rather surprising action that the Liberal government has taken to amend the Companies' Creditors Arrangement Act.

At the beginning of the week, a private member's bill to amend the Companies' Creditors Arrangement Act in connection with the situation at Laurentian University was introduced by the member for Sudbury. That bill excludes post-secondary teaching institutions from the definition of company. I am confused. The government had an opportunity to significantly improve the legislation — I say an opportunity, but it has had several — but all it did was add a simple exception to make itself look good and restore its image after what happened at Laurentian University.

Bill C-253 goes much further and truly protects those who need protection for the long term, not the creditors, not businesses and even less so the government, but the workers and what they are planning to live on, the money to fund the retirement they have looked forward to their entire lives.

Bill C-253 proposes real change by amending the order of priority of companies' creditors. Bill C-253 ensures that workers will not be penalized if their former employer declares bankruptcy. It reassures those workers by promising that they will not lose their deferred wages, meaning their pension plans and group insurance.

We have seen hundreds of tragedies where workers have lost their money. Sears, Capital Media Group and Cliffs are just a few of the many examples, and I want to reiterate that the current pandemic is only going to result in more cases like these.

Urgent action must be taken to end these injustices once and for all and to protect our workers' nest eggs. I am asking my colleagues to pass this bill quickly so that other pensioners, who dream of a secure retirement, do not have their modest dream shattered. They worked hard for a comfortable retirement.

On behalf of the workers, pensioners and seniors for whom I am speaking today, I urge my colleagues to share my concerns about laws that do not provide proper long-term protection for our workers. We have a duty to act and make real, much-needed changes to bankruptcy laws in order to protect pension plans and group insurance.

Let us vote for our fellow citizens. Let us vote in favour of Bill C-253.

Opposition Motion—Financial Situation of the Elderly

[Marilène Gill, Bloc, Manicouagan, QC]

Mr. Speaker, I want to thank my colleague from Berthier—Maskinongé for his speech. We could feel his emotion, but also his indignation, which I share. I have always said that I got into politics because I have a capacity for indignation, which I want to be constructive, of course. That is why I really understand the situation when we talk about how seniors are doing.

I would like to thank my colleague from Shefford for making a very good speech and for being behind this motion.

While I was listening to the news over the past few days, I heard a journalist ask a senior at what point one no longer counts. Regardless of where that came from, I must say that the question really surprised me and made me angry about the very issue of seniors, because we are letting such a dangerous discourse spread unchecked out there in society.

I have to say that I heard that on the national broadcaster, where I once heard a very serious discussion on the possibility of taking away seniors' right to vote at some point. These may not be major ideas but those ideas are being floated nonetheless. That gravely worries me. I must say that a motion like the one being moved today, which “acknowledge[s] the collective debt that we owe” to seniors must be taken seriously. There are good reasons for it.

I think that societal discourse is sometimes dismissive of seniors, when in fact they are an integral part of our society. Earlier I heard comments about age. Members talked about “starting at age 75”, “from age 65 to 67”, “after 67 years of age”, and so on. We have to work with that sort of breakdown, to some degree, to make things easier, but at the same time we must never forget that seniors are an integral part of society.

I think we should follow the example of the first nations. I say this humbly, as the member of Parliament for Manicouagan, where the Inuit and the Naskapi peoples make up 15% of the population. As demographics change, these communities will become larger and larger. The way the first nations treat seniors is the polar opposite of what I have heard on Radio-Canada. First nations elders are served first at community meetings. They will have first choice of cuts of meat, such as caribou meat. That is a bigger deal than I make it sound.

These seniors are seen as assets in their communities and not as liabilities, as is the case here, as the government gives benefits to everyone except seniors during the pandemic. This shows that seniors are still being put in a separate class. In the first nations, seniors are seen as wise elders, memory keepers and knowledge keepers. I do not want to speak for the first nations, but elders are the most important members of their communities.

As a member of Parliament, a Quebecker and a human being, I am learning a great deal and I appreciate how the first nations see their seniors and their role in society. We should view seniors the same way.

Beyond these points and this lesson in humanity, which I wanted to talk about, I will say that my colleagues have made a number of suggestions that should be implemented for our seniors. I would like to mention them again.

There is a major issue that the Bloc Québécois has rallied behind for a long time, particularly during the last year and a half, and that is health transfers. It is the federal government's job to increase health transfers to help seniors.

During the pandemic, we have talked a lot about access to vaccines. I represent a huge riding with an area of 350,000 square kilometres. People often have to travel in the riding, and because of the distances seniors have a number of needs. We need more services and more local services. The request for more health transfers is especially pertinent to seniors. That is one of our demands. Naturally, we have been repeating this since this morning, and we hope that the government will make it happen. The government must agree to increase old age security by $110 a month and it cannot be just a one-time increase. As several members have said, this must be recurring direct assistance. This assistance must not be provided solely during the COVID-19 pandemic. The funding shortfall was there well before the pandemic. That is what the Bloc Québécois is asking for, in addition to an increase in the guaranteed income supplement of $50 to $70, depending on whether the recipient is single or married. This assistance will help support seniors.

Due to the costs incurred by seniors during the pandemic and at the present time, their purchasing power is constantly getting lower. As I mentioned, there was already a shortfall before the pandemic, and it is now a huge gap. This must be addressed quickly.

The Bloc Québécois motion is a call for action, and I hope the government will answer the call. In the 2019 and 2020 throne speeches, the government said it would help seniors. It has been saying that for a year and a half. Earlier, I heard the Parliamentary Secretary to the Minister of Seniors talk about the new horizons for seniors program and several other measures that may be beneficial, but that do not provide seniors with any immediate assistance or give them the freedom to choose for themselves. There is a huge difference between the new horizons for seniors program, which is a useful program, and having money put directly in their pockets. It is important to understand that.

I hope that the parliamentary secretary and the minister heard what we had to say on this topic. I hope they will adopt the Bloc Québécois motion in order to demonstrate swift and meaningful support for our seniors. Seniors must not be left out.

I referred to a daily shortfall because the old age security pension is too low. The pandemic is making life even more difficult for seniors, so it is all the more urgent to act.

I would like to conclude by encouraging the House to vote for another bill, which I tabled last November. I am talking about Bill C-253, which we will very likely debate in the spring. It is also aimed at helping seniors and retirees. When companies restructure or go bankrupt, retirement funds are cut, leading to disaster, devastation and tragedy. Group insurance plans are also cancelled.

Seniors themselves keep saying that what they want is stability and predictability. By protecting the deferred wages that seniors have earned and deserve, the government would be protecting their rights.

I will conclude by adding that it is also important to protect seniors' dignity.

Bankruptcy and Insolvency Act

[Marilène Gill, Bloc, Manicouagan, QC]

moved for leave to introduce Bill C-253, An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act (pension plans and group insurance plans).

Mr. Speaker, I am honoured and proud to introduce today in the House, seconded by the hon. member for Thérèse-De Blainville, a private member's bill that seeks to amend the Bankruptcy and Insolvency Act and the Companies' Creditors Arrangement Act.

This bill reaffirms my unwavering commitment to workers and retirees, a commitment that is shared by my colleague and the Bloc Québécois. It is a commitment that I made in the House on October 17, 2017, by introducing Bill C-372 to defend the rights of workers, which I feel should be inalienable.

Under the existing legislation, when a company is restructured or goes bankrupt, the workers' pension funds and insurance are not properly protected, even though they belong to the workers. It is part of their salary that they negotiated and agreed to defer. My bill seeks to correct that injustice.

When we think about former workers at Cliffs Natural Resources, Mabe, La Pointe-de-l'Île or even Sears stores all across Quebec, my bill is there to protect what belongs to workers. I urge all my colleagues to support my bill.

(Motions deemed adopted, bill read the first time and printed)