Evidence of meeting #38 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was nortel.
A recording is available from Parliament.
9:55 a.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
I would suggest that maybe you could make that submission to the courts to deal with.
9:55 a.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
I just have another question. I know my time is short. Would you, in your future business plans, have any plan for paying any of those past severance obligations going forward? Say the company comes out of CCAA and it's profitable again. Would you make plans in your future business plans to compensate those severed employees?
9:55 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
That's part of the restructuring plan, which the courts would have to approve in that process. We'll be dealing with all the creditors. I do not believe there will be a priority for anyone.
9:55 a.m.
Conservative
9:55 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
Absolutely.
9:55 a.m.
Conservative
The Chair Conservative James Rajotte
Thank you.
We have about two or three minutes.
Ms. Hall Findlay for a short round.
9:55 a.m.
Liberal
Martha Hall Findlay Liberal Willowdale, ON
Thank you very much, Mr. Chair.
Thank you, Mr. Zafirovski and Mr. Tay, for being here.
My colleagues have asked--and I suspect everyone would agree--that if you are able to stay here for the following hour, if you have any comments after that based on what you will hear, we would really appreciate hearing from you. If those comments could actually be flowed through the clerk so we can all see them, that would be very much appreciated.
When General Motors and Chrysler approached the federal government for aid the first time, they were denied aid. Very publicly, the reason was that their plan was not viable enough. I understand your hesitation to disclose details of your conversations with the government. You have said you did ask the federal government for assistance and that this assistance was denied. Can you please tell us the reasons why that assistance was denied?
10 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
I do want to stay brief on this. A combination of the viability of the industry and the plan was one reason, and whether this was more company-specific as opposed to an industry-specific matter. The auto industry was being viewed as an industry-specific issue, and some of the challenges around Nortel were viewed more as company-specific.
10 a.m.
Liberal
Martha Hall Findlay Liberal Willowdale, ON
Given your understanding of Nortel and Nortel's viability, and your efforts to keep it out of CCAA, and given what you have read over the last several months in terms of government assistance for General Motors and Chrysler and their ability and their sector, do you think the government should have actually given Nortel assistance?
10 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
We were expecting to have a 5% or 10% growth in the industry, and overnight it went into a 20% decline. There was a very significant shift in telecom, in the communications industry. So any plan that was presented at that point in time, including internally, could have been viewed with lots of skepticism, if you will. So it's whether you can have a viable, guaranteed plan in the fourth quarter of 2008 when the industry came down 30% in revenues from where it was supposed to be. Arguments have been made by many that it was very difficult to have a 100% secured plan for Nortel for the future.
10 a.m.
Liberal
Martha Hall Findlay Liberal Willowdale, ON
I suspect it's hard for all of the stakeholders--employees, shareholders, everyone in Nortel--to have you do what you can do to make sure that this company remains viable and yet somehow acknowledge that the government may have not provided the assistance because it wasn't viable. I will just add that my colleague, Mr. McCallum, I think pointed out that the future of this country we believe is very strongly based on innovation and research and development and the technologies, and we see a disconnect.
10 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
I fully agree with that. As a side note, I think the governments also believe that's the case. I am very confident to tell you that in our discussions internally, preserving R and D jobs in whatever final restructuring form there will be for Nortel is a major priority. We are hopeful that forthcoming announcements later this summer will in fact be consistent with the view that we've done everything possible successfully to optimize R and D jobs in Canada.
10 a.m.
Conservative
The Chair Conservative James Rajotte
Thank you, Mr. Zafirovski.
Thank you, colleagues.
We will suspend for about two minutes and we'll bring the other witnesses to the table.
10 a.m.
President and Chief Executive Officer, Nortel Networks Corporation
Mr. Chairman, I appreciate the request to stay and would also appreciate—and I'm not sure if that's with your approval—making some comments after the hour.
I will stay; I've never shied away from the employees. It has always been the favourite part of my job to talk with employees, and if I can have three or four minutes at the end to make some comments, I would appreciate it.
10:05 a.m.
Conservative
The Chair Conservative James Rajotte
Colleagues, I ask you to take your seats, please.
You have a point of order, Mr. Wallace?
10:05 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Thank you, Mr. Chair.
Very quickly, I know we have a busy schedule, and I would like to deal with the motion on the parliamentary budget officer before we break, which I think we have unanimous consent to do. Could we just pass it now, if we have agreement?
10:05 a.m.
Conservative
10:05 a.m.
Conservative
The Chair Conservative James Rajotte
Do we have unanimous consent?
Monsieur Mulcair, Monsieur Laforest?
Monsieur Laforest.
10:05 a.m.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
I have a friendly amendment to make to Mr. Wallace's motion. I move that in his notice of motion, there be a definition of the regions designated for the tax credit.