Thank you very much for having me.
As it was mentioned, I am the Assistant to the National Director of United Steelworkers.
United Steelworkers is among the largest private sector unions in North America. We represent over 200,000 members in Canada and over 800,000 members across the continent. United Steelworkers is the most diverse union in Canada. It represents women and men working in all sectors of the economy.
Our union has long believed that the provisions of the Investment Canada Act and its enforcement mechanisms are not enough to make foreign investments in Canada beneficial for our members and for all Canadians.
The recent experiences involving Vale Inco, U.S. Steel, Rio Tinto and other major foreign investors add more urgency to those amendments.
I want to talk briefly with you about some of our experiences with foreign investment under the Investment Canada Act, and particularly about U.S. Steel. As you may know, U.S. Steel purchased the former Stelco out of insolvency in 2007. That purchase was, of course, approved under the Investment Canada Act, and U.S. Steel made certain undertakings under the act. Within two years of that investment, U.S. Steel promptly locked out 1,000 of our members at Lake Erie in an ultimately successful effort to get them to give up on their defined benefit pension plan.
To its credit, the Government of Canada ultimately launched a lawsuit against U.S. Steel for its failure to live up to its undertakings under the Investment Canada Act, a lawsuit in which we participated. During the time of that lawsuit, U.S. Steel also locked out our members in Hamilton for a full year, from 2010 until 2011, again in an effort to attack our defined benefit pension plan. That lockout was settled in October of 2011. In December of 2011, the lawsuit was also settled by the Government of Canada, with no notice to us whatsoever, and for relatively trivial further undertakings by U.S. Steel that, to my knowledge, it has yet to live up to.
The dénouement of this story is that less than a month ago, U.S. Steel locked out our members in Nanticoke, Ontario, again seeking further concessions.
The long and short of it is that U.S. Steel has never lived up to its commitments under the Investment Canada Act. The government has never enforced those commitments. And we've seen that pattern repeat itself over the last decade over and over again.
We saw that pattern with Vale, which purchased, of course, the former Inco. Since then we have experienced a strike of one year and a strike of 18 months in Labrador, again as the company has sought further concessions from its workers.
We saw that pattern with Rio Tinto, the second largest mining company in the world, which purchased Alcan and promptly locked out our members in December 2012 for six months in an effort to contract out much of the work our members were performing.
Our experience has been that the “net benefit to Canada test” that has been applied by the federal government has lacked any kind of transparency and has been completely insufficient to protect our workers, our members, and the communities in which these businesses have been operating.
I want to make a couple of quick comments about the amendments that are now being proposed and then make a few final observations.
We understand that there are obviously particular issues with respect to investments by state-owned enterprises, but we don't think the amendments that are currently being proposed are going to have any effect on the kinds of investments that I have just outlined for you and that have been extremely difficult for our members. If anything, we are especially troubled by the increase in the review threshold to $1 billion from the current $300,000, I think, which will mean that large foreign investments can be made without any review whatsoever under the Investment Canada Act.
I would note, for example, that the U.S. Steel takeover of Stelco was only a $1.1 billion takeover. Under these current rules, large takeovers could occur by foreign investors with no review whatsoever, as I understand the amendments.
I want to conclude by recommending certain changes we feel are essential.
First, the public, the community and the workers should participate in the review of public investments.
Second, the commitments made by foreign investors should be part of a transparent process.
Third, new approval criteria should be introduced to ensure that each community can make progress and to take into account the interests of current and retired workers of the companies affected by the investments.
Thank you very much.
I look forward to your questions.