Natural Resources Committee on Dec. 2nd, 2009

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

In order to cover the scenario of somebody or a group of people coming forward 15 years after the fact saying they developed these types of cancers and they relate them to the accident that happened at that time, that will come out of this pot.

Is there an estimation from government as to what that reinsurance is sitting at right now? How much money is in that and how much is it expected to be?

So if you have the scenario in which a group of people come forward and seek compensation, because they say they now have cancer caused by that accident, the nuclear provider is off the hook because it's been longer than 10 years. That $650 million liability is no longer available. Is that correct?

[Dave McCauley]

The liability limit is fixed at $650 million.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

But these folks fall outside of that liability because they showed up 11 years after the fact.

Or do they?

[Dave McCauley]

No, they don't. There's a $650 million limit, and the $650 million covers any claims within the period prescribed by the legislation.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

So again, we're back to 30 years.

[Dave McCauley]

That's right. It's $650 million unless the government appropriates additional funds. The legislation establishes $650 million as the limit.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Then for the reinsurance component, we talked about this 10- to 30-year component. Can you explain that to me again? I'm a bit confused.

[Dave McCauley]

Reinsurance is a component of the $650 million. The actual payments by either insurers or the government will not exceed $650 million.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

This is for folks who come with a claim more than 10 years after the fact if the $650 million has already been given out to other claimants? If the $650 million is exhausted, that's when the reinsurance kicks in?

[Dave McCauley]

No.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Okay, sorry. As I said, I'm not proficient in the world of insurance.

[Dave McCauley]

It's complicated.

If we're looking at the issue of damages or injury beyond 10 years, between 10 and 30 years, this is ahead of damage that is provided through reinsurance. That reinsurance is provided by the federal government.

The limit of liability is $650 million. That's the total liability. It will not exceed $650 million unless so prescribed by the federal government, or unless additional funds are appropriated by the federal government. That is the ultimate exposure, $650 million for an incident.

[The Chair, Conservative, Leon Benoit]

Ms. MacKenzie.

[Brenda MacKenzie]

I hope it helps a little bit, but the purpose of the act is to ensure that money is actually there in the amount of the liability limit for whatever is compensable under the act. What Mr. McCauley is talking about is that private insurance is actually not available for every single thing. For example, bodily injury from a 10- to 30-year period. I'm not an insurer, but I guess it's causation. I don't know, but they won't provide it anyway and that's the point. The government ensures that the money is actually there and that there will be money to compensate victims. In the event that there's nobody else to provide it, yes, it comes out of government funds, and that's the purpose of reinsurance.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Thank you.

[The Chair, Conservative, Leon Benoit]

Is there anything else, Mr. Cullen?

Is there anything else on clause 27?

(Clause 27 agreed to on division)

(On clause 28--Certain rights and obligations not limited )

Is there anything on clause 28?

Mr. Cullen.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

It's just that this is the preservation of rights. This was referred to earlier in some of the questions about what happens in a nuclear accident. It was repeated again by the witnesses that anything in this bill didn't alleviate the government programs that existed. Clause 28 reads:

Nothing in this Act is to be construed as limiting or restricting any right or obligation arising under

And then paragraph (c) says:

any survivor or disability provision of a pension plan.

One of the things that has been of concern to me is that, to the witnesses' knowledge—under any pension plans or these other things listed—I don't suspect a lot of these pension plans deal with nuclear accidents. I'm trying to feel confirmed that a group of workers will not have their pension plans essentially voided because they don't have access to a company that has experienced one of these nuclear accidents.

Did the government look at any provisions that exist under the pension plans of employees who work at these plants? There's this whole question back to how the folks who were involved in the accident can't be compensated, right? We went through the discussion earlier about how, if workers at a plant are out of work for two years, that could be quite devastating to a community if the EI runs out after seven or eight months. This act does not allow the workers to seek any compensation for wages, but a person working at the McDonald's next door could be compensated for wages.

I'm asking the same question with respect to pensions. If a pension plan has a stipulation within it that you can no longer receive benefits, or if you can't pay into the pension if you've stopped working, essentially, if you're a 40-year-old or 45-year-old worker, an accident at a plant could end up jeopardizing your pension, could it not? What does this act say about that?

I'm trying to imagine the people directly implicated by this and if there's anything in their contracts that will then be affected in the event of an accident.

[The Chair, Conservative, Leon Benoit]

Mr. McCauley, go ahead.

[Dave McCauley]

What the act does is preserve all those forms of agreements, all those pension plans, all those schemes of health insurance. What this provision does is say that although we are providing a separate and special avenue for victims to obtain compensation, recognize that all of these normal contractual agreements between individuals and their health insurance provider, or their pension provider, or other forms of insurance still exist. It does not preclude obtaining access through all these provisions, so it actually ensures that these are maintained.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

My concern is the reverse, in a sense. It's not that this act would override somebody's pension, but we were trying to deem benefit from an accident, earlier. We were trying to say that under this act, if somebody loses wages due to the fact of the accident, if they don't work at the plant itself, there's compensation made available to them. There was a question mark about people who actually happen to work at the plant, whether they too are available to get compensation. I think in the end we said no, they're not.

If somebody works outside of the plant and has their work affected by this, they will receive wages, they will receive compensation on wages, which then affects their pensions—that's how pensions work; you pay into them through your wages. If somebody loses their job and is unable to go back—the plant doesn't reopen or something happens—they also, in effect, would lose their pensions. It seems as if it's a double hit on the folks who are directly involved. Am I chasing the wrong truck here?

[Brenda MacKenzie]

I think we understand your question. We have to go back to the fundamental principle of the bill. As we've drafted it, the operator, under clause 4, doesn't get compensated. If you look at clauses 16 and 18, for instance, where there is compensation provided for lost wages in certain circumstances, it's always linked to property. Since the operator's property is excluded, they're out. That may seem harsh, but the point is that it is understood that the operator should make his own arrangements. That's outside the act. It's to ensure money is preserved for third-party victims.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Yet it also has a consequence for the workers involved with that operator—that's the harshness point. I have no problem in saying that if an operator has a nuclear accident, they should have their own insurance available to repair the damages to their facility. But we've made considerations in this bill for folks affected, working people who are affected by an accident. It still seems to me that the folks actually working at the plant are broadsided by that principle of not wanting to compensate the operator; they also cannot seek damages in terms of loss of wages—that's right. So as a corollary, the pension plans will also perhaps be made either null and void or simply just not be contributed to and be of little or no value.

I always have to imagine these things under the actual scenarios.

[Brenda MacKenzie]

Maybe you should make that clarification.

[Dave McCauley]

By virtue of clause 28, the workers will still have access to whatever employee scheme of compensation or pension plan, etc., that exists for them.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Yes. Getting back to this notion of wages, when talking to a group of workers after an accident, they haven't been back to work, their EI has run out, they're now saying, “Not only am I not getting work, I'm also not contributing to my pension.” So the thing that I thought was there is not there.

But I'll leave it at that, Chair. It just confirms that circular effect. The folks who actually work at the place, maybe through no fault of their own, are now not only out of a job but without a pension they contributed to for 15 years. We know how these pension schemes work. They add up towards the end, not the middle, and as a result of the accident, they are also one of the victims indirectly.

I won't ask any other questions, though, Chair.