Optimistic bill to secure pensions will pass

This past week, I was happy to table a new private member’s bill that will help secure the pensions of workers at companies that enter bankruptcy proceedings or undertake supervised restructuring.
Bill C-501—an Act to amend the Bankruptcy and Insolvency Act and other Acts—has the potential to secure tens of thousands of pensions across Canada, and I am optimistic it will pass with the full support of other parties in the House of Commons.
When AbitibiBowater filed for bankruptcy protection last year, many hard-working employees were left to wonder what would come of their jobs and their pensions.
In “town hall” meetings I hosted throughout the riding last year, I began to hear from workers about a rumour that there was a financial shortfall in their pension plan.
Sure enough, when the books finally were opened in the fall, it was found the pension plan was significantly underfunded and that the workers stood to lose up to 40 percent of their pension and retirement income.
It was obvious something had to be done to help save these pensions, and that the federal government could play a role in the process.
At about the same time of the discovery of the pension plan shortfall at AbitibiBowater, my New Democrat caucus colleague, Wayne Marston (Hamilton East-Stoney Creek), was in the process of tabling a pension protection bill (C-476) to assist the former employees of Nortel who found themselves in a similar position.
I approached Wayne to see if his bill also could help secure the pensions of workers at AbitibiBowater, and he indicated this was, in fact, the case.
However, C-476 would not be eligible for debate until late 2011, which likely would be too late help our local AbitibiBowater workers during the company’s restructuring efforts.
Following those initial discussions with Wayne, it was agreed that I would table a shorter and simpler version of his bill so it could be debated and voted on much sooner.
The early consideration of one of my bills is a result of sheer luck—I drew a lower number than Wayne (66 to 195) in the lottery that determined the order of consideration for private members’ business in this Parliament.
I have been notified my turn will come up in mid-April (although it could have been mid-February without prorogation, but that’s another story), and that C-501 should be voted on a final time before the end of the year.
As it stands now, pension plans are pretty much at the back of the line when it comes to settling debts and dividing assets among the various creditors of insolvent companies.
Pension plans currently are behind the government, unpaid suppliers, banks, and other lenders in the pecking order, which means there often is little to nothing left for the workers when a company’s assets are liquidated during bankruptcy proceedings.
To correct this problem, C-501 would move pension plans from the back of the line of creditors to the middle—somewhere ahead of the banks and just behind government and the suppliers of goods of services who have not yet been paid.
In nearly every bankruptcy case in recent memory, C-501 would have eliminated pension plan shortfalls when the assets of insolvent companies were sold off and divvied up among the various creditors.
While C-501 certainly will be voted upon before the end of the year, I am optimistic this timeline could be shortened with the support of the other parties in the House of Commons.
The Liberals and Bloc already have indicated in the Finance committee that they are likely to support the bill, and more than one Conservative has said in private that they don’t see anything that would stop them from doing the same.
If all parties agree to support the bill early on, then it could be “fast-tracked” through the House debates and right into the Industry committee, or right into the Senate if things go well.
Since I first heard from those AbitibiBowater workers at the town hall meetings last year, a tentative settlement has been reached between the creditors of that company which would eliminate the $1.3-billion pension plan shortfall and ensure every worker is paid their retirement income in full.
This is, of course, great news, but I want to assure those workers that I heard their concerns and am doing everything in my power as their MP to secure their pensions in case this deal falls through, or their company faces similar difficulties in the future.

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