NDP tables severance legislation to help jobless

OTTAWA – Today, New Democrat MP Irene Mathyssen (London-Fanshawe), will table legislation to allow Canadians receiving severance payouts to make a one-time, over-the-limit contribution to their Registered Retirement Savings Plan (RRSP). It will also remove the amount of severance pay received from Employment Insurance calculations.

“The inspiration for this bill was brought to me by the Canadian Auto Workers’ union local in my neighbouring riding,” said Mathyssen. “It is designed to help Canadians who are losing their jobs due to plant closures by providing them with an opportunity to contribute to their RRSPs.”

This bill, An Act to amend the Income Tax Act and the Employment Insurance Act (severance pay), changes the current income tax legislation, allowing for people who lose their jobs, through no fault of their own such as a plant closure, to have a one-time investment of the entire amount of their severance pay into their RRSPs. It also amends current employment insurance legislation to exclude severance pay amounts from the determination of earnings.

“In today’s economy, Canadians should be given every possible opportunity to save money for their future,” said Mathyssen. “We hear all too often of seniors living below the poverty line and of families not being able to put food on their tables due to plant closures and job losses.

“This bill will provide Canadians with an opportunity to save for their retirement as well as ensure they earn maximum Employment Insurance benefits in their time of need,” concluded Mathyssen.