Protecting pensions, protecting Canadians

OTTAWA –Canadians who rely on company pensions for their retirement are being left out in the cold by firms underfunding their pension plans then declaring bankruptcy, New Democrat leader Jack Layton said today.

“When you put years of hard work into a company, it’s only fair to expect that your pension will be protected if the company goes under,” Layton said. “But as we’ve seen with Nortel, when companies file for bankruptcy they are often able to take the money they owe to workers and use it to pay off other creditors.”

Nearly 17,500 Nortel workers are at risk at losing their pensions, yet the government has done little to help. And they are not alone. More than 5,700 Canadian companies have filed for bankruptcy in the year ending Aug. 31, 2009. Across the country thousands more workers are being left with little for their retirement but fear and uncertainty.

So New Democrats are announcing measures today that will change this by closing loopholes in the Bankruptcy and Insolvency Act. These measures will ensure companies make good on their unfunded pension liabilities by giving pensions priority status when companies fail.

“Pensions are nothing less than deferred wages and they deserve the same status as unpaid wages,” said New Democrat Pensions and Seniors Critic Wayne Marston (Hamilton East—Stoney Creek). “By leaving the law as its stands, the federal government is short-changing workers.”

These measures are in addition to the New Democrats’ comprehensive retirement-security plan, which includes increasing to the Guaranteed Income Supplement, doubling the Canada Pension Plan/Quebec Pension Plan, and developing a national pension insurance program.

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Protecting pensions, protecting Canadians