The House proceeded to the consideration of Bill , as reported (with amendments) from the committee.
moved that the bill be read the third time and passed.
She said: Madam Speaker, I am very pleased to rise to speak to my private member's bill, Bill , today at third reading. It was successfully passed as amended at the finance committee. Bill C-228 is centred on pension protection, working to prevent the loss of pensions for employees whose companies have declared bankruptcy.
Canadians deserve to know that the contributions they have made their whole lives will result in a secure financial future for themselves and their families, but the last few years have shown us that security can disappear in a moment. My bill would remedy this issue.
The bill would do three things. First, it would require that an annual report on the solvency of pension funds be tabled here in the House of Commons for greater transparency and oversight. Second, it would provide a mechanism to transfer funds into a pension fund to restore it to solvency. Finally, in the case of bankruptcy, pensions would be paid out ahead of large creditors and executive bonuses. The acceptance so far by this Parliament and the good work that has been done on the bill by all parties show that there is a common spirit and desire to improve pension security for Canadians. For that, the House has my sincere thanks.
Over the last 10 years, efforts by many parties and senators have been put forward to introduce bills to improve pension protection in Canada. I cherry-picked from all the ideas that were previously supported in the House and put them together in Bill . Learning from both the numerous cases of company collapse and the various pension protection bills that came before to improve pension protection in a way we can all live with is my goal here today.
To put things in context, I want to point out that there have been far too many cases of businesses that have declared bankruptcy to the great detriment of their own employees.
Nortel Networks declared bankruptcy in 2009, leaving 200,000 Canadians to fend for themselves when it came to their pensions. An article published in the Financial Post in 2016 entitled “The big lesson from Nortel Networks: Pension plans aren't a guarantee” gave a detailed account of the battle waged by these employees as they tried to recover even part of their share of Nortel's assets, which were estimated at $7.3 billion. Legal and consulting fees totalled over $1.9 billion, which further reduced the amount these former employees were seeking.
According to CBC, at the end of 2016, former Nortel employees were pleased with the agreement they reached under which they would get a payout of 40¢ on the dollar. That was an improvement over the 10¢ on the dollar they were initially offered.
However, in 2020, the employees lost out again when the Ontario pension benefits guarantee fund managed to reclaim some $200 million from monies allocated to pensioners in Nortel's bankruptcy proceedings.
In all, the whole mess with Nortel turned into a more than 11-year battle for former employees who failed several times while simply trying to obtain the financial security to which they were entitled. That is just one example.
Sears Canada is another infamous case and perhaps one of the most well known. Between 2005 and 2013, Sears Canada paid more than $3 billion in dividends to shareholders, even as it was operating at a loss and its pension plan was underfunded by about $133 million. In 2017, Sears Canada declared bankruptcy after attempting to restructure. During the restructuring, Sears Canada faced heavy criticism for giving retention bonuses to 43 executives and senior managers, but it did not plan to offer severance to laid-off employees. Allegedly, the bonuses were intended to maintain the morale of senior staff at the cost of providing necessary funds for the company's pension plan, leaving more than 17,000 pensioners cheated of their full pensions.
Sears pensioners learned their pensions were going to be cut by 30%. Seventy-two-year-old Ron Husk of Mount Pearl, Newfoundland, told the CBC that the cut caused his monthly pension payment to drop by $450. Many said they would have to go back to work in sales, in their seventies. Pensioners in Ontario fared marginally better because of the provincial mechanism that protects the first $1,500 of a pensioner's payment, but it made little difference overall. In today's era of extreme inflation, it is helping even less.
Looking back further, when the T. Eaton Company folded in 1999, the vast majority of its 24,500 employees were terminated without being paid termination pay and severance pay, as well as other amounts owed to them. All employee and retiree health and other benefits were cancelled. In the end, the liquidator released payments to employees and retirees of just 53.7 cents on the dollar. There are several other noted cases where courts have ruled in favour of creditors and lenders over pensioners, including Indalex, Stelco and Grant Forest Products among others.
In the Indalex case, Indalex Limited obtained creditor protection under the Companies’ Creditors Arrangement Act, also known as the CCAA. The court authorized Indalex to obtain debtor in possession, or DIP, financing, which would provide the company with loans to continue operating its businesses during the restructuring period. These DIP lenders had superior priority over the existing debt, equity and other claims.
At a hearing for approval of this motion in 2008, two groups of pension claimants opposed this distribution, asserting that the assets equal to the funding deficiencies in the two defined-benefit pension plans administered by Indalex were deemed to be held in trust and should be given to the pension plans in priority over the DIP lenders. The CCAA court ruled in favour of the DIP lenders, not the pensioners. This decision was upheld and became a precedent for the Grant Forest Products case. Sadly, many other examples of workers who did not receive their full pensions exist.
There is no doubt that this has been a problem for a long time. The government needs to intervene by taking stringent measures to rectify this and protect Canadian workers.
I want to acknowledge the contribution of some of my House of Commons colleagues. Many MPs from all parties have come to see me to propose bills on this same topic.
Currently there is a requirement for an annual report on the solvency of a fund, but it goes to the superintendent of finance, and it is not clear what, if any, actions are taken. In fact from 2003 to 2020, there is evidence that companies continued to have insolvent pension funds. My bill would require this report to be tabled here for greater transparency and oversight. Currently the average federally managed fund is at 109% solvency, so it is a good time to implement the measures of this bill.
The second part of the bill is to allow companies with insolvent pension funds to transfer additional funds from other assets in the business into the pension fund, without tax implications, to make it solvent.
In October 2017 and again in 2020, the Bloc member for introduced her private member's bill, Bill , which would amend the Bankruptcy and Insolvency Act and the CCAA. The bill would provide priority status for pensions in the event of bankruptcy proceedings. This bill ultimately made it to committee, but died on the Order Paper when the Liberals called the election. I have incorporated her bill here with some suggestions brought forward.
There was concern that implementing an immediate priority for pensions could have unintended consequences. The suggestion was to have the coming into force of the reporting on the insolvency of funds to happen immediately, along with a mechanism to top up the fund and restore it to solvency. However, it was recommended to have several years for companies to get their funds in order before implementing the priority part.
Five years was the period suggested originally in the bill, but there were stakeholders who preferred to see it be three years. At committee, we were able to come to a compromise of four years for the coming into force of the priority portion of the bill. I want to also acknowledge that the Liberal member for sponsored an e-petition on pension protection, supporting this very issue.
My bill has been reviewed by a variety of stakeholders, from the Canadian Labour Congress to financial institutions and many pension associations nationally, including the Canadian Federation of Pensioners and the Canadian Association of Retired Persons.
Bill VanGorder, the chief operating officer of CARP, offered this quote:
Most older Canadians have fixed incomes but face rising costs, growing inflation, an unpredictable economy and retirement savings that suffer as a result. The Canadian Association of Retired Persons...believes it is vital that the Federal Government protect pensioners by giving them “priority” status and creates a pension insurance program that insures 100% of pension liabilities. This proposal would go a long way in making that happen.
Some banks and large financial institutions have expressed their reluctance to me. They are concerned that, if pensioners are given priority, companies with insolvent funds will have to pay higher interest rates to obtain credit and will be less likely to apply for credit.
This is part of the reason why the implementation schedule should allow time for companies with insolvent funds to get their finances in order. I would like to point out that, if a company cannot restore the solvency of its fund within four years, it should indeed pay a higher interest rate to obtain credit because it really does present a higher risk.
In summary, this means reporting to Parliament on the solvency of funds for greater transparency so we can ensure actions are being taken to protect pensions, creating a mechanism to top up the funds to restore solvency, and, in the event of bankruptcy, ensuring that people who have worked their whole lives receive the pension they were promised.
An amendment was brought forward by the member for to include severance and termination pay at the same priority as pensions, ahead of secured creditors, and it was presented at finance committee. Indeed, discussions were held with all parties regarding this, and at second reading I said I would support this measure.
However, it was ruled out of scope by the clerk and the chair of the finance committee. The committee then voted in the majority to overturn the ruling of the chair and add this amendment to the bill.
Subsequently, the asked for a Speaker's ruling to eliminate the amendment since it was out of scope. The Speaker did rule it out of scope, and that amendment does not appear in the bill.
I respect the decision of the Speaker, although I am disappointed that this addition did not go forward, since I think people should receive their severance in the case of bankruptcy. However, with the priority falling after secured creditors, preferred creditors and unsecured creditors, it is unlikely they will get it, which contravenes the law in many provinces. In Ontario, for example, the law is that people get a minimum of one week of salary for every year of service.
Other amendments at committee included the deletion of clause 6, which eliminated a mechanism to get third party insurance on the insolvent portion of a pension fund. No one seemed to think this was as brilliant an idea as I originally thought. Clause 7 was also deleted to clean up sections 8.1 and 8.2, which were holdovers from previous legislation.
I want to thank everyone who helped to improve my bill at committee, and for passing it there expediently to bring it to this stage.
In summary, I am now asking all members of the House and the Senate to work to get this bill over the finish line and truly improve pension security for Canadians. We are so close. Let this 44th Parliament be the one to ensure that Canadians are able to live with dignity into their golden years.
Our continued efforts will ensure that Canadians are able to support themselves and their families with the pensions they have worked over a lifetime to earn. Please vote to support Bill .
Madam Speaker, I am pleased to participate in the debate on Bill . We are studying this bill at third reading in the House after it was examined by the Standing Committee on Finance.
As reported back to the House by the committee, Bill would amend the treatment of pension claims in proceedings under the Bankruptcy and Insolvency Act, or BIA, and the Companies' Creditors Arrangement Act, the CCAA.
Under current law, unfunded pension liabilities and unpaid special payments are unsecured claims. Unfunded pension liabilities are the shortfall between a fund's current assets and amounts owed to pensioners. Pension special payments are additional contributions by employers that are sometimes required under pension legislation to reduce a pension deficit over time.
Bill would give both these pension claims a superpriority. In BIA bankruptcies and receiverships, pension claims would be paid out ahead of secured, preferred and unsecured claims. CCAA and BIA restructuring plans would need to provide for the payment of pension claims to obtain court approval.
As originally drafted, Bill provided for a five-year transition period before the pension changes took effect. The bill that was sent back to the House after study in committee provides for a four-year transition period, as proposed by the government members.
Bill would also amend the Pension Benefits Standards Act, 1985, or PBSA, under the responsibility of the . The only PBSA amendment, as reported back by the committee, would amend the federal superintendent of financial institutions' existing requirement for an annual report to the Minister of Finance on the operation of the PBSA, which is tabled in Parliament. It would add additional content to this report related to the funding requirements of a federally regulated pension plan under the PBSA and require it to be transmitted to provincial counterparts.
I would note that Bill , as referred to committee by the House, dealt with the treatment of both federal and provincial private pensions in insolvency proceedings under the Bankruptcy and Insolvency Act, or BIA; the Companies' Creditors Arrangement Act, or CCAA; and the regulation of federal pensions under the PBSA.
However, during the clause-by-clause study of Bill , the committee broadened the scope of the bill beyond pensions by adding a new privileged claim for termination and severance pay owed to a worker by a bankrupt employer under the federal or provincial employment standards legislation or a collective agreement.
These amounts are currently considered unsecured debt. Under the amended Bill C-228, these debts would be paid in full before the claims of any other unsecured creditor.
The government clearly explained in the House and in committee that it understands the challenges that an employer's bankruptcy can present for retirees, current employees and their community. We continue to listen to the concerns expressed by Canadians on the important issues of retirement security, wage protection, and termination and severance pay.
Our government has taken measures to improve the retirement income and security of all Canadians, including retirees, and to improve the protection of Canadian workers who are owed unpaid wages and termination and severance pay by their bankrupt employers.
No one in the House doubts that Bill was introduced with good intentions in the interests of pensioners. Having said that, we should be mindful in our continuing debate on the bill that significant concerns were raised by expert witnesses and pension plan administrators during committee study that a superpriority for pension claims may have unintended negative consequences for both pensioners and employees of insolvent employers and the much larger number of pensioners and employees in the Canadian workplace as a whole.
We should also take serious note of the fact that the new preferred claim for termination and severance pay was introduced only during the committee's clause-by-clause consideration of the bill. As such, the committee did not have the benefit of the views of the House at second reading on this new priority claim. It also did not have the opportunity to hear the testimony of expert witnesses and ask questions regarding its potential impact on different employee groups, as well as other stakeholders and creditors in an insolvency proceeding.
Even though all members of the House share the desire of protecting the interests of retirees, we must also consider the significant negative consequences that a superpriority of the unfunded liabilities of a defined benefit pension plan could have for pensioners, employees, businesses and Canadian employers.
First, this superpriority can only protect pensioners from the consequences of the employer's bankruptcy in certain cases. We all know about past cases of bankruptcy where the pension plan deficits were very large, sometimes in the billions of dollars.
During study in committee of Bill and similar private member bills, experts, lenders, promoters of pension plans and employers, and even certain unions, noted that a superpriority would not guarantee that pensioners would be fully protected in the event of an employer's bankruptcy if the employer did not have sufficient assets to cover the liability.
It is also crucial that we take note in our deliberations of the potential impact of a pension claim superpriority on the incentives of pension plan sponsors to continue to provide defined benefit pension plans to current employees. During the committee's study of the bill, pension plan experts and plan sponsors predicted that as many as 40% of private plan sponsors could terminate their defined benefit pension plans during the bill's transition period if Bill were to pass with a superpriority.
Private defined benefit pension plans currently have 1.2 million active employee members who are still accruing defined benefit pension entitlements. We should be very careful about the potential impact of a superpriority on these employees when we consider whether to support Bill , as reported by the committee.
In some cases, retirees and workers are better served if the company can enter into a restructuring agreement and continue operations, which means pension and benefit plans would be funded.
Let us keep in mind that there have been successful restructurings involving unfunded pension liabilities that have taken place under the current processes in the Bankruptcy and Insolvency Act—including Stelco, AbitiBowater and Air Canada—where pension benefits were preserved even though the pension plans were significantly underfunded at the time of insolvency.
As we consider how to best protect pensioners and workers, we must also consider ways to balance the potential credit consequences of a pension superpriority for employers with pension plans. Lenders will price and allocate credit based on the risks of default and non-payment. If a pension deficit is payable ahead of all other claims, a responsible lender must take this risk into account, either through higher interest costs or reduced credit amounts.
The government made important changes to insolvency and corporate laws in 2019 to protect pensioner and worker interests in an employer insolvency. Corporate restructuring was made fairer, more transparent and more accessible for pensioners and workers. Federal corporate law amendments better aligned corporate incentives with the interests of workers and retirees, and provided greater scrutiny of corporate decision-making. Finally, Canada further improved its strong regulation of federal pension plans that already require full solvency funding.
While these measures have improved the retirement and security of employees, the government has also listened to the voices of pensioners and considered more balanced ways to protect their interests rather than a superpriority.
While no OECD country gives unfunded pension liabilities a superpriority—
Madam Speaker, I want to begin by informing the House that Quebec is currently in mourning. We just learned of the death of Jean Lapointe, a great writer, composer, performer, actor and comedian who was very involved in society.
On behalf of the Bloc Québécois, I want to extend my sincere condolences to his son, Jean-Marie, to his family, friends and loved ones, and to all Quebeckers. We will remember him for his comedy shows and his songs. He used to say that we learn to live through song. Many of his acting roles had a profound effect on me. Take, for example, his role in the series Duplessis, where he did an extraordinary job of playing “Le Chef”, his roles in various films by my favourite filmmaker Marc-André Forcier, and the role he played in Les ordres. We pay tribute to his memory, his political commitment and the rehabilitation centre that bears his name.
Farewell Jean Lapointe, and thank you.
Let us now talk about the important Bill
We are at third reading of this bill in the House of Commons. That is amazing. I want to sincerely congratulate the hon. member for for her masterful sponsorship of this bill and for managing to build consensus around a common goal. In committee, members of all parties contributed to the bill, including people like the hon. member for , who participated in the work and helped improve the bill.
In the House this afternoon, we are beginning third reading of a bill that will make a difference in people's lives, in the lives of workers and especially of the retirees who are entitled to these pensions.
As everyone has acknowledged, there have been several instances in recent decades when companies declared bankruptcy and their defined benefit pension funds were underfunded. That had a devastating impact on the company's retirees. They could no longer collect their full pension because the pension fund they were entitled to was underfunded.
In life, in a market economy based on supply and demand and capitalism, there are risks and bankruptcies occur. If a worker sees his company close and declare bankruptcy, it is a difficult situation, but that person will try to find another job and get on with their life.
What happens to pensioners? As the member for Sarnia—Lambton was saying, what happens to people who are 70 or 75 years old and depend on their pension when they suddenly learn that the company is bankrupt? The company has failed to meet its obligations and pensioners will no longer receive their pension, which is often the minimum amount required to live well or to survive. Those pensioners will no longer receive the full amount. They might lose half of their pension, for example, but they are too old and do not have the energy or the strength to return to work. These are terrible situations, unspeakable human tragedies. That is what Bill C‑228 would fix.
It truly is an extremely important bill. I am very pleased that it has reached third reading stage. I look forward to it receiving royal assent and making a real difference in people's lives.
I also want to acknowledge all the hard work done by my colleague from who was especially invested in this bill. She had introduced a similar bill in a previous Parliament that did not make it through the House. She continued trying, working with the member for Sarnia—Lambton, to see Bill C-228 through the legislative process.
My colleague from Manicouagan has been working closely with union members representing the workers who have gone through this kind of human problem. It was really a good faith, goodwill approach. What can we do to better protect workers? We know that a pension plan is a form of deferred wages.
During the negotiation, the union and management decide on salary and the terms and conditions. A lower salary is accepted in exchange for entitlement to group insurance or more generous pension funds, for example. The pension is therefore a type of deferred salary, and workers are entitled to it. However, we know that under the law, a company can underfund their pension fund for several years and allow shareholders to make more money on the backs of workers because it is failing in its duty.
This bill would make pension funds a greater priority for creditor payment in the event of a bankruptcy. This would take some of the pressure off the shoulders of workers and retired workers and would improve things. As the member for said, if this bill is passed, it will not solve every problem. There is no ironclad guarantee and not everything will be resolved. The risk will remain, but it will not be as high. What this bill does is give particular consideration to underfunded pension funds and give them higher priority for creditor payment in the event of a bankruptcy.
One thing we observed in committee and in studies of similar bills was that none of the experts who came to talk to us, including unions, said they should be the top priority. Both pensioners and union members told us they want to give the company a chance to restructure, refinance and come up with a plan to save itself from bankruptcy.
This bill gives mortgage holders priority over pension funds. Everyone recognizes that that is important, although the Liberal Party still seems unsure. Some of our Standing Committee on Finance colleagues are, anyway. I have had personal conversations with a few ministers. Judging from the Liberal member's speech on this bill, there still seems to be some confusion about this.
This is about giving pension funds higher priority while still enabling the company to restructure to avoid bankruptcy. That is what everyone here wants, obviously. That is a very important element.
Several cases have been mentioned, including Sears, Stelco, Nortel, Cliff Natural Resources and White Birch. In all of those cases, the pension plan was not fully funded when the company went bankrupt and the workers are the ones who got shortchanged.
As the Liberal member for Sudbury was saying, pension fund managers, large corporations, or the employer, came to see us to say that they did not really like this. Obviously, they do not like this because they will have to fully fund the pension plans and recognize that the amount owed to workers must be included in the financial statements and paid within a few years, with the necessary flexibility. In my opinion, we found a good balance, but it means less money for shareholders and less money for executives simply because they are being forced to pay what they owe.
The Liberal member who spoke before me did not mention that. Every time the employer or pension fund managers raised an argument, the seniors' advocacy organizations and unions responded clearly and simply by proving that the argument did not hold water.
Employers tried to scare people. The Liberal Party still brings that up, but every argument raised in committee was immediately refuted by parties representing pensioners' interests. Fear tactics are often employed when economic issues and other somewhat complex issues come up. In this case, I think the committee did a good job of rebutting fear-based arguments.
I feel absolutely confident about this bill, but it does not fix every problem pensioners face. There is still a degree of risk, but it is lower. Employers do not like this because they know they will make less money. That is true, but they have to pay what they owe, plain and simple.
In closing, I want to once again acknowledge the incredible work of the member for . As I said, I am the member for Joliette, and the Quebec MNA for Joliette was Véronique Hivon, a person who was all about cross-party collaboration and always tried to prioritize the common good over partisanship. She accomplished a lot in that respect, and the member for Sarnia—Lambton has accomplished just as much here. I thank her and congratulate her.
Madam Speaker, I am quite pleased to be rising in debate on third reading of Bill . There have been many attempts in the past to try to secure pension protection for workers when their companies go bankrupt. I believe this is the furthest we have come so far, and that has been the result of some good cross-party collaboration, which is often what it takes to be able to accomplish things for workers in this place.
I want to thank the member for for her collaborative and conciliatory attitude in trying to move her bill forward.
I would also like to thank the member for for her work on this matter and for her co-operation during the negotiations.
I also want to recognize the work of one of my former colleagues, Scott Duvall, who did a lot of work on this subject over two Parliaments and essentially developed the private member's bill that I was honoured to present in this Parliament on the very same issue.
This bill is an interesting case study, if we look at the process it has been through, of how difficult it can be to achieve things for the working people of Canada.
There always seem to be roadblocks and hiccups, and we do not see those same kinds of roadblocks usually put up when the government is trying to do something for corporate Canada. Those things tend to run pretty smoothly. Sometimes New Democrats try to slow it down, but we have only so many seats in this place. That is up to Canadians. That is why we are always working hard to elect more New Democrats so that we have more of an ability to ensure that corporate Canada does not have the run of this place.
In order to get something done for workers, it usually takes some kind of coming together of many disparate things in the right order, at the right time and in the right place. That is pretty hard to do.
We saw that, just the other day, with the member for . There was some agreement not only to protect the pensions of workers when their companies go bankrupt, but also to go above and beyond and to really do the right thing.
We saw this in the case of Sears workers as well. It was not just their pensions that they lost, but there was a lot of controversy over their severance and termination pay at that time, millions of dollars.
We now have a Parliament that was prepared to do that for working people. Instead, with some procedural fig leaves, we saw the member for get up and exclude what I take to be a really important part of the bill as it came out, amended, from committee, without actually speaking to the substantive issue.
We just heard from another Liberal MP on this, who did not address the issue of termination and severance pay and why the government was so keen to remove that from the bill.
I think that they owe workers an explanation on the substance of the matter, not on the parliamentary procedure but on why it was that, when there was just about a parliamentary consensus, and if it were not for the Liberals there would have been a parliamentary consensus on the fact that it makes sense to protect the termination and severance pay of workers, why they blew that up, instead of seeing it for the opportunity that it was to do right by workers and to have a gold standard when it comes to protecting them in the case of bankruptcy.
As I said, it is hard to accomplish things for workers in this place. I know because I am part of a caucus that works relentlessly to try to do that.
The Liberals ran on a promise to do better when it came to bargaining collectively with our public servants. In fact, the wrote them all a very nice note when he first got elected, and said that things were going to change, that it was not going to be like it was under the Harper years, when those guys would go for years without a collective agreement.
I met just last week with representatives of a public sector union who represent the thousands of people in Elmwood—Transcona who work at the tax centre. What are they telling us? They have been a year without a contract. The government will not make a wage offer. They are having to go to some kind of mediation because they cannot get the government bargaining in good faith. We see that far too often.
Frankly, when Conservatives have been in government, we have seen that lack of good faith and difficulty in getting contracts for public servants too. That is part of why it is very difficult to get things done for workers in this place.
In the previous government, we saw Bill and Bill . Folks in the labour movement will remember those bills because they made it easy to decertify a union. They made it harder to certify a union, and they would have required unions to inappropriately disclose their financial position, which matters if one is thinking about a strike, for instance, in order to make the case for better wages and working conditions.
If the employer knows how much is in a strike fund, it is very easy for them to develop a strategy to exhaust the strike, so that was something that was not good, and the Liberals promised to get rid of it. They did, finally. It took a long time after they came to power for Bill in the 42nd Parliament to pass. I remember encouraging them to do it a lot more quickly. It did not take a lot of time for them to try to pass a deferred prosecution agreement arrangement when SNC-Lavalin came knocking and said that was something it wanted. That appeared quickly in a budget bill, and all of a sudden it was getting done, when it took a year for the legislation to repeal Bill and Bill .
We have also seen Liberals and Conservatives stand up in this place over the course of many Parliaments now to legislate workers back to work, because God forbid workers get too uppity. They had to shut that down and make sure they were back at work, doing what they were told and working for the wages the government put in legislation.
The Liberals talked for a long time about anti-scab legislation, but until it was put in a confidence and supply agreement it was very hard to have any confidence they would do it, and they still were not going to do it the right way until the NDP said very clearly that anti-scab legislation should not apply just when there is a lockout, but also when there is a strike. We know the Conservatives are not supportive of anti-scab legislation, and that is why it is hard to get things done around here for workers.
Even for 10 paid sick days during the pandemic, we had to argue again and again that it ought to be done. We are told that next month it should finally be in place. We have had to wait a good long time. Do members know who did not have to wait? It was big companies at the beginning of the pandemic, when big banks and others got access to liquidity very quickly, because the government was concerned about them. We have seen that when the government is concerned, it is able to act quickly, and we often see long delays when it comes to doing the right thing by workers.
I am sick of it, and that is why this has been a very hopeful process, working with the member for and the member for , because something has been coming together here that is a good thing for workers and that we have been working to institute for a long time.
Not only was it going to be just the next little step, but it was going to be the gold standard. We see again that in this institution there are so many ways to pick off victories for workers, sometimes when we least expect it and sometimes for reasons that appear to have nothing to do with the substance but actually have everything to do with the substance in the bill, because we saw the parliamentary secretary for industry come to the finance committee and sing some kind of big tale and sad song from the financial industry about how hard it was going to be on them and how nobody was ever going to have any access to credit or anything like this. That was right out of the mouth of industry through the mouth of the parliamentary secretary.
These are all arguments that have been considered in the past. Parliament has studied this issue many times before. There was no new information in that. The fact remains that when we have a bankruptcy in this country, it is workers who are left holding the bag. It is wrong, and it should change. When we look at the percentage of businesses that go bankrupt and then the percentage of those that actually have defined benefit pension plans, the fact of the matter is that we are talking about a very small percentage of any one financial institution's portfolio. They can surely bear that risk and carry that load.
Most businesses they invest in succeed. We know that, and that is why we can say with confidence that this is something we can do to protect the pensions of Canadian workers. I wish I were saying we could protect the severance and termination pay also, because we know the big banks and financial institutions are going to get along just fine. The people we should be concerned about in this place are the people who work for 20 or 30 years and do not get a second chance to have a retirement nest egg.
They depend on that, and they went to work on that understanding, and when something goes wrong that is far beyond their decision-making or control, they need to know that the future they worked for is in place for them, so I am very glad we will be doing that with their pension. I am angry we are not doing that for termination and severance pay because the Liberals decided to go for sneaky tricks instead of a straight-up vote on the issue in this Parliament, and I look forward to working with other members of this place to see if folks in the other place, the Senate, will have the good sense to do what we should have done here.
Madam Speaker, it is a pleasure to be here, or least to be with the House virtually. It is always an honour to rise on behalf of the good people of Central Okanagan—Similkameen—Nicola.
I would like to thank the member for for her leadership in this Parliament on this issue. God knows we need these issues brought up because, in some cases, the issue around pension reform and the need to resolve it is long standing and has happened over periods, not just of governments, but of decades.
We have two issues in this particular space when it relates to pensions. One is legacy pensions, which is broadly what we are dealing with today. The other one is new ones, meaning that fewer companies are deciding to use the standard defined benefit pension plan. I am just going to take a quick moment to share a few reasons why that is.
Obviously the business environment has changed. Technologies have come in. We have seen new business models operating that challenge the status quo and have created all sorts of issues for legacy businesses as technology continues to change things.
The government tried to deal with this by bringing in Bill C-27 in its first mandate, but that particular bill went nowhere because the government probably did not do its homework and got hung up over one particular area that people were contesting around conversion, the conversion of a defined benefit to a target pension plan.
The reason why I raise this issue is because the government has failed when it comes to addressing both legacy issues, as well as trying to invoke new methods for bringing in benefits, whether they be a target-based benefit or a defined benefit. If we want to see more people having secure retirements, then that is part of the solution. I do not think the government has done a very good job, which brings me back to legacy issues.
Defined benefit pensions, those are usually handled, most of the time, by the companies themselves. There is no legislation that says that when they are in a surplus position, who actually owns that. Is it the actual company or is it the pensioners or the current workers? That problem, unfortunately, does not happen that often because it is very seldom that these particular private, defined benefits are running at a surplus. In fact, it is the opposite.
We have seen cases such as Sears. I represent a riding that has a large percentage of seniors. They rely on that income. It breaks one's heart when one finds out that they are no longer going to be receiving the benefit they paid into.
There has been inaction on this by the Liberal government since it came into office, but I would not put it all on them. If we just look to those who are fortunate enough to have a pension program, and it is usually in the public sector, the answer has already been given by successive governments over the decades. If there is a shortfall, the taxpayer will fill that gap. However, for these private pensions, that has not been answered.
Unfortunately, we have seen recessions. We have seen where stock markets have been hit hard, in the early 2000s, obviously in the financial crisis in 2008-09, and the subsequent great recession, and now we are looking at where there is a lot of talk about a possible recession. This is the worst time to be bringing these things up.
When these issues happen, when scarcity is abound, this is where everyone tightens up and demands to have what they are owed. The member for has been trying, struggling through the process of a private member's bill, working through committee, to put a new balance in place that would at least address this.
We do have the Office of the Superintendent of Financial Institutions. Bill C-27 that I referred to earlier did talk about having more rules and oversight in place that would force new target benefits to come up with plans to bring themselves back into a surplus position when there is a drop.
That is really important because joint-sponsored pension plans often have these things where they will, on a temporary basis, cut some secondary benefits to smooth things out, and once the plan comes back into balance, then the regular benefits continue. Those kinds of tools, where a pension plan can smooth out those outflows to make sure there is always a plan to get back into surplus, work. It has been shown in joint-sponsored plans, and it could work in defined benefit programs as well, but the government has a responsibility to start the discussion.
Unfortunately, the government seems to have taken the opinion that, if one touches it, one has basically bought it. It has, so far, decided not to enter into this space since its retreat from Bill . Again, this country deserves better. It deserves to have both certainty for the existing legacy pension plans out there in the federal space and, I believe, an overall discussion on provincial plans. So far, when it comes to that kind of discussion, successive ministers of finance, whether it be former minister Morneau, who is the minister no more, as I like to joke once in a while, or the current , they have not made this a priority. Thus, this is where members of Parliament need to fill the gap.
The superpriority, although it is an essential process that has been pointed out by the Canadian public, where they feel that if the government cannot put in place a framework that assures them of that, then, by goodness, they should receive superpriority in the Bankruptcy and Insolvency Act at the very end. It is an option that will have trade-offs in the corporate side, where it will make it in some cases harder for corporations to receive financing for their bonds. However, in the absence of better leadership by the government, members of Parliament have been forced to do this.
It is terrible that we have a government in office that votes down, or I should say denies, unanimous consent. Members of Parliament wanted to see the superpriority component of this bill included. For the Liberal government to continually say no and use whatever tools it can just shows the government is completely opposed to anything in this space. That is lamentable because ultimately it is Canadians who do not have an assured pension, such as public servants or most of us, if we are vested, do.
I would encourage the government to come clean. I would encourage Canadians to talk to their members of Parliament. Most of all, I would encourage the government to start taking this issue seriously, put forward consultations with both provincial governments and the Canadian public on how it intends to deal with legacy issues if it is not going to go forward with the Bill provisions presented by the good member for .
I appreciate the opportunity to speak today and wish all of my colleagues a good day.