Friday April 17, 2009
For Immediate Release
Winnipeg, MB – The International Association of Machinists and Aerospace Workers again called on the federal government to introduce a National Pension Insurance Plan.
Speaking to the Department of Finance Consultation Hearings on private pension plan reform, IAMAW Research Director Louis Erlichman said, “Canada needs a national pension insurance program to protect workers from the effects of corporate pension irresponsibility.” Winnipeg was the last stop in a cross country series of consultation hearings that began in Ottawa in early March.
The IAM submission calls for the federal government to set up an insurance fund, as is available in Ontario, the U.S. and many other countries, to top up pension funds when the plan sponsor fails. “The government should to amend pension legislation to make solvent employers in the federal jurisdiction responsible to top up terminated, but underfunded pension plans,” said Erlichman. “This is required in almost all other Canadian jurisdictions.”
In the current environment, many Canadian workers and retirees are concerned that the pension benefits they are negotiated will not be there when they need them, as corporate executives have put their own interests at the expense of pension plans.
As an example, Air Canada received a special authorization to defer its required pension contributions while under creditor protection in 2004. As soon as it exited creditor protection, Air Canada management moved to dismantle the airline, selling off assets, and removing over $2 billion for distribution to investors and management. All the while, they continued to underfund the pension plan.
Now, with the company in a precarious financial condition, and its pension seriously underfunded, Air Canada employees and pensioners face an uncertain future. The federal regulator should have acted to the extraction of profits at the expense of pensions. The changes proposed by the IAM would help protect the benefits that workers have negotiated and earned. Several IAMAW members from Air Canada attended the presentation.
The IAMAW also calls for a number of other legislative changes to increase pension security, including restrictions on employers’ use of surplus for contribution holidays.
For Immediate Release
Winnipeg, MB – The International Association of Machinists and Aerospace Workers again called on the federal government to introduce a National Pension Insurance Plan.
Speaking to the Department of Finance Consultation Hearings on private pension plan reform, IAMAW Research Director Louis Erlichman said, “Canada needs a national pension insurance program to protect workers from the effects of corporate pension irresponsibility.” Winnipeg was the last stop in a cross country series of consultation hearings that began in Ottawa in early March.
The IAM submission calls for the federal government to set up an insurance fund, as is available in Ontario, the U.S. and many other countries, to top up pension funds when the plan sponsor fails. “The government should to amend pension legislation to make solvent employers in the federal jurisdiction responsible to top up terminated, but underfunded pension plans,” said Erlichman. “This is required in almost all other Canadian jurisdictions.”
In the current environment, many Canadian workers and retirees are concerned that the pension benefits they are negotiated will not be there when they need them, as corporate executives have put their own interests at the expense of pension plans.
As an example, Air Canada received a special authorization to defer its required pension contributions while under creditor protection in 2004. As soon as it exited creditor protection, Air Canada management moved to dismantle the airline, selling off assets, and removing over $2 billion for distribution to investors and management. All the while, they continued to underfund the pension plan.
Now, with the company in a precarious financial condition, and its pension seriously underfunded, Air Canada employees and pensioners face an uncertain future. The federal regulator should have acted to the extraction of profits at the expense of pensions. The changes proposed by the IAM would help protect the benefits that workers have negotiated and earned. Several IAMAW members from Air Canada attended the presentation.
The IAMAW also calls for a number of other legislative changes to increase pension security, including restrictions on employers’ use of surplus for contribution holidays.
