CanAge urges federal leaders to protect pensioners

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On May 11, we sent letters to key federal government officials urging them to vote in support of Bill C-253, which safeguards defined benefit pensions by addressing the unfairness of current bankruptcy laws.

Protecting pensioners from corporate default is a core part of our advocacy, found in our policy platform VOICES: A Roadmap to an Age-Inclusive Canada under ‘E: Economic Security’.

1.3 million Canadians with corporate defined benefit pension plans are potentially at risk of having their pensions cut. Canada needs pension reform to ensure that pensions of hard-working Canadians are not lost due to insolvency or bankruptcy.

The following is the full text of the letter, which was sent to:

  • Hon. Justin Trudeau, Prime Minister
  • Hon. Erin O’Toole, Leader of the Conservative Party of Canada
  • Jagmeet Singh, Leader of the New Democratic Party
  • Yves-Francois Blanchet, Leader of the Bloc Québécois
  • Annamie Paul, Leader of the Green Party of Canada
  • Hon. Chrystia Freeland, Minister of Finance
  • Hon. Deb Schulte, Minister of Seniors
  • Marilene Gill, MP Manicouagan, Bloc Quebecois (Sponsor of Bill C-253)

Dear <Recipient>,

Bill C-253 — An Act to amend the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act (pension plans and group insurance plans) — is currently before the House. It is sponsored by Marilène Gill (MP, Manicouagan).

As Canada’s national seniors’ organization and a trusted voice of Canada’s seniors, we are asking you to vote in support of Bill C-253 because it safeguards defined benefit pensions by addressing the unfairness of current bankruptcy laws.

We believe that Canadian pensioners need this protection urgently.

Here are 4 reasons to support bill C-253:

Protect Seniors. The COVID-19 pandemic has revealed that our social structures don’t protect
seniors, and that includes their financial security. Seniors need protections. Bill C-253 grants
pensioners the legal status they need to protect their pensions and safeguard their financial

Fairness. Bill C-253 puts fairness into Canada’s pension and insolvency regime and protects
pensioners. Only the federal government can make these changes and ensure fairness for
defined benefit pensioners.

Companies Can Afford Their Pension Commitments. Ontario, where 90% of Canadian
pensions are registered, recently offered solvency relief to companies struggling with liquidity
during the pandemic. To receive relief, a company would have to accept restrictions on
discretionary uses of cash, such as dividends, share buybacks, or executive bonuses. No
company applied for this relief.

Pension Protection Must be Mandatory, Or Companies Won’t Do It. Companies do have the
financial capacity to fully fund their pension commitments. Instead, they choose to use cash for
dividends, executive bonuses and share buybacks. They do this because the current law allows
it. In 2017, the CCPA’s study of thirty-nine companies on the S&P/TSX 60 that maintain defined
benefit pension plans concluded that while companies have the capacity to fully fund their
pensions, they simply don’t.

Why Does Pension Protection Matter?

There are no real protections for defined benefit pensioners when a company goes bankrupt
and its pension is underfunded. Unlike creditors, pensioners are not automatically able to
negotiate their terms when assets are divided. They aren’t even allocated a seat at the table,
unless the court grants them one.

It doesn’t cost taxpayers anything to ensure seniors get the pensions they worked their
whole lives for.

On behalf of the 4.2 million seniors who rely on defined benefit pensions, thank you for your
support of C-253.


Laura Tamblyn Watts
CEO, CanAge Canada’s National Seniors’ Advocacy Organization


Canada’s National Seniors’ Advocacy Organization

Factor-Inwentash Faculty of Social Work
University of Toronto

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