McGuinty says voters to decide on 'vote-buying'
Updated: Mon Feb. 08 2010 2:39:14 PM
The Canadian Press
OTTAWA — It's up to voters to decide whether the Ontario Liberals are trying to buy votes in an upcoming Ottawa byelection by providing an estimated $200 million to help Nortel pensioners or just doing the right thing, Premier Dalton McGuinty said Monday.
"I have a tremendous amount of confidence in voters to draw whatever conclusions they feel are fair and to make their decisions accordingly," he said.
The Ontario government has an "obligation" to Nortel workers who put so many years into the now insolvent company and are worried that they'll lose their retirement income because its pension plan is underfunded, he said.
The move comes just a week after a March 4 byelection was called in the riding of Ottawa West-Nepean -- where many of the pensioners live -- and just a few days after the party's star candidate Bob Chiarelli urged the government to help Nortel retirees.
Last week, the government also promised on the eve of a Toronto byelection an estimated $15 million for a threatened hospital in the downtown riding. The Liberals ended up hanging onto the seat.
Opposition critics say McGuinty is trying to buy another byelection on the backs of seniors, but McGuinty brushed off suggestions that his timing was suspicious.
"(The pensioners) have been asking us for an answer for a long time," McGuinty said.
"Some have suggested that we should keep this a question mark until after the byelection. I think that would be unfair. I think people are entitled to know where we stand on this issue."
But Progressive Conservative Lisa McLeod disagreed.
"If McGuinty really wanted to help those pensioners out of the goodness of his heart, he would have done so eight months ago when they asked for help, not when they're about to head to the polls," said McLeod.
"He played the worst kind of politics with people's lives," she said. "He strung seniors along for months who were worried about their future, all so he could give Bob Chiarelli a nice media hit in the middle of an election campaign. He put the `buy' in byelection."
But the government would have been on the hook for a much larger amount of money if it had jumped in to help Nortel pensioners a year ago, said Finance Minister Dwight Duncan.
The valuation of Nortel's pension plan has changed "dramatically" over the past year, he said.
"Quite a bit has changed, and we took this step as a result of a variety of those factors," he said.
"We laid the groundwork for taking this step more than a year ago."
It's not yet clear how much it will cost to help Nortel pensioners in Ontario, which is already grappling with an unprecedented $25-billion deficit this year alone. But a loan of about $100 million to $200 million will likely be required, Duncan said.
The government will ensure money is available for the Pension Benefits Guarantee Fund if Nortel emerged from bankruptcy protection and filed for benefits under the plan, he said.
The fund provides Ontario's pensioners with up to $1,000 a month in the event a pension plan fails to provide its full benefit, or any at all. It is funded by corporate contributions, and the government has no legal obligation to top it up.
The province has already injected about $130 million into the provincial fund since the spring to help cover some of the smaller claims, Duncan said.
In the past, the provincial government has found ways to support the fund when it has been insufficient to meet demand, including when farm equipment maker Massey Ferguson and Algoma Steel filed for bankruptcy during previous recessions. But as it currently sits at about $100 million, the plan is dramatically underfunded.
Don Sproule, president of The Nortel Retirees and Former Employees Protection Canada organization, has said he hasn't received any details about the government's plans. But he said payouts that result from a windup of the pension plan would really only benefit those pensioners earning $12,000 a year.
Nortel's pension plan is about 30 per cent underfunded, and the guarantee fund doesn't contain enough money to cover the shortfall. If the guarantee fund kicks in, workers would get up to $1,000 a month.
That means anyone earning more than $12,000 would only get 70 per cent of their pension.
Many pensions are closer to $22,000 a year, so those people would see a big drop in their monthly income.
The fund also only applies to retirees who worked in Ontario and would do nothing for Nortel workers from Montreal, Calgary or Halifax.
http://toronto.ctv.ca/servlet/an/lo...ty_nortel_100208/20100208/?hub=TorontoNewHome
Updated: Mon Feb. 08 2010 2:39:14 PM
The Canadian Press
OTTAWA — It's up to voters to decide whether the Ontario Liberals are trying to buy votes in an upcoming Ottawa byelection by providing an estimated $200 million to help Nortel pensioners or just doing the right thing, Premier Dalton McGuinty said Monday.
"I have a tremendous amount of confidence in voters to draw whatever conclusions they feel are fair and to make their decisions accordingly," he said.
The Ontario government has an "obligation" to Nortel workers who put so many years into the now insolvent company and are worried that they'll lose their retirement income because its pension plan is underfunded, he said.
The move comes just a week after a March 4 byelection was called in the riding of Ottawa West-Nepean -- where many of the pensioners live -- and just a few days after the party's star candidate Bob Chiarelli urged the government to help Nortel retirees.
Last week, the government also promised on the eve of a Toronto byelection an estimated $15 million for a threatened hospital in the downtown riding. The Liberals ended up hanging onto the seat.
Opposition critics say McGuinty is trying to buy another byelection on the backs of seniors, but McGuinty brushed off suggestions that his timing was suspicious.
"(The pensioners) have been asking us for an answer for a long time," McGuinty said.
"Some have suggested that we should keep this a question mark until after the byelection. I think that would be unfair. I think people are entitled to know where we stand on this issue."
But Progressive Conservative Lisa McLeod disagreed.
"If McGuinty really wanted to help those pensioners out of the goodness of his heart, he would have done so eight months ago when they asked for help, not when they're about to head to the polls," said McLeod.
"He played the worst kind of politics with people's lives," she said. "He strung seniors along for months who were worried about their future, all so he could give Bob Chiarelli a nice media hit in the middle of an election campaign. He put the `buy' in byelection."
But the government would have been on the hook for a much larger amount of money if it had jumped in to help Nortel pensioners a year ago, said Finance Minister Dwight Duncan.
The valuation of Nortel's pension plan has changed "dramatically" over the past year, he said.
"Quite a bit has changed, and we took this step as a result of a variety of those factors," he said.
"We laid the groundwork for taking this step more than a year ago."
It's not yet clear how much it will cost to help Nortel pensioners in Ontario, which is already grappling with an unprecedented $25-billion deficit this year alone. But a loan of about $100 million to $200 million will likely be required, Duncan said.
The government will ensure money is available for the Pension Benefits Guarantee Fund if Nortel emerged from bankruptcy protection and filed for benefits under the plan, he said.
The fund provides Ontario's pensioners with up to $1,000 a month in the event a pension plan fails to provide its full benefit, or any at all. It is funded by corporate contributions, and the government has no legal obligation to top it up.
The province has already injected about $130 million into the provincial fund since the spring to help cover some of the smaller claims, Duncan said.
In the past, the provincial government has found ways to support the fund when it has been insufficient to meet demand, including when farm equipment maker Massey Ferguson and Algoma Steel filed for bankruptcy during previous recessions. But as it currently sits at about $100 million, the plan is dramatically underfunded.
Don Sproule, president of The Nortel Retirees and Former Employees Protection Canada organization, has said he hasn't received any details about the government's plans. But he said payouts that result from a windup of the pension plan would really only benefit those pensioners earning $12,000 a year.
Nortel's pension plan is about 30 per cent underfunded, and the guarantee fund doesn't contain enough money to cover the shortfall. If the guarantee fund kicks in, workers would get up to $1,000 a month.
That means anyone earning more than $12,000 would only get 70 per cent of their pension.
Many pensions are closer to $22,000 a year, so those people would see a big drop in their monthly income.
The fund also only applies to retirees who worked in Ontario and would do nothing for Nortel workers from Montreal, Calgary or Halifax.
http://toronto.ctv.ca/servlet/an/lo...ty_nortel_100208/20100208/?hub=TorontoNewHome
