O’Toole vows to force bankrupt firms to pay pensions over executive bonuses

A day after throwing a line to private-sector union workers, Conservative Leader Erin O’Toole is digging in against what the party calls “corporate elites” in a pitch to Canadian seniors and working-class voters.

O’Toole is pledging to give priority to pensioners over companies and most other creditors during bankruptcy or restructuring proceedings.

At an announcement from his virtual broadcast studio in Ottawa, he said a Conservative government would amend legislation to prevent executives from paying themselves bonuses while steering a company through restructuring unless the pension plan is fully funded.

“As I’ve met with Canadian workers and labour unions across the country, I’ve heard the same thing over and over again: After working hard their whole career, people should be able to look forward to financial security in retirement,” O’Toole said Tuesday.

“Canadian workers who’ve paid into a pension plan on every paycheque should be able to rely on it actually being there when they retire.”

The Tory leader, who on Monday promised union representation on federally regulated big companies’ boards, says workers have been forced to take major cuts to pensions when their former employer goes bankrupt, with Sears as a recent example.

The Canadian Labour Congress cast doubt on O’Toole’s pledge, citing his track as a cabinet minister under Stephen Harper. The former prime minister cut the corporate tax rate to 15 per cent from 22 per cent and replaced lifetime pensions for wounded veterans with lump-sum payments that some ex-soldiers said resulted in less money, noted president Bea Bruske.

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“Conservative Erin O’Toole’s rhetoric just doesn’t match his record,” she said in a release.

“Time and time again Mr. O’Toole failed to support pensioners — and even wrote a law to make it easier for corporations to walk away from pension obligations.”

O’Toole tabled a private member’s bill in 2018 that he has said aimed to give pension administrators more leeway to preserve remaining funds and beef up returns for pensioners. It also sought to limit payments to executives during insolvencies, he said.

“But it would have actually allowed executive bonuses to rise by a factor of ten once a company entered creditor protection,” Bruske stated.

O’Toole’s pension pitch builds on his push for trade union votes as he seeks to nab support from traditional NDP turf, and it has striking similarities to recent New Democrat legislation.

In December, NDP MP Scott Duvall tabled a basket of bills that sought to shore up worker protections, including around pensions and benefits in bankruptcy proceedings.

The bill, which died on the order paper after the federal election was called for Sept. 20, would have required companies to provide termination and severance pay before secured creditors were paid.

“Erin O’Toole can try and pretend he’s got workers’ backs this election, but he’s spent his entire political career throwing them under the bus,” NDP Leader Jagmeet Singh said in a statement.

For seniors, the Liberals pledged $3 billion over five years in their budget from the spring to support long-term care and another $90 million over three years to help low-income seniors age at home.

New Democrats have proposed universal pharmacare and a national seniors strategy that would target dementia and elder abuse and suspend clawbacks to the guaranteed income supplement for low-income seniors who received emergency benefits during the COVID-19 pandemic.