May 11, 2017

Growing Opposition to Federal Anti-Pension Legislation

Workers Organize Actions in Ottawa Demanding a Secure Pension for All


Protest against Bill C-27, Ottawa, May 5, 2017.

Growing Opposition to Federal Anti-Pension Legislation
Workers Organize Actions in Ottawa Demanding a Secure Pension
for All
- Louis Lang
Ottawa Retirees Won't Stand for Anti-Pension Bill C-27, They Will "Sit-In"
Against It
- Ottawa Committee for Pension Security

Quebec Paramedics' Strike
Workers Intensify Actions in Defence of Their Rights

Essar Steel Algoma Bankruptcy Protection Fraud
Instability and Bitter Infighting Amongst Oligarchs
Crisis in Sault Ste. Marie's Finances

Growing Opposition to Federal Anti-Pension Legislation

Workers Organize Actions in Ottawa Demanding a Secure Pension for All

Bill C-27, An Act to amend the Pension Benefits Standards Act, 1985, was introduced in the House of Commons by Finance Minister Bill Morneau on October 19, 2016.

The bill creates a "framework for the establishment, administration and supervision of target-benefit plans" for federally regulated workers in the private sector, as well as Crown Corporations. Currently, there are over 300 defined-benefit plans (DB) in the federal sector covering 489,000 workers with $100 billion in assets.

Bill C-27 would allow employers to undermine DB plans and replace them with target-benefit plans (TB) that reduce the value employers contribute and eliminate their obligation to maintain and provide a guaranteed level of benefits to retirees. With TB plans, the legal requirement on employers to fund, maintain and guarantee pension plan benefits is removed.

Immediately, a broad opposition of retirees and unions raised the alarm and demanded Bill C-27 be withdrawn as an affront to Canadians and their right to security in retirement. The opposition pointed out that Morneau introduced the legislation as a sneak attack with no consultation or prior notice to any of the organizations concerned.

The Trudeau Liberal government temporarily shelved the bill at first reading and began a hastily-organized "consultation" with a few select "stakeholders." No retiree organization was invited to submit views and no public consultation took place on the proposed legislation. The period of private consultation announced by Morneau concludes on May 15. All indications suggest the Trudeau government intends to push Bill C-27 through the House of Commons despite broad opposition from concerned Canadians and their organizations.

Pensions Must Not Be Target of Private Gain for Financial Oligarchy

Morneau Scheppel Inc., the pension and insurance consulting firm founded and operated by Bill Morneau until he was appointed Finance Minister, has long pushed pensions as a target for private corporate gain. Replacing defined-benefit pension plans with target-benefit plans is one such scheme to enrich the few.

Not surprisingly, Morneau Scheppel Inc. hailed the introduction of Bill C-27 as "a positive step that could boost the development of these types of plans across the country." The company expressed the hope that its former CEO and now Finance Minister's initiative at the federal level would prod the Quebec and provincial governments to do the same, as the prospects for transferring pension benefits from retirees to private corporate interests are enormous.

Already in 2012, the Conservative government in New Brunswick introduced its "Shared Risk" Target plan to replace the existing DB plans. Morneau Scheppel Inc., with the current federal Finance Minister still its Chair and CEO, was instrumental in the conversion of the New Brunswick Public Service Pension Plan away from defined benefits. Similar changes to DB plans soon followed in the pension plans of several hospitals and the City of Saint John. Also in 2012, CEO Morneau became an official pension investment advisor to Ontario Liberal Minister of Finance Dwight Duncan, and in 2014, Ontario Premier Kathleen Wynne appointed him to a pension panel led by former Prime Minister Paul Martin. The influence of private corporate interests over governments, along with their outlook, agenda and aim of private profit, extends into all facets of the economy including retirement.

Defend the Pensions We Have; Fight for Pensions for All!

Protest against destruction of public employees' defined-benefit pension plans in violation of workers' contracts, Fredericton, November 6, 2013.

New Brunswick public sector workers and unions continue their opposition to the destruction of their defined-benefit plans to this day. They express their contempt for the deceptively named "shared risk" and "target" plans. Many plan members, retirees and their organizations have denounced the government and Morneau Scheppel Inc. for providing false and misleading information about what the conversion away from their DB plans would mean for them. Plan conversions in New Brunswick have resulted in class action lawsuits and constitutional challenges that are flooding the courts.

Faced with the Liberal Trudeau/Morneau government's expansion of the attack on pensions and its threats against retirees' financial security with Bill C-27, increasing numbers of current and retired workers are actively organizing to defeat the bill and defend their right to a secure defined-benefit pension.

The Ottawa Committee for Pension Security organized a demonstration and sit-in at the Prime Minster' Office at the Langevin Block for noon on May 5. More than 250 active and retired public sector workers, members of the Public Service Alliance of Canada, Professional Institute of the Public Service, Canadian Association of Professional Employees, the Canadian Union of Postal Workers and other unions joined despite the heavy rainfall. Shouts of "Trudeau, Morneau; Bill C-27 Has to Go!" and "Secure Pensions for All!" rang through the streets across from Parliament Hill as workers expressed their determination to continue the fight for the right of all workers to a secure pension.

The Ottawa Committee demands the immediate withdrawal of Bill C-27, declaring in a leaflet, "The Ottawa Committee for Pension Security came together to counter the assault of Bill C-27 on retirement security and the inadequacy and inequality of recent changes to the Canada Pension Plan."

The leaflet also points out, "The Trudeau government has adopted Stephen Harper's 2014 proposal to allow employers to eliminate retirement security and break their legal pension obligations to workers and retirees in the federal jurisdiction."

Join the fight to defend the defined-benefit pensions that workers have now and their extension to all! Together let us stop the immoral destruction and conversion of defined-benefit plans to "shared risk," "target" or some other grossly defined variation of defined-contribution plans that steals value from pensioners and increases insecurity in retirement.

Importantly, the struggle includes a determined No! to Bill C-27 and the imposition of these vile schemes on young workers entering the workforce, which denies them their right to security in retirement, and splits and weakens the working class. Governments must reject as corrupt and retrogressive the influence of private corporate interests that want to profit from pensions and steal value from retirees.

Organize to Defeat Anti-Pension Bill C-27!
Hands Off Our Pensions!
Governments Must Guarantee the Right of All to
a Secure Defined-Benefit Pension and Retirement at a Canadian Standard!

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Ottawa Retirees Won't Stand for Anti-Pension
Bill C-27, They Will "Sit-In" Against It

The changes to federal pension legislation proposed in the Liberal Government's Bill C-27 will strip pension plan members of their benefit security, and violate the "sacred trust" principle of pensions, says the Ottawa Committee for Pension Security.

"Most retirees in this country survive on very modest workplace pension benefits, particularly women whose wages were relatively low and whose average time in the workforce is shorter," says Nancy Parker, a coordinator for the Ottawa Committee for Pension Security. "Retirees are standing against this terrible Bill by sitting down in front of the Prime Minister's Office until it is withdrawn. It will open the door to future rollbacks of our pension benefits, and close the door to secure pensions for younger and newly hired workers. The legal security of the basic 'defined-benefit' type pension plan has been reworked in Bill C-27 such that all of the future risk of pension provision is transferred to workers and retirees."

While Finance Minister Morneau claims that the legislation would provide for a consent mechanism for its most draconian provisions, the OCPS argues that an employer that is determined to escape its pension obligations could simply lock out its workers until they are prepared to offer their consent. In other words, in the real world of contemporary labour relations, consent can easily be coerced.

Widespread opposition to Bill C-27 has translated into an active national campaign by the Canadian Labour Congress and many of its affiliates, as well as the National Association of Federal Retirees, the Congress of Union Retirees of Canada (CURC), and many seniors' organizations. The formation of the Ottawa Committee for Pension Security in January 2017, and the demonstration it is organizing at the Prime Minister's Office on May 5, indicates that this opposition is moving from a relatively quiet lobby into the streets.

"We are not just here to protect our own pensions," says Parker, "but for a decent pension and retirement system for today's young generation. Bill C-27 also targets them, telling them that they should never expect a secure pension income. All generations need to unite to fight this bill."

The Ottawa Committee for Pension Security is a group of concerned individuals who have come together to support retirement security for all. Real retirement security comes from a greater expansion of the CPP supported by secure defined-benefit workplace pension plans that are not a "target" but guaranteed to pay the pension benefits we pay for.

Media Contact: Nancy Parker (613) 875-0474

Protest against Bill C-27, Ottawa, May 5, 2017.

(May 4, 2017)

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Quebec Paramedics' Strike

Workers Intensify Actions in Defence of Their Rights

Paramedics' contingent in May Day march in Montreal.

Paramedics in Quebec, who have been on strike since February, are intensifying their actions in defence of their rights and just demands. They have been without a collective agreement since March 31, 2015.

Paramedics are asking for wage increases similar to those of other public and semi-public sector workers. They are calling for improvements to their pension funds, including early retirement without penalty. As well, they are demanding the abolition of on-call schedules, called "7/14," putting workers on duty seven days in a row, on-call 24 hours a day, and then taking seven days off. These schedules were intended to be temporary when introduced, and workers say they are now out of date and unsuitable. Paramedics are further seeking stability with normal shifts, paid by the hour. This includes a workload that corresponds to actual conditions, given the level of staffing and the complexity of tasks they have to perform.

Paramedics participated in large numbers at the May Day demonstration in Montreal in support of their demands for substantial improvements in working conditions and retirement.

On May 5, paramedics held a militant demonstration against Premier Couillard's visit to the Gaspé Peninsula to promote his nation-wrecking anti-social offensive as an "economic plan" for Quebec. The workers took to the streets and briefly blocked the Premier's car, demanding that he render account for the government's refusal to negotiate. Premier Couillard arrogantly refused to speak to the paramedics and police intervened to clear the way. The paramedics continued their demonstration with support from local residents.

On May 9, striking paramedics employed by Urgences-Santé announced that they want to negotiate wages, retirement and workload together with all workers in the pre-hospital sector, to maintain the common conditions they have established through their struggles over many years. This came in direct response to the decision of the Quebec government to withdraw from negotiations in the pre-hospital sector (except at Urgences-Santé, which is a public enterprise), claiming that the various publicly-funded employers are "autonomous" and should negotiate as they want with workers. At the same time, the government imposes service agreements that dictate the budgets and staffing of these employers. Urgences-Santé paramedics are planning more mass actions including protests at events held by Couillard government ministers to challenge their anti-worker position and refusal to negotiate.

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Essar Steel Algoma Bankruptcy Protection Fraud

Instability and Bitter Infighting Amongst Oligarchs

The necessity for a new direction for the economy

Billionaire oligarch Tom Clarke seized control of Essar Steel Minnesota for $550 million at a U.S. Chapter 11 bankruptcy auction on April 26. Clarke's Social Wealth Controlling Fund (SWCF) called Chippewa Capital Partners also recently acquired U.S. iron ore pellet producer and transporter Magnetation out of bankruptcy protection. He announced plans to merge the two as Mesabi Metallics and complete construction of the $1.9-billion Essar taconite pellet plant in Minnesota. Clarke boasted that his oligopoly would soon be adding a steel mill or two to go with his coalmines, carbon trading business, healthcare interests and other social wealth. He would not reveal the name of the steel mills but rumours are circulating that they may be Stelco or Essar Steel Algoma, which are both under CCAA bankruptcy protection in Canada.

Clarke's purchase of Essar Steel Minnesota is reportedly backed using the recently acquired Magnetation assets as collateral in an arrangement with Liberty House's GFG (Gupta Family Group) Alliance, a SWCF headquartered in London, England with connections in India, and another undisclosed SWCF, which both pledged $250 million to complete the transaction. Clarke boasts that the book value of Magnetation for purposes of borrowing is $700 million even though he acquired the assets out of bankruptcy in January this year for only $52.5 million.

Chippewa Capital Partners was the only entity to show up to the Essar bankruptcy auction. SPL Advisors, the current SWCF managing Mesabi Metallics, formerly known as Essar Steel Minnesota, bowed out as did Cliffs Natural Resources that initially offered $75 million.

Cliffs Natural Resources did not withdraw gracefully. Its CEO Lourenco Goncalves denounced the sudden entry of Clarke's oligopolist firm on the scene with its greater offer. Clarke's seizure of the two iron ore pellet producers puts the oligarch into direct competition with Cliffs, a major iron ore pellet producer in Minnesota. Cliffs has long wanted to seize control of Essar Minnesota's unfinished pellet facility and valuable state mineral leases or at least prevent Essar from becoming a direct competitor.

The CEO of Cliffs, Lourenco Goncalves, is known in Canada for his bombastic and disruptive words and actions against the working class and rivals. Aside from closing competing Canadian iron ore mines in Labrador and elsewhere and refusing to uphold its social responsibilities towards retirees, miners and the environment, Cliffs has interfered directly in the affairs of Essar Steel Algoma in Sault Ste. Marie, Ontario.

Algoma Steel depends on Cliffs for iron ore pellets. Cliffs has used this dependency to attack its Essar Global rival with whom it has engaged in a long bitter struggle in Minnesota. Cliffs inserted a clause into its iron ore delivery agreement with Essar Steel Algoma, while the latter was under CCAA, prohibiting Essar Global from becoming a possible candidate to take Algoma Steel out of bankruptcy protection.

Immediately after the Essar Minnesota (aka Mesabi Metallics) bankruptcy auction where Clarke's firm seized control, Goncalves unleashed a tirade, quoted below from Steel Market Update (grammar is per the published original): "What happened yesterday was an auction that we elected not to show up for. Our offer was made, it was public, so I can talk about, was $75 million. And then I increased that offer to $100 million and that's also public information, so I can talk about. And our offer was all cash, just writing a check. And my offer would also make all the contractors and vendors 50 per cent hold [whole] on their money as soon as the process -- the bankruptcy process would end. So, they would recover $0.50 on each $1 that they owned at that point. The squatters that are there for -- at this point for 10 years would get zip [Goncalves is referring to Essar Global with whom he has had a bitter feud for years], would get a goose egg as well as all the other parties that helped them to continue to be there. I would only this 50% for the vendors and contractors. It's cash."

Goncalves was then quoted calling Clarke's SWCF not Chippewa Capital Partners but "Chewbacca," and sarcastically and abusively saying:

"Look, if you combine a blind with a handicap, you are not going to make for MMA fighter, right? You are going make a handicapped blind man. So, you're combining Magnetation [out of Chapter 11 bankruptcy], with all their success in the past, with Essar Minnesota [out of Chapter 11 bankruptcy], that has also been extremely successful. So, you combine those two stories of success, you pair with someone that offer $250 million of equity and then increase to $350 million. That said that they are going to put a DRI [Direct-Reduced Iron] facility for 3 million tons of pellets and they will start talking in three years. That 3 million tons mega model for that type of size does not exist yet. And they are going to start talking and they're going to start talking through it. That sounds like a great combination of everything.

"And the other thing is where's the money? Although they have an underwritten letter of commitment from big financial institutions like Goldman Sachs, like Bank of America, or JPMorgan or Morgan Stanley or something like that, or the account with Bank of Timbuktu, so these are things that we all see in court. That's the mix, amount of color that I can give to you. I just feel bad for the Minnesota people that fool me once, shame on me. But fool me twice, blame me. That's my assessment of the situation with Chewbacca Steel. That's the word I'd use."

Goncalves said he still believes that Cliffs is in the running to acquire Essar Minnesota's state mineral rights, which is scheduled to be decided at a hearing on May 22. Clarke's seizure of Essar Minnesota and plans to complete the half-finished facility require mineral rights, which is a Minnesota state political decision.

During the long running battle between Cliffs and Essar, Minnesota Governor Mark Dayton terminated Essar's lease last July 1 because of failure to complete the project on time, pay contractors and return a conditional grant from the state of $66-million for infrastructure. Governor Dayton entered into discussions with Cliff's CEO Goncalves at that time to take over the mineral rights. However, with oligarch Clarke taking over the unfinished Essar project, the fight over mineral rights has assumed a new dimension.

The modern socialized economy of industrial mass production needs modern relations of production, cooperation and scientific planning amongst all its sectors and parts within a nation-building project if it is to avoid recurring economic crises and reach its enormous potential. The bitter economic and political infighting amongst competing oligarchs over control of parts of the economy in building their empires both at the national and international level is a fundamental reason for wars and why the socialized economy consistently falls into crisis and fails to meet the needs of the people and general interests of society.

The organized working class is the social force capable of depriving the oligarchs of their power to disrupt the economy and wage wars for empire-building. The time is now for a new direction for the economy without the destructive control of the financial oligarchy.

Together, Let's Build the New!

(With files from Star Tribune-Minneapolis)

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Crisis in Sault Ste. Marie's Finances

Time for a new direction for the economy that favours the people
and says no to the oligarchs!

The bankruptcy protection of Essar Steel Algoma has deprived the Northern Ontario city of Sault Ste. Marie of $26 million in municipal taxes. This represents one quarter of its annual budget. In addition, the city has already paid $250,000 in legal fees to defend its interests within Algoma Steel's Companies' Creditors Arrangement Act (CCAA) bankruptcy process in the Ontario Superior Court.

The police powers of the CCAA put in first place the interests of moneylenders and big legal and accounting companies of the financial oligarchy to the detriment of the working class, pensioners, municipalities and other claimants on the value workers produce. The moneylenders who provide funds during the CCAA process, called Debtors-In-Possession, are paid ongoing interest as a priority. The bills of the big legal and accounting firms that employ a hoard of lawyers and consultants are promptly paid along with the Superior Court fees. Beyond those payments, the presiding CCAA judge has police powers to dictate who else is paid and who is not, such as the municipalities and pensioners regardless of anyone's legal arrangements, expectations and rights. In most cases for example, the judge allows executive managers to receive retention bonuses under the hoax that they are indispensable while retirees are routinely denied benefits and payments into their pension plans.

The shortfall in Sault Ste. Marie's city budget has led to dire talk of austerity and the need to increase taxes on all others by as much as 25 per cent. Also destructive is the fact that in Sault Ste. Marie, Essar Steel Algoma owes more than $40 million to over 120 local businesses, which the oligarchs in control refuse to pay now, and may only pay a small percentage of the amount owed upon exiting CCAA.

The financial oligarchy in command of the CCAA in each particular case uses the police powers to strengthen its dictate over the social wealth existing within the facility, either its value upon liquidation or potential from the continuing value workers produce. This process is to the detriment of the legal claims and rights of all others, including the expectations of retirees with longstanding arrangements for pensions and benefits and municipalities that have provided necessary infrastructure and services. The entire CCAA process stands in sharp contradiction with the proper smooth functioning of the socialized economy on which everyone depends.

With Algoma Steel, the oligarchs who want to seize control and exit from CCAA are demanding huge concessions from active and retired steelworkers and salaried employees.

With the CCAA fraud at Stelco, originally engineered by the infamous U.S. Steel, the oligarchs vying for control are demanding a negation of all social obligations for pensions, benefits and environmental remediation, and concessions in the existing steelworkers' contract, such as the eventual elimination of the COLA. They want to use the police powers of the CCAA to take all social obligations and expectations "off the balance sheet" so they can increase their claim on the added-value workers produce and flip Stelco to another buyer for a big score, as happened before in 2007.

The Algoma steel mill and the workers who produce and have produced steel value are a precious asset of the economy, community and society. They should be treated with care and respect as the foundation of the well-being of the people in the region and the general interests of Canadian society. Those directly in charge of the facility and the provincial and federal government should be held to account for the attacks and threats of the oligarchs against the working people, local suppliers, the community and their valuable steel producing asset.

The retrogressive outlook of forcing the economy and its assets to serve the financial oligarchy to the detriment of the productive forces, working people, community and society is backward in the extreme and must be rejected and replaced. A new direction for the economy with a broad modern outlook to serve the people and put their interests and well-being as a priority within a nation-building project must come into being to turn the situation around.

Canadians must mobilize and organize themselves to say No! to the oligarchs and Yes! to themselves.

All out for a new direction for the economy that favours the people!

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