Pension attention cheers Nortel retirees

Nortel pensioners are welcoming the attention that politicians are giving to pensions this week.

"People hopefully thought the company [Nortel] might re-emerge. It's now quite apparent that it's not and it's heading towards bankruptcy," Don Sproule, national chair of the group representing Nortel retirees, saidMonday.

"And I think that people are now understanding the implications to the pensioners and people who are owed money from the Nortel estate."

Nortel retirees have been lobbying governments since Nortel filed for bankruptcy protection in January and began selling off its units one by one.

They worry they will lose a large chunk of their pensions once Nortel finally ceases operations, leaving themofficiallyin the queueof the company's unsecured creditors. That means they would have to jostle with other creditors for a share of whatever is left.

Finance Minister Jim Flaherty announced changes to federally regulated pensions on Tuesday, but they affectonly the 10 per cent of pensionplans that are federally regulated.Sproule acknowledged that Nortel's pensionfalls underprovincial regulation.

Nevertheless, many Nortel retirees sat in the audience as a Liberal working group on pensions heard from politicians, labour and finance experts Monday.

The speakersdescribed the pension deficits faced by many companies, which worsen during a recession, and the problems that occur when a company goes bankrupt and employee contributions to the pension plan cease.

Pierre Laporte, a Toronto pension lawyer who co-chairs the working group, said its goal is to get people involved to "come up with meaningful, substantive policies to fix the mess we're in" and to provide advice to the Liberal Party.

On Tuesday, Flahertyconfirmed thegovernmentplans toboost the allowable surplus for federally regulated pension plans from 10 per cent to 25 per cent. In the past, it was capped to protect tax revenues, as pension plan contributions are tax-exempt.

The government also plans tomakeemployers who terminate a pension plan fund all of the benefits of those already retired, rather than the 80 per cent currently required.