Wabush mine pension fight continues, says Labrador West MHA
Labrador West MHA, Graham Letto, says the fight continues for pensioners affected by the area's downturn, but work will also have to be done to diversity the economy.
It's been two years since Wabush Mines shut down and communities are struggling.
"We have stepped up to the plate with Wabush as a government … we're working very hard to find some resolutions to the issues that exist up there, especially around the pension plans, finding a new buyer for Wabush Mines," said Letto.
When the financially troubled mine, owned by Cliffs Natural Resources, closed in 2014, pension plans were underfunded by about $47 million dollars.
Letto said the big trouble came when a Quebec Superior court gave the company permission to stop paying into the plans until the end of bankruptcy proceedings for its troubled Canadian assets.
"Cliffs has an obligation to fund the pension plan, and they did through our pension regulations, which are some of the strongest in the country," he said.
"Once Cliffs went into bankruptcy protection through the CCWA [Companies' Creditors Arrangement Act] they were permitted to withdraw those payments."
Tough times
Pensioners have faced cuts of up to 25 per cent and more than 900 retirees have lost their medical coverage.
"They knew when Wabush closed their gates in 2014 that the pension was underfunded. It was 16 months later before they went to look for protection," said Ellen, the wife of a Wabush pensioner who called into CBC's On The Go Thursday.
"Why hadn't the government stepped in then? But what happened in that 16 month period was that our pension lost even more."
Letto said the government continues to fight for pensioners and sympathized with the caller, adding that many of his family and friends have been affected by the issue.
"It's very unfortunate that we find ourselves in these situations."
Letto said a change is needed in federal law that puts workers first, along with their pensions and benefits, and work is being done across the country to make those changes.
"There's a very big concerted effort right now across the country through the federal government to make changes to the CCWA so that pensioners and pension plans become a priority … the fact is that we need this to be corrected today so that workers are protected in the future."
Sale of mine still on the table
A meeting set for Friday evening will "bring the pensioners up to speed" on what's happening with the legal battle.
Efforts are continuing with the potential sale of the mine, said Letto, with negotiations continuing to get a purchase agreement finalized and have the assets moved to the new company.
"It's taking some time as a deal of this sort is quite a big job," he said.
"Hopefully that we'll have a successful outcome before too long."
Need to diversify
Letto believes mining will be part of life in Labrador for some time but the area needs to diversify.
"Each and every job today is important. We have to sell what we have. We have to build on our assets," he said.
"Labrador is known for it's cold, it's climate, it's cheap electricity, we have to find ways to put that into opportunities to make it work for us."
Letto said more consideration needs to be given to things such as tourism, and to business opportunities such as data storage for companies that are looking to the north to reduce operating costs.
"This downturn has certainly shown us that we cannot depend solely on mining iron ore."
with files from On The Go