Bill C-501: Did the government's sudden love affair with parliamentary procedure stall long overdue legislation to protect pensioners in a bankruptcy?

While Parliamentary procedure is by no means a rousing topic of conversation for most Canadians, the intricate rules that guide our parliamentary democracy have increasingly become the tools of choice for trying to dodge hot-button issues. The drawn-out saga that is Bill 501- a private members bill that would place pensioners ahead of other creditors such as banks and insurance companies in the event of company bankruptcies – reveals the governments growing penchant for evoking parliamentary procedure to skirt around the pressing issues surrounding Canadas retirement income system. While private members bills rarely become law, the relevance of Bill C-501 to the crisis currently afflicting Nortel pensioners allowed the concept of heightened protection for pensioners in the event of bankruptcy to garner unanimous, if qualified, support from both government and opposition parities. To learn more about this Bill C-501 click here.

Last June, all parties supported, in principle, a Parliamentary Motion that included a call for preferred creditor status for pensioners in bankruptcy proceedings. The recent Throne Speech included a declaration that Our Government will also explore ways to better protect workers when their employers go bankrupt. Bill 501 would have fulfilled this promise. However, the government invoked a technical element of parliamentary protocol and asked the Speaker to rule the Bill out of order.

Prior to the second reading vote on Bill C-501, the government pointed out that Bill C-501 allows for the appointment of adjudicators by the Minister of Labour in connection with claims related to bankruptcy proceedings. Since Private Members Bills cannot require the expenditure of public funds, the government indicated that the bill could not be passed. On Wednesday, the Speaker of the House of Commons ruled that since the clause permitting the appointment of adjudicators would require government spending, the bill could be put to a second reading vote and proceed to committee, but not return to the House of Commons for final reading. Click here to read the Speaker’s Ruling.

Bill c-501 passed second reading by a vote of 144 to 111 and was referred to the Industry Committee for further debate. After the committee hearings Bill C-501 will be nullified unless the Speakers ruling is appealed and overturned OR the government adopts the Bill. Is it possible that the government intends to do this but wanted to fulfil its promise on its own rather than allow an opposition bill to do it?

While it is a true that clause 6 of bill 501 conflicts with the rules governing private members bills, it is equally true that inter-party collaboration and behind the scenes consultation on matters regarding the matters of parliamentary protocol is one of the key conventions of national and provincial legislatures. Indeed, one of the most important practices within the House of Commons is regular meetings of the house leaders of all four parties to address procedural issues.

In the case of bill C-501, there is also ambiguity about the necessity of prohibiting the bills passage to third reading since the offending clause could have been removed from the bill altogether during the committee stage. These realities of parliamentary practice suggest that a lack of political will to confer preferred creditor status on employees caught in a bankruptcy proceeding- rather than a scrupulous regard for parliamentary procedure- may be the real force behind the stoppage of bill c-501