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Politics : Canadian Political Free-for-All -- Ignore unavailable to you. Want to Upgrade?

To: John Carragher who wrote (2815)	7/13/2003 9:02:02 AM
From: DeplorableIrredeemableRedneck	Respond to of 37571

Rich bugger indeed: Martin's shipping firm $83M richer after liquidating pension fund surplus Windfall likely to be reinvested in company Glen McGregor The Ottawa Citizen canada.com Sunday, July 13, 2003 CREDIT: Ted Jacob, CanWest News Service Paul Martin, seen at the Calgary Stampede yesterday sporting an 'I love Alberta beef' button, has vowed to hand ownership of the company to his sons in an effort to avoid conflicts of interest. Paul Martin's shipping company is $83 million richer now that the federal pension regulator has approved a request to liquidate the surplus in its employees' pension fund. The Office of the Superintendent of Financial Institutions (OSFI) last month agreed to a deal that allowed Canada Steamship Lines to split the accumulated surplus of $167 million with pension plan members. The windfall comes just as Mr. Martin prepares to transfer control over the company to his children, a move intended to curb the questions about his ownership of the company that nagged him earlier this year. Critics suggested Mr. Martin could not retain ownership of the shipping giant should he become prime minister without facing constant conflict-of-interest allegations. Although he initially resisted calls to divest himself of the company, in March he announced he would turn over control to his three adult sons. Technically, ownership of the firm has always rested with the sons, who held all the common shares. But Mr. Martin and his wife, Sheila, retained control through owners of a class of preferential shares. The company has already received the cash from the pension surplus and the transaction will be on the company's books before the sons -- Paul III, David, and Jamie -- take over. As the sole controlling shareholder, Mr. Martin can disburse the money as he wishes, although CSL vice-president Pierre Préfontaine says he expects the cash will be kept in the company. "It's going to be reinvested in growth projects," Mr. Préfontaine said. The $83 million represents a substantial boost to the bottom line for CSL, which had annual sales of $283 million in 2001, according to a Dun & Bradstreet Canada credit report. The same report pegged the privately held company's assets at $693 million. Four months after Mr. Martin announced he would give his controlling shares to his four sons, the deal is still not complete. "It's in the hands of lawyers and others expert in that matter," said Scott Reid, a spokesman for Mr. Martin's Liberal leadership campaign. He would not say when the deal will be finalized. "The commitment was that it would be completed before November. There's no question that commitment will be honoured." Mr. Reid denied the pension payout was a factor in the timing of the transfer. "The surplus has nothing to do with the bottom line." Before the transfer is complete, ethics counsellor Howard Wilson is expected to release guidelines he drafted to help Mr. Martin deal with conflicts of interest with his family business holdings, should he win the party leadership in November and become prime minister. As a transportation company, CSL's pension is run under federal rules and regulated by the OSFI, an agency within the Department of Finance. When he served as finance minister, Mr. Martin delegated responsibility for OSFI to a junior minister. But because the issue of CSL pension surplus arose while he was still in cabinet, Mr. Martin was required to recuse himself from discussions involving amendments to federal pension plan law. Members of the CSL pension plan filed a class action against the company to force it to liquidate the surplus. They settled out of court last year with a surplus-sharing agreement that would see about 8,000 pensioners receive a minimum of $1,200. Some plan members could see their pension payments doubled under the agreement. The CSL pensioners fared far better than those in the plan for employees of Voyageur-Colonial, the bus company Mr. Martin owned until 1997. They are currently suing plan trustees, claiming that they lost as much as 46 per cent of their pension benefits because of bungling of the fund management. According to court documents, employees repeatedly complained about impending shortfalls in the plan to the OSFI but the agency did not intervene. © Copyright 2003 The Ottawa Citizen