Sears Canada wants to cut retiree benefits in bankruptcy restructuring

   Canada column for Sunday, July 9/17

   THE CANADIAN REPORT

   (c) By Jim Fox

   Sears Canada, in bankruptcy protection from creditors, wants court approval to cut off benefits for its retired employees.

   The company that has been hammered by online shopping and tough competition is raising “significant doubt” about its future in Canada and seeking a buyer.

   Plans are to cut 2,900 jobs and close 59 of its 225 stores as it restructures and to seek court approval to suspend benefits for its retired employees and special payments to its defined benefit pension plan.

   Sears said in its initial court filings that it planned to suspend life insurance, health and dental benefits to certain employees during the restructuring.

   Now it is asking the Ontario Superior Court to extend court protection from creditors to Oct. 4 as it seeks potential investors and buyers and consults with its landlords, employees, suppliers and creditors.

   The restructuring hasn’t affected monthly pension payments to the retirement plan’s beneficiaries.

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   An increase of 45,300 jobs last month comes as there is speculation the Bank of Canada will raise its trendsetting interest rate.

   Bank governor Stephen Poloz has been making increasingly positive comments about the state of Canada’s economy, hinting at raising the rate of 0.5 percent in the coming week.

   The rate, unchanged in about seven years, is used by commercial banks to set their prime lending and mortgage rates.

   There was an increase in the number of full-time positions in June along with many more part-time jobs, Statistics Canada reported.

   It resulted in pushing the national unemployment rate down to 6.5 percent from 6.6 percent in May.

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   News in brief:

   - The Canadian government has apologized to former Guantanamo Bay inmate Omar Khadr and paid him $10.5 million to settle a lawsuit over violations of his rights. The Toronto-born Khadr, now 30, was in U.S. custody at Guantanamo at age 15 for allegedly throwing a grenade that killed American soldier Christopher Speer in Afghanistan in 2002. The Supreme Court ruled in 2010 the Canadian government’s participation in the “then-illegal military regime” at Guantanamo breached Khadr’s guarantee of fundamental justice under the Charter of Rights and Freedoms.

   - Karim Baratov, 22, of Ancaster, Ontario has had a U.S. extradition hearing set for Sept. 8 on charges he breached about 500-million Yahoo e-mail accounts and targeted diplomats, bureaucrats and others for political or financial gain. Police say he is wanted for identity theft and conspiring to commit fraud in the scheme allegedly organized by Russian intelligence agents. He was arrested by the Mounties on March 14 on behalf of the U.S. government and has remained in custody since then.

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   Facts and figures:

   Canada’s dollar has advanced to 77.67 cents U.S. as the U.S. dollar is worth $1.287 in Canadian funds before exchange fees.

   The Bank of Canada’s key interest rate is steady at 0.5 percent while the prime-lending rate is 2.7 percent.

   Stock markets are lower, with the Toronto exchange index at 15,027 points while the TSX Venture index is 755 points.

   The average price for gas in Canada is higher at $1.064 a liter or $4.04 (Canadian) for a U.S. gallon.

   Lotto 6/49: (July 5) 4, 9, 33, 36, 47 and 49; bonus 10. (July 1) 15, 16, 22, 33, 37 and 41; bonus 27. Lotto Max: (June 30) 7, 24, 26, 36, 37, 43 and 44; bonus 3.

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   Regional briefs:

   - About 3,600 people have been forced from their homes by a fast-moving wildfire in central British Columbia. The evacuation order, over concerns about changing wind patterns and heavy smoke, involves properties around 105 and 108 Mile House and the west shore of Lac La Hache. Another fire near Ashcroft also triggered an evacuation order.

   - Things are looking brighter this year in once oil-rich Calgary, Mayor Naheed Neshi said as the Calgary Stampede kicked off with a parade. The mood is brightening in the city beleaguered by a prolonged downturn in oil prices, he said. Alberta added 41,000 jobs over the past year and the provincial government has committed $1.53 billion to a major light rail transit expansion in Calgary.

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Jim Fox can be reached at canadareport@hotmail.com