Dear (name removed),

Thank you for your e-mail regarding issues surrounding Air Canada, its unions, and its retiree associations as they worked towards devising a sustainable path for the airline's pension plan.  I appreciate that you have taken time to express your opinion on this matter.

Air Canada has been pursuing a number of initiatives to meet significant financial challenges and devise a sustainable path forward for the airline.

As Air Canada's pension plan is subject to federal regulation, our Conservative Government had been closely monitoring and involved in these proceedings. In fact, we took leadership in June 2009, by naming former Ontario Superior Court Justice James Farley to help find a solution that was acceptable to all parties in respect of the pension plan and other issues Air Canada faces in this difficult economic climate.

I can report that a satisfactory settlement was reached, as agreements over the summer were ratified by the membership of each of the unions and Air Canada’s retirees.

Under the settlement, Air Canada is expected to realize funding relief to help meet the airline’s ongoing operations and ensure the continued viability of its pension plans.

Air Canada has also concluded a financing arrangement with numerous lenders that includes the Government of Canada through Export Development Canada to help address its immediate liquidity requirements.  Consistent with the expectations and approach taken by all parties, this financing arrangement is on commercial terms.

While the full agreement contains commercially sensitive and confidential information, I can confirm that the loan agreement contains provisions to protect Air Canada’s valuable airport slots.

It is my sincere hope that these pension agreements, which include concessions by all parties, and the new financial arrangement, will help Air Canada through these challenging economic times.

Once again, thank you for contacting my office.

Sincerely,

Mike Wallace