WINNIPEG – It’s a step in the right direction for the troubled paper mill in The Pas.
The Manitoba government has approved a deferral of pension payments to help the sale of the Tolko Industries mill.
The pension holiday will allow a prospective buyer to wait three years before they have to worry about topping up the workers pension fund at the mill.
Premier Brian Pallister says the payments total roughly $20-million.
“This is the key ask that both the potential buyer and seller had asked us to do to facilitate, I think in part at least them, in the transition, being able to do the investments they feel are critical.”
That could translate into money being freed up to modernize the mill.
American Industrial Acquisition Corporation is the prospective buyer. They sent a letter of intent to Tolko on September 23. The province says this corporation has a history of purchasing and turning around industrial operations in North America, Europe, and Asia.
Now, while Pallister says this is a positive step, there’s still work to be done.
“This is not a fait accompli. This is not a done deal. And I would not wish for it to be reported that it was because I do not want to unduly offer hope, which is not justified, as a consequence of the follow-up that’s required for the people of The Pas and Manitoba who want to see a resolution to this.”
In response to the deal, NDP MLA for Flin Flon Tom Lindsey showed appreciation for the short-term commitments but still has some concern.
“What kind of commitments has the government got prior to agreeing to the moratorium? The point of the government getting some kind of commitment that this company is going to be here in the long term is that the government has agreed to make a change to the pension regulation. That means that these workers may not have the pensions in the future because the funding may run out.”