Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Wednesday December 20, 2017
Payday lenders squeezed by new regulations
After more than two decades in the payday-loan industry, Anthony Piet faces his most difficult year in the business.
Mr. Piet operates eight Money Mart franchises sprinkled across Canada, located in small towns such as Banff, Alta., and Timmins, Ont. Legislative changes in numerous provinces – including Ontario, to take effect on Jan. 1 – have squeezed payday lenders, in particular smaller players such as Hamilton-based Mr. Piet. New rules reduce how much they can charge and put restrictions on lending.
“Tough,” says Mr. Piet of his 2018 outlook. “Really tough.”
The much-maligned payday-loan industry sells short-term loans at a high cost, mostly to lower-income Canadians. If a person doesn’t have access to credit, but is short on money in between paycheques and needs to cover something essential, such as the hydro bill, a lender such as Money Mart is an easy and fast place to get cash. The loans are generally repaid quickly, but the fees, which long stood at more than $20 for every $100 borrowed, added up to an annual interest rate of 500 per cent and more.
Provinces across Canada have tightened the rules that govern the industry. Payday lenders insist they provide an essential service, but they have been widely criticized for exploiting vulnerable customers and charging too much. Now they say their margins are being squeezed so badly that they’re fighting for survival.
The number of payday lenders operating in Canada has been on a downward trend for several years, in part because of the new legislation. In 2017, there are an estimated 1,360, down 5 per cent from 1,434 in 2015.
For Mr. Piet, with one Money Mart in Alberta, he has taken pragmatic measures. He has reduced hours of operation, cut advertising and pulled back on community contributions. He called his Banff store’s future “tenuous.”
In Ontario, where his Money Marts are in Timmins and Simcoe, Mr. Piet doesn’t feel the new rules in the province foretell looming closures but feels like he is in a vise as he draws up budgets for the coming year. “Everything is under the microscope,” he said. (Source: Globe & Mail)
Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday October 27, 2017
Sears Canada pensioners demand shortfall be paid off first
The law firm representing Sears Canada pensioners has issued a letter to the agency overseeing the liquidation and all other creditors, asking that the pension deficit be paid first and as soon as possible, as money from liquidation sales becomes available.
“Our clients . . . are entitled to first priority recover for those amounts,” according to the letter, from Koskie Minsky’s Andrew Hatnay, citing a prior Supreme Court of Canada decision.
The letter is addressed to the monitor assigned to the case, FTI Consulting, and to the service list, which includes lawyers representing every party to the insolvency.
If Hatnay’s position is accepted by the creditors lining up to be paid, the pension’s $270-million deficit would be paid first, although pensioners would not receive other benefits – dental benefits and life insurance benefits, which were discontinued at the end of September.
If the other creditors refuse to allow the pensioners to be paid first, the matter could end up before the court, according to Hatnay.
The legal letter was sent Thursday, a day after Innovation Minister Navdeep Bains said the federal government will consider legislation to protect employees’ pensions when a company goes bankrupt.
While there’s no plan for the government to introduce legislation at the moment, he said it will carefully examine two different private member’s bills on the subject, put forward by a New Democrat MP and a Bloc Quebecois MP. (Source: Toronto Star)
Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday October 20, 2017
‘Dear Jeff…’: Trudeau sends personal pitch to Amazon CEO
Prime Minister Justin Trudeau is making a personal pitch to Amazon to open its second headquarters north of the border, marketing Canada’s cities as “progressive, confident and natural homes” for the company.
The deadline to submit bids to Amazon ended Wednesday at midnight, and Toronto, Ottawa, Montreal, Vancouver and Calgary are all expected to be in on the scramble, among many others.
In a two-page letter dated Oct. 13 that starts “Dear Jeff,” Trudeau gives Amazon CEO Jeff Bezos the full sales pitch on Canada — though diligently avoids tipping his hand toward one city or another.
The letter puts a heavy emphasis on Canada as an open, tolerant and multicultural society, before going on to promote the business climate and educated workforce.
“As the first country in the world to adopt a policy of multiculturalism, we have shown time and time again that a country can be stronger not in spite of its differences, but because of them,” it says.
“Diversity is a fact, but inclusion is a choice. Canada has made its decision and our cities have become windows to the world.”
The letter specifically mentions Canada’s efforts to attract skilled immigrants — a noted contrast to the immigration restrictions U.S. President Donald Trump has put in place that have prompted protests from American tech leaders. (Source: National Post)
Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday September 28, 2017
Bombardier hit with 219% duty on sale of jets to Delta Air Lines
OTTAWA—Bombardier’s hopes for breaking into the U.S. commercial aviation market took a massive blow on Tuesday, as the U.S. Department of Commerce proposed a hefty 219 per cent duty on its CSeries jets.
The department ruled in a preliminary decision that Bombardier benefited from improper government subsidies, which gave the Montreal-based company an unfair advantage when selling south of the border.
The investigation was sparked by a complaint from U.S. aerospace giant Boeing, after Bombardier secured a deal for up to 125 of its CS100s with Delta Air Lines in April 2016.
The list price for the planes is around $6 billion, but the actual amount of money involved in the deal has not been made public and Boeing alleges Bombardier offered them for much less.
The financial penalties aren’t officially due until Bombardier delivers the first CS100 to Delta, which is expected in the spring. They could also still be dropped or refunded.
The key will be whether the U.S. International Trade Commissions finds that Bombardier-Delta deal actually hurt Boeing’s business, a decision that’s not expected until the spring. (Source: Toronto Star)