SUDBURY – The Liberal Federal Government tabled its Fall Economic Statement today. The Statement included an important reference to Sudbury. Citing the cuts that happened at Laurentian University when it underwent the CCAA process, the Liberal Government says it will take steps to amend the Act so that post-secondary institutions can no longer access the bankruptcy act as a means of dealing with financial hardships.

Earlier this year, Member of Parliament for Sudbury, Viviane Lapointe, spoke with Minister François-Philippe Champagne about the substantial impact to Sudbury when Laurentian University chose to enter the CCAA process. More than 100 professors and 70 staff members loss their jobs. A total of 24 programs were cut. Students who were mid-program had their education and future prospects put in jeopardy.

“We discussed how the province of Ontario failed to intervene. They were aware of the financial mismanagement and did not act. The CCAA process did not have to be used,” stated MP Lapointe.

Lapointe says removing the ability of publicly funded institutions, such as universities and colleges, to make use of bankruptcy and insolvency law is a path to ensuring this does not happen again. “In my discussions with university officials, faculty, unions, and community members, all have stated there is a need to ensure this never happens again. Today, we made it clear that we agree, and are taking the necessary steps to preserve the security of students’ education and the employment of university faculty and staff.”

The 2023 Fall Economic Statement states:

Protecting Public Interest in Cases of Public Post-Secondary Educational Institutions Insolvency

By educating our young people and conducting world-leading research, public post-secondary educational institutions play a critical role in Canada’s social, scientific, and economic development. Following the unprecedented financial crisis and restructuring at Laurentian University in 2021, Canadians have raised concerns about the appropriate protection of important programs and services in the event of a publicly funded postsecondary educational institution becoming insolvent.

Since then, Innovation, Science, and Economic Development Canada has engaged with universities, students, faculty, and other stakeholders to explore how to best protect the public interest functions of these essential institutions in insolvency and restructuring situations.

 The 2023 Fall Economic Statement proposes that the government will amend federal insolvency laws, namely the Companies’ Creditors Arrangement Act and the Bankruptcy and Insolvency Act, to exclude public post-secondary educational institutions from becoming the subject of proceedings under either Act. These amendments will reduce the risk of negative consequences in possible corporate restructuring at public post-secondary educational institutions, such as reduced programming.

Full version of the 2023 Fall Economic Statement can be found here.