Article content

The federal government is helping Air Canada get out of a deep pension hole, but in exchange the airline will face an almost total freeze on executive compensation increases and shareholder payouts.

The agreement giving the airline more time to eliminate the $4.2-billion deficit in its pension plan is only the latest lifeline from Ottawa to the country’s largest air carrier and saves it from another brush with insolvency.

We apologize, but this video has failed to load.

tap here to see other videos from our team. Try refreshing your browser, or Ottawa gives Air Canada pension break, demands near freeze on executive compensation Back to video

Under the terms of the deal, Air Canada will be required to pay at least $150-million annually — in addition to its current service payments — into its pension plan. Overall, the minimum amount required will be $1.4-billion over seven years, the federal government said.

“By taking this action, we are ensuring that Air Canada remains viable, that thousands of jobs are protected and the service is there when Canadians need it,” Jim Flaherty, the federal Finance Minister, said in a statement announcing the deal.