Air Canada Pension Approval On Track

The Canadian government does not foresee any obstacles to approving a pension moratorium at Air Canada, a Finance Ministry spokesman said Tuesday, although he declined to say when it might do so.

Cash-strapped Air Canada is seeking to waive payments to fund a CAD$2.9 billion (USD$2.6 billion) deficit in its pension fund until April 2011.

Mike Storeshaw, a spokesman for Finance Minister Jim Flaherty, said he could not "give a specific timeline at this point, but we do not expect any obstacles to doing so".

Government approval is expected soon as Air Canada has a CAD$100 million pension payment due on July 30 and another CAD$60 million due two weeks later.