His grandfather came back from World War I wounded, and in need of a place to live. The Canadian government offered him the Vanier two-storey residence with a mortgage of $3,000.
Now, Mr. Carleton says he's considering selling the house. The reason? To pay for his retirement.
The former Nortel Networks Corp. wireless-research employee says he will lose his benefits this December, threatening the future of both he and his wife, Sandra.
"I sure would have looked for something else," Mr. Carleton said, recalling his 2006 decision to retire from Nortel after 12 years of service.
"I think we felt very secure with his job, and we would have had some benefits as well," added Ms. Carleton, sitting across from her husband on a black leather couch.
The couple say they funded their retirement almost entirely through Mr. Carleton, as a medical condition had restricted Ms. Carleton to mainly part-time work.Their golden year plans were modest – remain in the house, stay in touch with friends from Nortel and travel occasionally.
But that all changed in March, when a friend alerted them to a news report about Nortel's financial trouble and announcing the severance of benefits to employees and pensioners by the end of 2010.
The Carletons say they haven't received any correspondence from the dying telecom giant, which sold off most of its divisions to satisfy secured creditors in the wake of a 2009 bankruptcy.
What was worse, the Carletons belatedly discovered their benefits plan was not funded through Sun-Life Financial, as they'd thought, but through Nortel itself. They will lose their disability plan, survivors' benefit and health insurance at the end of the year.
"Nortel has not issued any advice to us," said Mr. Carleton. "They were (also) like that when I worked there – extremely secretive."
In late June, Nortel asked a U.S. judge to eliminate medical and disability benefits to around 4,000 former employees in that country by the end of August. The company said the benefits in question cost it around $2 million per month.
In Canada around 22,000 pensioners are in the same situation as the Carletons. During the past few months, however, provincial and federal governments have made moves to combat the problem.
What we're being told is when you retire, you have to assume the debt of the company you were working for. - Sandra Carleton
In February, at the same time a provincial by-election was called in an Ottawa riding, provincial finance minister Dwight Duncan quietly arranged for a pension benefits guarantee fund that provides former Nortel employees up to $1,000 a month.
However, Nortel's pension plan is about 30-per-cent underfunded, meaning anyone earning over $12,000 would see only 70 per cent of their previous income. Nortel pensions are on average worth around $22,000 a year.
At the federal level, a group of disabled, long-term benefit Nortel employees received a collective $57-million settlement early in 2010 to pay benefits through the end of the year. In June, the pensioners lost their battle to get these benefits extended at the Federal Court of Appeal.
On a more global level, the Carletons had hoped that Bill C-501 – which would amend the Bankruptcy and Insolvency Act to accord pensioners secured-creditor status – would get support in Parliament.
The bill passed at second reading on May 26 and is now at the committee level.
The Carletons say they took it upon themselves to contact every Member of Parliament who voted against the bill, which turned out to be only Conservative members. Only one or two MPs responded, the couple says.
"We talked to one of the MP's aides, one who had voted against it, and we brought it to his attention," Mr. Carleton said.
"He didn"t know (about this) and he started to get shaky about his own pension. It"s a federal issue.
The Carletons now say they worry for their health, and their future. Some of their friends have already given notice at retirement homes, knowing they won't be able to afford the monthly fees.
With thoughts of selling the house, the Carletons expect to struggle to find a place to live; Mr. Carleton said he's toyed with re-entering the workforce, but fears the loss of telecom jobs overseas will doom him to "a job at Home Depot."
"What we're being told is when you retire," Ms. Carleton added, "you have to assume the debt of the company you were working for."
