Business New Brunswick Minister Victor Boudreau is welcoming Canada's exemption from the protectionist "Buy American" policy that was attached to the massive U.S. stimulus package.

Under the agreement announced on Friday, Canadian firms can bid on American stimulus projects, and in return, the provinces agree to open their contracts to bidding from U.S. contractors.

The province's business minister said he is not concerned about the potential for New Brunswick companies losing out on work here in Canada.

"New Brunswick companies would be able to bid on contracts in Maine as well for example. It's to create that better level field between our two countries and the provinces and states," he said.

Boudreau said he learned of the agreement on a conference call early last week with his federal and provincial counterparts.

The deal will let Canadian companies bid for the remaining $75-billion worth of U.S. projects under the American stimulus program.

New Brunswick is dependent on open markets to the U.S. as 90 per cent of its international exports head south of the border.

Members of Congress attached the "Buy American" clause to U.S. President Barack Obama's $787-billion stimulus plan, which was passed last year.

The U.S. stimulus money is allocated for roads, public housing and other infrastructure projects. Most of that funding has already been spent and the program's deadline for handing out money is Feb. 17.

Lost business

Steve Ross, who operates a steel fabrication company in Halifax, said the contentious rule cost him work in the United States.

"Yes, I would say there have been a number of projects that likely would have been available for us to bid, and the opportunity to do, but with the 'Buy America' clause, we never had the opportunity," Ross said.

The agreement also lets companies bid across the border on municipal contracts in larger cities, such as Fredericton, Moncton and Saint John.

All the provinces and territories had to agree to the deal before it could go ahead.

The deal provides companies in both countries with permanent market access to projects at the sub-federal level, meaning they can bid and work on public works projects at the provincial, state or municipal

The agreement applies only to U.S. funding delivered under the current stimulus program, not future legislation that might include similar "Buy American" provisions.

OTTAWA-It's up to voters to decide whether the Ontario Liberals are trying to buy votes in an upcoming Ottawa byelection by providing an estimated $200 million to help Nortel pensioners or just doing the right thing, Premier Dalton McGuinty said Monday.

"I have a tremendous amount of confidence in voters to draw whatever conclusions they feel are fair and to make their decisions accordingly," he said.

His government has an "obligation" to Nortel workers who put so many years into the now insolvent company and are worried that they'll lose their retirement income because its pension plan is underfunded, McGuinty added.

The move comes just a week after a March 4 byelection was called in the riding of Ottawa West-Nepean - where many of the pensioners live - and just a few days after the party's star candidate Bob Chiarelli urged the government to help Nortel retirees.

Last week on the eve of a Toronto byelection, the government also promised an estimated $15 million to keep a threatened hospital from closing in the downtown riding. The Liberals ended up hanging onto the seat.

Opposition critics accused McGuinty of trying to buy another byelection on the backs of seniors, but the premier brushed off suggestions that his timing was suspicious.

"(The pensioners) have been asking us for an answer for a long time," said McGuinty.

"Some have suggested that we should keep this a question mark until after the byelection. I think that would be unfair. I think people are entitled to know where we stand on this issue."

If McGuinty really wanted to help those pensioners "out of the goodness of his heart," he would have done so eight months ago when they asked for help, not when they're about to head to the polls, said Progressive Conservative Lisa McLeod.

"He played the worst kind of politics with people's lives," she said.

"He strung seniors along for months who were worried about their future, all so he could give Bob Chiarelli a nice media hit in the middle of an election campaign. He put the 'buy' in byelection."

But the government would have been on the hook for a much larger amount of money if it had jumped in to help Nortel pensioners a year ago, said Finance Minister Dwight Duncan.

The valuation of Nortel's pension plan has changed "dramatically" over the past year, he said.

"Quite a bit has changed, and we took this step as a result of a variety of those factors," he said.

"We laid the groundwork for taking this step more than a year ago."

It's not yet clear how much the move will cost the province, which is already grappling with an unprecedented $25-billion deficit this year alone. But a loan of about $100 million to $200 million will likely be required, Duncan said.

That will ensure that there's enough money available under the Pension Benefits Guarantee Fund to help Nortel once it emerged from bankruptcy protection, he said.

The fund provides Ontario's pensioners with up to $1,000 a month in the event a pension plan fails to provide its full benefit, or any at all. It is funded by corporate contributions, and the government has no legal obligation to top it up.

In the past, the government has found ways to support the fund when it has been insufficient to meet demand, including when farm equipment maker Massey Ferguson and Algoma Steel filed for bankruptcy during previous recessions.

But the plan is dramatically underfunded and the province has injected about $130 million since the spring to help cover some of the smaller claims.

Duncan said he expects that there will be others "in the queue," but none have triggered a claim for benefits under the provincial fund.

Don Sproule, president of the Nortel Retirees and Former Employees Protection Canada organization, said the move to bolster the provincial fund will affect about 8,000 pensioners and 4,500 others.

"I wish we'd known this a lot earlier because it's a slow-motion train wreck waiting to happen," he said.

There are about 17,500 ex-Nortel employees who are collecting pensions or have a deferred plan, Sproule said.

Only those who worked in Ontario would be able to qualify for the provincial guarantee plan, which is unique in Canada although others exist in the United States and Britain.

Payouts that result from a windup of the pension plan would really only benefit those pensioners earning $12,000 a year, Sproule said.

Nortel's pension plan is about 30 per cent underfunded, and the guarantee fund doesn't contain enough money to cover the shortfall. If the guarantee fund kicks in, workers would get up to $1,000 a month.

That means anyone earning more than $12,000 would only get 70 per cent of their pension.

Many pensions are closer to $22,000 a year, so those people would see a big drop in their monthly income.

Canadian companies will be exempt from a protectionist "Buy American" clause in the U.S. government's $787-billion US economic stimulus package, the federal government announced Friday.

The deal involves 37 U.S. states that adhere to the World Trade Organization's government procurement agreement, effectively ending a dispute that has raged since Congress passed the protectionist measures in 2009.

"Our government had serious concerns about the 'Buy American' provisions contained in the American Recovery and Reinvestment Act," International Trade Minister Peter Van Loan told reporters in Ottawa.

"We believe that a co-ordinated approach to job creation and economic recovery was essential for both countries," said Van Loan.

Speaking shortly after details of the deal were announced, Liberal trade critic Scott Brison slammed it as "too little, too late" as much of the stimulus funds made available by the Obama administration have already been spent.

The U.S. stimulus money is allocated for roads, public housing and other infrastructure projects, the drawback being that most of the funding has already been spent. The program's deadline for handing out funding is Feb. 17.

"This deal is a pathetic attempt to try to create some level of symbolic victory when, in fact, a real deal was required to defend Canadian interests," Brison told reporters in Ottawa. "There is absolutely no reason the government couldn't have concluded this deal last March."

Access to sub-federal projects

The deal provides companies in both countries with permanent market access to projects at the sub-federal level, meaning they can bid and work on public works projects at the provincial, state or municipal level.

The agreement applies only to U.S. funding delivered under the current stimulus program, not future legislation that might include similar "Buy American" provisions.

International Trade Minister Peter Van Loan did not say how much the deal would be worth to Canadian companies, calling any estimate "highly speculative."

"We could only guess at how much value Canadians would have gotten out of [the stimulus] contracts," said Van Loan. In the future, the deal will bring "significant opportunities" for Canadians, he said.

'It sure is a sweet victory.'?Victor Fedeli, mayor of North Bay, Ont.

The "Buy American" provision gives priority to U.S. iron, steel and other manufactured goods for use in state-level and municipal public works and building projects funded with stimulus tax revenue.

In October, reports of progress between the U.S and Canada over the controversial provision prompted the Federation of Canadian Municipalities to withdraw a resolution to block U.S. companies from bidding on city contracts in this country.

'It's going to be good': mayor

The deal was made with the support of the provinces, territories and industrial associations, said Van Loan.

But it also has the support of some municipal leaders.

"It sure is a sweet victory," said Victor Fedeli, the mayor of North Bay, Ont.

"We have companies that make everything from sandbags and tarps to municipal engineering to huge bridges that you find all over the United States," said Fedeli. "And these companies now have their door open again."

Asked whether he worried the deal could also mean large American companies winning contracts in North Bay that might otherwise have gone to his own constituents, Fedeli said the city was "already a community with open doors."

"We bought two fire trucks in South Dakota for $850,000," he said. "They had to compete against the Canadian firms, and while we certainly want to buy Canadian, that is not the best value for taxpayers.

"The Canadian companies needed to sharpen their pencil, and if a company can make a water reservoir in Illinois and ship it to North Bay and install it for $1 million, I would hope someone in Ontario would have a sharper pencil," he said.

"I think it's going to be good."