Targeted Reviews – Member Option Statements
On February 23, 2018, FSCO launched another targeted review, dealing with member option statements. This includes termination and retirement statements, but not death or survivor benefit statements. The review will focus on whether plan administrators are meeting legislated requirements for statement content and prescribed timelines, and are calculating commuted values correctly. The requested data is for Ontario members only who were active members up to their date of termination or retirement. FAQs have also been prepared explaining the review process, what administrators must provide as part of the review, and measures to protect personal member information.
Last year, FSCO launched its Targeted Reviews initiative to gather information from selected plans on various issues and trends. The first review dealt with contribution reporting and monitoring (Form 7).
Estimated Solvency Funded Status as at December 31, 2017
According to FSCO’s latest Quarterly Update on the estimated solvency funded status of DB pension plans in Ontario, as at December 31, 2017:
- The median solvency ratio was 94% (compared to 91% as at September 30, 2017)
- 57.2% of plans had a solvency ratio between 85% and 100%
- 25.1% of plans had a solvency ratio greater than 100%
An explanation of FSCO’s methodology and assumptions is also provided.
These results reflect strong equity and bond markets, plus declining bond yields during the fourth quarter of 2017.
2017-18 Pension Assessments
FSCO has issued pension assessment invoices for 2017-18. The total on the invoice is the portion of the preliminary pension assessment for the current fiscal year attributable to the assessed pension plan, plus the adjustment for the previous fiscal year. To avoid late fees, the required invoice payment must be made within 30 days of the invoice date. PBGF assessments, where applicable, should not be combined with the pension assessment.
Asset Transfers under Sections 80 and 81 of the PBA
O. Reg. 310/13, Asset Transfers under Sections 80 and 81 of the Act, has been amended to adjust the requirements for an application to transfer assets in situations where the successor pension plan is the Public Service Pension Plan.
Limitation Issues -
Beccarea v. Canadian National Railway Company,
In 1980, the Federal member retired from Canadian National Railway Company (CNR). In 1992, the member and the plaintiff were divorced. Shortly after the member’s death, in 2003, the plaintiff was incorrectly advised that she would start receiving survivor benefits under CNR’s pension plan. The plan administrator’s error was discovered shortly afterwards, and no survivor benefits were ever paid. The plaintiff eventually sued CNR in 2012. To meet its defence that her claim was commenced out of time, the plaintiff argued that a fresh cause of action accrued each month a disputed pension payment was not made.
The Ontario Superior Court of Justice rejected the plaintiff’s “rolling” limitation periods argument, because this case did not involve the breach of periodic or continuing obligations. According to the Court, from 2003 the plaintiff’s claim “has been consistently rejected by the CNR because of the 1992 divorce … Its position has never wavered or changed. In this case there has not been – or could there be – any new fact which could have affected either party’s legal position.” As such, the plaintiff’s claim was out of time and could not succeed.