New Developments in Pensions and Benefits Law - May 2013

  • May 30, 2013

MAY 2013

ON - Pension Announcements in Ontario Budget 2013

On May 2, 2013, the Ontario government announced its 2013 Budget, which indicated that the government will undertake pension-related initiatives with respect to the Carrigan case, target benefit plans, pooled registered pension plans, the Canada Pension Plan, asset transfers between public sector and private sector pension plans, financial hardship unlocking for locked-in accounts, “funding concerns testing” for plans that are not obliged to satisfy solvency funding requirements, contribution holidays, changes to standards issued by professional bodies and disclosure to former and retired members.  In addition, with respect to public sector pension plans, the budget included announcements related to continued cost reduction though negotiated plan changes that improve sustainability and affordability and pooled asset management structures, transfers of assets from single employer pension plans (SEPPs) to jointly sponsored pension plans (JSPPs) and the conversion of SEPPs into JSPPs and the creation of new JSPPs in the electricity sector. The Budget also indicates that after consultations with each of the four JSPPs consolidated in the government’s financial statements, the sponsors have signed agreements with the government that meet its policy objectives. These agreements freeze contribution rates until the deficit is eliminated in 2017-18 and require reductions in future benefits to address new funding shortfalls.


ON - Bill 50 re PRPPs

A private member introduced Bill 50, Pooled Registered Pension Plans Act, 2013, on April 10, 2013 for first reading. If this private member’s bill is passed, it would require the Minister of Finance to introduce a bill to allow for pooled registered pension plans (PRPP) in Ontario. The bill was referred to the Standing Committee on the Legislative Assembly on April 25, 2013.


QC - Bill 39 re VRSPs

Quebec introduced Bill 39, Voluntary Retirement Savings Plans Act, for first reading on May 8, 2013.  If passed, the Bill will establish a new type of retirement plan for Quebec workers - voluntary retirement savings plans (VRSPs).