: Pension and Retirement Income System Reform

Archive

Proposed Framework for Target Benefit Multi-Employer Pension Plans

July 28, 2017

Ontario is taking further steps to strengthen and modernize workplace pension plans as part of its commitment to workers’ retirement security, while helping businesses to continue to compete and attract skilled workers. A new permanent and comprehensive framework for target benefit multi-employer pension plans would help ensure these plans are healthy and sustainable over the long term. The new framework would replace the time-limited funding regulations currently in place for specified Ontario multi-employer pension plans (SOMEPPs). 
The changes would provide these plans with a permanent exemption from funding on a solvency basis while also:

  • Enhancing long term plan sustainability and benefit security by requiring the funding of a reserve to assist plans in overcoming adverse events, such as poor investment returns
  • Ensuring target benefits are predictable by lowering the risk of benefit reductions
  • Improving transparency so plan participants understand how their plans are governed and operated. 

The government intends to introduce legislation in the fall to implement some of these changes and will be consulting on the details of new regulations, including the design of the reserve and how plans transition to the new framework. As an interim step, the government is extending the temporary solvency funding exemption currently in place for SOMEPPs by one year.

Read the Consultation Paper

A New Funding Framework for Defined Benefit Pension Plans in Ontario

May 19, 2017

The government is moving forward with changes that will help ensure workers’ retirement benefits are protected and maintained, while enabling business to grow and be more competitive. This new funding regime will be based on an enhanced going concern framework while requiring funding on a solvency basis if a plan’s funded status falls below 85 per cent

Read more about the new funding rules for defined benefit pension plans.

Solvency Funding Review

July 26, 2016

Ontario has released a consultation paper seeking feedback on the review of the funding framework for defined benefit pension plans in Ontario.

The 2015 Ontario Economic Outlook and Fiscal Review announced the government’s intention to review the current solvency funding framework.  Feedback should be submitted to the Pension Initiatives Unit in the Pension Policy Branch of the Ontario Ministry of Finance by September 30, 2016.

Read more about the Solvency Funding Review

Read the Consultation Paper

Ontario Seeks Feedback on Proposed Framework for Target Benefit Multi-Employer Pension Plans

July 23, 2015

Ontario is seeking input on key policy issues associated with developing a new target benefit framework for multi-employer pension plans (MEPPs) in Ontario.

The 2015 Budget outlined Ontario's strategy for strengthening retirement income security, including fostering the development of target benefit pension plans. Going forward, Ontario will consult with affected stakeholders about the framework as well as clarifying the rules for multi-employer pension plans MEPPs that provide target benefits.

The proposed framework would address issues such as eligibility conditions, funding rules and governance requirements.

Because of the interest in this consultation, the deadline for submissions has been extended until Friday, October 9.

Read the Consultation Paper

SEPP to JSPP Merger and Conversion Framework Regulatory Posting

Jun 6, 2015

In 2014, the government amended the Pension Benefits Act (PBA) to create a framework that would facilitate single-employer pension plan (SEPP) mergers with existing jointly-sponsored pension plans (JSPPs) or conversions to new JSPPs.  This framework is limited to Ontario's broader public sector.

Strengthening Ontario's Retirement Income System

Nov 29, 2013

Ontario is asking for public input on Securing our Future: Strengthening Retirement Income in Ontario through Pooled Registered Pension Plans, a discussion paper that lays out a framework for implementing pooled registered pension plans in the province. 

In the 2013 Fall Economic Outlook and Fiscal Update, Ontario announced a bold new plan to strengthen retirement income.

Letters Of Credit For Employer Sponsors Of Public Sector Single Employer Pension Plans (SEPPS)

Oct 28, 2013

In May 2011, the government provided temporary solvency funding relief to public-sector SEPPs.  The relief is provided in two stages, with eligibility criteria attached to each stage. In exchange for the relief, plans commit to explore plan changes that would improve sustainability and affordability in the long term.

Since the introduction of the program, many of the plans that entered into the relief regime have made significant progress towards long-term sustainability.  However, continued low long-term interest rates and volatility in financial markets still present a significant risk for pension plans.

Additional Temporary Solvency Funding Relief For Employer Sponsors Of Public Sector Single Employer Pension Plans (SEPPS)

Oct 23, 2013

In May 2011, the government provided temporary solvency funding relief to public-sector SEPPs.  The relief is provided in two stages, with eligibility criteria attached to each stage. In exchange for the relief, plans commit to explore plan changes that would improve sustainability and affordability in the long term.

Since the introduction of the program, many of the plans that entered into the relief regime have made significant progress towards long-term sustainability.  However, continued low long-term interest rates and volatility in financial markets still present a significant risk for pension plans.

Making It Easier to Withdraw Locked-in Retirement Funds

June 24, 2013

Ontario is making it easier for people who need to access their locked-in retirement funds by restructuring its financial hardship unlocking program. 

Beginning January 1, 2014, individuals can apply directly to their financial institution for financial hardship withdrawals, rather than to the Superintendent of Financial Services. 

As well, the government is reducing the amount of evidence required to authorize a withdrawal, and the asset test that determines how much can be unlocked from an account will be replaced with a maximum withdrawal limit. 

New Regulation On Nortel Pensions

Jan 15, 2013

Ontario Regulation 10/13, made under the PBA came into force January 15, 2013.  The regulation, among other requirements, establishes the method for determining the commuted value for those retired members and other plan beneficiaries who are in receipt of a pension and decide to make use of the option to transfer the value of their pension entitlements to a Life Income Fund as a result of the wind up of the Nortel pension plans. The regulation provides that the commuted value shall be determined using the Canadian Institute of Actuaries Commuted Value Standard method which is the same method used to determine the value of all other lump-sum transfers for non-retired plan members on wind up of the pension plan, thereby providing for equal treatment of all plan beneficiaries.

Third Window for Applications for Temporary Solvency Funding Relief Opens for Public Sector Pension Plans

Dec 6, 2012

Changes made to the regulation under the Pension Benefits Act (PBA) in May 2011 provide certain pension plans in the public sector and broader public sector with the opportunity to take advantage of temporary solvency funding relief (Ontario Regulation 178/11).

Facilitating Pooled Asset Management for Ontario’s Public-Sector Institutions

Nov 16, 2012

In the 2012 Ontario Budget, the Ontario government announced its intention to create a framework that would facilitate the pooling of pension fund asset management. To get the best possible advice on this complex undertaking, William Morneau was appointed as Pension Investment Advisor in May 2012 to help determine the advantages of pooled asset management for Ontario’s public-sector pension funds and, if appropriate, a path to implementation. 

Filing Extension for Certain Pension Plans in the Public Sector and Broader Public Sector

June 26, 2012

In an effort to support sustainable public sector and BPS pension plans, the Minister of Finance announced in the 2010 Budget that the government would consider providing additional temporary solvency funding relief to certain single employer, defined benefit or hybrid pension plans in the public sector and the broader public sector, including Ontario university pension plans.

Temporary Solvency Funding Relief

June 22, 2012

The 2012 Ontario Budget announced a proposed extension of the 2009 solvency funding relief measures to sponsors of private-sector defined benefit plans, in light of the pension funding challenges that resulted from recent declines in long-term interest rates and low investment returns.

Province Embarks on Consultations to Enhance Pension Fund Investment Efficiencies

May 31, 2012

The 2012 Ontario Budget includes strong action to balance the budget and to maintain gains made in education and health care. The Budget also presents a strong plan to move forward and transform public services – to change the way they are delivered to give Ontario families better value for money and better results.

Province Embarks on Consultations with Jointly Sponsored Pension Plans

April 25, 2012

The 2012 Ontario Budget includes strong action to balance the budget and to maintain gains made in education and health care.  If passed, the plan would include $17.7 billion in savings and actions to contain cost increases and $4.4 billion in revenue-raising measures.

The Budget also presents a strong plan to move forward and transform public services – to change the way they are delivered to give Ontario families better value for money and better results.

Second Window for Applications for Temporary Solvency Funding Relief Opens for Public Sector Pension Plans

November 7, 2011

Changes made to the regulation under the Pension Benefits Act in May 2011 provide some pension plans in the public sector and broader public sector with the opportunity to take advantage of temporary solvency funding relief.

In exchange for the relief, plan sponsors are expected to adopt plan changes that would make their plans more sustainable in the long term.  The process could include negotiations with collective bargaining agents.

Greater Flexibility For Some Jointly Sponsored Pension Plans

May 26, 2011

Ontario is taking another step toward modernizing pensions.

The government is providing more flexibility for the funding of jointly sponsored pension plans (JSPPs) – a kind of pension plan where risk is shared between employers and employees. Contributions required from members and employers who participate in these plans would be more stable and predictable. Plans would also be required to disclose more information to their members, who as joint sponsors have a say in how their pension plan is governed.

Providing Eligible Pension Plans Temporary Solvency Funding Relief

May 25, 2011

Changes under the Pension Benefits Act will provide some pension plans in the public sector and broader public sector with temporary solvency funding relief.

In exchange for changes that would make plans more sustainable in the long run, a new regulation provides certain pension plans with temporary solvency funding relief. This relief allows plan sponsors to make lower payments into their pension plans for a fixed number of years while negotiating and implementing plan changes – such as higher member contribution rates and/or lower benefits earned in the future.

Ontario Making Progress On Pension Rules

May 20, 2011

Ontario is moving forward with Quebec to create rules that will make the pension regulatory environment more efficient and transparent.

The Agreement Respecting Multi-Jurisdictional Pension Plans would establish clear rules on how multi-jurisdictional pension plans (MJPPs) are administered in Ontario and Quebec.

Ontario Updates Pension Investment Rules

April 12, 2011

The Ontario government has amended Regulation 909 under the Ontario Pension Benefits Act (PBA), effective March 25, 2011, to update the investment rules applicable to Ontario-registered pension plans.  This follows through on the commitment made in the Ontario 2010 Budget to adopt changes to the federal investment rules, if appropriate, for Ontario pension plans. Ontario adopts by reference sections of the federal Pension Benefits Standards Regulations (PBSR) and Schedule III.

Savings Targets Set For Public Sector Pension Plans

February 10, 2011

Today the Ontario government proposed specific sustainability targets for public sector and broader public sector pension plans.  In order to qualify for temporary pension solvency relief the plans must move towards the targets.  The purpose of these measures is to minimize the need for significant solvency deficit payments in the short term and place pension plans on a more sustainable track for the long term.

Ontario Government Moves Forward With Solution for Nortel Pensioners

December 17, 2010

Legislative amendments to be introduced would, if passed, respect pensioner choice while safeguarding benefit security.

Read Minister Duncan’s letter to Nortel Retirees and former employees Protection Canada

Frequently Asked Questions for Nortel Pensioners

Securing Our Retirement Future

October 29, 2010

Ontario is asking for input on proposed reforms to Canada's Retirement Income System that would help strengthen retirement incomes in the future.

News Release: Ontario Seeks to Strengthen Canada’s Retirement Income System

Further Improvements To Pensions For Ontarians

October 19, 2010

Reforms to be introduced today will further strengthen Ontarians' pensions, addressing concerns of workers, retirees, and employers.

Backgrounder: Ontario Government Taking Additional Steps to Strengthen Ontario's Pension System

Further Strengthening Pensions

August 24, 2010

Ontario will propose a broad package of reforms this fall that would help strengthen Ontarians' pensions.

Backgrounder: Ontario Government Taking Additional Steps to Strengthen Ontario's Pension System

The Pension Benefits Guarantee Fund Final Report

Introduction

The Pension Benefits Guarantee Fund (PBGF) provides protection to Ontario members and beneficiaries of privately sponsored single-employer defined benefit pension plans in the event of plan sponsor insolvency. It is the only fund of its kind in Canada and is administered by the Superintendent of Financial Services for the Financial Services Commission of Ontario (FSCO). The PBGF is intended to be self financing through annual premiums based on per-member and partially risk-related fees. Participation in the PBGF is mandatory for most defined benefit pension plans registered in Ontario.

Read the Full report

Improving Ontario's Pension System

December 9, 2009

Ontario is proposing to strengthen and modernize the employment pension system to help pension plans adapt to economic changes while balancing the need for benefit security.

Employment Pension System Reform - Frequently Asked Questions