2021 Pensions Regulatory Updates Across Canada

• Federal

• Ontario

• British Columbia

• Quebec

• Alberta

• Saskatchewan

• Manitoba

• Newfoundland & Labrador

• Nova Scotia

• New Brunswick

Federal  

Office of the Superintendent of Financial Institutions (OSFI)

• Launched consultation on Navigating Uncertainty in Climate Change.

• FAQs related to the revised Standards of Practice of the Canadian Institute of Actuaries as applicable to determining commuted values.

• Instruction Guides:

  • Revised Instruction Guide for the Termination of a DC pension plan and a revised Standardized Termination Report for DC Plans

  • Revised Instruction Guide for the Termination of a DB pension plan. The requirements apply to pension plans with both DB and DC components

  • Draft Revised Instruction Guide for the Preparation of Actuarial Reports for Defined Benefit Pension Plans

  • Updated Instructions for Form 1 – Attestation Regarding Withdrawal Based on Financial Hardship

Department of Finance

• On April 19, 2021, the 2021 Federal Budget was released.¹

• On June 10, 2021, regulations amending the Income Tax Regulations to extend relief to Registered Pension Plans and Deferred Salary Leave Plans came into force.

• On June 29, 2021, Bill C-30, An Act to implement certain provisions of the budget tabled in Parliament on April 19, 2021 and other measures received royal assent.

Other Federal Initiatives

• CAPSA released a revised Guideline No. 7, which is intended to provide guidance on the development and adoption of funding policies for plans that provide defined benefits or target benefits.

​Canada Revenue Agency (CRA)

• Newsletter no. 94-3R1, guidelines on the assumptions that are acceptable to the Canada Revenue Agency when computing the present value of benefits in connection with a DB provision of a registered pension plan.

• Newsletter 21-1, Additional Conditions Applicable to Individual Pension Plans and Designated Plans.²

Ontario  

Legislative Developments

• On March 24, 2021, the Ontario 2021 Budget was released.³

• On July 29, 2021, Regulation 909 under the Ontario Pension Benefits Act was amended to require administrators of plans with pension benefit guarantee fund liabilities of C$10-million or more to include additional information in actuarial valuation reports filed on or after September 1, 2021.⁴

• NEW – On October 7, 2021, proposed amendments to Ontario Regulation 909 of the Pension Benefits Act were released. The proposed amendments include removing the requirement for administrators of member-directed defined contribution (DC) pension plans to establish a statement of investment policies and procedures and for administrators of DC plans to file audited financial statements.

Regulatory Guidance

• Missing pension plan members data collection becomes mandatory September 1, 2021

• Supervisory Approach to Defined Benefit Asset Transfers

• Leading Practice for Defined Benefit Multi-Employer Pension Plans

• DC Wind-Up Applications, as well as numerous other applications, moved to the portal starting March 22, 2021

• Pensions and Marriage Breakdown – a Guide for Members and their Spouses

• Pension Plan Administrator Roles and Responsibilities

British Columbia

The B.C. Financial Services Regulatory Authority has published the following Pension Bulletins:

• PENS 21-001, assist administrators of plans with a DB component who wish to use a line of credit to meet the component’s solvency deficiency

• PENS 21-002 on the registration of plan amendments under the Pension Benefits Standards Act and the Pension Benefits Standards Regulation

• PENS 21-003, application of the transfer of commuted values provision under the Pension Benefits Standards Act and Pension Benefits Standards Regulation for pension plans with a DB component

Quebec

• Revised instructions on actuarial assumptions and methods for determining the value of pension plan commitments on a going concern basis.

• Retraite Québec published the RCR-020 form to register a target-benefit plan.

• NEW – ​On September 22, 2021, the draft regulation to amend the Regulation respecting supplemental pension plans was published in the Gazette officielle du Québec. The proposed amendments to the regulation address a number of issues applicable to target benefit, defined benefit, defined contribution and negotiated contribution pension plans. Any person wishing to comment on the draft regulation must submit written comments by November 6, 2021, to the address indicated on the notice of publication of the draft regulation.

Alberta

• EPPA Update 21-02: Alberta Employment Pensions upgraded its online filing site to allow for the payment of annual filing fees and penalties. Payments by cheque will still be accepted.

Saskatchewan

• The Saskatchewan Financial and Consumer Affairs Authority (FCAA) began a Public Consultation with regards to establishing a new unlocking rule for new and existing locked-in retirement account contracts.

• The FCAA released a Consultation Paper regarding the pension funding framework for single employer defined benefit plans in the private sector and other complementary reform measures applicable to all defined benefit plans. Comments were due June 11, 2021.

• On April 13, 2021, the FCAA released its 2021-2024 Strategic Plan.

Manitoba

• On October 1, 2021, Bill 8, The Pension Benefits Amendment Act, except certain provisions primarily addressing solvency reserve accounts, will come into force. Bill 8 amends Manitoba’s The Pension Benefits Act to, among other things:

  • ​Allow a pension plan to permit a member that continues to be employed after reaching the normal retirement age to stop contributing to the plan and accruing benefits

  • Clarify how ancillary benefits are to be determined

  • Allow a person who transfers their pension benefit credit to a locked-in retirement account or life income fund to unlock all or part of the amount, subject to certain conditions

  • Allow the use of solvency reserve accounts by an employer to fund a solvency deficiency (to come into force at a later date)

  • Establish a new category of specified multi-employer plans

  • Allow rules to address a vacancy on a pension committee involving an inactive plan member

  • Allow greater flexibility in dividing pension assets after a relationship breakdown

  • Corresponding regulations to come into force on October 1, 2021 (see Regulation 63/2021  and Regulation 64/2021)

• NEW – Effective October 1, 2021, the Office of the Superintendent – Pension Commission has updated five of their policy bulletins, namely:

  • #1: Locking-In Retirement Accounts (LIRA)

  • #2: Life Income Fund (LIF)

  • #3: One-Time 50% Transfer (Unlocking)

  • #4: Withdrawal or Unlocking of LIRAs and LIFs

  • ​#5: Pension Benefit Division

  • #14: Financial Hardship Withdrawals from LIRAs and LIFs (realeased by the Office of the Superintendent – Pension Commission and took effect on October 1, 2021)

Newfoundland & Labrador

• Newfoundland & Labrador Pension Benefits Act amended to allow a person who had previously transferred his or her pension benefit to a class or type of retirement savings arrangement approved by the Newfoundland & Labrador Superintendent of Pensions to withdraw from the retirement savings arrangement an amount not exceeding a prescribed amount where:

  • The person is experiencing a circumstance of financial hardship and satisfies the prescribed requirements, or

  • The person has resided outside Canada for at least two consecutive calendar years and satisfies the prescribed requirements

• Corresponding regulations also came into force (see Regulation 4/21)

• Updated Pension Directives No.4, No.5, No. 17, and added No. 18 all with an effective date of March 1, 2021 ⁵

Nova Scotia

• Bill 87 received royal assent. It removed the Nova Scotia Superintendent of Pensions’ responsibility with respect to financial hardship applications to commute or surrender retirement savings arrangements and provided the Governor in Council with the authority to make regulations regarding such applications.

• The Governor in Council amended the Nova Scotia Pension Benefits Regulations to create authority for financial institutions to approve the withdrawal of money in a registered retirement savings arrangement.

• The Nova Scotia Finance and Treasury Board published Form 12: 2021 Financial Hardship Application.

• The Nova Scotia Finance and Treasury Board issued a news release, which details the amendments to the Nova Scotia Pension Benefits Act, and how the changes will streamline the process for Nova Scotians to access locked-in retirement accounts or life income funds.

New Brunswick

• The New Brunswick Financial and Consumer Services Commission published a Request for Comments on unclaimed property rule relating, in part, to wound-up pension plans.