With the return of the Ontario government on October 28th came the introduction of Bill 132, Better for People, Smarter for Business Act, 2019 (“Bill 132”). Bill 132 is an omnibus bill that includes amendments to a number of Ontario statutes, such as the Pension Benefits Act (“PBA”).
Shortly before the government’s return, on October 24th, the Financial Services Regulatory Authority of Ontario (“FSRA”) published a draft F2020-21 Priorities and Budget Consultation Document (“Statement of Priorities”). Comments on the Statement of Priorities may be submitted through the FSRA website until November 18, 2019.
In this post, we briefly highlight some aspects of the Statement of Priorities and some of the proposed amendments to the PBA in Bill 132.
Bill 132 was introduced for first reading in the Ontario legislature on October 28, 2019. Under Bill 132, a number of amendments to the PBA are proposed, including the following that will be of interest to administrators of single employer pension plans:
- Former and Retired Member Biennial Statements: Under the PBA, a plan administrator is required to provide biennial statements to former and retired members. The PBA currently allows the CEO of FSRA to waive that requirement if satisfied that there are reasonable and probable grounds to believe that the former or retired member is missing. Bill 132 proposes that the PBA be amended to permit the CEO to waive the requirement if satisfied that the administrator is unable to locate the former or retired member after making reasonable efforts to do so. The factors that the CEO must consider in determining whether the plan administrator has made reasonable efforts are set out in a proposed new subsection of the PBA and include the amount of the pension and the searches undertaken by the administrator.
- Electronic Communication: As we reported in our last post, in August 2019, the Ontario Ministry of Finance published draft amendments to the PBA in respect of electronic communications. Bill 132 includes further provisions in respect of electronic communications under the PBA, including: (i) provisions intended to facilitate electronic communication by deeming members and former members of a plan to have consented to receive certain documents in electronic form if certain conditions are met; and (ii) provisions to allow a plan administrator to send documents containing personal information electronically if such documents are sent through a secure information system that requires the recipient to identify themselves prior to accessing the document.
Statement of Priorities
The priorities identified by FSRA for the pensions sector include:
- Support Plan Flexibility: Under the priority of supporting plan flexibility or evolution, FSRA has, among other things, indicated that it will be reviewing and consulting on inherited guidance and developing a plan to update, retire or merge guidance. To further deliver on this priority going forward, FSRA intends to promote good administration of pension plans that is facilitative for employers and cost efficient.
- Develop and Consult on Prudential Supervision Framework: FSRA intends to review and develop a plan to ensure appropriate assessment of risks and targeting of supervision. This process will include consideration of appropriate governance of plans and the long-term sustainability of the Pension Benefits Guarantee Fund.
- Refocus Pension Regulation on Burden Reduction: FSRA intends to reduce unnecessary regulatory burdens and low-return regulatory activities. As part of this process, FSRA has indicated that it will continue to focus on top areas of concern for stakeholders, which include missing members, assets transfers and family law matters.
For further information on any of these developments, please contact Kim Ozubko at firstname.lastname@example.org or (416-597-4338) and subscribe to our A.M. Pension Blog to stay informed on the latest developments.