Ontario is proposing to strengthen and modernize the employment pension system to help plans adapt to economic changes while balancing the need for benefit security.
The Pension Benefits Amendment Act, 2009, introduced in the legislature recently, is supposed to build on the recommendations in the report by the Expert Commission of Pensions, and would:
– clarify the benefits of plan members affected by lay-offs and eliminate partial wind-ups (when only part of a pension plan is closed);
– enable the restructuring of pension plans affected by corporate reorganizations, while protecting benefit security for plan members and pensioners;
– increase transparency and access to information for plan members and pensioners; and
– enhance regulatory oversight, improve administration, lower compliance costs.
The government hopes that providing clear rules and modernizing pension plan administration would enable plan sponsors and plan administrators to operate more efficiently and effectively.
The Pension Benefits Amendment Act, 2009 is part of a multi-step process that represents the first pension reform of this magnitude in more than 20 years. Another bill is planned for 2010.
Minister of Finance Dwight Duncan said, the government is “balancing the diverse interests of working Ontario families, pensioners, and businesses that employ Ontarians. Despite the wide range of views, all of these parties want to achieve the common goal of successful pension reform."
In the 2009 budget, the government committed to introduce pension reform legislation this fall.
McGuinty has called for a national pension summit in 2010 to encourage a pan-Canadian discussion on retirement income; a call endorsed by all other premiers.
