New Brunswick proposes new defined benefit funding rules
An in-depth look at this and other subjects are covered in the current issue of the Morneau Shepell News & Views.
TORONTO, July 27, 2020 /CNW/ - Morneau Shepell released the July 2020 issue of its monthly newsletter, News & Views, in which the company looks at the following topics:
- New Brunswick proposes new defined benefit funding rules – The New Brunswick government has released proposed changes to its provincial pension regulations relating to the province's funding framework for defined benefit pension plans. The new funding framework would reduce solvency funding requirements and shorten the amortization period for going concern funding, as well as introduce a provision for adverse deviation (PfAD). The amendments would also require administrators of New Brunswick registered pension plans to establish a written governance policy.
- Alberta provides defined benefit funding and other forms of relief for administrators – The Alberta government has amended its pension legislation to provide certain relief measures in light of the COVID-19 pandemic and economic downturn. Among other measures, the amendment enables administrators of Alberta registered pension plans to apply for a temporary suspension of special payments for funding deficiencies.
- Ontario extends annual statement and other deadlines – Ontario has amended provisions of its pension regulation to extend the deadlines for making certain required filings. Ontario has also provided extensions for issuing annual statements to members, conditional on the plan administrator providing advance notice to the regulator.
- FSRA releases draft guidance on missing members – The Financial Services Regulatory Authority of Ontario (FSRA) has released a draft guidance document on the topic of missing members, which includes commentary on various search tools as well as guidance on how plan administrators may approach winding up a pension plan in which there remain missing members.
- CRA temporarily ceases enforcements of requirements to pay – In light of the COVID-19 pandemic, the Canada Revenue Agency (CRA) has instructed employers, banks and other parties responsible for complying with and remitting taxes that they are not required to comply with or to make remittances based on existing "requirements to pay," which is a method the CRA uses to collect debts from taxpayers who have not paid amounts owing.
- Tracking the funded status of pension plans as at June 30, 2020 – Morneau Shepell describes the funded status of pension plans since December 31, 2019 based on three typical investment portfolios. A graph shows the changes in the financial position of a typical defined benefit plan since the end of 2019. A table shows the impact of past returns on plan assets and the effect of interest rate changes on solvency liabilities of a medium duration pension plan.
- The impact of pension expense under international accounting as at June 30, 2020 – Morneau Shepell has shown the evolution of the pension expense for a typical defined benefit pension plan. Since the beginning of the year, the pension expense has increased by 20 per cent, mainly due to the decrease in the discount rates.
About Morneau Shepell
Morneau Shepell is a leading provider of technology-enabled HR services that deliver an integrated approach to employee wellbeing through our cloud-based platform. Our focus is providing world-class solutions to our clients to support the mental, physical, social and financial wellbeing of their people. By improving lives, we improve business. Our approach spans services in employee and family assistance, health and wellness, recognition, pension and benefits administration, retirement consulting, actuarial and investment services. Morneau Shepell employs approximately 6,000 employees who work with some 24,000 client organizations that use our services in 162 countries. Morneau Shepell is a publicly traded company on the Toronto Stock Exchange (TSX: MSI). For more information, visit morneaushepell.com.
SOURCE Morneau Shepell Inc.