Ontario issues consultation paper on solvency funding reform
On July 26, 2016, the Ontario Ministry of Finance released a consultation paper on solvency funding reform. In the 2016 budget, the Ontario government had announced the appointment of David Marshall, former president and CEO of the WSIB, to lead the solvency funding review.
The consultation paper sets out a set of potential reforms to the funding regime for Ontario-registered defined benefit (“DB”) pension plans, ranging from solvency funding reform (Approach A) to the complete abolition of solvency funding in Ontario and its replacement with a reformed going-concern model (Approach B). The consultation paper also presents a set of additional complementary reform measures that would potentially enhance benefit security to offset the impact of funding reform.