Quebec announces Quebec Pension Plan consultation
This and other subjects are included in the current issue of the Morneau Shepell monthly publication, News & Views
TORONTO, Dec.15, 2016 /CNW/ - In the December 2016 issue of its monthly newsletter, News & Views, Morneau Shepell analyzes the QPP consultation announcement. It also looks at legislative changes in other provinces across Canada.
- Quebec announces Quebec Pension Plan consultation – Last week, the Quebec Minister of Finance announced a public consultation on the Quebec Pension Plan (QPP). The purpose of the consultation is to address potential QPP enhancements and to strengthen QPP sustainability, with controlling the contribution rate a necessary constraint. A Consultation Paper titled Strengthening the Plan to Promote Greater Intergenerational Fairness was released for public discussion. Morneau Shepell looks at three proposals that have been put forth for public discussion.
- Quebec: Bill 92 a game-changer for prescription drugs – Last November, Quebec Health Minister Gaétan Barrette tabled amendments to Bill 92 with the aim of boosting competition and improving drug price transparency in Quebec. Among the changes proposed is the obligation on pharmacists to provide more details on drug receipts, in particular the price of the drug, the wholesaler's margin, and the pharmacist's professional fees. Morneau Shepell explains how these measures, if adopted, are good news for Quebec insureds and plan sponsors.
- Ontario Pension Bill: Restructuring of pension regulator and portability after age 65 – Last month, the Ontario government introduced Bill 70, the Building Ontario Up for Everyone Act. Bill 70 will make several changes to the Pension Benefits Act (the PBA). Also, in the Fall 2016 Economic Outlook, Ontario stated that it will encourage innovative retirement savings tools and review the DC policy framework.
- Employment Insurance: Changes effective January 1, 2017 – The last federal budget in March 2016 announced changes to Employment Insurance rules, including a reduction in the waiting period for benefits from two weeks to one week effective January 1, 2017. At the same date, the premiums will be reduced.
- Prince Edward Island: Changes to premium taxes – Changes to premium taxes were announced by the Prince Edward Island government in October 2016. Effective January 1, 2017, the tax rate on life, accident and sickness insurance (which affects individual and group insurance premiums for insured benefits) will increase from 3.50 per cent to 3.75 per cent.
- British Columbia: Temporary solvency funding relief announced – BC's new temporary solvency funding relief measures are similar to Ontario's temporary solvency funding relief measures adopted earlier in 2016, with the exception that member consent is not required for the extension.
- Ontario and Manitoba move to adopt Pooled Registered Pension Plans – Both Ontario and Manitoba took steps to allow for the introduction of Pooled Registered Pension Plans (PRPPs) in those provinces. PRPPs are an optional form of pension plan for employers who wish to offer a low-cost, defined contribution plan to their employees.
- Ontario revises Form 7: Summary of contributions – All administrators of pension plans registered in Ontario should be revised using the Form 7 effective immediately.
- Tracking the funded status of pension plans as at November 30, 2016 – During the month of November, Canadian universe bonds, Canadian long term bonds, Canadian long-term provincial bonds as well as alternative investments showed negative returns, while Canadian and global equity markets showed positive returns.
- Impact on pension expense under international accounting as at November 30, 2016 – Every year, companies must establish an expense for their defined benefit pension plans. Since the beginning of the year, the pension expense has increased by 24 per cent (for a contributory plan) due to the decrease in the discount rate. The pension expense, however, has decreased since the last couple of months due to the increase in the discount rate.
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SOURCE Morneau Shepell - Corporate