Ontario Budget
On April 11, 2019, Ontario tabled the 2019 Ontario Budget and introduced the Budget Bill (Bill 100). Items of interest include:
The Budget Bill will amend the contribution holiday provisions under section 55.1 of the PBA that became effective on May 1, 2018 as part of defined benefit funding reform to make it clear that administrators can apply any discretionary contributions made in previous years toward ongoing funding requirements. This will remove the current Financial Services Commission of Ontario (FSCO) interpretation of section 55.1 as preventing defined benefit plan sponsors from applying a prior year credit balance toward normal cost contributions.
- Financial Services Regulatory Authority of Ontario (FSRA)
The Budget notes that FSRA could be given additional rule-making authority over the pension sector. The Budget Bill will amend the Financial Services Regulatory Authority of Ontario Act, 2016 to give FSRA the power to collect and enforce assessments to be paid to the Pension Benefits Guarantee Fund (PBGF), and to clarify that any of the assets of the PBGF are separate from the revenues, assets and investments of FSRA. The changes also require FSRA to develop an annual business plan to be provided to the Minister of Finance and to the public.
A new section of the PBA will require FSRA to give the Minister of Finance records and information related to a pension plan or pension fund, or both, as the Minister requests, as well as information relating to the PBGF.
- Electronic communications
The PBA may be amended to allow administrators to communicate electronically unless the member specifically requests paper documents.
Target benefit plans, when they become effective, will extend the target benefit framework to non-unionized Multi Employer Pension Plans. Further developments, including a funding framework, are anticipated.
- Regulating financial planners and advisors
The Budget Bill includes a new statute, Financial Professionals Title Protection Act, 2019, which will restrict the use of the title of financial planner or financial advisor, or similar titles to those who have approved credentials.
- Double-dipping in universities
The Budget Bill proposed amendments to the Ministry of Training, Colleges and Universities Act to allow the government to reduce, eliminate, limit or alter the compensation due to an individual who is employed or otherwise engaged by a post-secondary institution is either in receipt of a public sector pension or who has transferred its commuted value out of the plan.
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