Canadian Pension Plans

EBIS Search Results

To order copies of these articles, use the online order form or contact the Document Delivery Service at bookstore@ifebp.org or (888) 334-3327, option 4.

These executive summaries were compiled from EMPLOYEE BENEFITS INFOSOURCE database, a source for information on employee benefits and human resources.

Foreign Plans: Report Urges Reform of Pension, Tax Rules to Improve Canadian Pension Savings.
BNA's Pension & Benefits Reporter; v35 p 2536 Nov 11, 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : A report by the C.D. Howe Institute argues for reforms of Canadian pension and tax rules to provide for better retirement savings by a wider range of people. The institute contends pension laws should change to allow more types of groups to set up pension plans, and tax laws should not tie pension plans strictly to employers. Individuals and employers should be able to make contributions to any pension arrangement. Establishing a target accumulation limit is also more equitable than a contribution limit.
[0155222]
Individual, Perk-Filled Pension Plans.
Merrick, Peter J.; Canadian HR Reporter; v21 no19 p 16 Nov 3, 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Individual pension plans (IPPs) provide high income Canadians with a retirement savings vehicle suited to their needs. It goes beyond the locked in Registered Retirement Savings Plan (RRSP) and provides a tax advantaged way to transfer funds from an existing pension plan. IPPs are available to those earning over $100,000 (Canadian) yearly who have reached their contribution limit for an RRSP or other pension fund. It enables the owner to accumulate more wealth and offers several other advantages including protection from creditors, an extended employer contribution period, predictable lifetime income, splitting funds with a spouse earlier and opportunity for a special terminal funding contribution.
[0155356]
Helping Them Figure It All Out.
Massey, Annie; Canadian HR Reporter; v21 no16 pp 16, 18 Oct 6, 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Getting employees to become engaged in the retirement planning process is one of employers' greatest challenges. Employees must make many active decisions on joining, contribution level, investment preferences, rebalancing and understanding their retirement income needs. Implementing automatic features is unlikely to be enough. Employers can raise workers' engagement and financial literacy level by branding educational resources, sponsoring in-person meetings and webinars and providing online retirement planning tools. Focus groups enable deeper exploration of employees' thoughts on retirement planning.
[0155116]
Alberta Court Rejects Plan Members' Challenge to Early Retirement Amendments.
Guindon, Anthony; Canadian Benefits & Compensation Digest; v26 no5 pp 7-8 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Lloyd v. Imperial Oil Ltd. was first heard in 1995 by the Pension Commission of Ontario (PCO). In 1997, the Queen' Bench Court of Alberta determined issues relating to an early retirement amendment had not been addressed under Alberta's Employment Pension Plans Act, but since the case was largely covered by the PCO, barred the plaintiffs' claims. However, the court judged the early retirement benefit was not an accrued benefit and tightening the provision did not reduce accrued benefits. The court found the company acted as an employer in amending the plan and was not bound by fiduciary or trustee responsibility in doing so. The two-hat doctrine is increasingly being accepted in the courts to distinguish plan administration from sponsorship but is sure to prompt further litigation.
[0154933]
Balancing DB Pension Risk.
Smolkin, Sheryl; Employee Benefit News Canada; v5 no5 pp 6, 8 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The University of British Columbia's staff pension plan is unique and successful, having limited financial liability and a special contingency reserve by special permission of the Canada Revenue Agency. The university's and employee contributions are set, though there is a move to increase employee contribution caps for low income workers. Keys to the plan's success are the contingency reserve and the distinction in the British Columbia Pension Standards Act between negotiated cost plans and multiemployer plans. This differentiation is recommended as a model for modifying pension laws to enable affordable defined benefit plans.
[0155174]
Charting DB Plans Through Troubled Waters.
Martel, Louis; Benefits and Pensions Monitor; v18 no7 pp 45, 47 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : As economic conditions decline, defined benefit (DB) plan sponsors need to develop clear and manageable funding policies. A funding policy is a formal statement of the rules and means by which the plan fund acquires the assets needed to pay plan members' benefits. A DB plan may already be operating under these principles, but by formalizing them in writing a sponsor can ensure that participants and sponsors have the same understanding of the plan's policies. A funding policy should cover plan design, governance structure, funding objectives, financial assessment, risk management and plan monitoring.
[0155207]
FSCO Replaces Policy on Financial Statements.
MacDonald, Lesa; Canadian Benefits & Compensation Digest; v26 no5 p 6 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Effective May 15, 2008, the Financial Services Commission of Ontario issued a revised policy governing financial statements by pension plans and funds. The revision allows plans and funds to submit financial statements not prepared in accordance with generally accepted accounting principles in certain circumstances. Such statements, however, must conform to the standards described in the handbook of the Canadian Institute of Chartered Accountants. Plan sponsors are required to report on plan assets but not on liabilities, which are covered in other financial reports.
[0154971]
No Surplus Distribution on Federal Partial Plan Termination.
Galinski, Colin; Canadian Benefits & Compensation Digest; v26 no5 pp 4-5 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Canada's Federal Court of Appeal overturned a lower court's ruling that supported sharing surplus pension plan funds proportionately among members in a partial plan termination. The decision goes against earlier rulings, notably the Supreme Court's decision in Monsanto. The court pointed out key differences between the cases, including that Monsanto was covered by the Ontario Pension Benefits Act (PBA), which requires surplus distribution on termination, while the federal Pension Benefits Standards Act (PBSA) applicable to Cousins does not give plan members the right to a surplus. The PBA also requires the employer to fund deficits, while the PBSA only mandates payment of outstanding employer contributions.
[0154934]
Nova Scotia Arbitrator Finds Plan Members Own Pension Surplus.
Ruparell, Rajeev; Canadian Benefits & Compensation Digest; v26 no5 pp 9-10 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : After ten years of collective bargaining agreements stating that on plan termination any surplus funds would go to members and beneficiaries, a pension plan was amended so that surplus funds would go to the employer. In 1988 the plan was terminated and the surplus used as employer contributions to a defined contribution plan. The union learned this in 2004 and filed a grievance. The arbitrator ruled the ten-year delay undermined the plaintiffs' grievance regarding the employer's failure to make matching contributions, but supported the plaintiffs' claim that the employer illegally appropriated the surplus and unilaterally amended the pension plan agreement. The employer was ordered to return the surplus funds as of 1987 to the vested plan members.
[0154932]
Pension Fund Financial Statement Audits: Who Benefits?
Chousky, Aaron; Benefits and Pensions Monitor; v18 no7 pp 58-59 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : For conducting a pension fund audit, the best approach is not to double up with a corporate financial audit or to rely on the HR staff to do the job, but to use an independent auditor that focuses on pension funds. A dedicated pension fund auditor brings specialized skills, knowledge and experience. An audit team can coordinate information gathering across the organization, easing the burden on staff while promoting a more efficient process. Using the same audit team annually progressively increases that efficiency.
[0155203]
Releases Under the ABCP Plan.
Chaplick, Nancy D.; Employee Benefit News Canada; v5 no5 p 14 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Under the Ontario Court of Appeal's ruling, a plan offered by the Pan-Canadian Investors Committee for Third-Party Asset Backed Commercial Paper (ABCP) will sharply limit pension plan administrators' liability and claims for losses tied to ABCP investments. Pension plans, Canadian banks and sponsors, dealers and conduits of ABCP and others are released from liability, with limited exceptions. Investment losses must be clearly related to the ABCP market to support the release. ABCP had been seen as a reasonably prudent and accepted investment vehicle but is so complex that many investors were not fully aware of the potential risk.
[0155179]
Talent Tactics.
Gros, Barry; Benefits Canada; v32 no10 p 53 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : A 2007 survey by FEI Canada and Aon Consulting on recruitment and retention issues shows growing interest in adopting phased retirement among the 61 plan sponsors polled. An amendment to the Income Tax Act in early 2008 permits simultaneous pension distributions during part time work, but some provincial laws conflict with the federal rules. Though there is strong support for defined benefit (DB) plans, survey respondents hope for a more equitable risk sharing balance between the DB and defined contribution schemes. They admit to weak plan governance but show more interest in providing financial planning education to plan members.
[0155295]
The DC Retirement Savings Lottery.
Shakeel, Mazen; Employee Benefit News Canada; v5 no5 p 9 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Adding automatic features to a defined contribution pension plan design will help participants improve their retirement security, but they may not be enough. A better approach is more comprehensive, based on education and encouragement through incentives. Employers should stress participation as soon as an employee becomes eligible. Saving at higher rates for a longer time, helping members cope with other financial demands while saving for retirement and educating members on the tie between saving and investing all promote success. Incentives that reinforce the value of participation and saving multiply the value of each action.
[0155180]
We Don't Need No Education.
Helik, Jim; Benefits and Pensions Monitor; v18 no7 p 62 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The average owner of a defined contribution pension plan is nearly financially illiterate, having little real knowledge of the plan, investment options and future needs on which to base well informed decisions. Education is routinely touted as the answer, but individual situations differ widely. The typical lunch-and-learn sessions fall far short of the comprehensive knowledge account holders would need. The best solution may be to abandon efforts to provide financial education, letting individuals make their own choices, or to return to a defined benefit approach to pensions.
[0155202]
When Employees Won't Make Retirement Savings Decisions.
Genno, C. Ian; Benefits and Pensions Monitor; v18 no7 pp 53-55 Oct 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : For the many employees who do not make active and informed choices about their Capital Accumulation Plan (CAP) accounts, employers can turn to plan design features to improved retirement saving. For new hires, automatic enrollment may be mandatory or a default unless a worker opts out. With mandatory participation, the employer can automatically contribute at a low level and offer matching contributions. Employers can limit overwhelming investment options to a more workable number. Default investments can be more diversified than the typical low risk and low return choice. If too many employees fail to make active choices, a review of the communication plan is in order.
[0155205]
The Retirement Puzzle: Sorting the Pieces.
Schellenberg, Grant; Ostrovsky, Yuri; no86 pp 35-47 Sep 9, 2008; misc. publication

Availability : International Foundation of Employee Benefit Plans
Abstract : Statistics Canada's 2007 General Social Survey Report details Canadians' pension coverage and adequacy, sources of retirement information and degree of understanding, broken down by various demographic factors. The survey indicates about half of near retirees get information from financial industry representatives, 17 percent from friends and family and 15 percent from other sources including employers. Nearly 30 percent reported not getting any advice. One in four admits no understanding of Canadian public retirement programs. Those closer to retirement, with more wealth, higher education and better health are more likely to get advice and report better understanding of their pension prospects.
[0154853]
A Shield for Quebec Pension Committee Members.
Bussiere, Natalie; Employee Benefit News Canada; v5 no4 pp 10-11 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Committee members of pension plans registered in Quebec have been vulnerable to fiduciary complaints but not covered by liability insurance, while service providers have not been held liable. Quebec's Bill 30 amends the Supplemental Pension Plans Act (SPPA) to address this inequity. Bill 30 includes an assumption that committees will act prudently on expert advice. Since many service providers are experts, plan committees' reliance on them creates some protection for committee members. But the bill prohibits service providers from contractually limiting their liability through indemnification provisions, time limitations or arbitration requirements.
[0154827]
Good Policy.
Pines, Steven R.; Benefits Canada; v32 no9 pp 41, 43-44 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Investment policy guidelines, recommended by the Pension Benefits Standards Act and required by some federal and provincial regulations, start with clear goals and performance objectives. Guidelines should delineate responsibilities for management and oversight, define the asset mix framework and set the policy for rebalancing. Permitted components within an asset class should be specified. An investment policy guideline must establish sources of risk and how it will be measured, preferably prospectively. There must be a process for selecting, monitoring and evaluating investment managers. Allowance must be made for responding to the dynamic quality of the investment market.
[0155043]
Guidance Note for the Disclosure of Ability to Reduce Benefits in NCDB Plans.
3 pp Sep 2008; misc. publication

Availability : International Foundation of Employee Benefit Plans
Abstract : When it becomes necessary to reduce benefits under a Negotiated Contribution Defined Benefit (NCDB) plan, trustees must take certain actions. If reductions are permitted by the plan document and authorized under the Pension Benefits Standards Act, trustees must communicate their authority to do so. The Office of the Superintendent of Financial Institutions Canada (OFSI) requires that this authority be communicated to participating employees when they enroll in the plan and in their annual statements. OFSI also requires that retired members and their spouses and other beneficiaries be told their benefits can be reduced.
[0154988]
Living Happily Ever After.
Genno, C. Ian; Employee Benefit News Canada; v5 no4 pp 12-13 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : The focus in most capital accumulation plans (CAPs) has been on building wealth with little attention paid to the careful draw down of assets after retirement. But investment risk continues, and varying investment approaches produce different results. To lessen the risks of investment performance, inflation and longevity, CAP members should consider the various annuitization strategies available. Sponsors must provide effective communications and should offer financial modeling tools. Nonregistered savings, tax free savings accounts and other innovative products present useful design possibilities which sponsors should carefully consider to help plan members achieve a secure retirement.
[0154828]
OMERS Calls for Even Playing Field.
Nobrega, Michael; Benefits and Pensions Monitor; v18 no6 pp 10-11 suppl. Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Canadian pension plans are restricted by laws created when most plans were passive investors focusing on government bonds and index funds. The Ontario Municipal Employees Retirement System (OMERS) and other plans have been lobbying federal and provincial governments to update the rules. In 2006, the Ontario government mandated the Ontario Expert Commission on Pensions (OECP) to examine defined benefit pension law in Ontario. The OECP has identified a number of rules that require change to produce the higher returns necessitated by the changing demographics of the 21st century. Rules restricting the percentage of assets in specific classes or a single entity are targeted.
[0155013]
One Step at a Time.
Smith, Brooke; Benefits Canada; v32 no9 pp 15-16, 20-21, 25 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In an economic downturn, plan sponsors remind participants to stay calm and focus on long term retirement planning. It may be necessary to reduce expectations for continually strong growth and remind members that market risk always exists. Education should revisit the need to rebalance portfolios, continue with contributions and spend down assets in retirement carefully to meet longevity risk. Online planning tools, lower management fees, simpler investment choices and target date plans help meet the retirement income challenge. A list shows the top 50 Canadian defined contribution plans.
[0155046]
Risk Management Is Built Into Quebec Member-Funded Pension Plans.
Smolkin, Sheryl; Employee Benefit News Canada; v5 no4 pp 6, 8 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In approving two member-funded pension plans (MFPPs), Quebec stressed risk management to minimize asset volatility. MFPPs are defined benefit plans mostly for unionized workers and sponsored by single or multiple employers making fixed contributions. The plans have several design features to reduce risk. The province amended its law in response to lobbying to support the many employees of nonprofit organizations and others in loosely managed defined contribution plans facing little or no retirement pension income. A significant number of Quebec Federation of Labour member unions are expected to move to MFPPs, probably to be joined by the more reluctant Confederation of National Trade Unions.
[0154826]
Sticking to Principles.
McCann, David; Benefits and Pensions Monitor; v18 no6 pp 20-21 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : Between 2005 and 2008, the UN Principles for Responsible Investment (UN PRI) have acquired 362 signatories. The Canada Pension Plan Investment Board (CPPIB) was one of the founding signatories and party to the process of developing the UN PRI. The Principles reflect the view that environmental, social and governance issues are relevant to the long term performance of investment portfolios. The CPPIB implements the UN PRI pursuant to its mandate of maximizing returns without undue risk of loss.
[0155007]
The CAP Guidelines: Exploring the Road Forward.
Di Falco, George; Benefits and Pensions Monitor; v18 no6 pp 32-33 Sep 2008; journal article

Availability : International Foundation of Employee Benefit Plans
Abstract : In 2004, the Joint Forum of Financial Market Regulators released the Guidelines for Capital Accumulation Plans (CAPs). In 2008, the Forum is examining the guidelines and considering changes. Experts say that the CAP guidelines provide information on what should be done, but they fail to describe how to monitor investments and review service providers. They hope that the CAP guidelines will one day form the basis of a legal and regulatory system that will provide all the necessary instruction with protective safe harbor rules.
[0155008]