FSRA is continuing its work to make more applications available for submission through the Pension Services Portal (PSP). 12 additional applications will be available on the PSP starting June 1! Further information will be provided in May through the portal.
COVID administrative and funding relief uptake by the Pension Sector
Effective October 1, 2020, the government provided funding relief to Ontario registered Defined Benefit (DB) pension plans, subject to certain restrictions. The relief allowed the deferral of DB contributions between October 1, 2020 and March 31, 2021. No plans took advantage of this relief.
FSRA communicated to the pension sector that it would not order a defined contribution plan to be wound up solely because the plan was amended (on a go forward basis) to temporarily pause contributions during the pandemic. Approximately 30 defined contribution plans reduced contributions as a result of the pandemic.
The government also introduced regulatory amendments providing plans with extensions for annual member statements and certain annual filing requirements.
Approximately 150 plans (out of approximately 6,500 plans) notified FSRA that they intended to use the extension for annual member statements. FSRA also saw approximately 15% of all Ontario-registered plans take advantage of the filing extensions leading up to the December 31 deadline. Of this 15%, 22% of defined benefit plans also took advantage of the filing extension for the Actuarial Valuation Report.
Required timing for filing Amendments
FSRA has noticed that some plans are filing amendments that reduce benefits after the effective date of the amendment. The Pension Benefits Act (PBA):
- requires that Plans be administered in accordance with the documents filed with the pension regulator;
- allows for retroactive amendments, assuming that those amendments are not “void” under section 14 of the PBA;
Of particular concern to FSRA are amendments which state that they are reducing pension benefits accrued before the amendment is filed with FSRA.
While the PBA allows retroactive amendments, this does not override the requirements regarding amendments which reduce accrued benefits. The plan must be administered in accordance with the existing plan terms on file with FSRA.
Note that there are certain exceptions to the void amendment restriction.
Waiver of the Adverse Amendment Notice
When an amendment involves the reduction of benefits on a go-forward basis, notice must be provided to members unless a waiver from this requirement is approved by FSRA. One common situation is where the amendment has been bargained by a trade union that represents the members. There is no automatic right to a waiver from the adverse amendment notice requirements. A plan must apply to FSRA for such a waiver. FSRA expects all requests to be supported by facts and relevant documentation.
Pension Benefits Guarantee Fund e-payment option
FSRA is pleased to announce that effective May 3, 2021, plans will be able to remit PBGF assessments electronically. FSRA will be using the same electronic payment program as that used for paying FSRA assessments.
As a reminder, PBGF assessment certificates must be filed and paid by the PBGF assessment due date (9 months after the fiscal year of a pension plan, or, for plans winding up, 6 months after the effective date of the wind up). Late payments will be subject to the legislated 20% penalty and interest charges. Unpaid balances may also be pursued by a third-party collection agency on behalf of FSRA.
Reminder and uptake on PBA Exemption and Consent Forms for Individual Pension Plans and Designated Plans
Employers who wish to exempt their eligible Individual Pension Plans or Designated Plans from the PBA must complete and submit a PBA Exemption Election Form and the applicable consent forms.
As of March 31, 2021, approximately 86% of eligible IPPs and DPs registered with FSRA submitted the exemption election and consent forms.
As previously communicated, IPPs and DPs that did not opt out prior to March 31, 2021, will be required to pay a FSRA assessment for this year.
IPPs with outstanding FSRA pension assessments are expected to remit payment. FSRA intends to pursue all collections regardless of whether the pension plan has since become exempt from the PBA.
See PBA Exemption Election Form and Consent Forms for an Individual Pension Plan or Designated Plan
Have your say: Family Law Guidance consultation
FSRA is consulting on proposed Interpretation and Approach guidance regarding the processes for the valuation and division of pensions upon marriage breakdown. This guidance is intended to support plan administrators’ compliance with their legal obligations. The consultation period is open until May 3, 2021: Consultation 2021-002 - Proposed Guidance on the Administration of Pension Benefits Upon Marriage Breakdown.
Government consultation: Two Ministry of Finance consultations underway
Voice your thoughts. Until May 31, 2021, the Ministry of Finance is consulting on:
- Updated DB Asset Transfer Forms now on FSRA Website
FSRA has updated the summary and certification forms for defined benefit asset transfers to be Ontarians with Disability Act (AODA) compliant. They are now PDF fillable/saveable. The “Supervisory Approach to Defined Benefit Asset Transfers under the PBA” Guidance has been updated with links to these AODA compliant forms.
- In Case You Missed It – Benefits Canada Article
In February, Benefits Canada published an article on how regulators across the country, and in particular FSRA, have responded to the COVID-19 pandemic.
FSRA will be updating our website for a more user-friendly experience. Keep an eye out for the initial phase of this update!
FSRA has moved!
Please note effective February 1, 2021, FSRA is now located at:
25 Sheppard Avenue West
Toronto, ON M2N 6S6
Please direct all correspondence to this address. If you have any questions, please contact FSRA at:
Tel: 416-250-7250 | 1-800-668-0128
Email at: [email protected]