Ontario’s fall economic statement confirmed a number of previously announced frameworks for the province’s pension, health-care and employment programs, including a look at addressing decumulation.
The statement, delivered by Ontario’s Finance Minister Charles Sousa on Tuesday, noted the government is exploring new approaches to help retirees draw down their savings in an efficient, cost-effective manner so their savings last throughout retirement.
Read: Ontario budget touts variable benefits from DC pension plans
It also confirmed the introduction of a new framework for defined benefit plans that includes certain measures intended to help protect employees’ retirement benefits, as well as the introduction of a new framework for target-benefit, multi-employer pension plans, which was first announced in June.
“With two-thirds of Ontario workers not participating in workplace pension plans and many families worried about how they will maintain their standard of living in retirement, strengthening and modernizing retirement security continues to be a priority for this government,” noted the statement.
“As well, current economic realities are putting pressure on sponsors of existing defined benefit pension plans, highlighting a need to address plan sustainability and benefit security.”
Read: Ontario sets out plans for target-benefit multi-employer pensions
In the economic statement, Sousa also confirmed the province’s new pharmacare program, which will provide prescription drug coverage for all Ontarians under the age of 25 from Jan. 1, 2018. The program will include more than 4,400 medicines currently available through the Ontario drug benefit program.
“This is one of the most significant expansions of medicare in a generation — and a major step towards universal drug coverage in this country,” said Sousa.
Read: The impact of Ontario’s public drug program changes on private plans
The statement also confirmed the 2017 budget’s commitment to modernize Ontario’s employment and labour laws through a new act that, if passed, would:
- Raise the minimum wage to $14 on Jan. 1, 2018 and to $15 on Jan. 1, 2019;
- Ensure part-time workers are paid the same hourly wage as full-time workers;
- Introduce paid sick days for every employee;
- Ensure all employees are entitled to 10 personal emergency leave days per year; and
- Ensure at least three weeks’ vacation after five years with the same employer.
Sousa also said the provincial government will spend $124 million over three years to help companies with fewer than 100 employees who hire youths aged 15 to 29.
Read: Ontario proposes five days of paid leave for workers dealing with domestic violence
In other provincial news, New Brunswick introduced legislation on Tuesday that would allow pooled registered pension plans for employees of small and medium-sized businesses, as well as for the self-employed.
The provincial government said the PRPPs would reduce the administrative burden of operating a pension plan and make offering a plan more attractive and affordable for small and medium-sized businesses. Also, because the employee contributions would be pooled, the plans would offer investment and savings opportunities with lower administration costs.
“We understand the financial challenges that many New Brunswickers face in retirement,” said the province’s Finance Minister Cathy Rogers, in a news release.”This act will allow for an additional instrument to New Brunswickers for pension planning that is low-cost to both employees and employers.”
The federal government, as well as British Columbia, Nova Scotia, Quebec and Saskatchewan, signed a multilateral agreement on pooled registered pension plans, which came into effect on June 15, 2016.
Read: PRPPs continue to languish as provinces vary in enthusiasm for new option