A look at the landscape for pension solvency funding reform across Canada

With Canadians living longer, the country’s pension landscape continuing to evolve and more private sector companies struggling to fund their defined benefit plans, governments across the country are reconsidering their regulations around pension solvency funding requirements.

From coast to coast, here’s an update on the latest consultations and amendments.

British Columbia

In October 2018, the B.C. government introduced a consultation on a number of technical reforms aimed at amending the province’s solvency funding rules. Among the five reforms the consultation put forward, a report published in August 2019 suggested lowering the required pension solvency funding from 100 to 85 per cent.

Read: B.C. launches consultation on new options for pension solvency funding

Read: Retiree organizations rejecting changes to B.C.’s DB pension solvency rules


Alberta isn’t reviewing its solvency funding rules at this time, according to a spokesperson. However, in its 2017 report, Alberta’s superintendent of pensions noted one of the key challenges for the coming years is the appropriate degree of funding for a DB plan and whether solvency funding is an appropriate funding standard.


Saskatchewan is monitoring the developments in other jurisdictions, but hasn’t announced any changes or released a consultation paper, according to a spokesperson.


In January 2018, the Manitoba government announced consultations on a number of pension reforms, including amending the funding rules. The options for a new DB funding framework include eliminating solvency funding and enhancing going-concern requirements (through, for example, a shorter amortization period of mandating a provision for adverse deviation) and introducing solvency reserve accounts. Also on the table are the options of eliminating solvency funding altogether without going-concern changes or maintaining the current rules.


Effective 2018, Ontario’s reforms to its pension funding rules included requiring funding on an enhanced going-concern basis; requiring funding of a reserve within the plan, called a provision for adverse deviation; and requiring funding on a solvency basis if a plan’s funded status falls below 85 per cent. The government also boosted the monthly guarantee provided by its pension benefits guarantee fund to $1,500 a month from $1,000.

Read: Ontario announces long-awaited DB solvency reforms

Read: New pension funding rules take effect in Quebec


Quebec was the first jurisdiction, in 2016, to shift to going-concern obligations for funding valuations. It also required plan sponsors to augment their going-concern funding with contributions to a stabilization fund specific to each plan’s investment policy.

New Brunswick

New Brunswick is in the process of conducting a complete policy analysis of its solvency funding rules in light of the guidance that has been issued on this subject by the Canadian Association of Pension Supervisory Authorities, according to a spokesperson from N.B.’s Financial and Consumer Services Commission.

Nova Scotia

Following a review launched in September 2017 and a summary of feedback released in April 2018, Nova Scotia said in May 2019 that it’s moving forward with changes to its regulatory framework for defined benefit pension plans.

Read: N.S. moving forward with new DB pension solvency regime

The regulatory changes include permitting DB plan sponsors to elect, on a go-forward basis, to permanently fund their plans to an 85 per cent solvency standard rather than the current 100 per cent. The province also enhanced its going-concern funding rules to require deficiencies to be funded over 10 years rather than 15 years. It will also allow special payments to be consolidated with prior years’ deficiencies into a single schedule and will require the establishment of a provision for adverse deviation or margin.

Prince Edward Island

Prince Edward Island hasn’t published anything indicating it’s looking at its pension solvency requirements and the provincial government didn’t respond to Benefits Canada‘s request for an update.

Newfoundland and Labrador

Newfoundland and Labrador isn’t reviewing its solvency funding requirements. A spokesperson from that province said, with the exception of exemptions for government, municipal and multi-employer pension plans, the legislation requires solvency deficits to be funded over five years.