© Copyright 2006 Rogers Publishing Ltd. The following article first appeared in the June 2006 edition of BENEFITS CANADA magazine.
Editorial: Grandes idees
Looking for innovation? Start in Quebec.
By Don Bisch

When the Harper government unveiled temporary measures in its recent budget to provide solvency relief for federally regulated defined benefit plans, the proposals had a familiar ring to them.

That’s because the proposals—permitting plan sponsors to extend the period for making solvency funding payments to 10 years from five years when the difference is secured by a letter of credit—were already enacted in Quebec last June.

The budget proposals were just the latest example of how la belle province seems to be leading the way when it comes to out-of-the box thinking on pensions and benefits in this country.

It was the first province to introduce phased retirement—allowing people between the ages of 55 and 70 to work fewer hours without reducing the pension they’ll receive under the Quebec Pension Plan.

It was also the first province to make pension committees mandatory. The Canadian Association of Pension Supervisory Authorities adopted the Quebec approach in its Model Law released in January 2004. But the pension committee model isn’t without its challenges. Our annual report on pension and benefits issues in Quebec looks at the issues that have arisen surrounding the fiduciary liability of committee members.

Also in 2004, the Régie des rentes du Québec proposed an innovative new type of pension plan design—member funded pension plans(MFPPs)—to address declining private-sector pension plan coverage. Because employer contributions would be fixed, MFPPs would make it easier and less costly for them to establish pension plans. Members would be responsible for making up funding shortfalls as well as being entitled to any surplus.

More recently, the Quebec government has undertaken groundbreaking healthcare reforms that could form the basis of a blueprint for the rest of the country. The reform package—aimed at addressing long wait lists for key procedures such as knee and hip replacements, and cataract surgeries— is the government’s response to last year’s Supreme Court of Canada decision in Chaoulli and Zeliotis vs. Quebec. Under the proposed new rules, citizens could purchase private insurance for these three procedures. But, unlike proposals by the Alberta government that have since been abandoned, the Quebec reforms would not allow physicians to practice in both the public and private systems. Our report examines the implications of these reforms for employee benefit plans.

The province is also bringing in changes to its drug plan regime designed to improve accessibility to medications, incorporate fair and reasonable drug pricing, improve medication usage and foster Quebec’s pharmaceutical industry. Our Quebec report reviews the implications of Bill 130 for plan sponsors on page 23.

The changes taking place in Quebec over the past few years have provided quite a few good ideas and lessons for pension and benefits industry stakeholders across the country. We look forward to any future plans the province has up its sleeve.

Don Bisch