The government of Manitoba has introduced legislation to bring pooled registered pension plans to the province, a move first referenced in the throne speech on Monday.

The PRPP legislation will build on federal legislation in setting out rules and procedures for establishing the retirement plan, following other provinces that have made PRPPs a voluntary option for employers, according to a press release issued by the government.

“Many employees and self-employed Manitobans do not have access to a workplace pension,” said Finance Minister Cameron Friesen, in the release. “These plans are designed to help people defer their income and save for retirement, while offering investment and savings opportunities at lower administration costs.”

Read: Manitoba to introduce pooled retirement pension plans

According to Friesen, Manitoba’s proposed legislation will allow self-employed workers or employees whose employers do not offer a pension plan to open a PRPP account directly. He also notes that PRPPs help lower administration costs and that employees’ contributions to their account would be counted against their registered retirement savings account’s contribution room.

Manitoba originally opted out of the Canada Pension Plan agreement struck by federal, provincial and territorial ministers in June, but then joined the other provinces in July in working towards the enhancement. However, Manitoba’s participation is contingent on additional research and analysis on several proposals it set out in a public consultation at the beginning of November.

In Monday’s throne speech, the government said that while the CPP is essential to ensuring retirement security, it’s not enough, and hopes that by introducing PRPPs, the province will be providing Manitobans with a new retirement savings option.

Read: PRPPs continue to languish as provinces vary in enthusiasm for new option

“We’re pleased that Manitoba is taking steps to do more to help people retire with financial security,” says Wanda Morris, vice-president of advocacy and chief operating officer at the Canadian Association of Retired Persons.

“We really have a looming retirement crisis in Canada,” she says. “We’re really grateful that Manitoba is showing leadership and would hope that other provinces will step forward.”

Since the federal government introduced PRPPs to federally regulated employees in 2012, Alberta, British Columbia, Nova Scotia, Ontario and Saskatchewan have introduced their own legislation. Quebec has followed suit but adopted its own unique regulations to eventually make participation mandatory for employers that have more than five employees and have no workplace pension plan.

Read: Canada and four provinces sign PRPP agreement

Copyright © 2020 Transcontinental Media G.P. Originally published on benefitscanada.com

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