The Association of Canadian Pension Management is asking the federal government to consider changes in proposed amendments to the Pension Benefits Standards Act and Pooled Registered Pension Plans Act, including retaining the definition of defined benefit provision and expanding access to pooled registered pension plans.
In an open letter, the ACPM noted the government’s proposed classification of defined contribution pension plans that offer a variable life benefit option as a defined benefit provision could cause confusion and potentially deter plan sponsors and administrators from adding the variable life benefit option to their plan.
Since scale is paramount to the success of variable life benefits, the ACPM suggested legislation support, wherever possible, pension plans’ ability to achieve the necessary scale, including the possibility of the transfers upon windup of a variable life benefit fund to other pension plans or to a PRPP. “This would be further aided by requiring the administrator to identify a default election to be applied in the event a pensioner or survivor does not make an election with the prescribed period of time.”
The ACPM also recommended changes that would allow for increased participation in PRPPs by expanding availability to workers who elect to participate without any employer affiliation through a transfer from prescribed registered plans, such as registered retirement savings plans, registered retirement income funds, registered pension plans, other pooled registered pension plans or deferred profit-sharing plans.