The Financial Services Regulatory Authority of Ontario’s proposed guidance on pension plan administrator roles and responsibilities requires more clarity and consistency, according to the Association of Canadian Pension Management.

In an open letter, the ACPM recommended greater clarity regarding the distinction between statutory guidance and general commentary, particularly in the sections on records retention and complaints and inquiries. It noted an administrator isn’t required by the Pension Benefits Act to direct a complaint to the FSRA when it isn’t resolved to the satisfaction of the claimant and suggested clarification to indicate this isn’t mandatory.

The ACPM also said the guidance acknowledges that specific aspects of an administrator’s roles and responsibilities can vary, it noted this distinction isn’t reflected in a statement on an employer’s responsibility to provide sufficient funding to provide the promised pension benefits. “While this may be true in an employer-sponsored defined benefit provision, it wouldn’t apply to other types of arrangements like defined contribution or certain multi-employer plans.”

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While the guidance includes the FSRA’s views on best practices, the ACPM noted these views extend to commentary on civil and administrative law considerations that fall outside the mandate of a pension regulator. “While recognizing that pension administrators perform their duties in a legal environment that is broader than just the PBA, this approach blurs the lines between statutory guidance related to FSRA’s mandate and general commentary on best practices and other legislation that is not within FSRA’s mandate.”

Regarding conflict of interest, the ACPM said providing professional, external advice provided by an actuary or a lawyer to a plan sponsor or administrator doesn’t inherently engage a conflict of interest and it’s important the guidance doesn’t imply or assume this would be the case.

In relation to the guidance’s suggestion that inadvertent errors in communications may impact the rights and entitlements of beneficiaries, referencing case law involving negligent misrepresentations, the ACPM said this reference needs to be clarified as pension entitlements are governed by the plan’s terms, while a claim for damages is a separate action that would generally be dealt with through the courts, not the FSRA.

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