The Government of Quebec has tabled a bill to create voluntary retirement savings plans (VRSPs) in the province.

Beginning in January 2014, about 90,000 companies with at least five workers who currently don’t have employer-sponsored retirement savings plans will be required to offer their workers a VRSP within two years.

It will be up to the employee to decide whether or not to join the plan.

“We believe this innovative solution might provide individuals and employers with a clear and simple method,” says Charles Guay, president and CEO of Standard Life in Canada. “The voluntary feature values the employee’s freedom of choice, and the group feature promotes scale economies for participants.”

The default contribution rate for employees will be 2% and will gradually increase in subsequent years. Workers will also be able to raise their contributions based on their ability to save.

If an employee leaves a company, he or she will be able to keep the money accumulated in the plan or transfer it to the new employer’s plan.

VRSPs were originally proposed by the then-Liberal government in 2011. The Parti Québécois mentioned a new bill in November’s budget, and last month’s D’Amours report also called for the rapid introduction of VRSPs.

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

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