The Government of Quebec has released a draft regulation concerning new relief measures for the funding of solvency deficiencies for private sector pension plans, according to a Towers Watson advisory.
This draft regulation contains the rules enabling the new special temporary funding relief measures available to DB plans in the private sector and registered in Quebec for actuarial valuations dated after Dec. 30, 2013.
These measures, which are similar to those adopted in 2012, include the following:
- elimination of amortization payments related to the solvency deficiencies determined in previous actuarial valuations;
- extension of the solvency amortization period up to a maximum of 10 years; and
- use of a smoothed asset value for the solvency valuation.
The application of these measures will not require the consent of plan members or the pension committee.
The new measures are available irrespective of whether or not the plan sponsor used the funding relief measures in 2012. They will apply in 2014 and 2015 only.
Submissions respecting the draft regulation must be filed before Aug. 24, 2013.
Read more: