Draft regulation to mitigate the consequences of the COVID-19 pandemic on Quebec-registered pension plans
On July 15, the Quebec government published a draft regulation on Quebec-registered supplemental pension plans. The main goal of this draft regulation is to mitigate the consequences of the COVID-19 pandemic, and as such, it proposes to:
- Confirm the temporary measures issued by Retraite Québec on April 15, 2020. These measures include administrative extensions and the introduction of monthly updates of the solvency ratio that is taken into consideration for transfers or refunds paid from defined benefit plans.
- Suspend the obligation of filing an actuarial valuation as at December 31, 2020 for private-sector pension plans whose funding ratio as at 31 December 2019 is less than 90%.
- Allow the temporary suspension of accrued benefits for up to 12 months starting in 2020 (not before July 15). This measure applies to defined benefit and defined contribution plans. We understand that modifications to the plan text are needed in order to take advantage of this provision. The effective date of the modification may not be earlier than the date when the notice is sent to members, or as the case may be, the date of the agreement between plan stakeholders. For defined benefit plans, the impact would also need to be reflected in an actuarial valuation.
Retraite Québec published an FAQ with additional information on the temporary suspension of benefits and on the following topics:
- multi-jurisdictional pension plans;
- members’ annual meetings; and
- the solvency ratios to be included in annual statements.
Stay tuned! We will inform you when the final regulation is enacted. In the meantime, don’t hesitate to contact your Normandin Beaudry consultant for more information.