Improvements to the VRSP: New measures announced in Budget 2026-2027

The Quebec government tabled Budget 2026-2027 on March 18. Among the announced measures, it has expressed its intention to improve the Voluntary Retirement Savings Plan (VRSP). Introduced in 2013, this type of plan has helped increase retirement savings in Quebec and offer a collective solution to those without access to a pension plan, despite not being the most widely used option. The proposed adjustments are designed to address issues noted by financial institutions that administer VRSPs, particularly the complexity of compliance requirements and the low value of accumulated assets.

In order to make VRSPs a more attractive tool while ensuring they remain low cost, the government intends to:

• Introduce a minimum contribution rate of 2% of salary and the possibility of closing inactive accounts in certain situations;
• Increase the management fee cap to 1.50% for all existing investment options (this cap is currently 1.25% for the default investment option and 1.50% for the other investment options);
• Introduce new investment options requiring an employer contribution of at least 2% of salary, with management fees of up to 1.75%;
• Simplify contribution tracking and clarify Retraite Québec’s expectations regarding the role of administrators through guidelines;
• Offer greater flexibility to employers and administrators, by allowing annual enrolment for employees with less than one year of seniority, replacing the mandatory reminder with the submission of a document produced by Retraite Québec, and clarifying guidance on contract terminations.

Following last December’s adoption of regulations for the implementation of dynamic pensions in Quebec (see our bulletin for more details), these announcements illustrate the government’s commitment to strengthening retirement savings coverage and offering innovative solutions to the challenges of decumulation. By combining the planned improvements to VRSPs with the possibility of integrating dynamic pension funds into these vehicles, these measures are strengthening the VRSP’s potential as an accessible, attractive and effective retirement savings tool.

For the measures to be implemented, amendments will need to be made to the Voluntary Retirement Savings Plans Act (VRSP Act) and its accompanying regulation. We will monitor developments closely.

It is also worth noting that the government will continue to examine the retirement savings vehicles available in Quebec, as well as the possibility of establishing a public VRSP and increasing oversight of employer compliance with the VRSP Act.

Would you like more information? Contact your Normandin Beaudry consultant or email us.