August 2021
Ontario’s Pension Benefits Guarantee Fund (PBGF) and Other News
On July 29, 2021, an additional burden was placed on administrators of defined benefit pension plans with PBGF liabilities of $10 million or greater who will now be required to calculate and report their plan’s PBGF claim exposure and information regarding the distribution of benefits. This new measure was introduced to address issues related to data availability, which were raised following a recent review of the PBGF and will be applicable to valuations filed on or after September 1, 2021.
As all previous reporting requirements remain effective, additional required disclosures include:
- The pension plan’s PBGF liabilities in respect of all Ontario plan beneficiaries who are receiving or have accrued pension benefits (including any bridging benefits), subject to a maximum pension benefit of $1,500 per month.
- The total number of Ontario plan beneficiaries, including subsets of those receiving pensions and those accruing pension benefits (including any bridging benefit) of $1,500 or less per month.
- Amounts payable under the pension plan to Ontario plan beneficiaries under every tenth percentile and all of the related PBGF liabilities that are less than that each of these tenth percentiles, relative to each of:
- the payable pensions, including any bridging benefit; and
- the accrued pension benefits, including any bridging benefit.
- The amount of the largest pension or pension benefit that has accrued under the pension plan, including any bridging benefit, to an Ontario plan beneficiary.
In addition to these new disclosures, which will result in additional calculations for plan administrators, it can also be anticipated that some confidentiality issues may be raised by some of the measures.
Since May 2021, defined benefit pension plans can remit PBGF assessments electronically using the same electronic payment program used for paying assessments from the Financial Services Regulatory Authority of Ontario (FSRAO).
PBGF assessment certificates must be filed nine months after the pension plan’s fiscal year end. Late payments will be subject to the legislated 20% penalty and interest charges.
Effective September 1, 2021, FSRAO will require pension plans to provide a best estimate of their missing members data when filing their Annual Information Return.
The Annual Information Return must be filed nine months after the pension plan’s fiscal year end.
Normandin Beaudry consultants will continue to monitor Ontario pension sector news and developments with FSRAO’s activities and will keep you informed. Feel free to contact us if you have any questions.