Ontario has released two detailed regulatory proposals on the reform of the defined benefit funding regime for Ontario registered pension plans. The first proposal addresses the Ontario funding rules and includes details on new solvency funding requirements, new going concern funding requirements (including the introduction of a provision for adverse deviation), rules for contribution holidays and benefit improvements, disclosure requirements, and transition rules. The second proposal addresses the ability of plan administrators to obtain a discharge of their obligations after certain annuity purchases and includes details on funding and notice requirements related to the discharge.
The changes, when implemented, will significantly impact many Ontario pension plans. This Client Advisory will be of interest to sponsors and administrators of defined benefit pension plans registered in Ontario and others interested in the development of funding requirements and annuity purchase discharges in Canadian jurisdictions.