What’s New in Group Retirement Solutions
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QPP enhancement to match CPP
On November 2, 2017 Quebec introduced legislation to enhance the Quebec Pension Plan (“QPP”) by increasing contributions and benefits. The enhancement reflects the Canadian Pension Plan (“CPP”) enhancements agreed to by the first ministers and federal government in June of 2016 so Quebecers receive the same retirement benefits from the QPP as Canadians do from the CPP.
Starting in 2019 until 2023 the income replacement rate will increase from 25% to 33.33% (one third) of the years’ maximum pensionable earnings (“YMPE”). The YMPE was $55,300 in 2017. To provide for this additional benefit the contributions will increase a total of 2% (1% for the employer and 1% for employees).
In 2024 and 2025 YMPE will be extended by 7% each year to become 114% in 2025 of the current target. To provide for this additional benefit an 8% contribution (4% employer and 4% employee) for earnings between YMPE and the new 114% of YMPE will fund this enhancement.
It is important to note that current contributions to the QPP are 10.8% while the CPP contributions are 9.9%. The changes to the QPP and the CPP do not affect these rates.
Manulife wants to remind pension plan sponsors registered in New Brunswick
of the up coming changes to filing processes after October 15, 2017
As communicated by the Financial and Consumer Services commission of New Brunswick, paper filings will no longer be accepted after October 15, 2017. We encourage you to login to the https://portal.fcnb.ca. to create your account if you have not already done so.
For more information on how to setup your account and the change you can read the full bulletin here:
http://0104.n\ccdn.net/1_5/31d/190/33a/Pension-Bulletin-2017-02.pdf
New OSFI
on March 21, 2017
New OSFI on March 21, 2017 released a revised version of the Pooled Registered Pension Plan Annual Information Return (PRPP AIR) to its website, along with a new Guide to the return.
OSFI has also posted the directive that the Superintendent of Financial Institutions issued pursuant to the Pooled Registered Pension Plans Act, changing the required filing date of the PRPP AIR. The new filing deadline provides PRPP administrators with an additional month to file the return which includes an auditor’s report on the PRPP’s assets.
OSFI
OSFI has posted updated versions of the Risk Assessment Framework for Federally Regulated Private Pension Plans and its accompanying guidance note on asset management. Key updates reflect changes to our pension plan examination process and include additions on what to consider when assessing risk in situations where a pension plan or a pooled registered pension plan offers investment choices to its members.
Minister Morneau Announces New Appointments to Canada Pension Plan Investment Board
February 13, 2017
Learn more
Ontario to introduce new financial services regulator
November 14, 2016
On November 14, 2016 Finance Minister Sousa released the 2016 Ontario Economic Outlook and Fiscal Review, it included a proposal to legislation to establish the initial parameters for the Financial Services Regulatory Authority (FRSA), a new independent and flexible regulator of financial services and pensions that would be more consumer-focused and improve protections for consumers, investors and pension plan beneficiaries.
In 2015 an expert advisory panel reviewed the mandates of financial sector regulators in Ontario. In June, the government released the expert advisory panel’s final report. The panel recommended significant reforms to the regulatory landscape, including the establishment of a new, independent and flexible regulator with a modernized governance and accountability framework and a mechanism to ensure individuals’ perspectives are considered, for example, through the establishment of an Office of the Consumer.
The establishment of FSRA is expected to modernize and strengthen the regulation of financial services and pensions in Ontario.
We will keep you informed of future developments.