Speak by November 10: Transformative Potential Changes to Nova Scotia DB Funding Framework
September 7, 2017
By Hugh Wright, at McInnes Cooper
On September 6, 2017, the N.S. Government distributed a discussion paper, “Pension Funding Framework Review and other issues affecting pension plans”. The paper includes questions respecting N.S.’s defined benefits pension plan funding framework and other regulatory issues affecting pension plans for which the N.S. government is seeking stakeholder input. This N.S. discussion paper follows Nova Scotia’s recent announcement of regulatory changes giving N.S. registered pension plans temporary solvency funding relief, and longer term pension funding reforms implemented in Quebec and soon to be implemented in Ontario.
The N.S. government is considering three options for a new funding framework, outlined in the discussion paper:
- Maintain full solvency funding, but potentially increase the funding period, establish solvency reserve accounts, or other measures to reduce volatility.
- Eliminate solvency funding, but enhance going concern funding, essentially an approach similar in its basic design to that of Quebec and Ontario.
- Reduce the solvency funding requirement to less than 100%, an approach similar to aspects of that of Ontario, and that could be combined with one of the two other options.
Other key questions of interest beyond the funding framework include target benefit plans, obtaining an annuity discharge and harmonizing the investment rules to recent federal changes.
To be considered, stakeholders must submit feedback on the N.S. discussion paper by Friday, November 10, 2017, to either:
Finance and Treasury Board
Pension Regulation Division
PO Box 2531
Halifax, NS B3J 3N5
Please contact your McInnes Cooper lawyer or any member of the Pensions & Benefits Team @ McInnes Cooper to discuss this topic or any other legal issue.
McInnes Cooper has prepared this document for information only; it is not intended to be legal advice. You should consult McInnes Cooper about your unique circumstances before acting on this information. McInnes Cooper excludes all liability for anything contained in this document and any use you make of it.
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