The Office of the Superintendent of Financial Institutions (OSFI) is proposing regulatory amendments to pension rules that will enable the federal regulator to fund the oversight of pooled registered pension plans (PRPPs).
Specifically, the proposed amendments would set the formula for OSFI to recover the cost of overseeing PRPPs. The existing regulations prescribe the formula used to determine the annual assessments for private pension plans, but do not include provisions for recovering expenses from PRPPs, which are a new pension option.
OSFI’s expenses from overseeing federally regulated plans are fully recovered from pension plans. The proposed changes, which were published for comment in the latest edition of the Canada Gazette, would amend the rules to permit the annual assessment of PRPPs on the same basis as other private pension plans.
“In developing the proposed assessment method for PRPPs, it was determined that supervisory costs for PRPPs are expected to be similar to the supervisory costs for defined-contribution [pension] plans,” the proposals note, adding that the rules aim to put these plans on a level playing field with other private plans.
However, this approach will be re-examined against actual experience in the future, the proposed amendments state: “It is intended that expenses incurred in relation to the administration of the PRPP Act will be tracked to determine if experience indicates that a revision to the assessment methodology for PRPPs should be considered.”
Separately, Saskatchewan announced that it has entered into a multilateral agreement with the federal government — along with British Columbia, Quebec and Nova Scotia — that simplifies the licensing and registration process for PRPPs.
“[PRPPs] will provide Saskatchewan workers with another option to save money for retirement,” said the province’s justice minister and attorney general, Gordon Wyant, in a statement. “These plans will be very accessible and will be offered at a low cost to plan members. I am pleased that Saskatchewan is able to be part of a multilateral agreement, which will pave the way for employers to set up a [PRPP] for their employees.”
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