Federal Budget Proposes Changes Related To Pension Plans
Temporary Solvency Funding Regime for Federally Regulated Plans
The latest federal budget proposes temporary relief for companies sponsoring defined benefit pension plans that are faced with significant pension solvency funding obligations. However, this temporary relief will only be available to pension plans that are registered under the federal Pension Benefits Standards Act. Federally registered plans cover employees who are employed in a business that is subject to the legislative authority of the federal government, including banks, inter-provincial and international transportation (including railway, shipping and airlines) and radio broadcasting. Pension plans registered in a province, such as those subject to Ontario’s Pension Benefits Act, will not be covered by the proposed change.