GENERAL

ontario regulation 177/11

made under the

pension benefits act

Made: May 17, 2011
Filed: May 20, 2011
Published on e-Laws: May 25, 2011
Printed in The Ontario Gazette: June 4, 2011

Amending Reg. 909 of R.R.O. 1990

(General)

1. The definition of “solvency deficiency” in subsection 1 (2) of Regulation 909 of the Revised Regulations of Ontario, 1990 is revoked and the following substituted:

“solvency deficiency”, in relation to a report, means the amount determined in accordance with section 1.3.1 for a pension plan that provides defined benefits; (“déficit de solvabilité”)

2. The Regulation is amended by adding the following section:

1.3.1 (1) For the purposes of this Part, the solvency deficiency, in relation to a report, of a pension plan that provides defined benefits is the amount determined in accordance with this section.

(2) The amount of the solvency deficiency of a pension plan, as of a particular valuation date, is the amount by which “A” exceeds “B” where,

  “A” is the sum of the solvency liabilities, the solvency liability adjustment and the prior year credit balance as of the valuation date, and

  “B” is the sum of the solvency assets and the solvency asset adjustment as of the valuation date.

(3) Despite subsection (2), a report for any of the following pension plans may specify that the solvency deficiency as of a valuation date that falls on or after December 31, 2010 is a stated amount which is less than the solvency deficiency calculated under subsection (2) but not less than zero:

1. Pension Plan for the Employees of the Ontario Public Service Employees Union, registered under the Act as number 339861.

2. Ontario Teachers’ Pension Plan, registered under the Act as number 345785.

3. OMERS Primary Pension Plan, registered under the Act as number 345983.

4. Healthcare of Ontario Pension Plan, registered under the Act as number 346007.

5. Colleges of Applied Arts and Technology Pension Plan, registered under the Act as number 589895.

6. Ontario Public Service Employees’ Union Pension Plan, registered under the Act as number 1012046.

(4) If a pension plan listed in subsection (3) ceases to be a jointly sponsored pension plan, subsection (3) does not apply to any solvency deficiency of the pension plan as of a valuation date that falls on or after the date on which the pension plan ceased to be a jointly sponsored pension plan.

3. Section 3 of the Regulation is amended by adding the following subsection:

(1.2) A jointly sponsored pension plan listed in subsection 1.3.1 (3) must file a report under subsection (1) if an amendment to the pension plan changes the amount of the solvency deficiency that would be calculated under subsection 1.3.1 (2) for the pension plan.

4. Section 3.2 of the Regulation is revoked and the following substituted:

3.2 (1) The administrator of a jointly sponsored pension plan shall file a statement that certifies that the pension plan satisfies the criteria to be a jointly sponsored pension plan, certifies the date on which it became such a pension plan, and describes how the pension plan satisfies the criteria to be a jointly sponsored pension plan.

(2) The statement must be filed no later than the date on which the first report under section 3, 13 or 14 is filed or submitted after the pension plan becomes a jointly sponsored pension plan. 

(3) Despite subsection (2), if the pension plan is a jointly sponsored pension plan on June 1, 2011, the statement must be filed no later than the date on which the first report under section 3, 13 or 14 is filed or submitted after June 1, 2011.

5. The heading immediately before section 5.5 of the Regulation is revoked.

6. The Regulation is amended by adding the following section before the heading “Solvency Funding Relief”:

5.5.2 (1) This section applies with respect to the Retirement Plan of the University of St. Michael’s College, registered under the Act as number 0211441.

(2) A report with a valuation date on January 1, 2010 may be filed no later than May 31, 2011, despite subsection 14 (10).

(3) The employer (or a person or entity required to make contributions on behalf of the employer) shall make payments in accordance with the report filed or submitted under section 3, 4 or 14 with a valuation date on December 31, 2009 in respect of the period beginning on December 31, 2009 and ending on May 31, 2011.

(4) The employer (or a person or entity required to make contributions on behalf of the employer) shall make payments in accordance with the report with a valuation date on January 1, 2010 in respect of the period beginning on June 1, 2011 and ending on the date the next report is filed.

(5) Expressions used in this section have the same meaning as in section 5.6.

7. (1) Subsection 14 (2) of the Regulation is revoked and the following substituted:

(2) For the purposes of subsection (3), a report indicates solvency concerns if any of the following circumstances exist:

1. The employer has elected under subsection 5 (18) to exclude plant closure benefits or permanent layoff benefits and this election has not been rescinded.

2. The ratio of the solvency assets to the solvency liabilities is,

i. less than 0.8 if the valuation date is before December 31, 2012, and

ii. less than 0.85 if the valuation date is on or after December 31, 2012.

3. The solvency liabilities exceed the solvency assets by more than $5 million, for a valuation date before December 31, 2012, and the ratio of the solvency assets to the solvency liabilities is,

i. less than 0.9 if the valuation date is before December 31, 2010, and

ii. less than 0.85 if the valuation date is on or after December 31, 2010 and before December 31, 2012.

(2) Paragraphs 2 and 3 of subsection 14 (2) of the Regulation are revoked and the following substituted:

2. The ratio of the solvency assets to the solvency liabilities is less than 0.85 for a valuation date on or after December 31, 2012.

(3) Section 14 of the Regulation is amended by adding the following subsection:

(4.2) Subsections (2) and (3) do not apply to the following pension plans:

1. A jointly sponsored pension plan listed in subsection 1.3.1 (3).

2. A multi-employer pension plan that is a specified Ontario multi-employer pension plan under section 6.0.1 that files a report required to be filed in respect of the plan under this section.

3. The OMERS Supplemental Pension Plan for Police, Firefighters and Paramedics, registered under the Act as number 1175892. 

(4) Subsection 14 (4.2) of the Regulation is revoked.

8. (1) Clause 40 (1) (p) of the Regulation is amended by striking out “and” at the end of subclause 40 (1) (p) (iii) and by adding the following subclauses:

(v) the transfer ratio of the pension plan as of the valuation date of each of the two reports filed most recently under sections 13 and 14, and

(vi) an explanation of the transfer ratio and how it relates to the level of funding of members’ benefits;

(2) Subsection 40 (1) of the Regulation is amended by striking out “and” at the end of clause 40 (1) (s), by adding “and” at the end of subclause 40 (1) (t) (ii) and by adding the following clause:

(u) for a pension plan that is a jointly sponsored pension plan and that, in a report filed under section 3, 13 or 14, has specified a solvency deficiency that is lower than the amount of the solvency deficiency that would be calculated for the pension plan under subsection 1.3.1 (2),

(i) a statement that the pension benefits established under the pension plan are not guaranteed by the Guarantee Fund,

(ii) a statement that, on wind up of the pension plan, the Act allows pension benefits to be reduced if assets of the plan are not sufficient to meet the liabilities of the plan,

(iii) a statement that contribution rates for an employer (or a person or entity required to make contributions on behalf of an employer) and for members could change depending on how well the pension plan is funded on a going concern basis,

(iv) a statement setting out the contribution rates for an employer (or a person or entity required to make contributions on behalf of an employer) and for members for the year before, and the year after, the date of the statement, and

(v) if the most recent report filed under section 3, 13 or 14 for the pension plan has specified a solvency deficiency that is lower than would be calculated under subsection 1.3.1 (2), a statement that additional contributions are not being made by an employer (or a person or entity required to make contributions on behalf of an employer) or by members to eliminate the solvency funding shortfall determined in the most recently filed report.

9. (1) Section 47.7 of the Regulation is amended by adding the following subsections:

(3.1) Despite subsection 14 (10), a report under section 14 with a valuation date on or after August 2, 2010 and on or before May 30, 2011 may be filed or submitted on or before February 29, 2012.

(3.2) Despite subsection 12 (2), the employer shall pay the following into the pension fund no later than March 1, 2012:

1. All amounts due under a report described in subsection (3.1) on the date the report is filed or submitted.

2. Interest on those amounts calculated at the going concern interest rate or the solvency valuation interest rate, whichever applies in the circumstances.

(2) Subsection 47.7 (4) of the Regulation is revoked and the following substituted:

(4) The actuary who prepares the report described in subsection (2) or (3.1) shall calculate the amount of interest that is payable under paragraph 2 of subsection (3) or paragraph 2 of subsection (3.2), as applicable.

Commencement

10. (1) Subject to subsections (2), (3) and (4), this Regulation comes into force on the day it is filed.

(2) Sections 1 to 5 and subsection 7 (1) come into force on June 1, 2011.

(3) Subsections 7 (2) and (4) come into force on December 31, 2012.

(4) Section 8 comes into force on January 1, 2012.