On May 19, 2017, the Ontario Ministry of Finance issued a News Release and a Backgrounder to give a progress update on the province’s ongoing defined benefit (DB) pension funding reform.
These materials contain information on next steps in the funding reform process, provide details about the new funding framework, a timeline for interim relief measures, and information on changes to the Pension Benefits Guarantee Fund (PBGF).
The new framework is currently expected to apply only to single-employer DB plans, and to multi-employer pension plans that do not currently qualify as a specified Ontario multi-employer pension plan (SOMEPP). There is no indication that it will apply to jointly sponsored pension plans (JSPPs). Also, the government is in the process of developing a separate regulatory framework for target benefit multi-employer pension plans (TBMEPPs), which would replace the rules that currently apply to SOMEPPs.
This Special Notice reviews the latest announcements and discusses their potential impact on employers and plan sponsors.