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Benefits August 5, 2011
New Marriage-Breakdown Rules Create Risk for Canadian DB Sponsors
August 5, 2011 (PLANSPONSOR.com) - Ontario has passed long-awaited regulations to the Family Statute Law Amendment Act, 2009 (Bill 133), effective January 1, 2012, which Sibson Consulting says draws plan sponsors into the marriage-breakdown process.
Reported by Rebecca Moore
In a Bulletin, Sibson says the revised marriage-breakdown rules for defined benefit pension plans in Bill 133 present a number of challenges for plan sponsors, including:
- Performing the required calculations,
- Selecting tools and creating processes and procedures to ensure plan administration is consistent with the new requirements, and
- Drafting and designing the statement of imputed value that plans must provide to members and non-member spouses.
Sibson says the complexity of the calculations and administrative processes will introduce an element of risk to plan administrators that does not exist under current rules. To address the risk, plan sponsors will be required to either invest in putting in place tools, processes and procedures that will ensure plan administration is consistent with the legislated requirements – or prepare to pay higher ongoing to outside providers of these calculations.
The Sibson Bulletin is at http://www.sibson.com/publications/bulletins/july11Canada.pdf.« Voters Must Weigh in on Miami Firefighters Pension Changes