Officials Issue New Items for DB Plan Sponsors

The PBGC has issued a final rule regarding pension plans undergoing distress or involuntary termination, and the OSFI has released a form for contribution schedule reporting.

The Pension Benefit Guaranty Corporation (PBGC) has published a final rule amending its regulation on Allocation of Assets in Single-Employer Plans by substituting a new table for determining expected retirement ages for participants in pension plans undergoing distress or involuntary termination with valuation dates falling in 2020.

The table is needed to compute the value of early retirement benefits and, thus, the total value of benefits under a plan. The rule is effective January 1, 2020.

The Office of the Superintendent of Financial Institutions (OSFI) issued a Schedule of Expected Pension Contributions Form. Section 9.1 of the Pension Benefits Standards Act, 1985(PBSA) requires a pension plan administrator and the fund trustee or custodian to notify the OSFI when expected contributions to a pension plan are not remitted on time. To enable fund trustees or custodians to fulfill their obligation to report late remittances, the PBSA requires a plan administrator to notify them of the amount and expected remittance date of future contributions. For this, the Schedule of Expected Pension Contributions Form may be used.

The OSFI says the use of the form is not compulsory and administrators may choose to use another format to notify the trustee or custodian of expected contributions. Fund trustees or custodians should notify the OSFI if a schedule is not provided.