On Tuesday, Alberta’s Employment Pension Plans Regulation was passed by cabinet.
The regulation supports the new Employment Pension Plans Act, which was passed by the legislative assembly in fall 2012 and is the culmination of the rewrite of private sector pension legislation following the establishment of the Joint Expert Panel on Pension Standards in fall 2007.
Although the new regulation is passed, proclamation of the new act and regulation is Sept. 1, 2014.
The 2012 act and regulation make it easier for private sector employers to offer or continue to offer pension plans. Toward this end, the act and regulation establish funding rules for private sector pension plans that choose to move to a target benefit model on a go-forward basis only.
“Private sector plan sponsors such as employers and unions have expressed concern about the long-term viability of their plans and have demanded more flexibility,” says president of Treasury Board and Minister of Finance Doug Horner. “To further delay proclaiming this act and its regulation would be irresponsible to the many organizations across Alberta who are eagerly awaiting it.”
The 2012 act and regulation are separate and distinct from what was proposed with Bill 10 in spring 2014. Unlike Bill 10, the 2012 act and regulation do not allow private sector pension plans to retroactively convert previously accrued defined benefits to target benefits.
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