The Ontario Teachers’ Pension Plan president and CEO says the federal government is out to lunch when it comes to the rules governing pension plan investment laws.
Speaking to an audience on Wednesday in Toronto, Jim Leech explained that while the Ontario government included amendments to the 30% maximum ownership rule for pension plans in its latest budget, the federal government has yet to signal that reform of the 1932 law is on its radar screen.
This puts Canadian institutional investors at a disadvantage, as foreign pension funds are able to purchase 100% of a Canadian company while local funds cannot.
“Because of this outdated rule, we have to either bow out of the race or construct costly, complex, time-consuming structures that eat into our rate of return and distract our investment professionals. This is not a theory. This is day-to-day reality that does nothing but cost plan members and taxpayers money.”
Leech called upon the federal government to make amendments to the 30% rule a priority as a means of improving the lot of the country’s defined benefit pension plans.
More to come…