The long-awaited report from the Alberta/British Columbia Joint Expert Panel on Pension Standards was released Friday, calling for sweeping changes to pension standards legislation for the two provinces as well as the creation of a new pension plan for Canadians who currently have no pension coverage.
Created in October 2007 by their respective provincial governments, the panel consisted of six experts tasked with conducting an overview of Alberta’s Employment Pension Plans Act and British Columbia’s Pension Benefits Standards Act, which have not been reviewed for decades.
The panel’s recommendations include the adoption of identical pension acts between the provinces, along with a joint policy advisory council, joint pension tribunal, and pension regulator. It suggests a shift to a more principle-based regulatory system, improved governance, and revised rules towards funding, disclosure, and benefits.
Perhaps the most significant recommendation in the report involves the creation of an Alberta/British Columbia Pension (ABC) Plan, available to all workers for which individual employers would not have any fiduciary responsibility. Such a plan, explains Scott Sweatman, the panel’s B.C. co-chair, is to create sufficient economies of scale to enable employees and employers to participate at low cost—as much as 50 basis points—in a defined contribution plan.
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However, the panel’s suggestions may be further reaching than their respective provinces, as the proposed ABC Plan, if implemented, would be capable of growing into a national supplementary plan similar to the one recently called for by pension expert Keith Ambachtsheer.
“If it was successful in B.C. and Alberta, there’s no reason why it couldn’t have national scope,” says Sweatman.
While he doesn’t expect the report to be implemented to the letter, Sweatman is confident the spirit of the recommendations will eventually come to pass.
“There’s no reason why most of these recommendations, with obvious tweaking that will take place, can’t be adopted.”
Alberta co-chair Chris Brown explains that aside from a few changes to the Income Tax Act, the panel’s proposals are not subject to federal government approval, making it an almost exclusively inter-provincial affair.
Due to the current economic environment, the panel is encouraging both the federal and provincial governments to engage on the recommendations, regardless of the reaction from other provinces. “If national efforts don’t proceed in a timely manner, our [provincial] governments should move ahead on their own,” says Brown.
The public may review the report and provide feedback until March 2, 2009. To view the Report of the Joint Expert Panel on Pension Standards, click here
To comment on this story, email jody.white@rci.rogers.com.