Ontario Legislative Assembly Resumes Sitting
On February 21, 2012, the House resumed sitting.
BPS Solvency Funding Relief Regulation Amended
On February 17, 2012, the Ontario government filed an amendment to O. Reg. 178/11 (Solvency Funding Relief For Certain Public Sector Pension Plans) under the Pension Benefits Act.
O. Reg. 12/12 prescribes those plans that have successfully applied for and, are receiving, solvency funding relief under O. Reg. 178/11.
The Regulation is now in force.
The details regarding solvency funding relief for public sector pension plans were first announced in February, 2011.
Drummond Commission Reports on Public Service Reform
On February 15, 2012, the Commission on the Reform of Ontario's Public Services (“Commission”) chaired by Don Drummond released its long-awaited report (“Drummond Report”) identifying wide-ranging reform measures aimed at increasing efficiencies within the broader public service.
In June of 2011, the Ontario government tasked the Commission with the examination of its service delivery models, and the preparation of a comprehensive report identifying:
- programs that were no longer serving their intended purpose that could be eliminated or redesigned;
- areas of overlap and duplication that could be eliminated; and
- areas of value in the public sector that could be further enhanced.
With hundred of recommendations made, the Drummond Report is intended to provide the Minister of Finance with a series of wide-ranging and far-reaching recommendations for the government to consider in advance of its 2012 Ontario Budget.
We are in the process of reviewing the Report, and will be providing a more detailed analysis of the potential impact of the Report in subsequent FTR Nows over the coming days
Federal Pooled Registered Pension Plan ("PRPP") Legislation Referred to Committee
On February 1, 2012, Bill C-25, An Act relating to pooled registered pension plans and making related amendments to other Acts passed at Second Reading in the House of Commons, and was referred to the Standing Committee on Finance.
As previously reported, Bill C-25 is new legislation implementing the framework for federally regulated PRPPs, and was first introduced on November 17, 2011. The government subsequently released draft, supporting Income Tax Act amendments related to the PRPP for public commentary on December 14, 2011, which will apply to both federally and provincially regulated PRPPs. Provincial enabling legislation has not yet been introduced; the Ontario Legislative Assembly is set to resume sitting on February 21, 2012.
As announced in Budget 2011, the release of the PRPP legislation follows a joint federal-provincial initiative to move forward with a new type of broad-based privately administered pension arrangement to bridge existing gaps in the Canadian retirement system. Notably, the PRPP is intended to provide small business owners and their employees with access to large-scale, low-cost, professionally administered pension plans.
The proposed tax rules for PRPPs would apply to both federally and provincially regulated PRPPs, and would operate alongside Bill C-25.
Stakeholders and interested parties may submit comments on the package of proposed PRPP amendments before February 14, 2012.
More information about the proposed PRPP legislation is available in our FTR Now of November 23, 2011, "Pooled Registered Pension Framework Introduced."
