Cabinet has extended a moratorium on solvency for a group of private sector pension plans, protecting the benefits of 158,000 plan members.
In their December 18 meeting, Cabinet approved two changes to the Employment Pension Plans Regulation, which applies to private sector pension plans. One of the changes allows defined benefit collectively-bargained, multi-employer pension plans to continue a moratorium on solvency funding until permanent legislation addressing their funding concerns is in place. Without this change, 158,000 plan members could have seen their benefits reduced.
“The extension of the solvency moratorium is an indication that the government understands the importance of pension security to Albertans, and is working to ensure a legislative framework that supports well-funded sustainable and secure pensions. Union sponsors of multi-employer pension plans are working with government to address the needs of updated regulations.”
~ Bruce Moffatt, Chair of the Collectively Bargained Multi-Employer Advisory Committee and Business Manager and CEO of the International Union of Operating Engineers Local Union No. 995
The second change deals with pension splitting rules in cases of marriage breakdown for supplemental plans registered under the Employment Pension Plans Regulation. Going forward, one set of rules will apply when splitting regular and supplemental pension plans, simplifying the administrative process and making it clearer for all parties involved.
The changes do not apply to public sector pension plans.
This fall, the Employment Pension (Private Sector) Plans Amendment Act, 2014 ended when Legislature was prorogued. The Government of Alberta is working collaboratively with groups such as private sector unions and the Collectively Bargained Multi-Employer Advisory Committee to draft new legislation to address the long-term sustainability of private pension plans.