Budget Implementation Act, 2023, No. 1 (S.C. 2023, c. 26)
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Assented to 2023-06-22
PART 4Various Measures (continued)
DIVISION 2Private Sector Pension Plans (continued)
R.S., c. 32 (2nd Supp.)Pension Benefits Standards Act, 1985 (continued)
149 Section 10.1 of the Act is amended by adding the following after subsection (2):
Marginal note:Non-application — variable life benefit
(3) Subsection (2) does not apply with respect to an amendment to reduce, as permitted or required under the regulations, the amount of a variable life benefit.
150 Section 10.2 of the Act is amended by adding the following after subsection (2):
Marginal note:Transfer from variable life benefit fund
(3) Subject to section 16.91 and subsection 29(12), the administrator may transfer or permit the transfer of any part of the assets of a variable life benefit fund established under subsection 16.6(1) to another pension plan, including a pension plan to which this Act does not apply, only with the Superintendent’s permission.
151 The Act is amended by adding the following after section 16.5:
Variable Life Benefits
Marginal note:Fund and benefits
16.6 (1) Subject to the regulations, a pension plan may
(a) provide for the establishment within the pension fund of a variable life benefit fund from which variable life benefits are to be paid; and
(b) provide that a person referred to in subsection (2) may, in order to receive variable life benefits, elect to transfer to the variable life benefit fund any amounts in either or both of the following accounts:
(i) their account in the pension fund maintained in respect of a defined contribution provision, and
(ii) their account in the pension fund maintained for additional voluntary contributions.
Marginal note:Persons who may elect
(2) The following persons may make the election referred to in paragraph (1)(b):
(a) a member or former member who is entitled to an immediate pension benefit under subsection 16(1) or eligible to receive an immediate pension benefit under subsection 16(2);
(b) a survivor who is entitled to pension benefits under the pension plan.
Marginal note:Conditions on election
16.7 A person referred to in subsection 16.6(2) may elect to transfer amounts to the variable life benefit fund only if the prescribed conditions are met.
Marginal note:No accounts in fund
16.8 A variable life benefit fund does not contain individual accounts for recipients of variable life benefits and, for greater certainty, a reference in this Act to an account, made in relation to a defined contribution provision or a defined contribution plan, is not to be construed as referring to amounts held within a variable life benefit fund.
Marginal note:Termination
16.9 (1) This section, and not section 29, applies with respect to the termination of a variable life benefit fund if that termination includes only the termination of one or more such funds and the whole of the plan is not being terminated.
Marginal note:No partial termination
(2) A partial termination of a variable life benefit fund is not permitted.
Marginal note:Termination by administrator
(3) Subject to subsection (4), a variable life benefit fund is terminated only if the administrator of the pension plan notifies the Superintendent — in writing or in the form and manner, if any, that the Superintendent directs — of the decision to terminate the fund and the date of termination, not less than 60 days and not more than 180 days before the date of termination.
Marginal note:Declaration by Superintendent
(4) In the prescribed circumstances, the Superintendent may declare a variable life benefit fund to be terminated as of the date that the Superintendent considers appropriate.
Marginal note:Termination report
(5) On the termination of a variable life benefit fund, the administrator shall file with the Superintendent — in the form and manner, if any, that the Superintendent directs — a termination report that contains the prescribed information and that is prepared by a person having the prescribed qualifications.
Marginal note:Approval of termination report
(6) Assets of the variable life benefit fund may not be applied toward the provision of any benefits until the Superintendent has approved the termination report. The administrator may nevertheless pay variable life benefits, as they fall due, to the persons entitled to them.
Marginal note:Transfer or purchase on termination
16.91 (1) On the termination of a variable life benefit fund under section 16.9, a former member or survivor who was receiving a variable life benefit from the fund is entitled to
(a) transfer, for the purpose of making an election to receive a variable benefit under section 16.2, the amount of the aggregate value of their variable life benefits at termination to an account maintained in the pension plan in respect of a defined contribution provision, if the pension plan provides for such an election;
(b) transfer that amount to another pension plan, including one referred to in any of paragraphs 26(5)(a) to (c), if that other plan permits;
(c) transfer that amount to a retirement savings plan of the prescribed kind for the former member or survivor, as the case may be; or
(d) use that amount to purchase an immediate or deferred life annuity of the prescribed kind for the former member or survivor, as the case may be.
Marginal note:Aggregate value
(2) The aggregate value of a person’s variable life benefits at termination is to be calculated in the prescribed manner.
Marginal note:Survivor
(3) For the purposes of paragraph (1)(a), a survivor may make an election under section 16.2 as if they were a former member, but neither paragraph 16.2(2)(a) nor section 16.3 apply with respect to the survivor.
Marginal note:Superintendent may direct winding-up
16.92 If a variable life benefit fund has been terminated under section 16.9 and the Superintendent is of the opinion that no action or insufficient action has been taken to wind up the fund, the Superintendent may direct the administrator to distribute the assets of the fund, and may direct that any expenses incurred in connection with that distribution be paid out of the fund, and the administrator shall comply with any such direction without delay.
152 (1) Paragraphs 18(1)(a) and (b) of the Act are replaced by the following:
(a) that no benefit provided under the plan is capable of being assigned, charged, anticipated or given as security or confers on a member or former member, that person’s personal representative or dependant or any other person any right or interest in the benefit that is capable of being assigned, charged, anticipated or given as security;
(b) that, except in the case of the unexpired period of a guaranteed annuity, no benefit described in section 16 or 17 is capable of being surrendered or commuted during the lifetime of the member or former member or that person’s spouse or common-law partner or confers on a member or former member, on that person’s personal representative or dependant or on any other person any right or interest in the benefit that is capable of being surrendered or commuted during the lifetime of the member or former member or that person’s spouse or common-law partner; and
(2) Paragraphs 18(1)(b) and (c) of the Act are replaced by the following:
(b) that, except in the case of the unexpired period of a guaranteed annuity or as provided in section 16.4 or 16.91 or subsection 29(12), no benefit described in section 16 or 17 is capable of being surrendered or commuted during the lifetime of the member or former member or that person’s spouse or common-law partner or confers on a member or former member, on that person’s personal representative or dependant or on any other person any right or interest in the benefit that is capable of being surrendered or commuted during the lifetime of the member or former member or that person’s spouse or common-law partner; and
(c) with respect to a person who has been a member for a continuous period of at least two years, that, except as provided in section 16.4, 16.91 or 26 or subsection 29(12), that person — if they are entitled to a benefit described in section 16 or 17 or would be entitled to the benefit if they retired or ceased membership in the plan — is not permitted to withdraw any part of their contributions to the plan, other than additional voluntary contributions, in respect of any period of membership in the plan on or after October 1, 1967 for which they are entitled to the benefit, and that any pension fund moneys attributable to those contributions shall be applied under the terms of the plan toward the payment of the benefit.
153 (1) The portion of subsection 26(1) of the French version of the Act before paragraph (a) is replaced by the following:
Marginal note:Transfert avant l’admissibilité à la retraite
26 (1) Le participant dont la participation a pris fin avant qu’il n’ait droit à la prestation visée au paragraphe 16(2), ou son survivant, dans le cas où le participant meurt avant d’y avoir droit, peut, s’il informe l’administrateur de son intention, en la forme réglementaire, dans les quatre-vingt-dix jours suivant l’événement en cause, ou si le surintendant accorde un délai supplémentaire au titre de l’alinéa 28(1)d), dans les soixante jours suivant la remise du relevé visé par cet alinéa ou, si sa participation prend fin en raison de la cessation totale du régime de pension, dans les soixante jours suivant la remise du relevé visé à l’alinéa 28(2.1)b) :
(2) The portion of subsection 26(1) of the English version of the Act after paragraph (c) is replaced by the following:
if the member or the survivor notifies the administrator of that desire, in the prescribed form and within 90 days after the cessation of membership or the member’s death (or, if the Superintendent allows a longer period under paragraph 28(1)(d), within 60 days after the administrator has given the written statement under that paragraph) — or, if the member ceases to be a member because the whole of the pension plan is terminated, within 60 days after the administrator has given the written statement under paragraph 28(2.1)(b) — and the administrator shall without delay take any necessary action to give effect to the notification.
154 Section 27 of the Act is amended by adding the following after subsection (3):
Marginal note:Variable life benefits
(4) The application of subsections (1) to (3) with respect to variable life benefits may be adapted, restricted or excluded under the regulations.
155 (1) The portion of paragraph 28(1)(b.1) of the Act before subparagraph (i) is replaced by the following:
(b.1) that each former member of the plan and the former member’s spouse or common-law partner, as well as each survivor who is entitled to pension benefits under the plan, will be given, in the prescribed circumstances and manner and within six months — or any longer period permitted by the Superintendent — after the end of each year of operation of the plan, a written statement showing
(2) The portion of paragraph 28(1)(b.1) of the Act before subparagraph (i) is replaced by the following:
(b.1) that, other than with respect to variable life benefits, each former member of the plan and the former member’s spouse or common-law partner, as well as each survivor who is entitled to pension benefits under the plan, will be given, in the prescribed circumstances and manner and within six months — or any longer period permitted by the Superintendent — after the end of each year of operation of the plan, a written statement showing
(3) Section 28 of the Act is amended by adding the following after subsection (2):
Marginal note:Variable life benefit fund
(2.01) A pension plan with a variable life benefit fund shall provide that each former member and survivor who is receiving a variable life benefit from the fund, as well the spouse or common-law partner of each such former member, will be given the prescribed information in the prescribed circumstances and manner and within the prescribed period or within any longer period permitted by the Superintendent.
(4) Subsection 28(2.1) of the Act is replaced by the following:
Marginal note:Information on plan termination
(2.1) A pension plan shall provide that if the whole of the plan is terminated, the administrator shall give to each member and former member and to the spouse or common-law partner of each member and former member, as well as to each survivor who is entitled to pension benefits under the plan, a written statement, in the prescribed form, informing them of
(a) the termination of the plan, within 30 days after the termination or any longer period permitted by the Superintendent; and
(b) the member’s, former member’s or survivor’s pension benefits and other benefits payable under the plan, within 120 days after the termination or any longer period that the Superintendent may allow.
(5) Section 28 of the Act is amended by adding the following after subsection (2.1):
Marginal note:Information — termination of variable life benefit fund
(2.2) A pension plan with a variable life benefit fund shall provide that, if the fund is terminated under section 16.9, the administrator shall give to each former member and survivor who is receiving a variable life benefit from the fund, as well as to the spouse or common-law partner of each such former member, a written statement, in the prescribed form, that
(a) informs them of the termination of the fund, within 30 days after the termination or any longer period permitted by the Superintendent; and
(b) provides them with the prescribed information, within 120 days after the termination or any longer period permitted by the Superintendent.
156 (1) Subsection 29(6.1) of the French version of the Act is replaced by the following:
Marginal note:Obligation de l’employeur
(6.1) S’il y a cessation totale d’un régime de pension autre qu’un régime à cotisations négociées, l’employeur est tenu de verser au fonds de pension, conformément aux règlements, la somme, calculée périodiquement conformément aux règlements, qui est nécessaire pour que soient acquittées toutes les obligations du régime à l’égard des prestations de pension déterminées à la date de la cessation.
(2) Subsections 29(6.3) and (6.4) of the French version of the Act are replaced by the following:
Marginal note:Paiement en trop
(6.3) À la liquidation du régime de pension, s’il reste dans le fonds de pension un solde qui excède la somme nécessaire pour permettre au régime de s’acquitter de toutes ses obligations à l’égard des prestations de pension déterminées à la date de la cessation, la partie du solde qui est, selon les règlements, attribuable aux paiements effectués par l’employeur sous le régime du paragraphe (6.1) ne constitue pas un excédent et, sous réserve du paragraphe (7), ce dernier a droit de la recouvrer.
Marginal note:Liquidation ou faillite
(6.4) En cas de liquidation du régime de pension ou de liquidation, de cession de biens ou de faillite de l’employeur, est immédiatement exigible la somme nécessaire pour permettre au régime de s’acquitter de toutes ses obligations à l’égard des prestations de pension déterminées à la date de la cessation.
(3) Section 29 of the Act is amended by adding the following after subsection (11):
Marginal note:Variable life benefits — transfer or purchase
(12) If a variable life benefit fund has been terminated as part of a termination under this section, a former member or survivor who was receiving a variable life benefit from the fund is entitled to
(a) transfer the amount of the aggregate value of their variable life benefits at termination, calculated in the prescribed manner, to another pension plan, including one referred to in any of paragraphs 26(5)(a) to (c), if that other plan permits;
(b) transfer that amount to a retirement savings plan of the prescribed kind for the former member or survivor, as the case may be; or
(c) use that amount to purchase an immediate or deferred life annuity of the prescribed kind for the former member or survivor, as the case may be.
157 (1) Paragraph 36(2)(b) of the Act is replaced by the following:
(b) any money withdrawn from a pension fund under section 16.4, 16.91 or 26 or subsection 29(12)
(2) The portion of subsection 36(3) of the Act before paragraph (a) is replaced by the following:
Marginal note:Exception
(3) Subsection (2) does not apply to prevent the assignment of a right or interest in a pension benefit, or in a life annuity of the prescribed kind resulting from a transfer or purchase under section 26, if the assignment
(3) The portion of subsection 36(3) of the Act before paragraph (a) is replaced by the following:
Marginal note:Exception
(3) Subsection (2) does not apply to prevent the assignment of a right or interest in a pension benefit, or in a life annuity of the prescribed kind resulting from a transfer or purchase under section 16.4, 16.91 or 26 or subsection 29(12), if the assignment
(4) Paragraphs 36(4)(a) and (b) of the Act are replaced by the following:
(a) to surrender or commute a benefit, or any right or interest in the benefit, or
(b) to surrender or commute benefits payable as a result of a transfer or purchase under section 26
(5) Paragraph 36(4)(b) of the Act is replaced by the following:
(b) to surrender or commute benefits payable as a result of a transfer or purchase under section 16.4, 16.91 or 26 or subsection 29(12)
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