The government of British Columbia has introduced a bill to modernize its pension legislation, in an effort to make plans more flexible, and encourage wider private-sector pension coverage.
The province Monday introduced legislation that it says will permit the use of alternatives to existing plans, such as jointly sponsored cost-sharing pension plans that are common in the public sector, and target benefit plans. It would require governance and funding policies for defined benefit and target benefit plans.
The bill also aims to improve pension legislation by reducing administrative costs and enhancing the rights of pension plan members, including creating an immediate entitlement to employer-paid contributions, and a right to more information about how a plan is operating. And, it will establish a framework that will give former pension plan members the option of withdrawing funds from an RRSP or life income fund in cases of financial hardship.
The provincial pension regulator would also get new supervisory tools, including the power to levy administrative penalties and appoint replacement administrators or actuaries.
“The new plan design options such as target benefit plans, and improved pension plan disclosure requirements, will help to ensure British Columbian’s retirement savings options are maximized,” said BC finance minister, Kevin Falcon. “Employers have said they need streamlined regulation so that they can focus on their business and not on red tape. Modernizing the legislation gives employers more flexibility to offer a wider choice of pension plan options, so that more British Columbians can have access to pension income during their retirement years.”