Acts and Regulations

2017-49 - Pension Benefits Act

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NEW BRUNSWICK
REGULATION 2017-49
under the
Pension Benefits Act
(O.C. 2017-315)
Filed December 22, 2017
1Section 2 of New Brunswick Regulation 2012-75 under the Pension Benefits Act is amended
(a) in the definition “temporary contributions” by striking out “particular risk management goal” and substituting “fixed funding goal”;
(b) by adding the following definition in alphabetical order:
“defined contribution plan” means a defined contribution plan as defined in section 2 of Regulation 91-195.(régime à cotisation déterminée)
2The heading “Definitions for Part 2 of the Act” preceding section 3 of the Regulation is repealed.
3Section 3 of the Regulation is repealed.
4Section 4 of the Regulation is amended by adding the following definition in alphabetical order:
“contingent indexing” means the escalated adjustments that may be provided under a shared risk plan based on the funding policy and the funded status of the plan at the relevant date.(indexation conditionnelle)
5Subsection 6(2) of the Regulation is amended
(a) in paragraph (h) of the English version by striking out “and” at the end of the paragraph;
(b) in paragraph (i) by striking out the period at the end of the paragraph and substituting “; and”;
(c) by adding after paragraph (i) the following:
(j) the actuarial assumptions used for a new shared risk plan and the process for changing the assumptions over time, including the discount rate used to calculate the funding policy liabilities of the shared risk plan.
6Section 7 of the Regulation is amended
(a) in paragraph (1)(a) by striking out “reduction of base benefits” and substituting “reduction of past base benefits”;
(b) in subsection (2)
(i) by repealing paragraph (d) and substituting the following:
(d) subject to subsection (2.1), at the date a benefit improvement is made;
(ii) by repealing paragraph (f) and substituting the following:
(f) at the date temporary contributions are reduced or removed if that date is before the expiry date of the period specified under subsection 9(4).
(c) by adding after subsection (2) the following:
7(2.1)Paragraph (2)(d) does not apply if
(a) the benefit improvement is made as a result of contingent indexing and there is at least a 95% probability that the past base benefits at the end of each year will not be reduced over a 20-year period; and
(b) the administrator confirms that the asset mix of the shared risk plan had not been changed in a manner that increased investment risks for the shared risk plan in the six-month period before the contingent indexing occurred.
(d) in subsection (3)
(i) in subparagraph (a)(i) by striking out “final average salary formula,” and substituting “final average salary formula or a best average salary formula,”;
(ii) in paragraph (b) by striking out “plan text” and substituting “shared risk plan”.
7Section 9 of the Regulation is amended
(a) in paragraph (1)(b) by striking out “the normal” and substituting “all”;
(b) by repealing subsection (3) and substituting the following:
9(3)Subject to subsection (3.1), the amount of the initial contributions shall be determined
(a) by using a fixed dollar amount, or
(b) by using either of the following calculations:
(i) a fixed dollar amount per hour worked by the members required to make contributions; or
(ii) a fixed percentage of earnings in respect of which contributions are made.
(c) by adding after subsection (3) the following:
9(3.1)The method for determining the amount of the initial contributions shall not be changed unless changed as a result of a permanent benefit change that is approved by
(a) the employer or employers required to make contributions under the plan, and
(b) the trade union that represents the members of the plan if the change is approved as a result of collective bargaining.
(d) by repealing subsection (5) and substituting the following:
9(5)Subject to subsection (5.1), the amount of the temporary contributions shall be determined
(a) by using a fixed dollar amount; or
(b) by using either of the following calculations:
(i) a fixed dollar amount per hour worked by the members required to make contributions; or
(ii) a fixed percentage of earnings in respect of which contributions are made.
(e) by adding after subsection (5) the following:
9(5.1)The amount of temporary contributions determined under subsection (5) shall not be less than the amount of temporary contributions determined at the date the shared risk plan was established.
(f) in subsection (8) in the portion preceding paragraph (a) by striking out “cumulative increases or cumulative decreases” and substituting “contribution adjustments”;
(g) by repealing subsection (10) and substituting the following:
9(10)Subject to subsection (11), if the administrator makes a permanent benefit change, the amount of the initial contributions shall be recalculated.
(h) in subsection (11) by adding “by the administrator” after “is considered”.
8Section 11 of the Regulation is amended
(a) in subsection (2) by striking out “to meet the primary risk management goal referred to in subsection 7(1)” and substituting “to meet an open group funded ratio of 100%”;
(b) by repealing subsection (5) and substituting the following:
11(5)If the actions taken under subsection (4) are not sufficient to meet an open group funded ratio of 100%, the past base benefits and the future base benefits shall be further reduced by such percentage that an open group funded ratio of 105% is met as of the review date of the actuarial valuation report that caused the implementation of the funding deficit recovery plan.
9Section 13 of the Regulation is amended
(a) by adding after subsection (3) the following:
13(3.1)A change in an investment policy that negatively impacts the primary risk management goal of the shared risk plan may only be made if the primary risk management goal of the shared risk plan continues to be met after the change.
(b) in subsection (4) by striking out “one month” and substituting “nine months”.
10Section 14 of the Regulation is amended
(a) by adding after subsection (7) the following:
14(7.1)The administrator shall ensure that an audited financial statement of the shared risk plan is prepared in accordance with generally accepted accounting principles at the same time as an actuarial valuation report is prepared under this section and that the statement is filed at the same time as the report is required to be filed or is filed, whichever occurs first.
(b) by repealing subsection (8) and substituting the following:
14(8)Sections 8, 9 and 10 of Regulation 91-195 do not apply to a shared risk plan.
11Section 15 of the Regulation is amended
(a) in paragraph (2)(a) by striking out “subject to subsection (3)” and substituting “subject to subsections (3) and (3.1)”;
(b) by adding after subsection (3) the following:
15(3.1)The economic assumptions referred to in paragraph (2)(a) shall not be used to affect the discount rate referred to in paragraph 6(2)(i).
12Section 16 of the Regulation is amended
(a) in subsection (2) by striking out “five years” and substituting “ten years”;
(b) by adding after subsection (3) the following:
16(3.1)If a defined benefit plan is converted to a shared risk plan which is wound up under paragraph (1)(b) between five years and ten years after the conversion date, the Superintendent may determine that the conversion is void and may require that the plan be wound-up as a defined benefit plan under Part 1 of the Act.
13Section 17 of the Regulation is amended in the portion preceding paragraph (a) by striking out “five” and substituting “ten”.
14Subparagraph 18(1)(b)(ii) of the Regulation is amended in the English version by striking out “liabiltities” and substituting “liabilities”.
15Section 26 of the Regulation is amended
(a) by adding after subsection (3) the following:
26(3.1)Section 48 of the Act applies to the determination of the termination value under section 18 for a shared risk plan that may be reduced under the shared risk plan by reason of payments under the Canada Pension Plan, the Quebec Pension Plan or the Old Age Security Act (Canada).
(b) by repealing subsection (4) and substituting the following:
26(4)Section 29 and subsections 30(2) and (2.1), 31(1), (2), (3), (4) and (7) and section 34 of Regulation 91-195 do not apply to a shared risk plan.
16Subsection 27(8) of the Regulation is amended by striking out “Board” and substituting “Tribunal”.
Commencement
17This Regulation comes into force on January 1, 2018.