Acts and Regulations

2014-112 - Fraser Papers’ Shared Risk Plans

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Current to 1 January 2024
NEW BRUNSWICK
REGULATION 2014-112
under the
Pension Benefits Act
(O.C. 2014-304)
Filed August 12, 2014
Under sections 100 and 100.9 of the Pension Benefits Act, the Lieutenant-Governor in Council makes the following Regulation:
Citation
1This Regulation may be cited as the Fraser Papers’ Shared Risk Plans Regulation - Pension Benefits Act.
Definitions
2The following definitions apply in this Regulation.
“Act” means the Pension Benefits Act.(Loi)
“conversion date” means September 30, 2014.(date de conversion)
“Fraser Papers’ shared risk plan” means(Régime à risques partagés de Papiers Fraser)
(a) the shared risk plan provision of the pension plan referred to in paragraph 99.6(a) of the Act, on and after the conversion date on which the pension plan is amended to include a shared risk plan provision; or
(b) the shared risk plan provision of the pension plan referred to in paragraph 99.6(b) of the Act, on and after the conversion date on which the pension plan is amended to include a shared risk plan provision.
“funding policy liabilities” means funding policy liabilities as defined in Regulation 2012-75.(passif de la politique de financement)
“open group funded ratio” means open group funded ratio as defined in Regulation 2012-75.(coefficient de capitalisation du groupe avec entrants)
“past base benefits” means past base benefits as defined in Regulation 2012-75.(prestations de base antérieures)
“Regulation 91-195” means New Brunswick Regulation 91-195 under the Act.(Règlement 91-195)
“Regulation 2012-75” means New Brunswick Regulation 2012-75 under the Act.(Règlement 2012-75)
“temporary contributions” means temporary contributions as defined in Regulation 2012-75.(cotisations temporaires)
“termination value funded ratio” means termination value funded ratio as defined in Regulation 2012-75.(coefficient de capitalisation de la valeur de terminaison)
“valuation date” means valuation date as defined in Regulation 2012-75.(date d’évaluation)
Registration
3(1)Subsections 10(5) and (6), paragraph 100.4(1)(a) and subsection 100.6(2) of the Act do not apply to the Fraser Papers’ shared risk plan.
3(2)The applicant shall pay the fee prescribed by Regulation 2012-75 for the purposes of section 100.6 of the Act and shall file the following with the Superintendent:
(a) a copy of the conversion plan that
(i) demonstrates how existing benefits are converted to benefits provided by the Fraser Papers’ shared risk plan,
(ii) specifies the base benefits and ancillary benefits, if any,
(iii) specifies the temporary contributions determined in accordance with section 6,
(iv) specifies the automatic changes allowed by the funding policy referred to in paragraph 100.4(1)(b) of the Act,
(v) demonstrates to the Superintendent that the temporary contributions are sufficient to pay for the projected base benefits and ancillary benefits, if any, and to meet all of the risk management goals under Part 2 of the Act and the regulations;
(b) an actuarial valuation report of the status of the Fraser Papers’ shared risk plan as of the conversion date;
(c) the results of an analysis of the Fraser Papers’ shared risk plan using an asset liability model that complies with the regulations and any guidelines issued by the Superintendent;
(d) the funding policy required under paragraph 100.4(1)(b) of the Act; and
(e) the investment policy required under paragraph 100.4(1)(c) of the Act.
Funding policy
4(1)Paragraphs 6(2)(c) and (g) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
4(2)The funding policy of the Fraser Papers’ shared risk plan shall contain the temporary contributions in accordance with section 6.
Risk management goals
5(1)Subsections 7(1) and (3) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
5(2)The primary risk management goal of the Fraser Papers’ shared risk plan shall be that there is at least a 97.5% probability that the past base benefits at the end of each year will not be reduced over the period of 15 years commencing on the date of conversion after taking into account the following:
(a) the funding deficit recovery plan, other than the reduction of base benefits; and
(b) the funding excess utilization plan, other than permanent benefit changes.
Temporary contributions
6(1)Section 9 of Regulation 2012-75 does not apply to the Fraser Papers’ shared risk plan.
6(2)Sections 35 to 41 of Regulation 91-195 do not apply to the Fraser Papers’ shared risk plan.
6(3)The administrator may receive temporary contributions to the Fraser Papers’ shared risk plan from any source in an amount determined each year in accordance with the funding policy required under paragraph 100.4(1)(b) of the Act.
6(4)A source from which money is received under subsection (3) shall not be considered a pension fund.
6(5)Temporary contributions shall be paid in accordance with the plan text, the funding policy and this Regulation.
Plan expenses
7(1)Section 10 of Regulation 2012-75 does not apply to the Fraser Papers’ shared risk plan.
7(2)The expenses relating to the administration of the Fraser Papers’ shared risk plan shall be paid by the pension fund.
Funding deficit recovery plan
8(1)In subsection 11(2) of Regulation 2012-75 the reference to the primary risk management goal referred to in subsection 7(1) of that Regulation shall be read as a reference to the primary risk management goal referred to in subsection 5(2).
8(2)Subsections 11(3) to (7) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
8(3)The funding deficit recovery plan for the Fraser Papers’ shared risk plan shall include the reduction of past base benefits of members and former members.
8(4)The past base benefits shall be reduced by such percentage that the following are met as of the review date of the actuarial valuation report that caused the implementation of the funding deficit recovery plan:
(a) an open group funded ratio of 105%, and
(b) the primary risk management goal referred to in subsection 5(2).
8(5)Past base benefits shall be reduced under subsection (4) no later than 18 months after the review date of the most recent actuarial valuation report that caused the implementation of the funding deficit recovery plan, unless sufficient improvement has occurred after that review date such that it can be demonstrated to the satisfaction of the Superintendent that the reduction is not required.
Actuarial valuation reports
9Subsections 14(1) to (4) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
Asset liability model
10(1)Paragraph 15(2)(e) of Regulation 2012-75 does not apply to the Fraser Papers’ shared risk plan.
10(2)An asset liability model for the Fraser Papers’ shared risk plan shall produce at least 1,000 series of simulations of economic parameters for the period of 15 years commencing on the date of conversion.
Wind-up
11(1)Section 61 of the Act and subsections 16(1) to (3) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
11(2)For the purposes of section 100.63 of the Act,
(a) the Superintendent may order the wind-up of the Fraser Papers’ shared risk plan in whole or in part in the following conditions:
(i) there is a cessation or suspension of temporary contributions, or
(ii) the market value of the Fraser Papers’ shared risk plan’s assets exceeds 110% of the value of the base benefits, or
(b) the Fraser Papers’ shared risk plan may be wound-up in whole or in part if the administrator terminates it.
Termination value
12(1)In this section and in section 13, “employee contributions” means
(a) employee contributions to the defined benefit provision of the pension plan referred to in paragraph 99.6(a) of the Act, calculated as at March 31, 2010; or
(b) employee contributions to the defined benefit provision of the pension plan referred to in paragraph 99.6(b) of the Act, calculated as at March 31, 2010.
12(2)Subsections 18(1) and (2) of Regulation 2012-75 do not apply to the Fraser Papers’ shared risk plan.
12(3)For the purposes of subsection 100.62(6) of the Act and subject to subsection (4), the termination value for the Fraser Papers’ shared risk plan at the valuation date shall be the greater of
(a) the employee contributions and interest calculated on them commencing April 1, 2010, as prescribed in section 27 of Regulation 2012-75 subject to section 13, and
(b) the amount calculated as follows:
H × I
where
H is the actuarial value of the base and ancillary benefits, if any, accrued at the termination date using the discount rate and the mortality basis used in the calculation of the funding policy liabilities; and
Iis the lesser of the following termination value funded ratios:
(i)the termination value funded ratio as of the review date of the most recent actuarial valuation report and calculated under paragraph 14(6)(e) of Regulation 2012-75; and
(ii)the termination value funded ratio estimated under subsection (4).
12(4)If the administrator has reason to believe that the termination value funded ratio has been reduced by more than 10% from the ratio referred to in subparagraph (i) of the explanation for “I” in paragraph (3)(b) before the termination value is calculated under paragraph (3)(b), payment of the termination value shall be suspended until a new termination value funded ratio is calculated under paragraph 14(6)(e) of Regulation 2012-75.
Interest
13(1)Subsection 27(1) of Regulation 2012-75 does not apply to the Fraser Papers’ shared risk plan.
13(2)For the purposes of section 54 of the Act, the interest credited to employee contributions to the Fraser Papers’ shared risk plan shall be at a rate of 4.39% for each plan year.
13(3) The references to the calculation of interest in accordance with subsection 27(1) in subsections 27(2), (3) and (7) of Regulation 2012-75 shall be read as references to the rate of interest referred to in subsection (2).
N.B. This Regulation is consolidated to August 12, 2014.