Finance committee  We're also suggesting that there be a maximum surplus that could be put in. Once it grows beyond that, then to the extent that it's in the pension security trust the sponsor would be obligated to withdraw the money, and it would be taxable at that point.

Finance committee  Yes, on wind-up; certainly it would be.

Finance committee  The target solvency margin would depend on the nature of the assets and the liability. It wouldn't be a flat amount; it depends on the profile of the assets. If you had all fixed-income securities, for instance, then it would likely be much smaller than if you had a substantial amount of equities, because there's less risk.

Finance committee  You can't have it wind up at more than its value.

Finance committee  The plain fact is that if there are assets in the fund that are worthless, there is nothing in our proposal or in any action that anybody could take that would change that. We would be encouraging wise investing in any case. That's part of the risk that's present, not just in the defined benefit plans but also in the defined contribution plans in which the individual is directly at stake.

Finance committee  I'm sorry, but I don't have an answer for you on that one.

Finance committee  The pension security trust would be owned by the employer, or, more properly, the plan sponsor. The regular part of the pension plan, the general ongoing contributions, are in the pension plan. They're for the benefit of the employees and are essentially owned by the employees. Then the pension security trust sits on top of that and provides additional security to the whole plan, but this top part is owned by the employer.

Finance committee  In fact, your proposal on the target solvency margin would have a direct bearing on that question, in that a pension fund that has riskier assets in it would be required to have a larger target solvency margin and therefore would require the employer to be funding a larger buffer into the plan.

Finance committee  Well, I think it is a real summit in that these are the people who have direct responsibility for pensions across the country. In fact, there are only four provinces that have pensions led by a finance minister. In Manitoba it's Labour and Immigration, in New Brunswick it's Justice and Consumer Affairs, and so on.

Finance committee  We certainly wouldn't have any objection to two meetings rather than none, which we have now. The issue is a very complex one, and it's important to get together the people right across the country to come up with proposals that will reform our pension system so that it can exist in the long term, and so that we have more harmonization across the country.

Finance committee  Good morning. My name is Bob Howard, and I am president of the Canadian Institute of Actuaries. We appreciate being invited to this meeting, and I look forward to an exchange that benefits all Canadians. The Canadian pension system, especially defined benefit, has been challenged for many years, and recent events have forcefully brought home issues that need long-term remedies.