Mr. Speaker, according to the latest available pension plan financial statements, www.osfi-bsif.gc.ca/app/DocRepository/1/eng/reports/osfi/ar0708_e.pdf, there were 1,350 private pension plans registered under the Pension Benefits Standards Act, 1985, PBSA, and supervised by the Office of the Superintendent of Financial Institutions (OSFI). Of those plans, there were 351 defined benefit plans, 904 defined contribution plans and 95 combination plans. These plans covered over 594,000 members, of which 391,000 were in a defined benefit plan, 104,000 in a defined contribution plan and 99,000 in a combination plan. Total assets for these plans were $132 billion, with $109 billion in defined benefit plans, $4 billion in defined contribution plans and $19 billion in combination plans. OSFI regulates approximately 7 percent of pension plans in Canada. The other 93 percent are under provincial regulation, representing 5.2 million members with total assets of $961 billion. 53 percent of federally regulated pension plan assets were invested in equities, 39 percent in debt instruments and 8 percent in diversified and other assets.
In April 2009, OSFI reported, www.osfi-bsif.gc.ca/app/DocRepository/1/eng/media/nr_esr_e.pdf, that the average estimated solvency ratio for federally regulated defined benefit plans was 0.85 in December 2008. Estimated solvency ratios are determined by dividing a plan’s estimated assets by the plan’s estimated liabilities, using assumptions consistent with the plan being terminated. OSFI continues to monitor the funding situation of plans carefully and is taking steps, where necessary, to protect the rights and interests of plan beneficiaries.
The government has taken action to better protect the pensions of working Canadians by making amendments to the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act that will grant super priority status to outstanding employer and employee pension contributions in both bankruptcy and corporate restructuring. This super-priority status became law in bankruptcy in July 2008.
Given the present extraordinary circumstances affecting private pension plans, the Government took action in Budget 2009, presented to the House of Commons on January 27, 2009, and the 2008 Economic and Fiscal Statement by providing temporary solvency funding relief that will facilitate an orderly return to full funding while protecting the security of benefits. The regulations implementing this temporary relief were pre-published in the Canada Gazette on April 4th.
The federal government also launched public consultations on pension issues in January with the release of a consultation paper (http://www.fin.gc.ca/n08/09-005-eng.asp). As part of the consultation process, the Parliamentary Secretary to the Minister of Finance led public meetings across Canada in March and April. To become better familiarized with this consultation process, please visit http://www.fin.gc.ca/n08/09-018-eng.asp