The ACPM provided comments to FINA during its review of Bill C-228, the Bankruptcy and Insolvency Act (BIA), the Corporate Creditors Arrangement Act (CCAA), and the Act Amending the Pension Benefit Standards Act, 1985 (PBSA). I’ll submit it.business journal

While the C-228’s declared goals are laudable, the proposed means of achieving that goal are flawed and would have serious, undesirable and unintended consequences – MPs will help Including stakeholders who are

TORONTO, Oct. 18, 2022 (GLOBE NEWSWIRE) — In a letter filed before the House Finance Standing Committee (FINA), the Association of Canadian Pension Managers (ACPM) comments on Bill C-228, calling it serious and desirable. Without the unintended consequences if the bill were passed, outlining alternative approaches to securing retiree pensions and achieving the same goals without the potential harm to the retirement income system.

Among the unintended negative consequences, ACPM said: Regular course borrowing becomes more difficult, expensive or impossible for some defined benefit (DB) plan sponsorsnotes that “the priority of the pension deficit created by C-228 will fundamentally change the risk profile assessed by creditors.” I am pointing out that doing so No Using a hyper-prioritized approach to bankruptcy issues involving the United States, such an approach would make it even more difficult for Canada to attract business investment.

Another potential negative impact of C-228 in its current form is Many DB pension plans are ending This is due to the increased costs and borrowing burden faced by plan sponsors. These measures will have far-reaching implications for Canada’s retirement system, further reducing DB coverage and adversely affecting employees and union members.Indeed, it is stated that this could be “Effectively eliminate DB plans for active private sector employees who still receive DB pensions. ”

To avoid negative consequences, ACPM proposes several policy approaches to secure pensions. First, by amending the CCAA and BIA to allow pension plans to continue even if the sponsoring employer becomes insolvent, bankruptcy trustees can reduce pension plans for insolvent employers. and may improve your plan’s funding status before benefits are paid. ACPM also proposes the use of Variable Life Annuities (VPLA) or Deferred Life Annuities (ALDA) to maximize the retirement benefits available to retirees. Finally, the appointment of a federal pension asset manager could enable insolvent corporate pension funds to meet their pension promises.

Given these serious problems, the ACPM should abandon Bill C-228 in its current form for responsive and innovative policies that do not have the potential for collateral damage to retirement systems and the economy. I urge you to pursue it.

ACPM is Canada’s leading advocate for a balanced, effective and sustainable retirement income system. Our private and public sector retirement plan sponsors and administrators manage retirement plans for millions of plan members, both active plan members and retirees.

For more information or to schedule an interview, please contact:
Lorianne Weston, Advocacy and Communications Manager, ACPM.
[email protected] | | 416-964-1260 x225 | www.acpm.com

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