Pension Benefits Standards Regulations, 1985 (SOR/87-19)

Regulations are current to 2014-08-05 and last amended on 2014-01-01. Previous Versions

Minimum Requirements for Funding Schedule

 The funding schedule shall meet the following requirements:

  • (a) the funding schedule shall only address the funding and liquidation of a solvency deficiency and an unfunded liability as determined at the latest valuation date minus special payments and other payments due to the plan before the start of the negotiation period;

  • (b) the funding schedule shall specify the amounts of the going concern payments and solvency payments payable in each plan year that are used to fund the solvency deficiency and unfunded liability referred to in paragraph (a);

  • (c) the payments shall be made to the plan in equal monthly instalments;

  • (d) the aggregate present value, as at the end of the most recent plan year preceding the establishment of the funding schedule, of the going concern payments included in the funding schedule and the going concern special payments due to the plan before the start of the negotiation period shall be at least equal to the going concern deficit of the plan at the end of that year;

  • (e) the aggregate present value, as at the end of the most recent plan year preceding the establishment of the funding schedule, of the solvency payments and the going concern payments included in the funding schedule and the special payments due to the plan before the start of the negotiation period shall be at least equal to the solvency deficiency of the plan as at the end of the plan year preceding the plan year in which the payment is to be made;

  • (f) any annual going concern payment included in the funding schedule shall be no less than the annual amount of interest on the outstanding balance of the going concern deficit of the plan as at the end of the plan year preceding the plan year in which the payment is to be made;

  • (g) any annual solvency payment included in the funding schedule shall be no less than the annual amount of interest on the outstanding balance of the solvency deficiency as at the end of the plan year preceding the plan year in which the payment is to be made;

  • (h) the aggregate going concern payments to be made in the first half of the funding schedule shall be no less than 40% of the aggregate going concern payments for the entire duration of the funding schedule;

  • (i) the aggregate solvency payments to be made in the first five plan years of the funding schedule shall be no less than 40% of the aggregate solvency payments for the entire duration of the funding schedule;

  • (j) the interest rate used to determine the present value of going concern payments referred to in paragraph (d) and the interest rate used to calculate the amount of interest referred to in paragraph (f) is the same as the interest rate used to determine the going concern liabilities of the plan as at the valuation date; and

  • (k) the interest rate used to determine the present value of solvency payments referred to in paragraph (e) and the interest rate used to calculate the interest in accordance with paragraph (g) is the same as the interest rate used to determine the solvency liabilities of the plan as at the valuation date.

  • SOR/2011-85, s. 6.

Optional Requirements for Funding Schedule

 A funding schedule may provide that if

  • (a) the funding schedule includes the funding of an unfunded liability or solvency deficiency and the unfunded liability or solvency deficiency is liquidated at a rate greater than the sum of payments set out in the funding schedule by the making of additional payments, the amount of a payment set out in a funding schedule for a subsequent year may be reduced if the outstanding balance of the unfunded liability that is being liquidated by the remaining payments set out in the funding schedule or the solvency deficiency that is being liquidated by those payments will at no time be greater than it would have been had the payments that were required to be made under the funding schedule in relation to the unfunded liability or solvency deficiency, whichever is applicable, been made;

  • (b) the funding schedule includes the funding of an unfunded liability and the aggregate of the present value of payments set out in the funding schedule and of going concern special payments, established in respect of a period after the valuation date, exceeds the going concern deficit, that excess may be applied to reduce the going concern payments that will become due at the latest dates in the approved funding schedule in such a way that the present value of those payments is reduced by the amount of reduction applied to the outstanding balance of the unfunded liability; and

  • (c) there is a solvency excess as described in subsection 10.991(2), the payments established to liquidate a solvency deficiency that will become due at the latest dates in the approved funding schedule may be eliminated or reduced in such a way that the present value of the remaining payments set out in the funding schedule to liquidate the solvency deficiency is reduced by the solvency excess.

  • SOR/2011-85, s. 6.