An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act (S.C. 2016, c. 14)
Full Document:
Assented to 2016-12-15
PART 1Amendments to the Canada Pension Plan and the Canada Pension Plan Investment Board Act (continued)
R.S., c. C-8Canada Pension Plan (continued)
43 Subsection 107(3) of the Act is replaced by the following:
Marginal note:Regulations for giving effect to agreements
(3) For the purpose of giving effect to any agreement entered into under subsection (1), the Governor in Council may make any regulations respecting the manner in which this Act is to apply to any case or class of cases affected by the agreement, and for adapting this Act to any such case or class of cases, that appear to the Governor in Council to be necessary for that purpose, and any regulations so made may provide for the making of any financial adjustments required under the agreement and for the crediting or charging of the amount of any of those adjustments to the Canada Pension Plan Account or the Additional Canada Pension Plan Account, as the case may be.
44 (1) Paragraph 108(2)(a) of the Act is replaced by the following:
(a) all amounts received under this Act as or on account of contributions under subsections 8(1), 9(1) and 10(1) or otherwise on account of the base Canada Pension Plan;
Marginal note:1995, c. 33, s. 46(1); 1997, c. 40, s. 89(1)
(2) Paragraphs 108(2)(c) to (g) of the Act are replaced by the following:
(d) any amount of money received under section 107.1 on account of the base Canada Pension Plan and any proceeds from the disposition of any securities or other property received under that section on account of the base Canada Pension Plan;
(e) all amounts charged for the use of resources that are associated with the administration of this Act in relation to the base Canada Pension Plan;
(f) any interest or administrative charge collected in relation to money payable under this Act in relation to the base Canada Pension Plan; and
(g) all amounts received under subsection 56(1) of the Canada Pension Plan Investment Board Act.
(3) Paragraph 108(3)(a) of the Act is replaced by the following:
(a) all amounts payable under this Act in relation to the base Canada Pension Plan as or on account of benefits or otherwise;
(4) Paragraph 108(3)(c) of the Act is replaced by the following:
(c) the costs of administration of this Act in relation to the base Canada Pension Plan, under the authority of Parliament;
Marginal note:2012, c. 19, s. 234(2); 2013, c. 40, subpar. 236(1)(b)(iv)
(5) Paragraph 108(3)(e) of the Act is replaced by the following:
(e) the costs, in relation to the base Canada Pension Plan, of administering Part 5 of the Department of Employment and Social Development Act in respect of appeals respecting this Act.
Marginal note:2003, c. 5, s. 2
(6) Paragraph 108(4)(b) of the Act is replaced by the following:
(b) the fair market value of the assets of the Investment Board less its liabilities, in relation to the base Canada Pension Plan.
Marginal note:2003, c. 5, s. 3
45 Subsection 108.1(2) of the Act is replaced by the following:
Marginal note:Payment by Investment Board
(2) The Minister may, by notice, and in accordance with any agreement entered into under section 111.1, require the Investment Board to pay into the Consolidated Revenue Fund any amount necessary to offset amounts charged or required to be charged to the Canada Pension Plan Account under subsection 108(3) and any interest charged under subsection 110(1).
46 The Act is amended by adding the following after section 108.1:
Marginal note:Additional Canada Pension Plan Account
108.2 (1) There is established in the accounts of Canada an account to be known as the Additional Canada Pension Plan Account.
Marginal note:Amounts to be credited to Account
(2) There is to be paid into the Consolidated Revenue Fund and credited to the Additional Canada Pension Plan Account
(a) all amounts received under this Act as or on account of contributions under subsections 8(1.1) and (1.2), 9(1.1) and (1.2) and 10(1.1) and (1.2) or otherwise on account of the additional Canada Pension Plan;
(b) all amounts required to be credited to the Additional Canada Pension Plan Account under any agreement entered into under subsection 39(1) or 80(1) or under any regulation made under paragraph 89(1)(j) or subsection 107(3);
(c) any amount of money received under section 107.1 on account of the additional Canada Pension Plan and any proceeds from the disposition of any securities or other property received under that section on account of the additional Canada Pension Plan;
(d) all amounts charged for the use of resources that are associated with the administration of this Act in relation to the additional Canada Pension Plan;
(e) any interest or administrative charge collected in relation to money payable under this Act in relation to the additional Canada Pension Plan; and
(f) all amounts received under subsection 56(1.1) of the Canada Pension Plan Investment Board Act.
Marginal note:Amounts to be charged to Account
(3) There is to be paid out of the Consolidated Revenue Fund and charged to the Additional Canada Pension Plan Account
(a) all amounts payable under this Act in relation to the additional Canada Pension Plan as or on account of benefits or otherwise;
(b) all amounts required to be charged to the Additional Canada Pension Plan Account under any agreement entered into under subsection 39(1) or 80(1) or under any regulation made under paragraph 89(1)(j) or subsection 107(3);
(c) all amounts credited to the Additional Canada Pension Plan Account under paragraph (2)(d);
(d) the costs of administration of this Act in relation to the additional Canada Pension Plan, under the authority of Parliament;
(e) all amounts required to be charged to the Additional Canada Pension Plan Account under section 57.1 of the Canada Pension Plan Investment Board Act; and
(f) the costs, in relation to the additional Canada Pension Plan, of administering Part 5 of the Department of Employment and Social Development Act in respect of appeals respecting this Act.
Marginal note:Limitation
(4) No payment is to be made out of the Consolidated Revenue Fund under this section in excess of the total of
(a) the amount of the balance to the credit of the Additional Canada Pension Plan Account, and
(b) the fair market value of the assets of the Investment Board less its liabilities, in relation to the additional Canada Pension Plan.
Marginal note:Management of Account
108.3 (1) Any amounts standing to the credit of the Additional Canada Pension Plan Account that exceed the immediate obligations of that Account are to be transferred to the Investment Board, unless any agreement entered into under section 111.1 provides otherwise. The amounts are to be paid out of the Consolidated Revenue Fund and charged to the Additional Canada Pension Plan Account.
Marginal note:Payment by Investment Board
(2) The Minister may, by notice, and in accordance with any agreement entered into under section 111.1, require the Investment Board to pay into the Consolidated Revenue Fund any amount necessary to offset amounts charged or required to be charged to the Additional Canada Pension Plan Account under subsection 108.2(3) and any interest charged under subsection 110(2).
Marginal note:Interest
(3) The Minister of Finance shall credit interest to the Additional Canada Pension Plan Account at market rates, as determined by that Minister, on any amount standing to the credit of that Account. The interest is to be paid out of the Consolidated Revenue Fund.
Marginal note:2003, c. 5, s. 5
47 Section 110 of the Act is replaced by the following:
Marginal note:Interest — Canada Pension Plan Account
110 (1) The Minister of Finance shall charge interest to the Canada Pension Plan Account at market rates, as determined by that Minister, on any amount paid out of the Consolidated Revenue Fund under subsection 108(3) that exceeds the balance to the credit of the Canada Pension Plan Account. Interest is to be charged for the period beginning on the day on which the amount is paid out of the Consolidated Revenue Fund under subsection 108(3) and ending on the day on which the Investment Board pays that amount into the Consolidated Revenue Fund under subsection 56(1) of the Canada Pension Plan Investment Board Act.
Marginal note:Interest — Additional Canada Pension Plan Account
(2) The Minister of Finance shall charge interest to the Additional Canada Pension Plan Account at market rates, as determined by that Minister, on any amount paid out of the Consolidated Revenue Fund under subsection 108.2(3) that exceeds the balance to the credit of the Additional Canada Pension Plan Account. Interest is to be charged for the period beginning on the day on which the amount is paid out of the Consolidated Revenue Fund under subsection 108.2(3) and ending on the day on which the Investment Board pays that amount into the Consolidated Revenue Fund under subsection 56(1.1) of the Canada Pension Plan Investment Board Act.
Marginal note:1997, c. 40, s. 91; 2003, c. 5, s. 8
48 Subsection 112(1) of the Act is replaced by the following:
Marginal note:Annual financial statements
112 (1) The Minister shall, as soon as possible after the end of each fiscal year, prepare one set of annual financial statements for the Canada Pension Plan in respect of that year setting out
(a) a statement combining the amounts credited to or charged to the Canada Pension Plan Account, the Additional Canada Pension Plan Account and the accounts of the Investment Board during the year;
(b) a schedule combining the amounts credited to or charged to the Canada Pension Plan Account and the accounts of the Investment Board in relation to the base Canada Pension Plan during the year;
(c) a schedule combining the amounts credited to or charged to the Additional Canada Pension Plan Account and the accounts of the Investment Board in relation to the additional Canada Pension Plan during the year;
(d) a statement combining the accounts of the Canada Pension Plan Account, the Additional Canada Pension Plan Account and the Investment Board as at the end of the year;
(e) a schedule combining the accounts of the Canada Pension Plan Account and the Investment Board in relation to the base Canada Pension Plan as at the end of the year;
(f) a schedule combining the accounts of the Additional Canada Pension Plan Account and the Investment Board in relation to the additional Canada Pension Plan as at the end of the year; and
(g) any other accounts and information that the Minister considers appropriate to present fairly the financial transactions and the financial position of the Canada Pension Plan for the year.
Marginal note:1997, c. 40, s. 92
49 (1) Paragraphs 113(2)(a) and (b) of the Act are replaced by the following:
(a) the total amount of all contributions credited to the Canada Pension Plan Account and the Additional Canada Pension Plan Account, to the day on which the regulation referred to in subsection (1) became effective, in respect of employment in that province or in respect of self-employed earnings of persons resident in that province, and
(b) the part of the net investment return of the Investment Board and all interest credited to or accrued to the credit of the Canada Pension Plan Account and the Additional Canada Pension Plan Account, to the day on which the regulation referred to in subsection (1) became effective, that is derived from the contributions referred to in paragraph (a),
(2) Paragraph 113(2)(d) of the Act is replaced by the following:
(d) the part of the costs of administration of this Act, to the day on which the regulation referred to in subsection (1) became effective, that is equal to the proportion of those costs that the total amount of the contributions referred to in paragraph (a) is of the total amount of all contributions credited to the Canada Pension Plan Account and the Additional Canada Pension Plan Account to that day.
Marginal note:1997, c. 40, s. 94(1)
50 (1) Subsection 113.1(1) of the Act is replaced by the following:
Marginal note:Review every three years
113.1 (1) Once every three years after 1997, the Minister of Finance and ministers of the Crown from the included provinces shall review the financial state of the Canada Pension Plan and may make recommendations as to whether benefits, contribution rates, first additional contribution rates or second additional contribution rates should be changed.
Marginal note:R.S., c. 30 (2nd Supp.), s. 56; 1997, c. 40, s. 94(4)
(2) Subparagraphs 113.1(4)(b)(i) to (iv) of the Act are replaced by the following:
(i) the outstanding balance of the Canada Pension Plan Account and the Additional Canada Pension Plan Account,
(ii) the projected revenues into and payments out of the Canada Pension Plan Account and the Additional Canada Pension Plan Account,
(iii) the ratio of the projected assets over the projected expenditures of the base Canada Pension Plan and the additional Canada Pension Plan, and
(iv) the changes, if any, to the amounts and ratios projected at the previous review under this section attributable to changing demographic and economic circumstances or to changes to the base Canada Pension Plan or the additional Canada Pension Plan affecting payments or contributions under the Canada Pension Plan;
Marginal note:1997, c. 40, s. 94(5); 2007, c. 11, s. 12(1)
(3) Paragraphs 113.1(4)(c) and (d) of the Act are replaced by the following:
(c) the financing objective, for the base Canada Pension Plan, of having a contribution rate, without taking into account the changes, if any, referred to in paragraph (e) for which the contribution rate most recently calculated under subparagraph 115(1.1)(c)(ii) exceeds zero, that is no lower than the rate
(i) that, beginning with the year 2003, is the lowest constant rate that can be maintained over the foreseeable future, and
(ii) that results in the ratio of the projected assets of the base Canada Pension Plan at the end of any given year over the projected expenditures of the base Canada Pension Plan in the following year being generally constant;
(d) the financing objective, for the additional Canada Pension Plan, of having additional contribution rates, without taking into account the changes, if any, referred to in paragraph (e) for which the additional contribution rates most recently calculated under subparagraphs 115(1.1)(d)(ii) and (e)(ii) exceed zero, that are no lower than the rates
(i) that, beginning with the year 2024, are the lowest constant rates that can be maintained over the foreseeable future, and
(ii) that result in projected contributions and investment income that are sufficient to fully pay the projected expenditures of the additional Canada Pension Plan over the foreseeable future; and
(e) that changes to the Act that increase benefits or add new benefits must be accompanied by a permanent increase in the contribution rates under this Act to cover the extra costs of the increased or new benefits and by a temporary increase in the contribution rates under this Act for a number of years that is consistent with common actuarial practice to fully pay any unfunded liability resulting from the increased or new benefits.
Marginal note:R.S., c. 30 (2nd Supp.), s. 56; 1997, c. 40, s. 94(6)
(4) Subsections 113.1(5) to (7) of the Act are replaced by the following:
Marginal note:Recommendations made on completion of review
(5) On the completion of a review required by subsection (1), the Minister of Finance may recommend to the Governor in Council that the Governor in Council make regulations under subsection (6) to amend Schedule 1 or 2 to give effect to any recommendations made under subsection (1). If the recommendations made under subsection (1) are that no changes be made to benefits, contribution rates, first additional contributions rates or second additional contribution rates, the Minister of Finance shall cause those recommendations to be published in the Canada Gazette.
Marginal note:Regulation to change rates
(6) Subject to subsections (7) and (8), the Governor in Council may, on the recommendation of the Minister of Finance made under subsection (5), by regulation amend Schedule 1 or 2 to change the contribution rates, first additional contribution rates or second additional contribution rates for any or all of the years following the review.
Marginal note:Limitation on changes
(7) The following shall apply with respect to any changes to and setting of the rates under subsection (6):
(a) the rates for employees and employers for a year must be identical;
(b) the rates for self-employed persons for a year must be equal to the sum of the rates for employees and employers for that year;
(c) no rate for employees and employers for a year may be increased by more than one-tenth of a percentage point above the rate for the previous year; and
(d) no rate for self-employed persons for a year may be increased by more than two-tenths of a percentage point above the rate for the previous year.
Marginal note:1997, c. 40, s. 94(8)
(5) Paragraph 113.1(11.05)(a) of the Act is replaced by the following:
(a) the amount of the benefits payable in respect of the base Canada Pension Plan in the three-year period shall be determined as if the ratios referred to in paragraphs 45(2)(b) and 56(2)(c), subsection 58(1.1) and subparagraph 59(c)(ii) were each 1; and
Marginal note:1997, c. 40, s. 94(8)
(6) The portion of paragraph 113.1(11.05)(b) of the Act before subparagraph (i) is replaced by the following:
(b) Schedule 1 is deemed to have been amended as of the next day after that October 1
Marginal note:1997, c. 40, s. 94(8); 2007, c. 11, s. 12(6)
(7) Subsections 113.1(11.15) and (12) of the Act are replaced by the following:
Marginal note:Deemed changes to rates — additional Canada Pension Plan
(11.141) Subject to subsection (11.143), if, at October 1 of the year before a three-year period for which a review is required by subsection (1), either of the following conditions is met, Schedule 2 is deemed to have been amended as of the next day after that October 1 to change the first additional contribution rates or second additional contribution rates, if required, in accordance with the calculations set out in the regulations:
(a) the difference between the first additional contribution rate most recently calculated under paragraph 115(1.1)(d) and the first additional contribution rate for self-employed persons set out in Schedule 2 for a prescribed year is not within the range set out in the regulations; and
(b) the difference between the second additional contribution rate most recently calculated under paragraph 115(1.1)(e) and the second additional contribution rate for self-employed persons set out in Schedule 2 for a prescribed year is not within the range set out in the regulations.
Marginal note:Determination of benefits — additional Canada Pension Plan
(11.142) Subject to subsection (11.143), if, at October 1 of the year before a three-year period for which a review is required by subsection (1), either of the conditions set out in paragraphs (11.141)(a) and (b) is met, the portions of benefits under this Act in respect of the additional Canada Pension Plan for the three-year period shall be determined in accordance with the regulations.
Marginal note:Non-application of subsections (11.141) and (11.142)
(11.143) Subsections (11.141) and (11.142) do not apply if
(a) a recommendation was made under subsection (1) in the three years before the three-year period referred to in subsection (11.141) that the first additional contribution rates or second additional contribution rates for one or more of the years in that three-year period be changed and the rates were changed before October 1 of the year before that three-year period, by an Act of Parliament or by a regulation made under subsection (6), to give effect to that recommendation; or
(b) a recommendation was made under subsection (1) in the three years before the three-year period referred to in subsection (11.141) that the first additional contribution rates or second additional contribution rates for the years in that three-year period not be changed and the Minister of Finance before October 1 of the year before that three-year period has caused that recommendation to be published in the Canada Gazette.
Marginal note:Regulations
(11.144) The Governor in Council may, on the recommendation of the Minister of Finance, make regulations respecting
(a) the calculation of deemed changes to rates for the purposes of subsection (11.141);
(b) the determination of the ranges referred to in paragraphs (11.141)(a) and (b); and
(c) the determination of portions of benefits for the purposes of subsection (11.142).
Marginal note:Provincial consent
(11.145) Regulations under subsection (11.144) may only be made if the lieutenant governor in council of each of at least two thirds of the included provinces, having in total not less than two thirds of the population of all of the included provinces, has signified the consent of that province.
Marginal note:Rates to be published
(11.15) The Minister of Finance shall publish in the Canada Gazette any amendment to Schedule 1 or 2 deemed to have been made under this section.
Marginal note:Non-application of subsection 114(2)
(12) For greater certainty, subsection 114(2) does not apply to any amendment to Schedule 1 or 2 made under subsection (6), (11.05) to (11.11) or (11.141).
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