National Webinar - Defining Your Ambition - Target Benefit Plans in Canada

June 19, 2014 1:00 PM to 2:00 PMBroadcasted Webinar, Eastern Daylight Time (EDT)
Area of Interest: Pensions Format: Web

Are Target Benefit Plans the “secret sauce” for Canadian pension plans?

Called “Defined Ambition” plans in the UK, Target Benefit Plans are picking up momentum in Canada as a new form of pension plan.   

Join us for this webinar when Hugh Wright, Partner at McInnes Cooper, will review the key aspects of target benefit pension plans as they are being developed in Canada and compare this form of plan with the traditional defined benefit plan and the defined contribution plan. In his presentation, Hugh will explore the strengths and weaknesses of this form of pension plan and the key issues arising on conversion to a target benefit plan.

Fees and Registration
Membership TypesRegular Price
Regular membership$0.00 CDN
Associate$0.00 CDN
Student$0.00 CDN
Non Member$65.00 CDN
Cancellation Policy

Overview
This trend initially emerged following the 2008 financial crisis and resulting low interest rates.  The federal government has kicked off a consultation process for federally regulated plans, joining a number of other pension jurisdictions, such as Alberta, British Columbia, Ontario and Nova Scotia, which may soon allow target benefit plans.  New Brunswick already makes a form of target benefit plan, the shared risk plan, available under its Pension Benefits Act.  Target benefit plans have also been implemented in certain public sector plans in Nova Scotia and Prince Edward Island, and are being considered in other provinces. 

The basic concept is relatively simple and has great promise, but can mask some challenging public policy and design issues.  Target Benefit Plans provide for fixed contributions by employers and employees.  If the contributions are not sufficient to fund the targeted benefits, then benefits (accrued and future) may be reduced.  Significantly, target benefit plans continue to permit pooling of investment and longevity risk which is a major benefit to employees over DC plans.  However, the employer’s contribution risk under the defined benefit plan is now limited to the fixed contribution rate, together with any agreed upon variances. 

Considering the implementation of these plans gives rise to various key questions, including:

  1. How will active members, retirees and unions be involved in plan governance? 
  2. What level of transparency for members and retirees should be required?
  3. Is intergenerational equity a concern?  If so, how is it to be achieved and at what cost?
  4. What benefit design features may support the success of a target benefit plan?
  5. What is the required funding level to support the targeted benefit?
  6. Under what circumstances may benefits be reduced, a key provision of such plans? 
  7. Should the rules be prescriptive, as in New Brunswick, or will the parties be able to take into account their particular circumstances? 
  8. On conversion of a defined benefit plan, what is the treatment of existing benefits and any employer covenant related to those benefits?

Who should attend
This webinar will be of interest to plan administrators and sponsors, as well as their service providers.  Target Benefit Plans will play a prominent role in pension reform discussions over the next number of years, and all those who may be affected will be interested in this seminar.

Hugh Wright is a Partner in McInnes Cooper’s Halifax office and Group Leader of the firm’s Pensions and Benefits Practice Group.  

Hugh provides advice to pension plan sponsors, administrators, employee groups and governments in all areas of the pensions and benefits field.  He regularly advises pension plan sponsors and administrators concerning pension standards legislation, guidelines, common law requirements, pension governance requirements, and pension issues arising from corporate transactions. He acts for administrators, employers and employee groups in pension related litigation. 

Hugh is listed in Chambers Global: The World’s Leading Lawyers for Business and Lexpert   in the area of pensions and benefits law. He has also been recognized by Best Lawyers in Canada   for his practice in Employee Benefits law since 2006. He is Vice-Chair of the Board of Directors of the Association of Canadian Pension Management and is a director of the Canadian Bar Insurance Association. Hugh is a Past Chair of the National Pensions and Benefits Section of the Canadian Bar Association and a member of the Judicial Compensation and Benefits Committee of the CBA. He is also a member of the Canadian Pension and Benefits Institute, the International Pension and Employee Benefits Lawyers’ Association, and the International Foundation of Employee Benefits Plans.  Hugh regularly presents on pension and benefits topics to pension industry groups. Hugh is active is various community organizations and chairs the firm’s Pro-Bono Committee.

CE credits will be offered through partnerships with provincial insurance councils across Canada (with the exception of the Manitoba Insurance Council), The Institute for Advanced Financial Education (Advocis) and La Chambre de sécurité financière.

Participants are required to Login to the live session by entering their Full Name as per CPBI profile; Participants must be present for the duration of the session; Participants will be asked to remain online following the presentation to complete a short test comprised of 3 to 4 questions as a proof of attendance. The test will be offered during the live session; participants who do not attend the live session will not be permitted to take the test or qualify to receive CE credits.

For questions or more information about this webinar, please contact the CPBI National Office at 514-288-1222, ext.27 or by email at webinar@cpbi-icra.ca