Mitch Frazer comments on the Canadian government’s Pooled Registered Pension Plans Act in Law Times

Pooled Plans Face Provincial Hurdles

August 20, 2012

The federal government’s Pooled Registered Pension Plans Act could be dead in the water unless it can get its provincial counterparts on board, according to a leading pensions lawyer.

Bill C-25 received Royal assent at the end of June, but Mitch Frazer, chairman of the Canadian Bar Association’s national pensions and benefits law section, says Ted Menzies, the minister of state for finance handed responsibility for the plans, needs to get selling if it’s going to have any effect.

“The concept is great, but it just depends how far it goes and how many people get access to it,” says Mitch. “The goal here really is to see the provinces pass their own enabling legislation. The question is can he [Menzies] get people from other jurisdictions to buy in. He’s got to convince people, and if he does, it’ll be a huge success. But if the provinces don’t come on board, this exercise has all been for naught.”

The government introduced pooled plans as a low-cost alternative for workers at smaller companies without pension plans as well as self-employed people. But the federal bill applies only to employees in federally regulated industries, such as banking, communications, and transportation. Workers in those sectors are already among the most likely to have adequate pension coverage, according to Frazer.

He says the bill provides a framework from which the provinces can develop their own more specific legislation.

It’s a high-level bill. The federal government made it flexible enough so that if a province wanted to make coverage mandatory for everyone, they could do that. Or if they don’t want to, they don’t have to.

Read the full article here.


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