Regulations Amending the Pension Benefits Standards Regulations, 1985 (Solvency Reserve Accounts and Multi-Employer Pension Plans)

Employers sponsoring federally regulated defined benefit pension plans — in sectors like banking, interprovincial transportation, and telecommunications — will gain a new tool to avoid having pension contributions become 'trapped' as surplus. Through an SRA, employers can contribute more than the minimum required and later withdraw up to 20% of eligible surplus per year, provided the plan remains at least 105% funded on both a going-concern and solvency basis. For the five federally regulated MEPPs that are not negotiated contribution plans, the solvency funding target drops from 100% to 85%, aligning with most provincial standards and reducing pressure on participating employers to cut member benefits to meet funding requirements. Administrative costs for setting up an SRA (amending plan text, tracking contributions and withdrawals, enhanced member reporting) are expected to be low and only apply to plans that voluntarily choose to establish one.