Can the Superintendent impose different conditions or reintroduce a portability freeze?
Yes. The Superintendent exercises his authority under section 26.1 of the
Pension Benefits Standards Act, 1985 by issuing
Directives of the Superintendent. The purpose of this authority is to protect the benefits of all plan members and beneficiaries, by granting the Superintendent the ability to restrict transfers out of the pension fund where they pose a risk to the overall financial health of the pension fund.
As a result of future events, such as a further deterioration in the financial and economic environment, the Superintendent may determine that any transfers would impair the solvency of pension funds and that it is prudent to reintroduce a temporary freeze or to change the conditions for providing automatic consent.
For instance, in the event of renewed market volatility, the Superintendent has the flexibility to require plan administrators to use a more recent projected solvency ratio as the basis for such transfers, if appropriate. Such a change would require plan administrators to use the lower of the solvency ratio as at the last filed actuarial report, and a solvency ratio projected to a date no earlier than the date set by the Superintendent. This would allow plan administrators to continue portability transfers in the ordinary course, using a more up-to-date solvency ratio. As a result, portability transfers should not adversely impact the financial position of the pension plan.