Amendments to the Pension Benefits Standards Act, 1985 in the 2021 Budget Implementation Act

On June 29, 2021, Bill C-30 – An Act to implement certain provisions of the budget tabled in Parliament on April 19, 2021 and other measures (the Budget Implementation Act or BIA) received royal assent. The BIA included amendments to the Pension Benefits Standards Act, 1985 (PBSA) as well as other measures related to pensions:

• Changes to the PBSA to implement a new framework for negotiated contributions plans, including the requirement for these plans to establish a funding policy and a governance policy.
• Changes to the PBSA’s unclaimed asset regime, including changes to facilitate the Government’s intent to expand the scope of the federal unclaimed assets regime to include unclaimed pension benefits for unlocatable members of terminated federally regulated pension plans.
• Changes to the Income Tax Act establishing rules to permit Variable Payment Life Annuities (VPLA) and Advanced Life Deferred Annuities (ALDA) for defined contribution pension plans and pooled registered pension plans.

Please note that changes to the negotiated contribution plan framework and unclaimed asset regime are not intended to be brought into force until the associated changes to the Pension Benefits Standards Regulations, 1985 are implemented. Similarly, defined contribution pension plans and pooled registered pension plans will not be able to offer VPLAs as a decumulation option until changes to pension benefits standards legislation have been implemented.