Saskatchewan loosens restrictions on DB transfers
On October 5, 2020, the Saskatchewan Superintendent of Pensions announced modifications to the province’s temporary freeze on transfers from defined benefit (DB) pension plans to provide automatic consent for most such transfers from Saskatchewan-registered DB plans.
Such transfers are now permitted subject to the following conditions:
- If a transfer deficiency “holdback” or employer contribution to the plan is required under the regulations, the transfer must reflect a solvency ratio which is the lesser of:
- The solvency ratio determined in the most recently filed actuarial valuation report; and
- The solvency ratio projected to a date no earlier than March 31, 2020; and
- Administrators must obtain the prior written consent of the Superintendent if a life annuity is to be purchased using funds from a DB pension plan.
The Superintendent had previously indicated that consent was required for all such transfers, and that most such applications would be declined (as discussed in the April 2020 News & Views).
The remaining restrictions on transfers and payments are temporary measures that may be modified further depending on financial market conditions.