Pension plans are a critical part of Canada’s retirement system, and strong pension plans help promote Canadians’ financial security. Plan sponsors rightly want to know what the government will do to ensure the integrity of Canada’s retirement system in the wake of the uncertainty caused by COVID-19. That’s why we at Mercer have been proactively communicating with pension regulators and Ministries of Finance nationwide: to ensure that the voices of plan sponsors are heard.

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“Canadians want and deserve retirement security. While the supports set aside for Canadian organization workers are needed and welcome, federal and provincial governments must also act to preserve the integrity of Canada’s pension plans,” says JP Provost, Senior Partner and Wealth Business Leader, Mercer Canada. “Immediate action is required to mitigate the challenges currently facing Canadian companies, other organizations, and workers.”

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In our conversations with federal and provincial governments, we proposed the adoption of several forms of funding and administrative relief for retirement plan sponsors, to help ensure retirement security for Canadians through this pandemic and afterwards.?

Some of these measures we recommended for consideration include:

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  • Extending or deferring some pension contributions required in 2020, to let sponsors more effectively deploy cash to address the immediate crisis,
  • Extending deadlines for certain administrative tasks and filling,
  • Giving consideration to increasing the current maximum retirement age past?71,
  • Giving consideration to increasing the defined contribution plan limits to greater than 18% of salary (and related dollar limit), and
  • Giving consideration to waiving CPP/QPP payroll deductions for a period of six months (with no impact on?benefits).

We wanted to make sure that you are aware that these discussions are taking place.?Your pension plan plays a critical role in ensuring Canadians’ financial security – you deserve to have your concerns heard.

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We would love to have you share your feedback. If you’d like to speak with us further, click here.

Speak with a Mercer consultant today
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