CANADA – Quebec employment minister Sam Hamad has proposed legal measures to guarantee pension benefits to pensioners and workers whose schemes go bust as a result of the financial crisis.

The bill, which the minister tabled at the Quebec National Assembly, applies to 950 defined benefit (DB) corporate plans, which group one million participants and beneficiaries and have C$98bn (US$79bn) of assets under management.

Public employees’ retirement plans, as well as certain corporate plans subject to federal provisions, will be excluded.

Under the proposal, the Quebec Pension Plan - the compulsory public insurance plan – would take over the management of insolvent pension plans and guarantee payments to entitled members of the scheme.

Hamad said: “We are offering an advantageous option to pensioners: guarantee their benefits and possibly improve them by having the Quebec Pension Plan managing schemes’ assets if a company goes bankrupt. All investments will be managed prudently.”

In addition, Quebec companies will have 10 years instead of five to make up for their total solvency liabilities. They will also be able to smooth over a period of maximum five years the assets of the plan, in order to spread out the losses on their investments.


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