Vol. 146, No. 13 — June 20, 2012

Registration

SOR/2012-114 June 1, 2012

SPECIAL RETIREMENT ARRANGEMENTS ACT

Regulations Amending the Retirement Compensation Arrangements Regulations, No. 1

P.C. 2012-745 May 31, 2012

His Excellency the Governor General in Council, on the recommendation of the President of the Treasury Board, pursuant to section 13 and subsection 28(1) (see footnote a) of the Special Retirement Arrangements Act (see footnote b), hereby makes the annexed Regulations Amending the Retirement Compensation Arrangements Regulations, No. 1, whose section 3, pursuant to subsection 13(2) of that Act, is deemed to have come into force on July 1, 2007.

REGULATIONS AMENDING THE RETIREMENT COMPENSATION ARRANGEMENTS REGULATIONS, NO. 1

AMENDMENTS

1. The portion of subsection 12(2) of the Retirement Compensation Arrangements Regulations, No. 1 (see footnote 1) before paragraph (a) is replaced by the following:

(2) If, at the expiration of the 60-day period, the amount payable has not been paid and the participant has not revoked the election, that amount shall be deducted,

2. Section 31 of the Regulations is replaced by the following:

31. A participant who makes an election under section 12.2 or 57 of the Public Service Superannuation Regulations or under paragraph 6(1)(b) or section 20 of the Public Service Superannuation Act, other than an election under clause 6(1)(b)(iii)(M) of that Act, shall pay to the Retirement Compensation Arrangements Account, in respect of any portion of the participant’s annual rate of salary that exceeds the annual rate of salary determined under section 5.1 of those Regulations, the amount that the participant would be required to contribute in respect of that portion under sections 12.4 and 57 of those Regulations or under section 7 or paragraph 20(1)(b) of that Act in the same manner and subject to the same conditions as are set out in subsection 57(3) of those Regulations or in section 8 or subsection 20(3) of that Act, respectively.

3. The Regulations are amended by adding the following after section 38.5:

38.51 Any amount transferred by an eligible employer from the employer’s external retirement compensation arrangement in respect of a participant, in accordance with an agreement made under subsection 40.2(2) of the Public Service Superannuation Act that provides for its payment to the Retirement Compensation Arrangements Account, shall be credited to that account.

4. Paragraph 41.81(b) of the English version of the Regulations is replaced by the following:

  • (b) remain employed by Canada Post for at least one day following September 30, 2000.

5. Subsection 44(3) of the Regulations is replaced by the following:

(3) An election under section 6.1 of the Canadian Forces Superannuation Act in respect of a period of leave without pay constitutes an election not to contribute to the Retirement Compensation Arrangements Account in respect of the same period.

6. Paragraph 52(2)(a) of the English version of the Regulations is replaced by the following:

  • (a) the annual amount of any benefit payable to the participant under this Division, determined in accordance with subsection 48(2) and not reduced on account of the age or period of pensionable service of the participant, and

7. Paragraph 70(2)(a) of the French version of the Regulations is replaced by the following:

  • a) à l’égard de chaque mois de la période commençant le 15 décembre 1994 et se terminant le 31 mars 1995, le total des sommes représentant chacune la cotisation versée à ce compte par l’employé qui est participant, sauf si celui-ci a cotisé à l’égard de cette période à un taux égal au double du taux visé au paragraphe 29(1);

8. Schedule 5 to the Regulations is amended by striking out the following:

Export Development Canada

Exportation et développement Canada

Farm Credit Corporation

Société du crédit agricole

The Canadian Wheat Board

Commission canadienne du blé

9. Schedule 5 to the Regulations is amended by adding the following:

Montreal Port Authority

Administration portuaire de Montréal

10. Schedule 6 to the Regulations is amended by striking out the following:

Export Development Canada

Exportation et développement Canada

Farm Credit Corporation

Société du crédit agricole

The Canadian Wheat Board

Commission canadienne du blé

11. Schedule 6 to the Regulations is amended by adding the following:

Montreal Port Authority

Administration portuaire de Montréal

COMING INTO FORCE

12. (1) These Regulations, except section 3, come into force on the day on which they are registered.

(2) Section 3 came into force on the day specified in the Order making these Regulations.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issue and objectives

Pension transfer agreements are a vehicle used by the Government of Canada to facilitate mobility into and out of the Public Service, by allowing employees to transfer the actuarial value of their accrued pension credits.

In 2003, the Retirement Compensation Arrangements Regulations, No. 1 (RCA, No. 1) were amended to allow for the transfer of funds from the Government of Canada’s Retirement Compensation Arrangement (RCA) account to an eligible employer’s RCA account (RCA-Out) in respect of employees who wished to transfer their pension credits from the public service pension plan.

However, individuals who wished to transfer pension credits they had earned under another employer’s retirement compensation arrangement after becoming employed in the federal public service could not be accommodated, as there was no mechanism in place to allow for retirement compensation arrangement amounts to be credited to the public service RCA account (RCA-In).

Section 38.51, the RCA-In amendment, of the Regulations Amending the Retirement Compensation Arrangements Regulations, No. 1 addresses this gap by providing a corresponding and parallel mechanism to the RCA-Out arrangement.

The Standing Joint Committee for the Scrutiny of Regulations has noted some discrepancies between the English and French provisions of the Retirement Compensation Arrangements Regulations, No. 1. The housekeeping amendments address these concerns, as well as update a number of provisions to ensure that current authorities are accurately reflected in the Regulations.

Description and rationale

The RCA-In amendment provides a parallel mechanism to allow the Government of Canada to request and receive payments of RCA amounts, in the circumstances where a member subject to the Public Service Superannuation Act (PSSA) wishes to transfer their pension credits from the eligible employer’s pension plan pursuant to subsection 40.2(9) of the PSSA.

Together, the 2003 RCA-Out amendment and the RCA-In amendment provide the requisite regulatory vehicle under the RCA, No. 1 to accommodate individuals who wish to transfer their retirement compensation pension credits either from or to the Public Service, pursuant to a pension transfer agreement, thereby facilitating the mobility of employees in and out of the public service.

The housekeeping amendments rectify discrepancies identified by the Standing Joint Committee for the Scrutiny of Regulations, as well as include a number of updates, to ensure that the Regulations reflect current legislative authorities. These updating amendments include the striking out of the entities listed in Schedule 5 and Schedule 6 of the RCA, No.1, as the payouts to these entities, pursuant to subsections 41.6(1) and 41.7(1), have been completed, and adding the Montreal Port Authority to these Schedules to authorize the payout to this entity.

Implementation, enforcement and service standards

The normal legislative, regulatory and administrative compliance structures will apply, including internal audits, the usual reports to Parliament, and responses to inquiries received from members of Parliament, affected plan members and their representatives.

Contact

Joan M. Arnold
Senior Director
Legislation, Authorities and Litigation Management
Pensions and Benefits Sector
Treasury Board Secretariat
Ottawa, Ontario
K1A 0R5
Telephone: 613-952-3119

Footnote a
S.C. 2000, c. 12, s. 294

Footnote b
S.C. 1992, c. 46, Sch. I

Footnote 1
SOR/94-785