2. PAUL YOUNG - BIO
• CPA, CGA
• Academia (PF1, FA4 and MS2)
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Financial Solutions
• SME – Business Process Change
• SME – Supply Chain Management
Contact information:
Paul_Young_CGA@Hotmail.com
4. AGENDA
• What is C27
• Pension Plans
• Issues with Pensions / Government
5. WHAT IS C27
Source - http://www.moneysense.ca/save/retirement/pensions/defined-benefit-pension-plans-due-change/
Bill C-27 is an Act to amend the long-standing Pension Benefits Standards Act.
Those in favour of pure Defined Benefit (DB) pension plans have criticized Bill C-
27, saying it would allow federally regulated employers to replace DB plans, which
provide a guaranteed retirement income for life with no risk, with Target Benefit
Plans (TBPs) which are also generous pensions but because they count on
employees taking on some risk, final retirement guaranteed payments may not be
as iron-glad.
7. GOVERNMENT PENSIONS
Source - http://o.canada.com/news/auditor-general-government-should-re-
examine-design-of-pension-plans-to-ensure-sustainability
Public servants are working fewer years and living longer in retirement on their pensions
– in fact, about 27 years longer – than when the plans were created more than 40 years
ago. The report found that a further increase in life expectancy over time, of between
one to three years, could boost the plans’ actuarial obligations by between $4.2 billion
and $11.7 billion.
At the same time, the plan has faced the volatility of the market since the 2008 financial
crisis and low interest rates, increasing the cost of pension obligations.
The plans have a major impact on Canada’s debt and deficit. The three plans have
liabilities totalling $152 billion, the second-biggest liability after Canada’s market debt.
8. LIBERALS AND PUBLIC SECTOR
Source - https://www.liberal.ca/wp-content/uploads/2015/10/New-plan-for-a-strong-middle-class.pdf
9. WHAT IS DIFFERENCE BETWEEN TBP, DB AND
DC PLANS
Source - http://www.moneysense.ca/save/retirement/pensions/defined-benefit-pension-plans-due-change/
TBPs can place explicit limits on the volatility of employer contributions. So if a funding deficit
arises in a TBP (because of underfunding, or lower-than-expected investment returns, say), part or
all of it can be compensated for by reducing accrued benefits to employees whereas a traditional
DB plan would require the entire deficit to be funded by increased contributions on the part of the
employer—the federal government (and by extension, the taxpayer).
Less desirable than either DB or TBP plans are DC plans, which are mostly self-directed by the
employees who own them. (If you have a pension with your employer you likely have one of these.)
That means that contributions are completely fixed and mostly paid by the plan holder, and there’s
a lot of uncertainty as to what retirement income payouts will be because that depends entirely on
the way you managed and invested your DC pension money over time.