R-15.1 - Supplemental Pension Plans Act

Section 130 Disposition versions

2016-01-01

130. There are three types of funding deficiencies: the technical actuarial deficiency, the stabilization actuarial deficiency and the improvement unfunded actuarial liability.

1989, c. 38, s. 130; 2000, c. 41, s. 78; 2006, c. 42, s. 11; 2015, c. 29, s. 24.

2010-01-01

130. A solvency deficiency includes

(1)  the technical actuarial deficiency which, at the date of an actuarial valuation of the pension plan, corresponds to the amount by which the plan’s liabilities, reduced by the value of the additional obligations arising from any amendment to the plan considered for the first time in the valuation, exceed the sum of the plan’s assets and the value of the amortization payments required to amortize a solvency deficiency determined in a prior actuarial valuation, which payments are not eliminated under section 131; the value of the amortization payments must be established using the same interest rate as the one used to establish the plan’s liabilities; and

(2)  the improvement unfunded actuarial liability which corresponds,

(a)  if it is determined in a complete actuarial valuation, to the amount by which the value of the additional obligations arising from any amendment to the plan considered for the first time in the valuation exceeds the special amortization payment provided for in section 132; or

(b)  if it is determined in a partial actuarial valuation, to the value of the additional obligations arising from any amendment to the plan considered for the first time in the valuation.

1989, c. 38, s. 130; 2000, c. 41, s. 78; 2006, c. 42, s. 11.

2001-01-01

130. The actuarial valuation required under paragraph 2 of section 118 may be limited to the determination on a funding basis of the value of the additional obligations arising from an amendment to the pension plan or may only concern the variation in the current service contribution arising from the amendment. The value or the variation shall be determined on the basis of the same assumptions and methods as were used for the preceding actuarial valuation, unless they are not appropriate in view of the nature of the amendment made to the pension plan.

However, where the amendment to the pension plan increases the pensions already in payment and the additional obligations arising from the amendment are insured at the date on which the actuarial valuation report is prepared, the value of the obligations may be assumed to correspond to the premium paid to the insurer, discounted at the date of actuarial valuation according to the rate of return of the pension fund.

Where the amendment increases the obligations arising from the pension plan, an improvement unfunded actuarial liability equal to the value of the additional obligations shall be determined unless

(1)  the actuary certifies that the pension plan would be funded and solvent or partially solvent if an actuarial valuation of the whole pension plan were made on the effective date of the amendment; and

(2)  the value of the additional obligations is less than or equal to the value of the surplus assets determined at the time of the last actuarial valuation of the whole plan, less any portion of the surplus assets used pursuant to Chapter X.1 and the value of the obligations arising from any other amendment to the pension plan which, after being the subject of an actuarial valuation subsequent to the last valuation of the whole plan, was certified pursuant to subparagraph 1.

The period of amortization of the unfunded liability cannot exceed five years unless the actuary certifies that the pension plan is solvent or partially solvent at the valuation date.

Unless the actuary certifies that the degree of solvency of the pension plan at the valuation date is or exceeds 100%, the actuary shall estimate the degree of solvency of the plan at the valuation date and indicate it in the actuary’s report. In addition, the estimated degree of solvency applies from the date the valuation report is transmitted to the Régie for the purpose of paying out the value of benefits to members and beneficiaries under section 142.

Every certification required under this section shall reflect the financial position of the plan at the date of the actuarial valuation, estimated on the basis, in particular, of the actual rate of return of the pension fund and the contributions actually paid into the pension fund since the last actuarial valuation of the whole plan.

1989, c. 38, s. 130; 2000, c. 41, s. 78.

For the purposes of an actuarial valuation required under paragraph 2 of section 118 of this Act in connection with an amendment made between 5 May 2005 and the date that is five years after the date of the actuarial valuation referred to in section 2 of the Act respecting the funding of certain pension plans (2005, chapter 25), section 130 of this Act applies subject to the amendments made by paragraphs 1 to 3 of section 13 of the Act respecting the funding of certain pension plans.

1999-04-01

130. An improvement unfunded actuarial liability may be determined without performing an actuarial valuation of the whole plan.

In that case, the unfunded liability shall be equal to the value of the additional obligations arising from an amendment to the plan; such value shall be determined on the basis of the same assumptions and methods as those used for the preceding actuarial valuation.

The period of amortization of such an unfunded liability shall not exceed five years, unless an actuary certifies that the plan is solvent or partially solvent.

1989, c. 38, s. 130.