BMKP Law Summary: 2023 Fall Economic Statement
November 23, 2023
The federal government released the 2023 Fall Economic Statement, which includes some important announcements related to pension plans and benefits.
This article highlights elements of the 2023 Fall Economic Statement that will be of interest to employers and sponsors and administrators of pension plans.
- Pension Fund Investment
The 2023 Fall Economic Statement announced that the federal government:
- Will work collaboratively with Canadian pension funds to create an environment that encourages and identifies more opportunities for investments in Canada by pension funds.
- Will explore removing the “30 per cent rule” from the Pension Benefits Standards Regulations, 1985, which restricts administrators from investing the moneys of the plan in the securities of a corporation which attach more than 30 per cent of the votes that may be cast to elect directors.
- Proposes to require large federally-regulated pension plans to disclose the distribution of their investments, both by jurisdiction and asset type per jurisdiction, to the Office of the Superintendent of Financial Institutions. This information will be made publicly available, and the government will engage with provinces and territories to discuss similar disclosures by Canada’s largest pension plans in a simple and uniform format.
- Update on Protecting Canadians From the Risks of Crypto-Assets
The 2023 Fall Economic Statement noted that the federal government has been advancing measures announced in Budget 2023 to require disclosures of crypto-asset exposures in federally registered pension plans. The federal government is also engaging provinces and encouraging those provinces to also require Canada’s provincially-regulated (and largest) pension plans to disclose their crypto-asset risk.
- Delivering Dental Care for Canadians
The 2023 Fall Economic Statement announced the federal government’s intention to continue preparing for the launch of the Canadian Dental Care Plan (expected to begin rolling out by the end of the 2023). The Canadian Dental Care Plan is expected to support up to 9 million uninsured Canadians who have an annual family net income of less than $90,000 in receiving oral health care.
Relatedly, the 2023 Fall Economic Statement proposes to amend the Income Tax Act (Canada) to allow Canada Revenue Agency to share taxpayer information with an official of Public Services and Procurement Canada solely for the purposes of the administration or enforcement of the Canadian Dental Care Plan.
- Canada Labour Code Amendments
The 2023 Fall Economic Statement proposes to amend the Employment Insurance Act and the Canada Labour Code to introduce a 15-week shareable Employment Insurance benefit for adoptive parents and introduce corresponding unpaid leave for workers in federally-regulated sectors. The 2023 Fall Economic Statement also proposes to amend the Canada Labour Code and An Act to amend the Criminal Code and the Canada Labour Code to create a new paid leave for workers in federally-regulated sectors who experience a pregnancy loss.
- Supporting Employee Ownership Trusts
The 2023 Fall Economic Statement proposes to exempt the first $10 million in capital gains realized on the sale of a business to an Employee Ownership Trust from taxation, subject to certain conditions, which would be in effect for the 2024, 2025 and 2026 taxation years.
Finally, the 2023 Fall Economic Statement confirmed the federal government’s intention to proceed with the previously announced tax and related measures, including employee ownership trusts and retirement compensation arrangements, as modified to take into account consultations and deliberations since their release. For a summary of the tax measures related to employee ownership trusts and retirement compensation arrangements that were announced as part of the federal government’s 2023 Budget please see our previous side bar “A Made-in-Canada Plan: Pension and Benefit Highlights from the 2023 Federal Budget”.
Click on more information below to read the 2023 Fall Economic Statement:
