National Institute on Aging report sheds light on challenges of missing pension plan members and unclaimed benefits
January 15, 2025
Nearly 200,000 members of Ontario-registered pension plans are considered missing, leaving behind around $3.6 billion in unclaimed benefits, according to a new report from the National Institute of Ageing.
The report defines missing pension plan members as individuals who cannot be contacted by their pension plan administrators due to outdated contact details or other challenges, such as the death of the plan participant.
Canada is not alone among nations dealing with the challenges of missing members in their pension systems and the report drew inspiration from approaches adopted in other jurisdictions as it laid out three main policy options for reuniting members with their entitlements:
- Unclaimed Deposit Program: This would expand the current program for unclaimed bank deposits, with plan administrators providing account balance and benefit terms for missing members to the Bank of Canada. Members are deemed to have received benefits, becoming liable for taxes as soon as the transfer occurs.
- Industry Pool: This would involve the creation of a new industry-sponsored entity to hold funds and administer benefits for missing members. The agency would actively search for missing members and respond to inquiries, with each pension plan establishing its own policy for transferring missing members to the pool.
- Dashboard: Mimicking a European or Australian-style pension dashboard, this option would give the Canada Revenue Agency a key role in allowing individuals to track their personal pension accrual history, including lost pensions. Another agency, such as Service Canada, would be responsible for linking this data to current plan administrators to help individuals track their retirement financial resources, including lost pensions. The success of this initiative also depends on the completeness and accuracy of the data provided by pension schemes and the engagement of individuals in using the dashboard.
To read the report, click on more information below:
