Archived - Federally Registered Pooled Registered Pension Plans Now Available
Archived information is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please contact us to request a format other than those available.
New federal retirement savings option available to businesses and individuals working in federally regulated industries as well as residents of the territories
October 7, 2014 – Ottawa, Ontario – Department of Finance
Minister of State (Finance) Kevin Sorenson today announced that the five insurance companies that have federal Pooled Registered Pension Plan (PRPP) licences (Sun Life, Great West Life, Manulife, Standard Life and Industrial-Alliance) have been registered with the Office of the Superintendent of Financial Institutions and the Canada Revenue Agency. This was the final step necessary for the plan administrators to make federal PRPPs available to Canadians.
- PRPPs establish large-scale, broad-based, voluntary pension arrangements available to employees—with or without a participating employer—as well as the self-employed.
- They will be low cost. By pooling pension savings, the cost of administering the pension funds will be spread over a larger group of people, allowing plan members to benefit from lower investment management costs.
- Most of the administrative and legal burdens associated with a PRPP will be borne by a qualified, licensed, third-party administrator. Under the PRPP program, the onus of this fiduciary duty is transferred to a professional plan administrator.
- PRPPs are straightforward in their design, will help small businesses and are intended to be largely harmonized across provinces. They will fit seamlessly into the existing system of tax rules and contribution limits for Registered Pension Plans and Registered Retirement Savings Plans.
“Today concludes the final administrative step in making federal PRPPs available to Canadians. This is a major milestone in providing an attractive new retirement savings option for those millions of Canadians—roughly 60 per cent—who do not have access to a workplace pension plan. It is also a significant achievement in the Government’s ongoing efforts to strengthen Canada’s retirement income system. I would like to encourage those provinces that haven’t implemented PRPP frameworks to do so expeditiously for the benefit of Canadians.”
- Kevin Sorenson, Minister of State (Finance)
“We commend the federal government for implementing a solution to help employers bridge existing gaps in the retirement system while maintaining existing employer-sponsored retirement plans, and are pleased to introduce our own PRPP to help more Canadians save.”
- Jeff Aarssen, Senior Vice-President of Group Retirement Services for Great West Life, London Life and Canada Life
“The PRPP is a very beneficial solution for eligible Canadians who did not have access to a group pension plan. We want to offer them tools to help them prepare better for retirement. It made perfect sense to enhance our offer by adding this new plan.”
- Renée Laflamme, Vice-President, Group Savings and Retirement, Industrial Alliance Insurance and Financial Services Inc
“Canadians without access to a workplace savings plan now have an easy, low-cost way to save for the future. With simplicity and affordability in mind, Manulife has created a cutting-edge federal PRPP with an innovative eApplication that can set up a contract in minutes. We also manage most of the ongoing administrative work, taking the burden off of advisors and employers.”
- Marc Avaria, Vice President, Group Small Business, Manulife
“Today marks an important step towards helping more Canadians save for a secure financial future, and Standard Life is proud to be part of it. Now that the federal PRPP and Quebec’s voluntary retirement savings plan are in place, we hope other Finance Ministers will soon adopt the PRPP framework that was agreed to a few years ago.”
- Charles Guay, President and CEO, Standard Life Canada
“We are excited to be a part of this important milestone in Canadian pension history. We are committed to providing Canadians with lifetime financial security, and this legislation is pivotal in providing access to a low-cost pension for the three to five million Canadians who do not currently have a workplace retirement savings plan.”
- Tom Reid, Senior Vice-President, Group Retirement Services, Sun Life Financial Canada
“The Canadian life and health insurance industry welcomes today’s announcement that five insurance companies have been licensed to provide PRPPs and believes it demonstrates the willingness of our industry to provide Canadians with an excellent vehicle to save for retirement. Because of our existing platforms in serving other pension plans, we can hit the ground running to provide top-quality, low-cost PRPP services to Canadians, particularly small and medium-sized businesses.”
- Frank Swedlove, President, Canadian Life and Health Insurance Association
“Today’s announcement is good news for Canadians looking for options to save for their retirement. It brings pooled retirement pension plans one step closer to becoming reality across the country, provided that provincial governments move quickly to allow financial institutions to offer them. In fact, CFIB recently signed an agreement with Standard Life in Quebec, which is the first province to adopt them, so that our small business members can provide their employees with access to these voluntary plans.”
- Dan Kelly, President, Canadian Federation of Independent Business
Office of the Minister of State (Finance)
Department of Finance