Pension Benefits Standards Act, 1985 (R.S.C., 1985, c. 32 (2nd Supp.))

Marginal note:Interest (defined contribution plans)

• 19. (1) In the case of a defined contribution plan, the members’ accounts shall be credited with such interest, gains and losses as can reasonably be attributed to the operation of the pension fund.

• Marginal note:Interest (defined benefit plans)

  (2) In the case of a defined benefit plan,

  • (a) interest shall be credited on members’ contributions at a rate equal to or greater than the rate fixed in advance by the Superintendent, or

  • (b) members’ contributions shall be credited with such interest, gains and losses as can reasonably be attributed to the operation of the pension fund,

  and the plan shall specify which of paragraph (a) or (b) operates, but the plan may specify that one of those two paragraphs applies to required contributions and the other paragraph applies to additional voluntary contributions, in which case the reference in paragraph (b) to “the operation of the pension fund” shall be read as either “the operation of that portion of the pension fund that relates to required contributions” or “the operation of that portion of the pension fund that relates to additional voluntary contributions”, as the case may be.

• Marginal note:Superintendent’s guideline

  (3) The rate fixed by the Superintendent under subsection (2) must be fixed so that it reflects reasonably current interest rates.

20. [Repealed, 2010, c. 12, s. 1807]

Marginal note:Minimum pension benefit credit

• 21. (1) Subject to paragraph 26(3)(b), if a member of a defined benefit plan retires, ceases to be a member or dies or if the whole or part of the plan is terminated, the pension benefit in respect of the member is to be increased by the amount, if any, by which the aggregate of the member’s contributions, other than additional voluntary contributions, together with interest in accordance with section 19, exceeds 50 per cent of the pension benefit credit in respect of the member’s membership in the plan.

• Marginal note:Exception

  (2) Subsection (1) does not apply to a contribution, or the pension benefit arising from it, in respect of any defined contribution provision of a defined benefit plan.

• Marginal note:If plan provides for indexation

  (3) Subsection (1) does not apply if a defined benefit plan provides for annual indexation of a deferred pension benefit, up to the day when payment of that deferred pension benefit commences, on the basis of

  • (a) increases of at least 75 per cent of the annual increase of the Consumer Price Index, minus one per cent; or

  • (b) any other formula that, in the Superintendent’s opinion, would provide protection that on the average would be comparable to that described in paragraph (a).

• Marginal note:Calculation of annual increase of Consumer Price Index

  (4) For the purposes of paragraph (3)(a),

  • (a) the “Consumer Price Index” means the Consumer Price Index for Canada, as published by Statistics Canada under the authority of the Statistics Act; and

  • (b) the annual increase of the Consumer Price Index must be calculated, in prescribed manner, by the comparison between two consecutive and reasonably current 12-month periods.