New federal retirement savings option available to businesses and individuals working in federally regulated industries as well as residents of the territories.
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.
October 7, 2014 – Ottawa, Ontario – Department of Finance