Summary
This regulation establishes the fee assessment framework for pension plans regulated under the Pension Benefits Standards Act, 1985 and Pooled Registered Pension Plans Act. It defines key terms, sets out a formula to calculate assessment amounts based on number of beneficiaries (sliding scale up to 19,000), determines the annual basic rate based on OSFI's estimated administrative expenses, and requires publication of rates 180 days before each fiscal year.
Reason
This fee regime duplicates existing government funding mechanisms and adds compliance costs to pension plans, ultimately reducing retirement savings for Canadians. Pension plan oversight could be funded through general taxation or minimal fees tied only to actual inspection services. The complex multi-year averaging formula creates uncertainty and administrative burden without justification. In a free market, pension providers would compete on fees and services, making this mandatory assessment an unnecessary distortion. The regulation assumes OSFI supervision is essential, but private accreditation, market discipline, and contractual relationships between employers, employees, and financial institutions can achieve prudent pension management without bureaucratic overhead. Hidden costs include reduced investment returns, fewer plan options, and barriers to entry for smaller employers.