Greenhouse Canada

B.C. takes the lead on pooled pension plans

March 1, 2013  By Canadian Garden Centre & Nursery

Mar. 1, 2013, Victoria — New legislation introduced by the B.C. government will create the country’s first Pooled Registered Pension Plans, allowing small businesses to set aside more money for employee retirement plans.

B.C. Finance Minister Michael de Jong introduced the Pooled Registered Pension Plans Act yesterday. If passed, the legislation will make all workers in B.C. eligible to enroll in defined-contribution pension plans. The bill follows on the heels of similar legislation enacted by the federal government last December, and is part of a national effort to make well-regulated, low-cost pension plans available to millions of Canadians who do not have occupational pension plans.

“It’s difficult to save for retirement when you’re raising a family, especially if you’re self-employed or work for a small business that doesn’t have access to a registered workplace pension plan,” said de Jong. “This legislation will provide an additional, optional safety net for thousands of British Columbians and make it easier for them to save for retirement.”


Pooled Registered Pension Plans (PRPPs) will be managed by licensed financial institutions, reducing administrative burdens for employers and providing tax advantages to employers that are not available under alternative models such as group RRSPs.

Under the proposed legislation, if an employer chooses to offer a PRPP to its employees, they will be automatically enrolled and have the right to opt out. Employers will not be obligated to make matching contributions. Workers whose employers do not set up a PRPP will be able to deal directly with a PRPP administrator to open an account, similar to opening an RRSP.

“Small firms tell us that the main reason 80 per cent of them do not have any form of company retirement plan for the business owner or their employees are the costs and administrative burden of offering a plan,” said Dan Kelly, president of the Canadian Federation of Independent Business. “We expect PRPPs to move the ball forward on both fronts.”

B.C. is the first province to introduce PRPP legislation. Quebec, Alberta and Saskatchewan have all signaled their intention to pass similar legislation in the months ahead.

“British Columbia can now serve as a valuable role model for other provinces seeking to support their citizens through a new low-cost pension option for employers, employees and the self-employed,” said Ted Menzies, B.C.’s Minister of State for Finance.

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