52

 


First Session, 47th General Assembly

61 Elizabeth II, 2012

BILL 52

AN ACT TO AMEND THE TEACHERS’
PENSIONS ACT

Received and Read the First Time...................................................................................................

Second Reading.................................................................................................................................

Committee............................................................................................................................................

Third Reading.....................................................................................................................................

Royal Assent......................................................................................................................................

HONOURABLE THOMAS W. MARSHALL, Q.C.

Minister of Finance and President of Treasury Board

Ordered to be printed by the Honourable House of Assembly

 

EXPLANATORY NOTES

This Bill would amend the Teachers’ Pensions Act to provide for consistency with certain provisions of the Pension Benefits Act, 1997 and the Income Tax Act (Canada).

The Bill would also enact a number of housekeeping changes to the Act including repealing lapsed provisions of the Act.

The Bill would amend the Act to

·         allow a terminating teacher who is eligible for a deferred pension to elect to receive the commuted value of the pension as determined at the date of election;

·         allow a terminating vested teacher who has reached 55 years of age to elect to take an actuarially reduced pension; and

·         provide that effective September 1, 1998, the survivor benefit payable to the surviving principal beneficiary of a deceased teacher will be based on the lifetime pension plus the bridge benefit until such time as the deceased teacher would have reached age 65.

 

A BILL

AN ACT TO AMEND THE TEACHERS'
PENSIONS ACT

Analysis


        1.   S.2 Amdt.
Interpretation

        2.   S.6 Amdt.
Contributions by teachers

        3.   S.8 Amdt.
Government contributions

        4.   S.8.1 Rep.
Government payments

        5.   S.9 Amdt.
Repayment of contributions

        6.   S.9.1 Amdt.
Election upon termination

        7.   S.10 R&S
Purchase of prior teaching service

        8.   S.11 Amdt.
Purchase of prior substitute teaching service

        9.   S.12 R&S
Purchase of service with related plans

      10.   12.1 Amdt.
Strike and lockout

      11.   S.13 Amdt.
Purchase of leave without pay

      12.   S.16.1 Amdt.
Transfer

      13.   S.20 Amdt.
Early retirement

      14.   S.22 Amdt.
Calculation of pension

      15.   S.26 R&S
Survivor benefits

      16.   S.27 Amdt.
Designated beneficiary

      17.   S.27.1 Amdt.
Death of employee

      18.   S.28.1 Rep.
Transitional

      19.   S.31 R&S
Pension shall not be assigned or attached

      20.   S.32 Rep.
Attachment


Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:

SNL1991 c17
as amended

        1. Subsection 2(1) of the Teachers’ Pensions Act is amended                 by deleting the word "and" at the end of paragraph (q.1), by deleting the period at the end of paragraph (r) and substituting a semi-colon and the word "and" and by adding immediately after that paragraph the following:

             (s)  "YMPE" means the year's maximum pensionable earnings as defined under the Canada Pension Plan.

 

        2. Subsection 6(4) of the Act is amended by deleting the words "together with interest at the prescribed rate".

 

        3. (1) Subsection 8(2) of the Act is amended by deleting the words "with interest at the prescribed rate".

             (2)  Subsections 8(3) and (3.1) of the Act are repealed.

             (3)  Subsection 8(4) of the Act is amended by deleting the words "is reduced under this Act" and substituting the words "was reduced under this Act between the period of April 1, 1993 and March 31, 1996".

 

        4. Section 8.1 of the Act is repealed.

 

        5. Subsections 9(3), (4) and (5) of the Act are repealed.

 

        6. (1) Subsection 9.1(1) of the Act is repealed and the following substituted:

Election upon termination

      9.1 (1) A terminating teacher with at least 5 years of pensionable service who is ineligible for an immediate, unreduced pension, may elect, within 180 days after termination,

             (a)  a transfer of the commuted value of the pension entitlement of the teacher, in accordance with paragraph 40(1)(a) of the Pension Benefits Act, 1997;

             (b)  a deferred pension in accordance with section 21; or

             (c)  a return of the contributions made by the teacher, with interest at a rate prescribed, for periods of pensionable service credited

                      (i)  before January 1, 1987, and

                     (ii)  before January 1, 1997, where the teacher had less than 10 years of pensionable service and is less than 45 years of age,

and a transfer of the commuted value of the teacher's pension entitlement based on the remaining periods of pensionable service under paragraph (a).

             (2)  Subsection 9.1(3) of the Act is repealed and the following substituted:

             (3)  A teacher who elects or is considered to have elected to receive a deferred pension may revoke that election and elect a transfer under paragraph (1)(a), calculated at the date of the election.

             (3)  Subsection 9.1(9) of the Act is repealed.

 

        7. Section 10 of the Act is repealed and the following substituted:

Purchase of prior teaching service

      10. (1) Where a former teacher ceased to be employed and received a termination benefit and later becomes a teacher, that teacher may be credited with the prior pensionable service that he or she may elect to purchase in accordance with the terms and conditions that may be prescribed.

             (2)  Where a teacher to whom subsection (1) applies transferred his or her termination benefit to a registered retirement savings plan, a deferred profit sharing plan or a registered pension plan, payment by that teacher for the purchase of prior pensionable service shall include a transfer of the funds remaining in the registered retirement savings plan, the deferred profit sharing plan or the registered pension plan from the amount originally transferred.

             (3)  Where a former teacher who ceased to be employed and has not received a termination benefit later becomes a teacher, that teacher shall be credited with all pensionable service that accrued immediately before the teacher's termination.

             (4)  Where a teacher

             (a)  continued in employment after reaching normal retirement age before May 26, 2007;

             (b)  continues to be employed as a teacher on and after May 26, 2007; and

             (c)  did not receive a pension upon reaching normal retirement age,

he or she may be credited with the pensionable service in respect of the period of service beyond normal retirement age that he or she may elect to purchase in accordance with prescribed terms and conditions.

             (5)  For the purpose of subsection (1), periods of pensionable service may be credited where that service qualifies as a period of eligible service under the Income Tax Act (Canada).

 

        8. Section 11 of the Act is amended by adding immediately after subsection (3) the following:

             (4)  For the purpose of this section, periods of pensionable service may be credited where that service qualifies as a period of eligible service under the Income Tax Act (Canada).

 

        9. Section 12 of the Act is repealed and the following substituted:

Purchase of service with related plans

      12. (1) Where a teacher was formerly covered under a pension plan established or continued under

             (a)  The Public Service (Pensions) Act;

             (b)  The Civil Service Act;

             (c)  The Members of the House of Assembly (Retiring Allowances) Act;

             (d)  The Memorial University (Pensions) Act;

             (e)  The Uniformed Services Pensions Act; or

              (f)  an Act replaced by an Act referred to in paragraphs (a) to (e)

and has received a termination benefit under that pension plan, the teacher shall be credited with the pensionable service recognized by those pension plans that he or she may elect to purchase upon paying contributions that may be prescribed.

             (2)  Where a teacher was covered under a pension plan listed in subsection (1) and

             (a)  the contributions were payable and not paid in respect of service under that plan; or

             (b)  the teacher was employed on a full-time basis but was not eligible for membership in the pension plan or was precluded from membership due to administrative error,

the teacher may, upon paying contributions that may be prescribed, be credited with the pensionable service recognized by that pension plan that he or she may elect to purchase.

             (3)  Where a teacher who was employed on a full time basis

             (a)  is an employee of an employer to which the Public Service Pensions Act, 1991 applies; and

             (b)  the service was performed before that Act was made applicable to the employer,

the teacher may, upon paying contributions that may be prescribed, be credited with the pensionable service recognized by that pension plan that he or she may elect to purchase provided that the teacher was not covered by a pension plan of the employer during that period.

             (4)  For the purpose of this section, periods of pensionable service may be credited where that service qualifies as a period of eligible service under the Income Tax Act (Canada).

 

      10. Subsection 12.1(2) of the Act is repealed.

 

      11. (1) Subsection 13(4) of the Act is amended by deleting the  reference "subsections (2), (6) and (7)" and substituting the reference "subsection (2)".

             (2)  Section 13 of the Act is amended by repealing subsections (6) and (7).

             (3)  Section 13 of the Act is amended by adding immediately after subsection (8) the following:

             (9)  Pensionable service credited under this section shall be limited to a cumulative maximum of 5 years in respect of periods of unpaid leave of absence or periods of reduced pay plus an additional 3 years in respect of periods of parenting and shall be subject to the limits on prescribed compensation set out in the regulations under the Income Tax Act (Canada).

 

      12. Subsection 16.1(2) of the Act is repealed and the following substituted:

             (2)  Subsection (1) applies where the teacher

             (a)  has terminated his or her membership in the exporting pension plan;

             (b)  has not received a termination benefit from the exporting pension plan; and

             (c)  is entitled to transfer his or her full entitlement from the exporting pension plan.

 

      13. Section 20 of the Act is amended by adding immediately after subsection (1) the following:

          (1.1)  A teacher who has reached early retirement age and has been credited with not less than 5 years of pensionable service may elect to retire and receive an actuarially reduced pension.

          (1.2)  For the purpose of subsection (1.1), an actuarially reduced pension refers to a pension that has been reduced by an amount determined by the actuary that reflects the fact that the pension is being paid from a date that is earlier than the date the teacher, based on his or her service, would be eligible for an unreduced pension.

 

      14. (1) Section 22 of the Act is amended by deleting the words "year's maximum pensionable earnings" wherever they occur and substituting "YMPE".

             (2)  Subsection 22(6.2) of the Act is repealed.

 

      15. Section 26 of the Act is repealed and the following substituted:

Survivor benefits

      26. (1) A surviving principal beneficiary of

             (a)  a pensioner;

             (b)  a deferred pensioner; or

             (c)  a teacher with at least 5 years pensionable service

is entitled upon the death of the pensioner, deferred pensioner or teacher to a survivor benefit equal to 60% of the pension entitlement of the pensioner, deferred pensioner or teacher.

             (2)  Where the pension entitlement of the pensioner, deferred pensioner or teacher on his or her death includes the bridge benefit determined under subsection 22(1.1), the bridge benefit shall continue until the last day of the month in which the deceased pensioner, deferred pensioner or teacher would have reached the age of 65 years and the survivor benefit shall be adjusted accordingly.

             (3)  The survivor benefit shall be paid to the surviving principal beneficiary for life and shall commence on the first day of the month following the month in which the pensioner or teacher dies.

             (4)  Where a surviving principal beneficiary dies while in receipt of a survivor benefit, the survivor benefit shall be paid to or for the benefit of any surviving children of the teacher, pensioner or deferred pensioner, while they are under the age of 18 years, or under the age of 24 years while they are in full-time attendance at a recognized school or post-secondary institution.

             (5)  Where a pensioner referred to in subsection (1) dies leaving no surviving principal beneficiary, the survivor benefit shall be paid to or for the benefit of his or her surviving children, while they are under the age of 18 years, or under the age of 24 years while they are in full-time attendance at a recognized school or post-secondary institution.

             (6)  Subsection (2) is considered to have come into force on September 1, 1998.

 

            16.  Subsection 27(5) of the Act is repealed and the following substituted:

             (5)  For the purpose of this section, a dependant of a teacher, pensioner or deferred pensioner at the time of the death of the teacher, pensioner or deferred pensioner means a parent, grandparent, brother, sister, child or grandchild of the teacher, pensioner or deferred pensioner who, at that time, is, by reason of mental or physical infirmity, dependent on the teacher, pensioner or deferred pensioner for support.

 

      17. Subsection 27.1(2) of the Act is amended by deleting the phrase "and subsections 9(3), (4) and (5) apply to the transfer".

 

      18. Section 28.1 of the Act is repealed.

 

      19. Section 31 of the Act is repealed and the following substituted:

Pension shall not be assigned or attached

      31. A pension awarded under this Act shall not be assigned, charged, attached, anticipated or given as security and is exempt from execution, seizure or attachment, and a transaction purporting to assign, charge, attach, anticipate or give as security such money is void, except in accordance with the Pension Benefits Act, 1997.

 

      20. Section 32 of the Act is repealed.

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