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(November 20, 2008) Two years after the Ontario Expert Commission on Pensions (OECP) was created, its 222-page report — along with 142 recommendations — was released to the public on Thursday.

The report, entitled A Fine Balance: Safe Pensions, Affordable Plans, Fair Rules, has numerous recommendations to reform and reinvigorate the province’s pension system, according to OECP chair Harry Arthurs.

Some of the recommendations include:

• The creation of a pension champion (a new government agency that would assume responsibility for collecting and disseminating reliable information about the pension system) for thinking creatively about new pension strategies and policies, and for working with stakeholders to improve the pension system. It also requires an adaptable legislative and regulatory framework.

• Encourage co-operation among small- and medium-sized plans, and promote target benefit plans that might be affordable for Ontarians who do not now have pension coverage.

• The provincial government should investigate the advantages and disadvantages of expanding the Canada Pension Plan, or creating a comparable provincial plan, to enhance pension coverage, control costs and improve benefit portability. It should also support the call for a national pension summit to investigate all ideas that might produce such outcomes.

• A new Pension Community Advisory Council should be formed, representing all stakeholder, professional and academic users. It should be invited to advise government on all significant policy initiatives and to serve as a forum for the exchange of views. This new approach to pension policymaking should be led by the pension champion, which should be given adequate staff and resources.

• Pension legislation should be drafted in such a way as to facilitate the introduction of new plan designs as well as new regulatory initiatives. Pension legislation should be comprehensively reviewed every eight years.

• The government should support efforts to avoid further divergence in pension policy, legislation and regulation among Canadian jurisdictions; seek co-operation with other provinces to secure necessary changes in federal tax and insolvency legislation; and attempt to secure greater standardization of technical and procedural requirements among pension regulators.

The province is seeking feedback on the report from Ontarians, with a written comment period ending February 27, 2009, and is committed to introducing legislation.

— filed by Craig Sebastiano, associate editor at Benefits Canada.

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Canada’s housing boom is over: Scotia

(November 20, 2008) If anyone needed proof that Canada’s housing market was in trouble, Scotia Economics has it.

According to the bank’s Real Estate Trends Report, the housing boom is over, especially in Calgary, Edmonton and Vancouver. Scotia adds that the market is “tilting back in favour of buyers” for the first time in years.

As uncomfortable as this news is for homeowners, Adrienne Warren, senior economist at Scotia, says people shouldn’t be alarmed.

“This is not a ‘U.S.-style’ bust caused by overbuilding, speculative buying and imprudent lending, but rather a cyclical slowdown accompanied by a valuation adjustment in several large centres, where booming demand conditions and temporary supply constraints led to an overshooting in prices,” she says.

One of the big differences between the housing markets here and in the States is that the inventory of for-sale homes in both the new and resale market is still well contained.

“With builders in most jurisdictions beginning to slow the pace of new construction, and with a low risk of widespread foreclosures, the Canadian market does not face the massive inventory glut underlying record-setting U.S. price declines,” says the report.

Warren adds, “There is further downside risk to home prices in Canada, especially in light of reduced growth and employment prospects. We expect, however, that the correction in national average prices from their late-2007 peak will probably be in the range of 10% to 15%, well below the ongoing U.S. retrenchment.”

(11/20/08)