Division of pensions upon marriage breakdown : Partage des régimes de retraite en cas d'échec du mariage

Other potential difficulties include the ending of the non-member spouse’s entitlement to share in the pension payments when the member spouse dies, reduction of the pension benefit because of the winding up of the plan and taxation issues. [...] This has led us to make a recommendation that the ISM should be the main settlement mechanism (with a proviso that the equalization debt is satisfied only to the extent of the value transferred out of the plan), but that the DSM should also be available where the member is within ten years of normal retirement date or where the plan administrator consents. [...] The amount payable to the surviving spouse of the former member must be at least 60 per cent of the amount that was being paid to the former member while both were alive.64 Section 46 of the PBA allows the member and the spouse, acting jointly, to waive the right to a joint and survivor pension prior to the commencement of the pension payments. [...] In that event, “subject to the application of the Guarantee Fund”,85 the PBA requires that the benefits under the plan be reduced in proportion to the wind-up deficiency.86 The Pension Benefits Guarantee Fund insures the pension benefits of Ontario employees who are members of defined benefit plans registered under the PBA or the legislation of a designated province, subject to certain exceptions [...] B. Equalization and Death The equalization regime applies not only upon the breakdown of a marriage, but also, potentially, in the event of termination of a marriage as a result of the death of one of the spouses (although equalization in that case is a “one-way” matter, in that the surviving spouse would not have a liability to the deceased spouse’s estate in the event that he had the higher-valu