Canadian Forces Superannuation Regulations (CFSR) Amendments

• In 2016 and 2019, the Committee issued letters to the Department of National Defence noting the lack of action to amend eleven provisions related to the Optional Survivor Benefit (OSB) of the Canadian Forces Superannuation Regulations (CFSR), specifically, inconsistencies in terminology between the French and English versions. In 2023, two letters were sent to the Minister of National Defence which underscored the delay in making the changes.  
  • In June 2023, Minister Anand advised the Committee that National Defence is committed to prioritizing the correction of the inconsistencies between the English and French versions of the Act.
  • A final draft of the regulatory amendments is being prepared in close consultation with Justice Canada and will be finalized by the end of this calendar year. These amendments will be submitted to the Governor-In-Council for approval in 2024.

• National Defence is prioritizing the work to correct the eleven inconsistencies between the English and French versions of the Canadian Forces Superannuation Regulations identified by this committee.
• I acknowledge that these amendments are well past due, and I have reiterated to the team my predecessor’s commitment to make the required changes.
• Since June 2023, our officials have met weekly with Justice Canada regulatory drafters on a priority basis to advance this file.
• The draft regulations will be finalized by the end of this calendar year and these amendments will be submitted to the Governor in Council for approval in 2024.

• We will also amend the Regulations so that the Canadian Forces pension operational matters currently addressed within the Act, be addressed within the Regulations. This will allow National Defence to respond quickly to operational matters whenever changes are required.
• For example, the provisions of CFSA section 6 which identify the various ways in which Contributors can accumulate pensionable service will move to the CFSR almost in their entirety.
• Further, the update to the Regulations revises discrepancies between the Act and the Regulations and extends the ability to opt-in for the Optional Survivor Benefit to common law partners. Currently, the Regulations limit this option to spouses only.

If pressed on the impacts of amendments not being made

• There have been no impacts to the services provided to our members due to the delay in making the necessary corrections.
• Currently, the CAF applies the English version of the regulations, which offers better coverage than the French version.
• We recognize that Canadians have a right to access federal regulations in both official languages and bilingualism is an asset that makes the Defence Team stronger and the CAF more operationally effective. 
• This is why we are committed to correcting the discrepancies between the English and French versions on a priority basis. To do so, National Defence received an exemption from pre-publishing the proposed changes in the Canada Gazette.
• This opportunity also allows us to extend the Optional Survivor Benefit to common law partners. This is an important change which responds to the evolving needs of our members.

• Since the inconsistencies in the Regulations were first identified by this Committee, National Defence and the Canadian Armed Forces have maintained a very high tempo, balancing competing priorities and demands in a shifting geopolitical context.
• This includes deploying to Afghanistan, advancing culture change, undertaking reconstitution efforts, responding to domestic challenges, maintaining international commitments, as well as providing military assistance to Ukraine.

If pressed on the modernization efforts

• Over the years, we focused our work on pension modernization to ensure that our members receive benefits which are up to date with other public pension plans.
• These revisions focused on de-linking the pension plan from our military terms of services, creating the Reserve Force Pension Plan and making critical, substantive changes necessary for the proper functions of the act and its regulations.
• The creation of the Reserve Force Pension Plan was a critical priority to ensure that the Reserve Force members receive the support and pension they deserve, in line with those in the Regular Force.
• Unfortunately, the eleven provisions of concern to this Committee were not included in the section of the Regulations that Treasury Board and the Department of Justice authorized to revise during those three modernization efforts.

• The Provision 59 (2) extends the period to make an OSB election in case of error/misleading information provided to the contributor:
  • 59(2) An election may be made under subsection (1) not later than three months after the day on which a written notice containing the correct information is sent to the contributor.
• Section 61(1) & (2) defines when delivery to the Minister of an OSB election occurs, and when the election is deemed to have occurred:
  • 61 (1) An election shall be delivered to the Minister, or to a person designated by the Minister, within the period referred to in section 58 or subsection 59(2), as the case may be.
  • (2) An election is made on the day on which the election is placed in the course of delivery in accordance with subsection (1).
• Section 62 requires proof of marriage/common-law partnership following an OSB election:
  • 62 The contributor, or a person acting on behalf of the contributor, shall, within one year after the day on which an election is made, send to the Minister or to a person designated by the Minister
  • (a) a document that is evidence of the date of birth of the spouse;
  • (b) a document that is evidence of the marriage of the contributor and the spouse; and
  • (c) where the name of the spouse as indicated on a document referred to in paragraph (a) is not the same as the name of the spouse as indicated on a document referred to in paragraph (b), any other document that confirms that the evidence of the birth and the marriage relates to the spouse, or a statutory declaration by which the spouse declares that the documents are in respect of the spouse.
• Section 63(1) & (2) relate to proof of age of a spouse/partner for an OSB election:
  • 63 (1) Notwithstanding section 49, for the purposes of section 25.1 of the Act, proof of age of the contributor’s spouse is established, subject to subsections (2) and (3), by a birth certificate issued by a civil authority.
  • (2) Where a birth certificate referred to in subsection (1) cannot be obtained, proof of age of the spouse is established
  • (a) by a statutory declaration of the spouse in which the spouse attests to the spouse’s date of birth and explains the reasons why the birth certificate cannot be obtained; and
  • (b) by a document that was created
  • (i) within five years after the date of birth of the spouse and that indicates the name of the spouse and the date of birth or age of the spouse, or
  • (ii) at least 20 years before the day on which the election is made and that indicates the date of birth of the spouse, which document is accompanied by a statutory declaration by which a person, other than the contributor or the spouse, attests that the date stated in the document is the correct date of birth of the spouse.
• Section 64(1) & (2) relates to proof of marriage for an OSB election:
  • 64 (1) Subject to subsection (2), proof of the marriage between the contributor and the spouse is established by a marriage certificate issued by a civil authority.
  • (2) Where a marriage certificate referred to in subsection (1) cannot be obtained, proof of the marriage between the contributor and the spouse is established by
  • (a) a statutory declaration by which the contributor or the spouse attests to the date of the marriage and explains the reasons why the marriage certificate cannot be obtained; and
  • (b) a document that is similar to a marriage certificate and is issued in relation to the marriage ceremony, or a statutory declaration by a person who attended the marriage ceremony, other than the contributor or the spouse, attesting to the person’s knowledge of the marriage.
• Section 66(2) relates to the pension reduction calculation following an OSB Election:
  • 66 (2) For the purposes of paragraph (1)(c), in determining the reduction for a contributor in respect of whom a minimum death benefit would be payable if the contributor were to die on the day on which the election is made, the actuarial present value that is converted in accordance with subparagraph (1)(b)(i) shall not take into account the minimum death benefit in respect of that contributor.
• Section 70(3) & (4) relates to the revision of OSB reduction in case of erroneous/misleading information:
  • 70 (3) The revision of the level of reduction or the revocation of the election shall be in writing and shall be delivered to the Minister or to the person designated by the Minister
  • (a) within three months after the day on which a written notice containing the correct information is sent to the contributor; or
  • (b) within three months after the day on which the annuity is adjusted in accordance with the Pension Benefits Division Act.
  • (4) A revision of the level of reduction or a revocation of the election is effective on the day on which it is placed in the course of delivery in accordance with subsection (3).

• The Canadian Armed Forces (CAF) offer a generous pension plan that takes responsibility for changes in a Veteran’s marital status long after a member has retired.
• Specifically, the Optional Survivor Benefit (OSB) allows retired members who marry after the age of 60 to provide corresponding benefits to the surviving spouse.
• This is more generous than many other pension plans in Canada that limit survivor benefits to an individual’s spouse or partner that existed when the plan member retired.
• The uptake to the OSB varies from month to month but has been between 140 and 150 out of 120,000 annuitants.
• National Defence works in close coordination with other key Departments to ensure members continue to be fairly compensated.
• As such, we are currently working to amend the regulations under all three of the federal pension plans (CAF, Royal Canadian Mounted Police and Public Service) to make the Optional Survivor Benefit available to both common-law spouses and legally married spouses.
• Furthermore, this will allow National Defence to correct the inconsistencies in the English and French versions found in the Canadian Forces Superannuation Regulations that relate to the administration of the Optional Survivors Benefit (OSB).

• National Defence is grateful for the service of all its members, both active and retired, and offers robust benefit packages to members and their spouses.
• Many pension plans in Canada limit eligibility for survivor benefits to the spouse or partner that existed when the plan member was employed.
• However, the Canadian Armed Forces pension plan is more generous because members retire earlier than their Public Service counterparts.
• That is why it includes a survivor benefit for the member’s spouse or partner should they marry or become common law after retirement, and before the age of 60.
• This is a benefit, and an expansion of a normal pension plan. It provides our members who tend to retire at a younger age than many in the public service, with the ability to have their benefits support a spouse even after retirement.
• The Optional Survivor Benefit has been put in place to allow contributing members to provide a supplementary death benefit to the surviving spouse for retired members who marry after the age of 60.
• National Defence appreciates the hard work of parliamentary committees, and my officials were happy to support Veterans Affairs Canada in their government response to the Veterans Affairs committee’s recent report on Marriage after 60.
• National Defence works in close coordination with other key departments to ensure members continue to be fairly compensated.

If pressed on revisions to the Marriage After 60 clause:

• The decision to make any revisions to this specific clause is not National Defence’s alone.
• Any revision to the clause would not only impact the Canadian Armed Forces pension plan, but that of the Public Service and the Royal Canadian Mounted Police.

• We are committed to ensuring that active and retired Canadian Armed Forces (CAF) members receive the respect, support and care they deserve.
• We are making efforts to ensure that members have access to the necessary information about their pension plan.
• Specifically, members have access to a broad range of free financial services and advice throughout the entirety of their careers, including leading up to and throughout retirement.
• For example, training sessions provided by pension experts are offered to ensure that members have the right information to make decisions related to their pension plan.
• In addition, the Canadian Forces Morale and Welfare Services (CFMWS) provides unbiased and tailored financial advice to CAF, Veterans and their families.
• Further, there are 32 CAF Transition Centres and detachments across Canada to help members transition from military to civilian life. 
• Each transitioning member is assigned a small team to provide personalized assistance to guide and assist with the pension plan and related benefits.
• In addition, by spring 2024, each Transition Centre will provide Long Term Planning seminars that include a portion devoted to financial aspects.
• All these initiatives ensure that members are aware of their financial benefits early on and are well equipped to plan for their financial wellness at every stage of their careers.