FSRA Releases its Proposed FY 2019-20 FSRA Priorities and Budget for Public Consultation

February 15, 2019

The Financial Services Regulatory Authority of Ontario (“FSRA”) has released its Proposed FY 2019-20 FSRA Priorities and Budget for public consultation (the “Proposal”).FSRA is a new, independent regulatory agency created to regulate pension plans and certain financial institutions in Ontario previously regulated by other agencies. The Proposal intends to reflect FSRA’s transformation to a forward-looking, flexible, self-funded, principles and risk-based regulator, and specifies that FSRA will not simply be a continuation of the existing regulators.

  • Pension Sector Focus: The Proposal contemplates three areas of priorities within the pension sector: support plan evolution through actions such as relationship building with larger plans and use of resources to support complex transactions, review prudential supervision framework to better assess at-risk plans and target supervision, and refocus regulation on burden reduction, which is a cross-sector focus. FSRA will work with stakeholders to review, streamline, clarify and update existing guidance for greater regulatory effectiveness, as well as to review data and filing requirements to eliminate unnecessary filings and data collection, and to increase transparency and information sharing.
  • Enhanced Regulatory Effectiveness: As part of this cross-sector focus, in response to what the Proposal describes as “a perceived lack of accountability and responsiveness under the current framework”, FSRA will seek to establish meaningful service standards to measure FRSA’s effectiveness in meeting its objectives and the needs of stakeholders, including reflecting service standards in employee performance targets.
  • Budget: Although the proposed budget is higher by $3.3 million than the current overall budget, the Proposal attributes this increase to certain key changes. Such changes include the need to invest in staff with sector/functional expertise and experienced/skilled leaders (including five new senior staff positions in the pension sector), as well as certain changes needed to establish FSRA as an entity that is independent from the Ontario Government. The operating budget and start-up costs will be funded though fees and assessments that will be charged by FSRA.

In addition to releasing the Proposal, on January 10, 2019, FSRA announced the leadership team and on February 5, 2019, FSRA released a revised proposed fee rule for further comment until February 25, 2019. The anticipated launch date of FSRA is spring 2019.

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