CANADA - Alberta has become the first province to allow its pension funds the permanent right to use letters of credit (LOC) to fund solvency deficiencies.
It should also be dated and issued by an approved bank.
Watson Wyatt warned pension funds these instruments could not be used to determine a scheme's solvency or funded ratio, but money committed to schemes through an LOC could be considered as assets to establish its solvency deficiency.
Alberta followed the federal government and Quebec in allowing LOC financing, but these two front runners only introduced it in 2006 as a temporary measure.
Quebec is set to make the legislation permanent in 2010.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers