“Locking-in” is the requirement that the money in a registered pension plan (RPP) be used to provide a retirement income stream – it can’t, as a general rule, be cashed out by the member. The merits of locking-in have been debated over the past few years. All jurisdictions have various provisions allowing some unlocking of pension money.
ACPM’s Advocacy and Government Relations Committee (AGRC) has discussed this issue over the past couple of years. In 2002, a sub-committee was established to review the issue. The consensus is that governments should proceed with caution before doing away with locking-in rules for pension plans – except in special circumstances (terminal illness, financial hardship and perhaps out-of-country residency).
The issue was also put to an informal vote at the 2003 ACPM Annual Conference. During an Open Forum session, participating members showed a preference for not changing current locking-in provisions.
ACPM’s Alberta Regional Council submitted a paper on locking-in to the Alberta government early in 2004. In it, they reflected ACPM’s position, although they also implied a preference for easing current rules.
ACPM surveyed its membership again in May 2008; 71% of members were opposed to unlocking.
ACPM will continue to monitor this issue.