A while back I was trying to figure out if PRPP rules would permit PRPP administrators to offer inducements to employers at the expense of plan participants . The idea was to determine whether employers are likely to choose administrators who offer the employees the best deal or whether the choice would be based on the best kickbacks flowing to the employers. Shawn Patton pointed me to recently published PRPP regulations. Here are the sections on permitted inducements and low cost requirements: PERMITTED INDUCEMENTS 19. An administrator may give, offer or agree to give or offer to an employer and an employer may demand, accept or offer or agree to accept from an administrator, as an inducement to enter into a contract with the administrator in respect of a PRPP (a) a product or a service on more favourable terms or conditions than the administrator would otherwise offer if the inducement is for the equal benefit of the employees of that employer who are eligible to be members ...

So far I have more questions than answers about the new Pooled Registered Pension Plans (PRPPs) and a big question is what the costs will be like for participants. The Department of Finance has a framework document that lays out the basic idea of PRPPs, but it is the details that will determine if this approach is beneficial for Canadians or not. PRPPs will be administered by “regulated financial institutions that are capable of taking on a fiduciary role in order to act in the best interests of plan members.” The investment choices will allow participants to create portfolios consistent with their “investment objectives and risk preferences including a low cost option.” This seems to imply that high-cost options may be offered as well. Because it will be employers who will decide which financial institution to choose as a PRPP administrator, and we can reasonably believe that employers can evaluate costs better than the typical Canadian, there is some hope that PRPP administrat...