The Canada Pension Plan Act, RSC 1985, c C-8, as amended in 1987, allowed that on the appropriate minister being informed of a divorce, the total Canada Pension Plan (“CPP”) credits accumulated by both spouses through the course of the marriage would be split evenly between both ex-spouses. These amendments reflected a desire to protect women who, because of their unpaid contributions within the home, had historically suffered greater poverty in retirement than men.
However, this method of equal splitting was not entirely harmonious with the Matrimonial Property Act, RSA 1980, c M-9, as then amended. At issue were the idea of spousal agreements (so-called “pre-nuptial agreements”) and the unequal division of property upon divorce, which was within the power of the courts. This report recommends four actions intended to clarify the relationship between the Matrimonial Property Act and the Canada Pension Plan Act, namely:
– that the credit-splitting scheme under the Canada Pension Plan Act be accepted as a mechanism of achieving a specific policy goal, namely that of reducing the poverty of women in retirement;
– that the province should not enact legislation, contemplated in s 55.2(3) of the CPP Act, allowing spousal agreements to determine the division of CPP credits on divorce;
– that the province should enact legislation that would render any portion of a spousal agreement which would affect the equal division of CPP credits or benefits on divorce; and
– that although the actual splitting of CPP credits should be beyond the reach of the Matrimonial Property Act, the courts should be entitled to consider such a course of action when contemplating the division of property between spouses on divorce.
In addition, this report notes that mechanisms for informing the appropriate minister of divorce were inefficient, and that there was a need for the federal authority to create a mechanism to inform the minister of divorces in a timely way.