Pension Life - Winter 2021
Strong valuation results
Pensions receive a 1.0 per cent inflation adjustment
As your Public Service Pension Board of Trustees, we are pleased to share that the 2020 valuation report is complete and the plan’s funded ratio is 109.6 per cent. The plan’s basic account, which pays lifetime pensions, had actuarial assets of $30.5 billion, actuarial liabilities of $27.8 billion and an actuarial surplus of $2.7 billion. When there is a surplus, we use the Public Service Pension Plan Joint Trust Agreement to help guide our decisions on how to use these funds. Please note that optional group health benefits have a different funding model and are not related to the valuation results. It is important that whatever decision we make be sustainable and equitable to members and employers. We will provide an update when we have made a decision.
Your pension has received a full inflation adjustment
Inflation adjustments are important because they help your pension keep pace with increases in the cost of living over time. All retired members received an inflation adjustment of 1.0 per cent to monthly pensions effective January 1, 2021. This adjustment is in line with the October to October change in the Canadian consumer price index. If you retired partway through 2020, your adjustment will be pro-rated based on the number of months in 2020 you received a pension. Inflation adjustments are not guaranteed and are only granted when funding permits. However, once an inflation adjustment is granted, it becomes part of your guaranteed lifetime pension.