Public Service Pension Plan Reports $1.9 Billion Surplus

Federal Public Service Pension Plan Reports $1.9 Billion Surplus, Sparks Debate Over Allocation

The federal public service pension plan has reported a $1.9 billion surplus, according to a report presented to the House of Commons on Monday by Treasury Board President Anita Anand.

In a statement, Anand’s office announced that the “non-permitted surplus” would be transferred to the Consolidated Revenue Fund, the government’s central account at the Bank of Canada. The funds will remain there “while next steps are considered,” with the Treasury Board engaging in discussions with stakeholders, the release noted.

Under the Public Service Superannuation Act, a non-permitted surplus occurs when a registered pension plan’s assets exceed its liabilities by more than 25 per cent.

“Federal public servants continue to benefit from a well-managed and sustainable pension plan and can be confident in its continued health in the years ahead,” the statement said.

Union Calls for Surplus to Address Pension Inequalities

The Public Service Alliance of Canada (PSAC) has argued that the surplus should be used to address inequalities within the pension system stemming from changes introduced under former Prime Minister Stephen Harper.

Reforms in the 2012 federal budget created a two-tier system, requiring public servants hired after 2013 to work until age 60 to qualify for retirement, compared to age 55 for those hired earlier with 30 years of service. PSAC has described this system as fundamentally unfair.

The union stated it will review the Treasury Board’s report in greater detail, reiterating its call for reforms to eliminate the inequities.

Public servants and the federal government currently share pension plan contributions equally at a 50:50 ratio.