January 9, 2025: Valuation shows your pension plan is safe and secure

You will be happy to learn that the Teachers’ Pension Plan’s most recent actuarial valuation, measured as at December 31, 2023, shows the money available for current and future pensions is more than the projected costs of paying for those pensions. This surplus means that the plan and member pensions are safe and secure.

The actuarial valuation also shows that the plan’s inflation adjustment account, the account from which the plan pays cost-of-living adjustments, continues to be sustainable.

What happens next?

When there is a valuation surplus, we use the plan’s Joint Trust Agreement (JTA) to help guide our decisions in the allocation of that surplus. The JTA is a document established by the plan partners (the provincial government and BC Teachers’ Federation) that guides us on the management of the plan. Part of the JTA’s guidance includes restrictions and considerations on the allocation of actuarial surpluses.

We are now carefully examining these restrictions and considerations. It is essential that we do not prioritize short-term benefits over long-term sustainability. Our decision on the allocation of the surplus must ensure that the plan remains sustainable and equitable for both members and employers into the future. This means our decision may be simply to keep the money in the basic account to protect against future economic downturns. Our prudent and cautious approach to managing previous surpluses is one of the reasons the plan remained strong through the recent economic downturns caused by the pandemic.

We will provide an update when we have made a final decision on the allocation of the actuarial surplus.

What is a valuation and why is it important?

A valuation is a point-in-time assessment of the financial position of the plan and its funding requirements. Valuations help us ensure the plan remains financially sustainable and has enough funds available for the current and future pensions of all members, whether active, inactive or retired.

A surplus can occur for a number of reasons, but is usually because returns on investments were higher than anticipated.

An independent actuary performs a valuation every three years. (An actuary is a professional with specialized knowledge in finance, statistics and risk theory.)

The next valuation will be measured as at December 31, 2026.

To read the full valuation report, visit Valuation report accessed under related content