Pension Plan Reports Released

The province's two major pension plans are in good shape, despite losing value in 2002, says Nova Scotia Finance Minister Neil LeBlanc.

The minister released the actuarial valuation results to December 31, 2002 for the Public Service Superannuation Plan and the Teachers' Pension Plan today, June 25. Nova Scotia is one of the first provinces to report pension plan results for 2002. Today's numbers are in line with projected results released last November.

"The downturn in the stock market affected pension plans everywhere over the past year and we were no different," Mr. LeBlanc said. "However, our pension investments are managed for the long term. They have done well over time and we're confident they will continue to do well."

Over the past 10 years, the province's pension plans have averaged gains of more than eight per cent, considered a good rate of return.

Mr. LeBlanc says Nova Scotia's plans fared better than many similar-sized plans in 2002, scoring in the top third.

For the Public Service Superannuation Plan, the funded ratio stands at 82.1 per cent, down from 95.8 per cent in 2001. Investment losses of $304 million are the primary reason for the increase in unfunded liability. The plan has assets worth $2.65 billion.

There are a total of 25,600 active and retired members in the Public Service Superannuation Plan, belonging to groups such as the Nova Scotia Government Employees Union (NSGEU), Canadian Union of Public Employees (CUPE) and the Nova Scotia Government Retired Employees Association. The heads of each of those organizations have committed to working with government to ensure that members' pension plan benefits are managed wisely for the future.

With assets of $3.36 billion, the Teachers' Pension Plan funded ratio is at 76.8 per cent, down from 86.5 per cent. The investment loss was $265 million.

Brian Forbes, president of the Nova Scotia Teachers' Union said, "There are challenges ahead of us but our union will continue working in partnership with the government to ensure the long- term viability of the Nova Scotia Teachers' Pension Plan."

There are 26,200 active and retired teachers in the plan.

The investment funds for both pension plans are monitored by the Investment Advisory Committee, which includes representatives of the provincial government, the NSGEU and the Nova Scotia Teachers' Union.

The Toronto Stock Exchange was down 12.4 per cent last year, roughly the same as in 2001. For the first time since 1932, U.S. stock markets recorded their third straight year of declines.

NOTE: A chart comparing rates of return for pension plans of similar size in 2002 is available at www.gov.ns.ca/fina/pension/comparativechart.asp

Actuarial valuation results for the Public Service Superannuation Plan are available at www.gov.ns.ca/finance/pension/PSS/PSS_ActuarialValuations.htm and for the Teachers' Pension Plan at www.gov.ns.ca/finance/pension/TPP/TPP_ActuarialValuations.htm .