Unlike some 85% of company pension plans in the US that are underfunded and with no real resolve in sight, we’re not nearly that bad off here in Canada.
The reasons for this are, yes, the obvious of stock market declines but add to this the perfect storm of longevity and the current massive wave of retiring baby boomers. Its a perfect storm of increasing and extended benefits and recipients and less and less employees contributing.
OMERS posts $4.3B net gain on investments in 2009, or 10.6 per cent return rate
By The Canadian Press
TORONTO - The Ontario public-sector pension manager known as OMERS says it booked a $4.3-billion net gain on its investments for 2009, with a 10.6 per cent rate of return on its assets that marked its move back into positive returns after a dismal performance a year earlier.
OMERS says the average rate of return for the past five years now stands at 6.6 per cent. That's above the five-year average benchmark return of 5.8 per cent.
Crowley of OMERS said that has pulled its deficit to a deeper $1.5 billion for the year ended Dec. 31, down from a comparable $279 million the previous year.
"Like the majority of the large plans, pension obligations have been increasing at a greater pace than contributions."
He added that another $4.95 billion in net losses from 2008 will continue to affect its overall deficit for the next four years.
Saverio Manzo
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