News Story

2011 Specified Plan Change Cycle Under Way - SC Receives Annual Actuarial Valuation

February 24, 2011

The 2011 cycle for considering specified plan change proposals is under way. The 2010 Actuarial Valuation of the OMERS Primary Pension Plan was received by the SC on February 24. Two requests were received from Stakeholders prior to February 28th and were reviewed by the Plan Design Information Committee (PDIC). In order to be considered, plan changes must be proposed by individual SC Members at the March 24th or April 28th meetings of the SC. Details will be provided throughout the process in the Plan Design section.

Primary Plan - Funded Status at December 31, 2010

Recently OMERS announced a 12.01% total rate of return in 2010 for the OMERS Primary Plan, compared to a 10.6% total rate of return in 2009. While the 2010 results are indeed positive, the investment losses suffered in 2008 continue to affect the funded status of the Plan.

On February 24, 2011, the OMERS Sponsors Corporation received the actuarial valuation report for the OMERS Primary Plan as of December 31, 2010. The report indicates that the deficit has grown from $1.5 billion at the end of 2009 to $4.5 billion at the end of 2010. The increased deficit is largely attributable to the economic downturn of 2008.

Principal Results of December 31, 2010 Primary Plan Valuation

(in $billions) Going Concern
Market Value of Assets $53.2
Adjustment for Actuarial Value $2.3
Smoothed Value of Assets $55.5
Actuarial Liabilities $60.0
Surplus/(Deficit) ($4.5)
Going Concern Funded Ratio 93%

The SC considers the funded status of the Plan along with other considerations as part of its Plan Design Change Process.

Note:  Subsection 15(1) of the OMERS Act, 2006, stipulates that the SC shall not amend the Primary Plan in a manner which reduces contributions or increases going concern liabilities unless, after the amendment, the ratio of the market value of assets to the going concern actuarial liabilities is not less than 1.05.  At December 31, this ratio was 0.89.