CAAT Pension Plan Contribution Rates
December 2003
The CAAT Pension Sponsor’s Committee, composed of representatives from CAAT Support, CAAT Academic, OPSEU, the Colleges and management staff approved an increase in the pension contribution rate at their meeting November 26, 2003, after consultation with the CAAT Academic and Support Divisions and college employers and their staff
association. This decision was thoroughly reviewed by the pension trustees and the plan actuary.
The CAAT pension plan, like many other pension plans in both Canada and the U.S in the past two years, has been hit by both the decline in interest rates and investment returns.
The pension plan text provides that in the event of funding deficiencies, that contributions be increased equally, employee and employer, after exhausting the contingency reserve.
The Sponsor’s Committee has agreed to increase contribution rates effective January 1, 2004 by 1.5%. The rates will increase as follows for plan members and the employers:
| Earnings |
Current Rate |
Rate Effective
January 1, 2004 |
| 0 - $3,500 |
7.6% |
9.1% |
| $3501- YMPE |
5.8% |
7.3% |
| Above YMPE |
7.6% |
9.1% |
The CAAT Sponsor’s Committee will continue to monitor the funding ratio to ensure that the plan remains fully funded and the benefits are paid as promised.
For a person earning $40,000 in 2004, the increase in rates will mean a pretax increase in CAAT pension contributions of $600 per year, for a person earning $60,000 a year, the pretax increase is $900 a year. The employer will match the employee contribution.
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