Message from the TTC Pension Fund Society CEO6/5/18 10:10 AM
The TTC Pension Fund Society has been delivering on our Pension Promise for over 75 years and we are committed to continue to deliver on that promise well into the future.
2017 was another positive year – our net investment return exceeded the actuarial rate, which has further improved the financial health of the PFS. When we manage our plan’s assets, we need to keep in mind that the contributions that we receive from a TTC Operator today, while they are in their 20s or 30s, will be used to deliver pension payments to that person as a pensioner while they are in their 80s and 90s.
Employing a long-term approach to pension plan management enables us to keep our sights on the horizon to deliver our pension promise long into the future. Of course, we fully expect, and anticipate that certain periods in the future will be characterized by challenging short-term performance due to slow economic growth, market volatility and heightened geopolitical risks. Despite some of these varied challenges in 2017, the PFS has been able to generate another year with positive results. The Fund earned 9.7% after fees for the year ending December 31st with Plan assets increasing by approximately $500 million to $6.6 billion at year end.
We maintained our funded status at 97% on a going concern basis. Consistent with our long-term track record, the Plan has earned an annualized return of 9.6% after fees, over the last five years, which has exceeded our Plan benchmark return by 0.8% annually.
This strong financial position has allowed the PFS Board the ability to approve valuable increases to Member benefits. The Board approved a base year update to include December 31, 2017, effective January 1, 2018, and an ad-hoc pensioner increase of up to 1.56%. The pensioner increase is the maximum permitted by Canadian tax law for new retirees and is equal to the change in the Consumer Price Index (CPI) published by Statistics Canada.
Chief Executive Officer
TTC Pension Fund Society
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