2001 Annual Report to Members
PUBLIC SERVICE PENSION PLAN
TRUSTEE'S MESSAGE
The Province of Newfoundland Pooled Pension Fund (the Pension Fund) was established in 1980 to finance all pension benefits and related administrative expenses for those plans covering the public service, teachers, uniformed service personnel, and Members of the House of Assembly.
As Trustee of the Pension Fund, I am pleased to report on the financial and administrative activities of the Public Service Pension Plan (PSPP) for the year ended December
31,2001.
The PSPP was established on April 1, 1967 to provide a contributory defined benefit pension plan for full-time employees of the Government of Newfoundland and Labrador and its various boards, agencies, commissions, crown corporations and health care institutions. The plan operates under the authority of the Public Service Pensions Act, 1991 and all contributions deducted from employees, together with matching amounts from their employers, are paid into the Pension Fund for investment.
This annual report outlines the financial activity and the Statement of Changes in Net Assets Available for Benefits of the PSPP portion of the Pension Fund for the Year.
The investment results for 2001 provided an annual return of -0.9%. Net assets increased by
$6.1 million in 2001, up from $1,463.9 million to $1,470.0 million, an increase of
0.4% over the prior year.
An actuarial valuation of the PSPP is performed every three years. The purpose of the valuation is to determine the PSPP's assets and liabilities as well as the cost of benefits expected in future years. The
results of the valuation report as at December 31, 2000 are expected
in the spring of 2002.
During the past year, Government made a special cash payment of $40 million and,
commencing January 1, 2003, will contribute a further $60 million
annually. In January, 2001, contribution rates increased by 1/4%. This was the final part of a four year phase-in of a 1% increase matched by employers. It is anticipated that both of these measures will
fully fund the Plan in 40 years.
I am pleased to submit the 2001 Annual Report to Members for your consideration.
Honourable Joan Marie Aylward
Minister of Finance
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