The Colleges of Applied Arts and Technology Pension Plan is reporting a return of eight per cent net of investment fees for 2016.
The result was down slightly from 8.1 per cent for 2015. As of Dec. 31, 2016, it held $9.4 billion in assets, compared to $8.6 billion the previous year.
In 2016, employers and employees jointly contributed $443 million to the plan. Net income from investments reached $700 million, and the plan paid $431 million in benefits. Over the past five years, the plan is reporting an annualized rate of return of 10.5 per cent, net of investment fees.
Read: CAAT plan’s funding status climbs to 113.3%
“For members, the CAAT plan provides an efficient, worry-free way to build predictable retirement income without the need to become an investment expert, or to understand longevity risk, or the effects of inflation on purchasing power,” said Derek Dobson, chief executive officer of the plan, in a statement.
The plan’s most recent actuarial valuation at Jan. 1, 2017, put its funding ratio at 113.3 per cent with a funding reserve of $1.6 billion. That was up from the prior year’s valuation, which showed a funding ratio of 110.4 per cent and a funding reserve of $1.2 billion. For the 2017 valuation, the plan used a discount rate of 5.6 per cent, down from 5.7 per cent previously.
The CAAT plan represents 38 employers, including colleges and student unions, and has 44,700 members. In December, its merger with the Royal Ontario Museum pension plan received final approval from the Financial Services Commission of Ontario. The sponsors of the CAAT plan include the Ontario College Administrative Staff Association, the College Employer Council and the Ontario Public Service Employees Union.
Read: Sounding Board: ROM, CAAT pension merger lowers costs and risks