While the number of plan members covered by registered pension plans has increased over the past decade, the percentage of the labour force with coverage has decreased slightly, according to a new fact sheet released by the federal Office of the Chief Actuary.
According to the fact sheet, Registered Pension Plan (RPP) and Retirement Savings Coverage (Canada), The total number of plan members covered by an RPP grew from 5.1 million in 1998 to six million in 2008, an increase of 18%.
Yet, the number of RPP members as a percentage of the labour force remained stable at 33% from 1998 to 2008. The proportion of paid workers covered by an RPP also declined, from 41% in 1998 to 38% in 2008. This discrepancy is due to the fact that the number of paid workers in Canada has grown at a faster pace than the number of Canadians covered by an RPP.
While the majority of public sector employees have RPP coverage, the percentage in that sector dropped from 87% to 84% between 1998 and 2008. By contrast, only 25% of private sector employees had coverage in 2008, down from 28% 10 years earlier.
The RPP coverage picture seems to be levelling out from a gender perspective. Of the six million Canadians with coverage in 2008, 3.1 million were men and 2.9 million were women. In comparison, 2.8 million men were covered in 1998, but only 2.3 million women. In 1989, only two million women had RPP coverage.
As might be expected, the percentage of paid workers in defined benefit (DB) plans has dropped 10% over the past decade, from 85% in 1998 to 75% in 2008. The shift from DB to defined contribution (DC) plans has been greatest in the private sector (from 77% to 57%), with just a 2% shift in the public sector (95% to 93%).
The trend toward conversion of DB plans into plans with both DB and DC components has grown over the decade, to the point where 16% of the private sector is now enrolled in such plans. In the public sector, 2% of members are in DB/DC plans, up from 1% in 1998.