Experience apportionments

​Experience apportionments are discretionary increases in pension credits or benefits.

​Experience apportionments are increases in pension credits or benefits:

  • For retirees or eligible survivors, an apportionment is a permanent increase in their current pension benefit for life, expressed as a percentage of that benefit.
  • For active or terminated vested members, an apportionment is a permanent increase in pension credits accrued, expressed as a percentage of those credits.

The Board of Pensions grants experience apportionments, based on an apportionment policy, at the sole discretion of its Board of Directors.

How apportionments are determined

Each year, the Board of Directors uses the apportionment policy to determine whether to grant an apportionment and, if so, what it will be. The policy takes into account the Pension Plan objectives, seeking to balance short- and long-term goals:

  • Ensure long-term financial stability of the plan.
  • Protect members against inflation.
  • Maintain generational equity.

The policy is also informed by periodic asset/liability studies.

Solvency, or plan funding status, is the primary factor that drives the determination. A funding status of 100 percent — fully funded — means that assets in the plan are able to meet current and future benefits obligations. The greater the funding status, the more opportunity to grant an apportionment to help protect current and future retiree benefits from inflation with minimal risk to the plan.

If the Pension Plan is funded at

  • less than 110 percent, no apportionment is granted;
  • 110 percent to less than 120 percent, a 1 percent apportionment may be granted;
  • 120 percent to less than 125 percent, a 2 percent apportionment may be granted;
  • 125 percent or more, an apportionment greater than 2 percent is considered, and actuarial analysis is used to determine the amount.