Her Excellency the Right Honourable Adrienne Clarkson, C.C., C.M.M., C.D.
Governor General of Canada
Excellency:
I have the honour to submit to Your Excellency the Report on the Administration of
the Supplementary Retirement Benefits Act for the Fiscal Year Ended
March 31, 2000.
Respectfully submitted,
The paper version was signed by Lucienne Robillard, President of the Treasury
Board
Lucienne Robillard
President of the Treasury Board
This is the 30th annual report on the administration of the Supplementary Retirement
Benefits Act (the Act), which came into force on April 1, 1970.
Supplementary Benefits
The Act makes it possible to provide supplementary benefits for - that is, to
index - pensions or allowances payable under the following Acts or regulations, as at
March 31, 2000:
1. the Governor General's Act;
2. Part VI of the Members of Parliament Retiring Allowances Act, R.S.C.
1970,
c. M-10;
3. the Lieutenant Governors Superannuation Act;
4. the Judges Act;
5. the Diplomatic Service (Special) Superannuation Act;
6. the Civil Service Superannuation Act;
7. the Defence Services Pension Continuation Act, R.S.C. 1970, c. D-3;
8. the Royal Canadian Mounted Police Pension Continuation Act, parts II and
III, R.S.C. 1970, c. R-10;
9. subsection 15(2) of the Currency, Mint and Exchange Fund Act;
10. subsection 25(10) of the War Veterans Allowance Act;
11. the Annuities Agents Pension Regulations;
12. the Canadian Overseas Telecommunications Corporation Pension Regulations;
13. the Canadian Arsenals Pension Regulations;
14. the Sydney Pilots Pension Regulations;
15. the National Harbours Board Pension Regulations;
16. the Canadian Wheat Board Pension Regulations;
17. the Atlantic Pilotage Authority Pension Regulations;
18. the Atomic Energy of Canada Ltd. Pension Regulations.
The original Act of 1970 provided for increases in pensions of a maximum of 2 per
cent per year, based on the year of retirement going back to 1952. The increases were
payable at the age of 60, or earlier under specific conditions.
Effective January 1, 1974, the 2 per cent ceiling on increases was
removed. An annual increase in pensions reflecting the full increase in the cost of living
was permitted. The annual increase in pensions is payable in January of each year. This
increase is based on the percentage increase in the average of the Consumer Price
Index (CPI) for the 12 months ended on the preceding September 30 over the CPI
average for the 12 months ended a year earlier.
The Act was amended in 1975 to permit interest to be paid on contributions. The
interest rate is 4 per cent compounded annually.
Since 1982, the legislation has required that the increase payable in the first year
after a person retires be pro-rated according to the number of complete months
of retirement.
In 1983 and 1984, the increases were limited to 6.5 and 5.5 per cent,
respectively, under amendments to the Act passed in 1983.
In 1992, the Act was amended because changes were being made to the statutes governing
four federal public-sector pension plans: the Public Service Superannuation Act (PSSA);
the Canadian Forces Superannuation Act (CFSA); the Royal Canadian Mounted
Police Superannuation Act (RCMPSA); and the Members of Parliament Retiring
Allowances Act (MPRAA). The amendments meant that the Act did not apply to
pensions payable under those statutes. Consequently, each of those statutes now permits
increases in these pensions, which are determined as they were under the Act. The
amendments to the Act related to benefits payable under the PSSA, the CFSA and the RCMPSA
were made retroactive to April 1, 1991. Those related to the MPRAA became effective
on January 1, 1992. For more information on these amendments, see the section titled
'Funding'.
The increase in pensions payable in January 2000 was 1.5 per cent.
Funding
The Act establishes an account known as the Supplementary Retirement Benefits Account
(the Account). Plan members who have not yet retired, except the Governor General,
contribute to this account. The government matches these contributions.
Between April 1, 1970, and December 31, 1976, members contributed
0.5 per cent of their salary. Effective January 1, 1977, this rate was increased
to 1 per cent.
Interest on the Account is payable at the end of each quarter. It is calculated monthly
on the minimum balance in the Account at an interest rate that represents the yield
on outstanding Government of Canada bonds having a term to maturity of five years,
less one eighth of 1 per cent.
Before January 1, 1974, all supplementary benefits were charged to the Account.
Since that date, however, the benefits paid to a former contributor have been charged to
the Account only until they equal the total amount credited to the Account for that
person. Supplementary benefits paid in excess of that total have been charged to the
Consolidated Revenue Fund.
Under the 1992 amendments mentioned in the preceding section, the appropriate portions
of the Account were transferred to the superannuation accounts established under the PSSA,
the CFSA, the RCMPSA and the MPRAA. These transfers greatly reduced the size of the
Account.
Account Transactions and Membership Statistics
During the year, total receipts from contributors and the government, including
interest, amounted to $7.0 million. The total amount paid under the Act was
$38.712 million, of which $0.039 million was charged to the Account; the remaining
$38.673 million was charged to the Consolidated Revenue Fund, in accordance with
subsection 8(2) of the Act. The balance in the Account at the end of the year was
$77.7 million.
Details of the transactions in the Account during the fiscal year appear in
tables 1 and 2.
Table 3 is a comparative statement of receipts and payments since the Act came
into force.
On March 31, 2000, there were 981 contributors to the Account and
2,429 beneficiaries. The number of contributors and beneficiaries over the last ten
years appears in Table 4.
TABLE 1 |
Supplementary Retirement Benefits Account (in
thousands of dollars) |
|
|
|
Balance on March 31, 1999 |
70,723 |
|
|
|
|
Receipts |
|
|
Contributions |
|
|
- Members |
1,727 |
|
- Government |
1,722 |
|
Interest |
3,546 |
|
Total Receipts |
6,995 |
|
|
|
|
Payments |
|
|
Annuities |
38,712 |
|
Less charges to the Consolidated
Revenue Fund in accordance with subsection 8(2) of the Act |
38,673 |
|
- Net Payments |
39 |
|
|
|
|
Balance on March 31, 2000 |
77,679 |
|
|
Note: Totals may not add up due to rounding.
TABLE 2 |
Supplementary Retirement Benefits Account
Details of Receipts and Payments 1999-00 (in thousands of dollars) |
|
|
RCMP |
Parliament |
Others |
Total |
|
Balance at March 31, 1999 |
9,169 |
99 |
61,454 |
70,723 |
|
|
|
|
|
Receipts |
|
|
|
|
Contributions |
|
|
|
|
- Members |
|
|
1,727 |
1,727 |
- Government |
|
|
1,722 |
1,722 |
Interest |
|
6 |
3,541 |
3,546 |
|
|
Total Receipts |
|
6 |
6,989 |
6,995 |
|
|
|
|
|
Payments |
|
|
|
|
Annuities1 |
|
|
39 |
39 |
Return of Contributions |
|
|
|
|
|
|
Total Payments |
|
|
39 |
39 |
Increase (Decrease) |
|
6 |
6,950 |
6,956 |
|
|
|
|
|
Balance at March 31, 2000 |
9,169 |
105 |
68,404 |
77,679 |
|
1 In addition to these charges to the Account, $38,673,415 was
charged to the Consolidated Revenue Fund under
subsection 8(2) of the Act.
Note: Totals may not add up due to rounding.
TABLE 4 |
Supplementary Retirement Benefits Account |
|
|
Public
Service |
Canadian
Forces |
RCMP |
Parliament |
Others |
Total |
|
Number of Contributors |
|
|
|
|
|
At: March 31, 1991 |
308,977 |
87,319 |
19,209 |
404 |
706 |
416,615 |
March 31, 19921 |
- |
- |
- |
- |
753 |
753 |
March 31, 1993 |
- |
- |
- |
- |
796 |
796 |
March 31, 1994 |
- |
- |
- |
- |
833 |
833 |
March 31, 1995 |
- |
- |
- |
- |
854 |
854 |
March 31, 1996 |
- |
- |
- |
- |
902 |
902 |
March 31, 1997 |
- |
- |
- |
- |
913 |
913 |
March 31, 1998 |
- |
- |
- |
- |
928 |
928 |
March 31, 1999 |
- |
- |
- |
- |
954 |
954 |
March 31, 2000 |
- |
- |
- |
- |
981 |
981 |
Number of Beneficiaries |
|
|
|
|
|
At: March 31, 1991 |
178,274 |
54,183 |
4,035 |
349 |
514 |
237,355 |
March 31, 19921 |
- |
1,5912 |
1,2602 |
- |
551 |
3,402 |
March 31, 1993 |
- |
1,476 |
1,196 |
- |
560 |
3,232 |
March 31, 1994 |
- |
1,383 |
1,143 |
- |
585 |
3,111 |
March 31, 1995 |
- |
1,294 |
1,095 |
- |
609 |
2,998 |
March 31, 1996 |
- |
1,174 |
1,004 |
- |
609 |
2,787 |
March 31, 1997 |
- |
1,092 |
992 |
- |
630 |
2,714 |
March 31, 1998 |
- |
1,007 |
906 |
- |
642 |
2,555 |
March 31, 1999 |
- |
923 |
886 |
- |
653 |
2,462 |
March 31, 2000 |
- |
870 |
887 |
- |
672 |
2,429 |
|
1 As explained earlier in this report, in the fiscal year 1991-92, the
Act ceased to apply to pensions payable under
the PSSA, the CFSA, the RCMPSA and the MPRAA.
2 Beginning with the fiscal year 1991-92, these beneficiaries are those
receiving pensions under the Defence
Services Pension Continuation Act and the Royal Canadian Mounted Police
Pension Continuation Act.
|