Actuarial Valuation of the Québec Pension Plan at 31 December 2018
The Actuarial Valuation of the Québec Pension Plan as at 31 December 2018 provides a projection of the Plan's cash inflows and outflows for the next 50 years, that is, from 2019 to 2068. It also includes a projection of the base plan's and additional plan's reserves and valuates the steady-state and reference contribution rates.
The actuarial valuation serves to inform the government, contributors and beneficiaries of the Plan's financial situation. It provides an overview of the Plan's health.
Results of the actuarial valuation
The Plan is financially sound
Base plan
| | As at 31 December 2018 | In 25 years | In 50 years |
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| Total benefits | $14B | $38B | $87B |
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| Reserve | $73B | $199B | $548B |
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The reserve as at 31 December 2018 was $73 billion and is to continue increasing until it reaches $548B in 2068.
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Cash inflows are sufficient: for each of the 50 years of the projection, cash inflows are sufficient to finance cash outflows.
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The steady-state contribution rate is 10.61% and is lower than the statutory contribution rate. As a result,
the contribution rate remains at 10.80%.
Additional plan
The
Additional plan was implemented in January 2019 when the Québec Pension Plan enhancement became effective and is part of the actuarial valuation for the first time.
| | As at 31 December 2018 | In 25 years | In 50 years |
|---|
| Total benefits | - | $4B | $27B |
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| Reserve | - | $191B | $814B |
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The additional plan's reserve is increasing quickly: its funding depends mainly on its financial assets.
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Cash inflows are sufficient: for each of the 50 years of the projection, cash inflows are sufficient to finance cash outflows.
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The reference contribution rate is 1.84%; which is slightly lower than the statutory contribution rate (2.00%).
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