The PPMP at a Glance

New provisions

Partition of benefits accrued under a public-sector pension plan after the breakdown of a de facto union

Since 1 January 2019, de facto spouses who stop living together can have the benefits accrued under certain public-sector pension plans partitionned, including those under the Pension Plan of Management Personnel (PPMP).

The The Act respecting the implementation of recommendations of the pension committee of certain public sector pension plans and amending various legislative provisions (S.Q. 2018, Chapter 4) provides for the partition of benefits accrued under certain pension plans for de facto spouses. Regulatory amendments stipulate the terms and conditions under which the benefits may be partitioned. The main regulatory changes affect the Application for a Statement of Benefits - Married or Civilly United Spouses, the Statement of Benefits accrued under the pension plan and the Application for Payment of the Value of Accrued Benefits Under a Public-Sector Pension Plan - Married, Civilly United and De Facto Spouses.

If you would like to have benefits accrued under a public-sector pension plan partitioned, you must file an application with Retraite Québec for a Statement of the Benefits accrued under the plan. The application must be signed by the member or beneficiary of the plan and his or her spouse. You must also file an Application for Payment of the Value of Accrued Benefits Under a Public-Sector Pension Plan - Married, Civilly United and De Facto Spouses with Retraite Québec, accompanied by a joint sworn declaration within 12 months following the date on which you stopped living together or a written agreement signed by both spouses before a notary or attorney. If you stopped living together before 1 January 2019, the written agreement must be signed by both you and your former spouse before 2 January 2020.

Who are considered de facto spouses?

Under the PPMP, de facto spouses are two persons who, on the date of the breakdown of their union, were not married or in a civil union, provided they presented themselves publicly as de facto spouses and lived together in a conjugal relationship for at least:

• the 3 years preceding the date on which they stopped living together
  or
• the year preceding the date on which they stopped living together if:
  • a child was born or is to be born of their union
  • one of the spouses adopted a child of the other
  • they adopted a child together.

For more information

Retraite Québec's website contains all the necessary information and forms concerning partition between spouses, regardless of the type of union (married, civil union or de facto union). For more information, see:

• the section of our website on Breaking up
• the booklet entitled In the Event of the Breakdown of Your Union.

In effect since 1 January 2019

Enhancement of the Québec Pension Plan

A major change has been made to the Québec Pension Plan (QPP) with the introduction of an additional plan. Since 1 January 2019, the QPP has been composed of two plans:

• the basic pension plan, that is, the plan that has been in place since 1966 and to which employees and employers each contribute 5.4% of the portion of employment income between the basic exemption of $3500 and the maximum pensionable earnings (MPE), which is $57 400 in 2019.
• the additional plan, to which employees and employers make additional contributions based on a rate that will increase gradually from 2019 (0.15%) to 2023 (1.00%). In addition, as of 2024, new contributions will be made to the portion of employment income between the MPE and a new eligible pensionable salary ceiling, which will be 107% of the MPE as of 2024 and 114% of the MPE as of 2025.

Individuals who contribute to the QPP additional plan will receive or be entitled to increased benefits at retirement, or in the event of death or disability, in proportion to the number of years they contribute to the plan.

Enhancement of the QPP and integration of public-sector pension plans

Some public-sector pension plans, including the PPMP, are integrated with the QPP base plan. This means that, when the beneficiary of a public-sector pension plan reaches age 65, the amount of his or her pension is reduced based on the amount of his or her QPP pension. This reduction will take into account the portion of the pension related to the base plan only. The current provisions of public-sector pension plans have not changes with the introduction of the additional plan.

See Retraite Québec's website for more information about the enhanced Québec Pension Plan. An animated presentation (French only) has been made available to better help you understand the changes.

A 4.3% return for the PPMP members' fund

The PPMP members' fund generated a 4.3% return in 2018. The amounts in the fund are invested with the Caisse de dépôt et placement du Québec (CDPQ), in various asset categories.

The real estate, infrastructures and private equity assets categories delivered the best returns in 2018, at 7.8%, 11.2% and 16.6%, respectively. The fixed income asset category yielded a return of 2.2%, while the equity markets portfolio yielded a loss of 0.9%.

The return in 2018 is lower than in recent years because of the negative returns of the main equity markets around the world. Trade tensions between China and the United States and the increase in the key rates of the major central banks contributed to these negative returns.

However, the return on the PPMP members' fund remained positive in 2018 for the following reasons:

• The strategies used by the CDPQ to manage stock market investments yield less volatile and more resilient returns than those of comparable markets. Thus, even if the return on the CDPQ's equity market portfolio was negative in 2018, losses were less than those of the benchmark indices.
• The PPMP members' fund holds several international investments denominated in foreign currencies. Exposure to these currencies was beneficial, since the Canadian dollar lost value compared to most other currencies in 2018.
• The real estate, infrastructures and private equity assets categories were less affected by the short-term market volatility, which allowed them to generate positive returns in 2018.

Table 1 shows the annual returns of the PPMP members' fund in the past 10 years. The average return during this period was 9.0%.

Table 1

Returns from 2009 to 2018 (percentage)

 

Table 2 shows the evolution of the PPMP members' fund in the past 10 years. The significant decrease in the PPMP fund in 2017 is due to the implementation of the Act to foster the financial health and sustainability of the PPMP and to amend various legislative provisions. Under the Act, the government is responsible for paying all benefits to beneficiaries who retired before 1 January 2015. In return, $5.1 billion (the portion of assets relating to its obligations with regard to these beneficiaries) was transferred to the government from the members' fund in 2017.

Table 2

Evolution of the PPMP members' fund
at the CDPQ (in billions of dollars)

 

The PPMP pension committee:
Ensuring sound management of your plan

The Pension Plan of Management Personnel has a pension committee made up of 17 members appointed by Cabinet. In addition to the president, who is an independent member, the committee includes the following 16 members:

• 7 members representing employees covered by the plan, appointed after consultation with the associations concerned, including:
  • 1 person representing employees in the public-service sector
  • 2 persons representing employees in the education sector
  • 4 persons representing employees in the health and social services sector, including 1 representing directors general, 1 representing senior management and 2 representing middle management
• 1 PPMP beneficiary, appointed after consultation with the associations of beneficiaries most represented in the plan
• 8 members representing the government.

Mandate

The responsibilities of the PPMP pension committee are set out in the Act respecting the Pension Plan of Management Personnel. They include:

1. Reviewing, on request, the decisions made by Retraite Québec concerning plan members and beneficiaries
2. Determining the conditions of implementation of the amendments to the plan agreed on by the associations representing those employees and the government if no such conditions have been determined
3. Establishing, jointly with the Caisse de dépôt et placement du Québec, an investment policy for the members' fund
4. Approving the financial statements of the plan
5. Receiving for examination Retraite Québec's annual action plan
6. Receiving for examination the reports on the actuarial valuation of the plan
7. Establishing a financing policy with respect to the employees' contribution fund under the plan

The committee may also request that Retraite Québec carry out studies on the administration of the PPMP.

To help in carrying out its mandate, the pension committee has delegated some of its responsibilities to subcommittees, in particular with respect to investments and review.

The Secrétariat des comités de retraite et du réexamen also helps the committee carry out its mandate.

Pension committee members