Pension Funding

2017 funding valuation

OPTrust engages independent actuaries to perform regular valuations of the Plan to ensure there are sufficient assets to meet the projected cost of members’ and retirees’ lifetime pensions. These valuations provide a snapshot of the Plan’s financial position and ability to meet its pension obligations, while providing a review of gains and losses experienced since the last valuation.

The Plan’s 2017 funding valuation showed it remained fully funded as of December 31, 2017. The funding valuation also confirmed deferred (or “smoothed”) investment gains of $885 million, which will be recognized over the next four years and should further improve the Plan’s funded status in years to come.

Consistent with our approach over the past few years, the Plan's real discount rate for the 2017 funding valuation was reduced to 3.30%, net of inflation, down from 3.40% in 2016 to further improve its long-term sustainability. This economic assumption change was approved by the Board of Trustees and better reflects the expectation of lower long-term investment returns and reduces the risk of future losses due to investment returns falling short of the expected cost of members’ and retirees’ future pensions. The effect of this change increased the total fund liabilities by $363 million, strengthening the Plan’s long-term sustainability.

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Funding Highlights
At December 31 ($ millions)   2017 VALUATION   2016 VALUATION
Net assets available for benefits   $20,290 $19,045
Actuarial smoothing adjustment   (885)   (681)
Present value of future contributions   5,797   5,395
TOTAL ASSETS   25,202   23,759
Present value of future benefits   (24,718)   (23,332)
Provision for future expenses   (350)   (294)
TOTAL LIABILITES   (25,068)   (23,626)
TOTAL SURPLUS   $134 $133
2017 OPTrust Funded Status PDF Reports

Get the big picture

For more information on OPTrust’s strategy and results, see our full 2017 funded status report.