Combination Plan: Contribution Rate Reduction
We are pleased to share that University of Victoria Combination Pension Plan members will see a decrease to the required contribution rates for the Combination Pension Plan (the “Plan”) effective January 1, 2024.
An actuarial valuation of the Plan was completed in 2023 for the year ending December 31, 2022. Actuarial valuations are undertaken periodically to measure the financial status of the Plan and ensure that it remains financially sustainable. The valuation showed that the Plan remains in a healthy financial position. As a result, a contribution reduction to the defined benefit element of the Plan has been recommended by the Actuary and approved by the Pension Board of Trustees.
This change directly affects the contribution rate for the Defined Retirement Benefit Account (DRBA), which is funded by university contributions to secure the defined benefit promise in the Plan. However, the Plan Document specifies that one-third of the reduction be to the benefit of members. This provision results in adjustments to the Combined Contribution Account (CCA) contribution rates which are detailed in the table on below. Note that while the amount you contribute is decreasing, the total amount being contributed to your CCA (when University contributions are included) is not changing.
Effective January 1st, the Combination Pension Plan contributions will change as follows:
|
Contribution rates |
Current |
Effective |
Difference |
|
|
|
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|
Combined Contribution Account (CCA) |
|
|||
|
Up to YMPE* |
Employee |
4.00% |
3.83% |
- 0.17% |
|
University |
6.37% |
6.54% |
+ 0.17% |
|
|
Total up to YMPE2 |
10.37 |
|||
|
Above YMPE |
Employee |
6.00% |
5.83% |
- 0.17% |
|
University |
8.00% |
8.17% |
+ 0.17% |
|
|
Total above YMPE2 |
14.00 |
|||
|
|
||||
|
Defined Retirement Benefit Account (DRBA) |
|
|
||
|
University |
4.00% |
3.50% |
- 0.5% |
|
*Year’s Maximum Pensionable Earnings (YMPE): $68,500 in 2024.
The changes should appear on the first pay of January.
For example, a member earning $90,000 per year would be required to contribute approximately $150 less per year. Total contributions going into their account would remain the same.
If you would like to learn more about your pension, please review the Understanding Your Pension Plan guide for further information.
If you wish to take this opportunity to consider additional contributions to your pension, please review the voluntary contribution application form or contact our office at pensions@uvic.ca or 250-721-7030.