Financial position of the Plan
Net assets available for benefits
The Canada Post Corporation Registered Pension Plan posted a 11.3% return in 2021. The Plan ended the year with net assets available for benefits of $32,537 million (including $140 million in the DC component), an increase of $2,780 million from $29,757 million (including $39 million in the DC component) at the end of 2020.
Changes in net assets available for benefits
The $2,780 million increase in net assets available for benefits represented investment income of $3,356 million and contributions of $685 million, offset by pension benefit payments of $1,116 million and expenses of $145 million.
Investment income – comprising interest, dividend, as well as realized and unrealized gains and losses – was $3,356 million for 2021, compared to $2,583 million for 2020.
Plan contributions in 2021 were $685 million compared to $633 million in 2020, an increase of $52 million.
Pension benefit payments for 2021 were $1,116 million compared to $1,072 million in 2020, an increase of $44 million. This was mostly the result of a 4.01% increase in the number of retirees over 2021.
| Contributions to the Plan (in millions) | 2020 | 2021 |
|---|---|---|
| Members | $281 | $297 |
| Canada Post current service | 301 | 326 |
| Canada Post special payments | 24 | 32 |
| Total contributions | $606 | $655 |
| Benefits payments (in millions) | 2020 | 2021 |
|---|---|---|
| Total benefits paid | $1,068 | $1,109 |
Changes in pension obligations
Pension obligations were $25,083 million (including $140 million in the DC component) compared to $24,149 million (including $101 million in the DC component) in 2020, an increase of $934 million. The increase was mainly due to interest accrued on the pension obligations, new benefits accrued and experience losses partially offset by benefits paid.
Surplus (deficit)
The difference between assets available for benefit and pension obligations as at December 31, 2021, resulted in a surplus of $7,454 million, as disclosed in the financial statements based on standards of the Chartered Professional Accountants of Canada (CPA Canada).
The going-concern surplus as of the same date was estimated at $4,826 million. The difference between the accounting surplus of $7,454 million and the estimated going-concern surplus of $4,826 million was an actuarial asset value adjustment (or smoothing) of $2,628 million. The smoothed-asset valuation method recognizes gains or losses on investments over a five-year period to minimize fluctuations due to market volatility. This actuarial adjustment is not permitted as a valuation methodology for accounting purposes under CPA Canada Section 4600 since 2011.