Pension Life - Winter 2024

COLA for 2024 is 3.8 per cent

As a retired member, you received a 3.8 per cent cost-of-living adjustment (COLA) to your pension. The COLA provides you with some inflation protection. While not guaranteed, once a COLA is provided, it becomes part of your lifetime pension. The COLA also applies to your bridge benefit and temporary annuity as long as you receive them.

The board cautiously removed the COLA cap for
2023–2025. We continue to closely monitor inflation and investment returns and make annual decisions on COLAs that consider the health of the plan and plan rule requirements.

Each year, the board decides whether to provide a COLA based on these guidelines:

• The amount can’t be higher than the increase in the Canadian consumer price index (CPI)
• The cost can’t exceed the funds in the inflation adjustment account (IAA)

The COLA cap will be revisited at the next valuation.

Where does money for COLAs come from?

Money in the IAA funds COLAs. This account is made up of contributions and investment returns. When you were working, most of the contributions from you and your employer went into the basic account, which funds your lifetime pension. Some went into the IAA and is now going toward providing COLAs.

What is the CPI?

The CPI is a measure of the changes in price of certain goods and services as tracked by Statistics Canada. This figure is released monthly and shows the average increase over the past 12 months. For the 12 months ending September 2023, this average increase was 3.8 per cent.