It’s your pension: take time to read about it
Introduction
Congratulations! As a member of the Ontario Public Service Employees Union (OPSEU) Pension Plan, you are part of one of Canada’s leading pension plans.
The purpose of the OPSEU Pension Plan is to provide retirement income (a pension) for you and your eligible survivors.
The OPSEU Pension Plan is a defined benefit pension plan. A defined benefit pension aims to provide a monthly pension for life, based on a formula that uses salary and pension service to calculate the amount of the pension benefit.
In cases where there is detailed information on a topic, we refer you to one of our other pension booklets or fact sheets.
The defined benefit advantage
The advantage of a defined benefit plan is that the risk of outliving one’s retirement savings or losing one’s retirement savings in an economic downturn is spread among all plan members. You may live a long time but others may not. It all evens out when the risks are shared.
This is the key difference between a defined benefit plan and a plan such as an RRSP or defined contribution (DC) plan. If you only have an RRSP or DC plan, all the risk is on you as an individual to save enough and to ensure your investments are protected against a market downturn. If you haven’t saved enough, you might have to work longer than expected. The goal of a defined benefit plan is to protect against these risks.
About OPTrust
The OPSEU Pension Plan Trust Fund (OPTrust) is a legal trust formed by a contractual agreement between the two plan sponsors, the Ontario Public Service Employees Union (OPSEU) and the Government of Ontario. OPTrust is governed by a Board of Trustees.
OPTrust began operations in 1995, and is a separate organization at arms-length from both sponsors. As of December 31, 2023, the OPSEU Pension Plan had over 111,000 members.
OPTrust is subject to the rules and regulations governing pension plans in Ontario and Canada, including the Pension Benefits Act (Ontario) and the Income Tax Act (Canada).
Joint governance
The OPSEU Pension Plan is the result of years of discussion between the Government of Ontario and OPSEU to create a pension plan in which members have a say. As the plan sponsors, the Government and OPSEU each appoint five trustees to the Board of Trustees. The Board is the legal plan administrator under the Pension Benefits Act and is responsible for the administration of the Plan and the administration and investment of the plan’s assets.
The Plan is legally a “jointly sponsored pension plan” (JSPP) under the Pension Benefits Act and is subject to the rules that apply to JSPPs. Under a JSPP, the members and employers share in the governance of the Plan.
A JSPP is designed to give the administrator the flexibility it needs to make the plan sustainable for the long term.
Changes to the Plan
This booklet summarizes the current plan provisions as of April 1, 2023. The plan terms can be changed if the plan sponsors agree to the change and the change complies with the plan terms and applicable legislation. OPTrust will provide notice of any plan amendments in accordance with the notice requirements in the Pension Benefits Act.