Changes in net assets
Investment income and contributions are the main sources used to fund payments to pensioners, payments to or on behalf of terminating members, and operating expenses. Changes in net assets result when investment income and contributions are greater or less than payments made during the period.
The Plan’s net investment income was $1,530 million in 2010, compared with an income of $1,348 million the previous year. [More on OPTrust’s investment strategy and performance].
Investment expenses amounted to $123 million in 2010, up from $113 million the previous year. The change is mainly due to an increase in the Plan’s assets during the year.
Pension contributions from members and employers totalled $426 million in 2010, compared with $357 million in 2009. The change is mainly due to an increase in the contribution rates paid by active members and their employers. Transfers from other pension plans totalled $12 million in 2010, compared with $33 million in 2009. The decrease is mainly due to a movement of fewer employees into the OPSEU bargaining unit in the Ontario Public Service during the year.
As a result, net contributions to the Plan were $438 million in 2010, compared with $390 million the previous year.
Regular contributions increased in 2010 reflecting the 1% increase in contribution rates and the increase in members’ average salaries. Between 2000 and 2004, OPSEU used a portion of past funding gains to pay for a temporary reduction in members’ contribution rates.