Five key features of the SPP

We often hear from members that they are not sure where to start when it comes to learning more about their pension benefits. Pension plans can be complex and challenging to understand. Our website, newsletters, brochures, and workshops are excellent resources to help you learn more about your pension benefits and how the pension plan works. There are a few key features of the SPP in particular that you should know about and we have highlighted five of them below:

1. 1. The SPP is a Target Benefit Plan.
      

      A key feature of the UBC SPP’s design is the pension promise and its funding policy. As both employee and employer contributions to the SPP are fixed, the SPP’s funding policy states that the basic pension benefit and inflation adjustments (indexing) are subject to the Plan’s ability to pay.

   2. Your contributions and the University contributions fund the overall plan.

      The contributions that you and the University (and related employers) make are fixed and go to fund the overall plan. The contributions are invested in the financial markets to earn a rate of return sufficient to help support the longer term financial needs of the SPP. These funds are used to pay termination and retirement benefits. Your pension amount at retirement is not determined by contributions.

   3. Your pension is calculated based on a formula that uses your salary and the number of years that you have contributed to the SPP.

      Your pension is calculated using the following formula:

      1.8% of your best average pensionable earnings x your years of pensionable service

      Your best average pensionable earnings are an average of your salary over any three, non-overlapping periods of twelve consecutive months of pensionable service which produce the highest figure. Your years of pensionable service include all periods in which you made contributions to the SPP.

      Note: The formula above applies to pensionable service earned on and after July 1, 2009. A different formula is used to calculate your pension for pensionable service earned prior to July 1, 2009.

   4. Pensions are paid for your lifetime and your spouse’s lifetime.

      Monthly lifetime pensions are paid for your lifetime and if you have spouse, their lifetime as well.

   5. Pensions may be increased each year.

      After you begin receiving your pension, a Cost of Living Adjustment may be applied to your pension payments subject to the Plan’s ability to finance it.