The SPP pays you a lifetime pension when you retire. When plan funding allows, a cost-of-living adjustment (also known as post-retirement indexing, or inflation adjustment) will be applied to your pension payments to help your basic pension benefit keep pace with increases to costs of living.
The level of COLA applied to SPP pensions is determined by the Actuarial Valuation
The Plan undergoes an actuarial valuation (a financial checkup) performed by the Plan’s actuary every three years. Part of this valuation includes a Benefits/Funding Test to determine the level of cost-of-living adjustment that the Plan can afford to pay. As the SPP is a Target Benefit Plan, the Plan uses inflation protection as the first lever to keep the Plan sustainable.
The most recent actuarial valuation occurred at December 31, 2022, and determined that the Plan can support a level of cost-of-living adjustment at 70% of inflation for the next three years (2024 to 2026). The level of inflation adjustment will be evaluated again at the next valuation at December 31, 2025. Depending on the Plan’s financial situation at that time, the level of cost-of-living adjustments that the Plan can afford to pay may stay the same, decrease or increase.
Although future cost-of-living adjustments are not guaranteed, every adjustment you receive becomes part of your pension going forward. Therefore, your pension will increase over time with future inflation adjustments.
How is the SPP COLA calculated each year?
The SPP uses the average of the Consumer Price Index (CPI) for the 12-month period ending in October, and compares it to the average for the same period the previous year, to determine the inflation rate. This matches the method and timing of the Canada Pension Plan indexing. To calculate the COLA, the inflation rate is then multiplied by the level of indexing that the Plan can afford, which is currently 70% of inflation.
The COLA applied to your pension payments will be shown on your annual pensioner statement.
Historical UBC SPP COLA
Over the past 10 years, the COLA applied to your SPP pension payments have been as follows (Effective as of January 1):
| Year | SPP COLA |
| 2024 | 3.08% |
| 2023 | 3.25% |
| 2022 | 1.35% |
| 2021 | 0.50% |
| 2020 | 0.95% |
| 2019 | 1.15% |
| 2018 | 0.75% |
| 2017 | 0.70% |
| 2016 | 0.60% |
| 2015 | 0.90% |
Note: If the cost of living decreased over a 12-month period, the calculation of COLA would produce a negative amount. However, in that case, pension payments are not decreased on January 1 of the next year. No adjustment is made to the pension amount – it remains the same as the prior year amount.