The Newfoundland and Labrador government will take on all existing retiree liabilities for the province’s teacher pension plan as well as 50% of its active member liabilities as part of an agreement reached between provincial authorities and the Newfoundland and Labrador Teachers’ Association.
The Newfoundland and Labrador Teachers’ Pension Plan, St. John’s, also will receive C$1.8 billion ($1.5 billion) contribution from the provincial government, spread over 30 years, to fund the C$3.14 billion pension plan. The annual contribution of C$135 million will be made even if the plan becomes fully funded before the end of the 30-year term, according to the agreement posted on the provincial government’s website.
A similar agreement was reached between the provincial government and the C$5.61 billion Newfoundland and Labrador Public Service Pension Plan, St. John’s, in September 2014. The plans are managed under the Newfoundland and Labrador Pooled Pension Fund, which was a combined 60% funded as of Dec. 31, 2013, the latest data available.
Under the teachers’ plan agreement, the government and participants each will contribute 11.35% of salary to the plan, up from the current 9.35% contribution. Also, the plan will become jointly sponsored by the provincial government and the NLTA. The provincial government had been the plan’s sole sponsor.
The agreement requires approval of the provincial assembly; legislation to approve the accord was introduced late last week.