What information is reflected in the table “For the period January 1, 2018 to December 31, 2018”?

  • The table outlines the number of months of service you worked and received credit for in the Plan during the year; the pensionable salary you earned during the year; and the amount of pension contributions you made to the plan during the year. These contributions do not include any contributions made to the Plan by your employer but may include purchases or transfers of service completed in 2018.

How is the rate of interest on contributions determined?

  • The rate of interest credited on member contributions is based on the average five-year personal fixed term, chartered bank deposit rates over the 12 months ending in October, as published by Statistics Canada.

Why are there three different accrual rates listed on my statement?

  • If you were a member of the PSPP prior to April 1, 1996, your accrual rates may have been impacted. Below are the accrual rates applicable for each period:

    • Service in the PSPP prior to April 1, 1993: accrual rate 2.0% per year
    • April 1, 1993 to March 31, 1994: accrual rate 1.1%
    • April 1, 1994 to March 31, 1995: accrual rate 1.8%
    • April 1, 1995 to March 31, 1996: accrual rate 1.8%
    • All years beyond March 31, 1996: accrual rate 2.0%

Why is my service broken down into indexed service and non-indexed service?

  • Indexing is an annual pension increase equal to 60% of the national Consumer Price Index (CPI), to a maximum annual increase of 1.2%.

    One of the changes agreed to during pension reform was the suspension of the indexing provision in the Plan. The suspension meant that all service accrued in the Plan up to December 31, 2014, would be indexed and used to calculate the indexed portion of your pension when the indexing benefit is payable at age 65. All accrued service after 2014 will not be included in the calculation of your indexed pension.

What is the transition period?

  • When pension reform happened in 2014, a five-year transition period began where some plan members could still retire under the pre-reform rules.

    PSPP members who meet the following criteria by December 31, 2019, are eligible to retire under the pre-reform pension eligibility rules and will be grand-parented.

    • A plan member was eligible to retire under pre-reform pension eligibility criteria prior to January 1, 2015, but decided to continue working.
    • A plan member will become eligible to retire under pre-reform pension eligibility criteria by December 31, 2019.
    • A plan member will accrue a minimum of 30 years of pensionable service by December 31, 2019, allowing them to be eligible to retire anytime after reaching age 55.
    • A plan member will accrue a minimum of five years of pensionable service and reach age 60 by December 31, 2019.

    After the transition period ends, post-reform pension eligibility criteria will apply to all PSPP members, except for those who are grand-parented.

What is pension reform?

  • Pension reform is what originally created Provident10 back in 2014, and even though it began years ago, this transition could still impact some members today. The purpose of reform was to have a sustainable defined-benefit pension plan; allow for a reasonable retirement income for public service employees; and to reduce the financial impact on the taxpayers of the province by putting the plan on track to be fully funded within 30 years.

    For more information about pension reform, please visit: https://www.fin.gov.nl.ca/fin/pensions/plans_pspp.html

How could this affect me?

  • The transitional period ends on December 31, 2019. This is a significant change in the Plan and may have major impact on those who are eligible to take advantage. But, the change won’t apply to everyone.

    We want to make sure that you have access to the information you need to make the right decisions for you, your pension, and your retirement. We encourage plan members who want to learn more to get in touch with our team by phone (709.701.3355) or email ([email protected]).

How do I find out if I’m affected?

  • We want to make sure you have access to the information you need to make the right decisions for you, your pension, and your retirement. We encourage plan members who want to learn more to get in touch with our team by phone (709.701.3355) or email ([email protected]).

    If you fall into any of these categories, or if you are unsure, please contact us.

    • If you have less than 30 years of credited service in the PSPP, but you have service in another pension plan that has not been credited in the PSPP.
    • If you will be 60 years old by December 31, 2019, with less than five years of credited service in the PSPP, but you have service in another pension plan that has not been credited in the PSPP.
    • If you have service that was refunded from the PSPP or service in the GMPP that hasn’t been credited in the PSPP.
    • If you are currently or formerly on leave and may need service credited in the plan to qualify for transition period rules.

Will the date my deferred pension is due to become payable change because of pension reform?

  • It’s possible that pension reform will impact the date your deferred pension is due to become payable. We encourage plan members to get in touch with our team by phone (709.701.3355) or email ([email protected]) to discuss their personal circumstance.

Will pension reform impact my medical coverage in retirement?

  • Provident10 does not administer group insurance programs. We recommend that you contact your Human Resources Department or your Group Insurance administrator/provider to determine if your eligibility for medical coverage has changed.

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