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FAQ

  • What is a “defined benefit” versus a “defined contribution” pension plan?

    A defined benefit plan is a type of pension plan in which an employer promises a specified monthly benefit on retirement that is predetermined by a formula based on the employee’s earnings history and years of service under the plan, rather than depending on investment returns. With a defined benefit plan, investment risk is borne by the employer.

    A defined contribution plan is a plan in which the amount of the employer’s annual contribution is specified. Individual accounts are set up for participants and benefits are based on the amounts credited to these accounts (through employer and employee contributions), plus any investment earnings on the money in the account. In defined contribution plans, future benefits fluctuate on the basis of investment earnings.

  • What is the Plan’s current financial status?

    As at December 31, 2020, the Plan’s financial position on a going concern basis was an estimated surplus of $3.31 billion or a going concern funding ratio of 161.4%. On a solvency basis, the Plan had an estimated surplus of $381 million or a solvency funding ratio of 104.6%.

    For more information, refer to the Fund Overview page.

  • What is the difference between “solvency” and “going concern”?

    When an actuarial valuation of the plan is performed, the actuary is required to provide opinions on the financial condition of the plan and on the contributions required to be made to the plan on the basis of two different scenarios: (1) that the plan will be a going concern and will not terminate; and (2) that the plan has terminated at the review date. In support of his or her opinions, the actuary prepares a going concern valuation based on the first assumption and solvency valuation based on the second.

    Solvency valuation assumes that the plan suddenly stops operating as of the valuation date. It is intended to test whether the plan has sufficient assets to pay all benefits that have been earned by members to that date.

    Going concern valuation looks at the plan’s funded status on the basis that the plan will continue to operate indefinitely. The purpose of a going concern valuation is to recommend the orderly funding of a plan to accumulate assets to provide for the plan’s benefits in advance of their actual payment.

    Where a plan’s liabilities exceed its assets, the plan sponsor is obliged to make special payments to the plan sufficient to amortize the deficit over a certain period of time.

  • Are my pension benefits guaranteed?

    Yes. CBC/Radio-Canada guarantees the payment of the pensions under the terms of the Plan.

  • What is the difference between my pension plan and Group RRSP?

    CBC Pension Plan

    The CBC Pension Plan is a contributory defined benefit plan and its primary purpose is to provide defined benefits for its members in accordance with federal legislation, the Trust Deed and other documents. CBC/Radio-Canada and active plan members share the costs of the CBC Pension Plan. Active plan members contribute a fixed percentage of salary until they reach 35 years of pensionable service and CBC/Radio-Canada assumes the other financial responsibilities to ensure that the benefits due to all members are paid.

    Group Retirement Savings Plan (Group RRSP)

    CBC/Radio-Canada has also established the RRSP savings mechanism to help employees reach their financial goals. All CBC employees—both active plan members and non plan members—can contribute to the Group RRSP.

    While investing in the Group RRSP:

    • Employees are responsible for determining how much to contribute, based on their contribution room.
    • Employees decide when and how to contribute (payroll deductions or lump sum payments).
    • Employees choose their investment vehicles based on their investment profile.
    • Employees can withdraw funds anytime (subject to income tax).
    • Employees can carry forward unused contribution room indefinitely.

     

    The decisions made will impact the amount of money accumulated in the Group RRSP. A RRSP allows for retirement savings and also acts as a tax shelter to minimize taxable income during prime income-earning years while the investment grows at a tax-deferred rate. At retirement, members will have a pool of resources from which to draw upon.