December 31, 2012 Valuation Results
Under Ontario pension legislation, Laurier was required to perform a triennial actuarial valuation of pension plan assets and liabilities at December 31, 2012. The results of the valuation are now complete, and have been filed with the Financial Services Commission of Ontario.
Pension valuations must be performed using two calculations - a “going concern” calculation, which assumes the plan will continue into the future, and a “solvency” calculation, which assumes the plan will wind-up at the valuation date. The valuation results show a going concern deficit of $86.2 million (assets covering only 79.9% of the liabilities) and a solvency deficit of $77.5 million (assets cover only 81.8% of the liabilities). To fund this deficit and to reflect the true cost of the plan going forward, the University will be required to increase its contributions and make additional special payments to the Plan. University required contributions to the Plan commencing in 2014 will increase to $26 million annually, which equates to just over 18% of plan member payroll or about 10% of the University’s total operating budget. These contributions include the relief measures provided to Laurier through the Ontario government’s temporary solvency relief program.