Employer pension plans (trusteed pension funds)

The value of retirement savings held in trusteed pension funds approached $800 billion in the final months of 2005.

Funds have increased in value for six straight quarters since the low of $652.2 billion observed in the second quarter of 2004. They accumulated $799.1 billion in the fourth quarter of 2005, a 2.9% rise over the previous three months. Since 1995, fund assets have more than doubled in value, while in the last five years, they have grown more than 30%.

Fourth quarter 2005 fund revenues and expenditures amounted to $28.8 billion and $9.6 billion respectively, for a net cash flow of $19.2 billion, up 9.3% from the previous quarter.

Year over year, 2005 revenues declined for the first time since 2001. Revenues of $94.2 billion were down 4.6%, following record high revenues of $98.8 billion in 2004. Expenditures for 2005 declined 31.1 % due to higher than normal expenditures in 2004 that resulted from an employer cash withdrawal and transfer from an existing plan to a much smaller plan. With reduced expenditures, the cash flow for 2005 amounted to $57.5 billion, a 26.6% increase over 2004.

Because of year-end industry accounting practices, contributions typically peak in the fourth quarter of each year. These were $8.9 billion in 2005, down slightly from a high of $9.0 billion in the fourth quarter of 2004. Employer contributions of $6.2 billion in the fourth quarter of 2005 were also slightly down from the $6.7 billion made by employers in the fourth quarter of 2004. For the year, however, total contributions including those of both employers and employees amounted to $30.3 billion, up 1.7% from the $29.8 billion contributed in 2004.

Employer contributions have increased significantly in the last five years, doubling from $10.4 billion in 2001 to $20.7 billion in 2005. For the third straight year, annual contributions have exceeded benefits paid out.

The return on investment for 2005 was 9.0%, the same as it was in 2004 and double the returns of 4% to 5% achieved in 2001 and 2002.

In 2005, of the 5.7 million Canadian workers belonging to employer pension plans, about 4.6 million were members of trusteed plans. The remaining one million workers with employer pension plans were covered by the consolidated revenue funds of the federal and provincial governments, or by insurance company contracts or Government of Canada annuities.

Available on CANSIM: tables 280-0002 to 280-0004.

Definitions, data sources and methods: survey number 2607.

For more information about the current survey results and related products and services, or to inquire about the concepts, methods, or data quality of this release, contact Client Services (613 951-7355 or 1 888 297-7355; fax: 613 951-3012; income@statcan.gc.ca), Income Statistics Division.