Royal Canadian Mounted Police Pension Plan - Highlights

Message from the Actuary

We reflected the impacts of the COVID-19 pandemic on the economic assumptions used in this report. The pandemic is a very fluid situation that will continue to evolve for some time. The final impacts will be reflected in future reports.

Contributions are expected to exceed Fund benefits payments until 2031.

Main Findings

Financial Position ($ millions)AccountFootnote 1Fund
Recorded Balance/Actuarial Value of Assets13,35913,802
Liabilities14,50312,720
Surplus (Shortfall)(1,144)Footnote 21,082
Funding Ratio92.1%108.5%

Key Assumptions

Discount RateCurrentPrevious
Ultimate real rate on the Account2.0%2.6%
Ultimate real rate on the Fund3.9%4.0%
Cohort Life expectancy at age 65 (in years)Footnote 320212036
Male22.523.4
Female25.025.8
Member Contribution Rates for Calendar Year 2023
Below YMPEAbove YMPERatio of Government to Contributor Current Service Cost
9.35%12.37%1.22

Range of Potential Funding Ratio

Bar graph showing the range of potential funding ratio of the Pension Fund for the best-estimate portfolio over time. 

Graphic Description - Range of Potential Funding Ratio
Range of Potential Funding Ratio
Year2021202220232024202520262027202820292030203120322033203420352036203720382039204020412042
5%-10%0%3%6%7%7%7%7%7%7%8%8%7%7%7%7%8%8%7%7%8%7%7%
10%-25%0%2%6%8%11%12%13%14%14%14%15%14%14%15%15%15%15%15%15%15%15%14%
25%-50%0%1%5%8%11%14%16%17%18%19%20%20%21%22%22%23%24%24%25%25%26%26%
50%-75%0%3%5%9%12%15%17%19%20%23%25%26%27%28%29%29%31%32%34%36%37%37%
75%-90%0%7%9%11%13%15%18%21%23%25%27%28%31%33%35%38%40%42%45%48%50%49%
90%-95%0%5%7%9%9%10%12%14%15%17%19%21%23%24%26%28%30%33%35%36%40%43%
Median109%111%113%115%116%116%116%116%116%115%114%114%114%114%114%115%115%115%115%115%116%114%
 

Bar graph showing the range of potential funding ratio of the Pension Fund for the best-estimate portfolio over time. Y-axis represents the funded ratio. X-axis shows the plan year, starting at 31 March 2021 and ending at 31 March 2042. 

The chart shows that the funding ratio for the Pension Fund was 108.5% as at 31 March 2021. The median expected funding ratio is stable (114.6% as at 31 March 2024, 113.8% as at 31 March 2033 and 113.5% as at 31 March 2042) over the projection period. At the fifth percentile, the funding ratio is 91.5% as at 31 March 2024, 71.6% as at 31 March 2033 and 67.0% as at 31 March 2042. At the 95th percentile, the funding ratio is 142.7% as at 31 March 2024, 194.5% as at 31 March 2033 and 242.0% at 31 March 2042. 

Evolution of Cash Flows over Time

Bar graph showing the evolution of cash flows under the Pension Fund over time. 

Graphic Description - Evolution of Cash Flows over Time
Evolution of Cash Flows over Time
Plan YearContributionsPaymentsSpecial PaymentsNet Cash Flows
2022743358 N/A-385
2023609373 N/A-236
2024631414 N/A-217
2025657455 N/A-202
2026682499 N/A-183
2027706548 N/A-158
2028732599 N/A-133
2029758655 N/A-103
2030785712 N/A-73
2031811777 N/A-34
2032836851 N/A--15
2033860930 N/A--70
20348861,016 N/A-- 130
20359121,107 N/A-- 195
20369371,199 N/A-- 262
20379621,294 N/A-- 332
20389901,390 N/A-- 400
20391,0191,490 N/A-- 471
20401,0501,588 N/A-- 538
20411,0821,688 N/A-- 606
20421,1151,791 N/A-- 676
20431,1511,892 N/A-- 741

Bar graph showing the evolution of cash flows under the Pension Fund over time. Y-axis represents the expected contributions, payments and resulting net cash flows in millions. X-axis represents the plan year, starting in 2022 and ending in 2043. 

In plan year 2022, contributions to the Pension Fund are $743 million, whereas payments are $358 million, resulting in net cash flows of $385 million. Both contributions and payments are increasing over time, however payments are increasing at a higher rate than the contributions. Payments will be higher than contributions starting plan year 2032. 

In 2032, the chart shows payments of $851 million exceeding contributions of $836 million and resulting in net cash flows of negative $15 million. From 2032, the Pension Fund experiences negative net cash flows. In plan year 2043, contributions to the Pension Fund reach $1,151 million, whereas payouts reach $1,892 million resulting in net cash flows of negative $741 million. 

Account and Fund Projection

Line graph showing  

Graphic Description - Account and Fund Projection
Account and Fund Projection
Valuation YearAccount LiabilitiesFund LiabilitiesFund Assets
2021151315
2022141416
2023141517
2024141619
2025131720
2026131821
2027121922
2028122124
2029112225
2030112327
2031102528
2032102630
203392832
203492933
203583035
203683237
203773439
203873541
203963743
204063845
204154047
204254249
204354351

The chart presents the evolution over time of the Superannuation Account liabilities for service prior to 1 April 2000 and the Pension Fund liabilities for service after 31 March 2000 as well as the Fund Assets. It is expected that the Pension Fund liabilities will exceed the Superannuation Account liabilities in 2023. 

Summary of Membership Data

Pie chart showing  

Graphic Description - Summary of Membership Data
Summary of Membership Data
blankNumber%
Contributors22 26949.4%
Retirement & Deferred Pensioners 15 82635.1%
Disability Pensioners3 8418.5%
Surviving Spouses and Children3 1377.0%
Total45 073blank 

The pie chart presents a summary of membership data. 49.4% of the members are contributors, 35.1% are retirees and deferred pensioners, 8.5% are pensioners with disability and 7.0% are surviving spouses and children. 

Footnotes

Footnote 1

The Account tracks the liability for service prior to 1 April 2000.

Return to footnote 1

Footnote 2

Is it expected that a one-time nominal credit of $1,220 millions in 2023 will eliminate the account shortfall including accrued interest.

Return to footnote 2

Footnote 3

For a healthy Regular Member.

Return to footnote 3