Pension Life - Winter 2024
Your 2024 COLA is 3.8 per cent
Message from the trustees
For the third consecutive year, inflation remains high and increases in the cost of living are at top of mind for retired members. We think you’ll be happy to learn that the Teachers’ Pension Plan was able to provide you a full cost-of-living adjustment (COLA) effective January 1, 2024.
The COLA of 3.8 per cent matches the annual change in the Canadian consumer price index (CPI) in the 12 months up to and including September 30, 2023. You can read more about the CPI below.
If you retired partway through 2023, your 2024 COLA will be pro-rated based on the number of months in 2023 you received a pension.
The plan’s rules allow us to grant an annual COLA up to the annual percentage increase in the CPI.
It is a priority for us to provide sustainable COLAs so your pension maintains its purchasing power. While not guaranteed, once granted, COLAs become part of your basic pension and, if applicable, your bridge benefit and temporary annuity for as long as you receive them.
The graph below shows how COLAs help your pension keep up with inflation over time.
Basic pension plus COLA granted
You may notice that retired members from some BC public sector pension plans receive different COLAs than you do each year. This is because some plans calculate COLAs in a slightly different way. Averaged over time, however, you receive the same COLA as members of other plans. To learn more, read the Adjusting for inflation learning article under related content.
The IAA is healthy and well funded
The plan takes the money for COLAs from the inflation adjustment account (IAA). Member and employer contributions and investment returns fund both the IAA and the basic account that pays your basic pension.
The plan’s most recent actuarial valuation (an assessment of the long-term health of the pension plan), showed the IAA is healthy and has sufficient funds to pay COLAs for the foreseeable future.
The next valuation will be measured as at December 31, 2023. We expect to publish the results of the valuation late in 2024.
What is the consumer price index?
Statistics Canada calculates the CPI every month. The CPI measures the monthly and annual changes in the cost of almost 700 goods and services, weighted according to how much Canadians spend on each good or service. Statistics Canada determined the price of the 700 goods and services increased 3.8 per cent between September 2022 and September 2023.
