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< page 8 of 44 > |
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Funding approach
The plan’s funding approach is aimed at providing pension security for all generations. The goal is to be able to pay promised benefits in full as they come due while keeping contribution rates affordable and stable. This requires ongoing effort and a spirit of cooperation and consensus among the two sponsors, the Ontario government and the OTF, who are responsible for all funding decisions and management of the pension plan.
When assets exceed future benefits by more than 10%, the surplus can be used to lower contribution rates below the regular rate of 8%, improve benefits, or a combination of both. When assets fall below the plan’s fully-funded zone, the plan must be rebalanced by increasing contributions and/or reducing future benefits for working teachers. (Under Ontario law, benefits already earned by working teachers and retirees cannot be reduced.) View results of the preliminary 2008 funding valuation. |
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