1. The changes in the cost of living in a given year, as measured by CPI
We use the Consumer Price Index (CPI) because it's prescribed by the terms of the plan and it's the most widely used indicator of price changes in Canada. The CPI represents a weighted basket of goods and services typically purchased by Canadian households each month.
2. The plan's funding status
We use inflation protection as a lever to keep the plan sustainable. When the plan has a funding shortfall, smaller cost-of-living adjustments help to bring the plan back into balance. When there's a funding surplus, inflation levels may be partially or fully restored.
3. When you earned your pension credit
There are three levels of inflation protection and they're based on when you earned pension credit: before 2010, during 2010 to 2013, and after 2013.
When you earned your pension credit
Inflation protection level
What it means after you retire
This portion of your pension will keep pace with annual increases in the CPI.
50% to 100%
This portion of your pension will receive at least 50% and up to 100% of the annual increase in the CPI, depending on the plan's funded status.
0% to 100%
This portion of your pension will receive from zero to 100% of the annual increase in the CPI, depending on the plan's funded status.
Your 2022 inflation adjustment
The annual cost-of-living adjustment for 2022 is 2.4%. The adjustment takes effect in January 2022.
The adjustment is based on 100% of the adjustment in the CPI, a weighted basket of goods and services typically purchased by Canadian households each month.