Pensions receive a base inflation adjustment of 2.8%

December 21, 2011

Every year, your monthly pension increases to help you maintain your purchasing power in retirement. For 2012, the base inflation adjustment has been set at 2.8%.

This is the first year that you will be able to see the effect of conditional inflation protection (invoked at 60%) on your pension. How it affects you is dependent on a number of factors, including when you retired and how much post-2009 credit you have.

Did you retire before 2010?

If you retired before 2010, your pension will continue to receive 100% of the annual inflation adjustment.

Example:

A pensioner with a $51,000 pension will receive an additional $1,428 in 2012.

Did you retire in 2010?

If you retired in 2010, you will be affected but the impact will be minimal, because only a small portion of your credit would have been earned after 2009.

Example:

A pensioner with 30 years of credit (and therefore 0.6 years of post-2009 credit, assuming a June 2010 retirement date) and a $51,000 pension will receive an additional $1,416 in 2012.

Did you retire in 2011?

If you retired in 2011, you will be affected but the impact will be minimal, because only a small portion of your credit would have been earned after 2009. In addition, your pension will be pro-rated to the number of months after you stopped working. For example, if you retired in June 2011, you will receive 50% of the inflation adjustment for six out of 12 months for 2011.

Example:

A pensioner with 30 years of credit (and therefore 1.6 years of post-2009 credit, assuming a June 2011 retirement date) and a $51,000 pension will receive an additional $676 in 2012.