Considerable research has shown how large pension plans like CAAT can provide twice as much income in retirement compared to large group RRSP and defined contribution plans, for the same cost. The 2018 study The Value of a Good Pension, published by the Healthcare of Ontario Pension Plan, showed that Canada-model pension plans such as CAAT provide, on average, $5.32 in retirement income for each $1 in contributions, compared to large group RRSP and defined contribution plans, providing (on average) $2.58 for each $1 contributed.
PENSION SOLUTIONS
Why join DBplus?
Value
On average, contributions to DBplus go twice as far in retirement compared to group RRSP or Defined Contribution (DC) plans. DBplus also provides features such as inflation protection, survivor benefits, and early retirement options.
Secure lifetime income in retirement, and other defined benefit pension features, are highly valued by employees – serving as a strong attraction and retention tool.
Defined benefit pensions with early retirement features can support workforce changes and minimize delayed retirements by employees unable to retire with confidence during an investment market down cycle.
Simplicity
DBplus provides an easy and simple approach for both employers and employees.
Employers benefit from simplicity and cost predictability, similar to a DC plan, but with the unparalleled benefits of a DB plan for their employees. Investments, administration, governance and member communications are all managed by the team of dedicated pension experts at CAAT, saving employers time and reducing costs compared to operating their own pension plan.
Employees are spared from making investment decisions and, like employers, can focus on the business.
Flexibility
DBplus brings the contribution flexibility that employers and employees want, with the value, stability and efficiency of a secure Modern DB plan.
Contribution Choice allows employers to offer a selection of employee contribution rates, each with an associated employer match. Employees choose which of those rates meets their needs and financial goals. Learn more about Contribution Choice.
Rate phase-in options allow employers to gradually introduce employees to adjust to a required minimum. Employers can choose to offer better than matching contribution rates.
Employers have the flexibility to provide different rates by employee group, prior membership, bargaining group and, in certain cases, to give specific groups the option to opt-out.
Employers have the option to match employee contributions or contribute more than their employees.
Security
Together, employers and employees benefit from the sustainability and efficiency of a multi-employer jointly sponsored pension plan, and employees can enjoy the security of retirement income that is paid monthly for life.
Research shows that Canadians want, and are willing to, contribute in order to achieve a secure, predictable, lifetime retirement income. Likewise, employees, unions and employers are increasingly looking for better and more secure pension options that have the best features of defined benefit pensions without the costs and risks of traditional, single-employer plans.
Unfortunately, many employers have stopped offering DB plans, inherently passing on retirement investment risks and fees to their employees (and by extension, governments and taxpayers). This sub-optimal outcome leads to substantially lower retirement income per contribution dollar, which can impact employee stress and health, and the demand for social programs in retirement.
The CAAT Pension Plan stands 124% funded on a going-concern basis, with $5.3 billion in funding reserves, based on its latest actuarial valuation as of January 1, 2024.
Certainty
Employer costs are limited to their contributions, at the rate they select when they join the plan. There is no balance sheet risk or contribution volatility. Employees have the assurance of knowing their pension will be there for them in retirement, with a plan that isn’t reliant on the financial health of any one employer. Learn more about your singular cost as an employer here.
When organizations join DBplus, they remove the costs and risks associated with managing and governing their own pension plan. For employees, their promised benefits are protected, as they are not dependent on the financial health of their employer. Furthermore, for organizations in Ontario, the requirement to pay Pension Benefit Guaranteed Fund premiums does not apply.
Members with secure defined benefit pensions don’t spend time worrying about how much pension they’ll have or about bearing the risk of their investment decisions.
Why employers choose DBplus
Our employees are delighted to have a superior pension plan – especially the part-timers who now also qualify for a pension under DBplus. I am so glad I invested the time to meet with Derek and his team. The R.O.I. on working with CAAT has been spectacular.
John Corley, President & Chief Executive Officer, Brink's Canada Limited
I’m interested in bringing DBplus to my workplace.
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