The University of Winnipeg Pension Plan is a solvency exempt pension plan, registered in the province of Manitoba. The University reports pension expense in accordance with Public Sector Accounting Standard 3250. The Plan is closed to new entrants since 2000. As at the valuation date, December 31, 2016, total assets of the Plan were $131,687,000, and liabilities totaled $150,490,000, with approximately 32.5% of liabilities attributable to active members and the remainder to deferred vested members, retirees and beneficiaries.
An asset liability modelling (ALM) study for the Plan was last completed in 2013, and a de-risking glide path was implemented. The Board now wishes to conduct an ALM study to review the current de-risking glide path, and to assess the merits of an alternative investment strategy which incorporates immunization of cash flows in the short term, and allocations to equities in the mid and longer term. Specifically, under the alternative investment strategy:
- the Plan would seek to own a ladder of 1- to 5-year high quality (investment grade A or better) Canadian bonds with each year of the ladder matching projected net cash outflows of the Plan for that year.
- The liabilities for cash flows beyond 5 years would be allocated to growth assets including common equity and real estate.
- Annual excess equity returns (over the valuation discount rate) would be used to roll the immunization component forward; where equity returns are less than the valuation discount rate, the immunization component would remain unchanged.
