Pension roundup: News about CAAT, CalPERS, Cerrado Group, Milliman

Pension offerings are being pushed aside in favor of defined contribution plans, but that doesn’t mean pensions aren’t crucial to millions of workers’ retirement. Pension professionals keep an eye on workers’ actuarial statistics, and the age they are able to retire is important. Retirement age varies in countries around the world, as you can see in the slideshow BenefitsPRO recently ran. Here’s what else is happening with pensions:

The Pension Benefit Guaranty Corporation reports in its Fiscal Year 2021 Annual Report that the Multiemployer Insurance Program has a positive net position of $481 million at the end of FY 2021. At the end of FY 2020, it was in a deficit of $63.7 billion. That program — which was expected to run out of money in FY 2026 — is now likely to remain solvent for more than 30 years, due to the American Rescue Plan Act of 2021, PBGC says. PBGC’s Single-Employer Program remains financially healthy with a positive net position of $30.9 billion at the end of FY 2021.

The Ohio Public Employees Retirement System is suing Facebook, reports Cleveland.com. The retirement system alleges the company misrepresented the risks its operations posed to shareholders, pointing to the recent news about Facebook knowing about the negative effects of Instagram on teens.

New York City’s Metropolitan Transportation Authority (MTA) incorrectly took too much in pension deductions from many transit workers’ paychecks, The City reports. The payroll error is reported to have continued for six years before being discovered this year. Refunds will be issued to those workers, along with interest.

The National Pension Service of Korea (NPS) and Tishman Speyer, a global real estate owner, developer, manager and investor, announced the creation of NPS-Tishman Speyer Thematic Platform, a $1.5 billion separately managed account focused on investments in real estate innovation and high-demand asset classes across major U.S. markets.

Milliman announced the latest results of its Milliman Pension Buyout Index. As the pension risk transfer market continues to grow, Milliman says it is important to monitor the annuity market for plan sponsors that are considering transferring retiree pension obligations to an insurer. During October, the average estimated cost to transfer retiree pension risk to an insurer decreased. Meanwhile annuity purchase costs decreased substantially due to insurer competition, Milliman says.

The Cerrado Group announced AimPoint Pension is joining its group, the third new member firm since the group’s launch in March. AimPoint brings a presence in the Southeast and MidAtlantic states to the group. The Cerrado Group was founded by nine third party administrator (TPA) consulting firms and is a member-only, 501(c)(6) Trade Association.

CalPERS has made a change to its investment policy that will require many California public employees to contribute more to their pensions, The Sacramento Bee reports. The CalPERS board voted to lower its annual investment return target, which means the pension fund will have to charge some local governments and employees to make up for the expected decline in returns, the newspaper says.

The CAAT Pension Plan, an independent, jointly governed pension plan in Canada, announced DBplus with Contribution Choice. It launches January 1, 2022 for Canadian employers. Contribution Choice offers additional contribution flexibility common to defined contribution plans, but with the advantages of a defined benefit plan, CAAT says. Originally created to support the Ontario college system, the CAAT Plan now serves more than 200 participating employers. At January 1, 2021, the Plan was 119% funded on a going-concern basis.

Our colleagues at the CAiP Forum ran an article about a trend pension professionals in Canada are monitoring. (CAiP is an ALM property, as is BenefitsPRO.) Take a look.