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Increase comes primarily from a 7.1 percent return on investment income during first quarter of fiscal 2010
Toronto (24 August 2009) - The Canada Pension Plan (CPP) Fund ended the first quarter of fiscal 2010 on June 30, 2009 at $116.6 billion compared to $105.5 billion at fiscal year-end on March 31, 2009. The $11.1 billion increase in assets this quarter consisted primarily of $7.6 billion in investment income, reflecting a 7.1 percent rate of return, and $3.5 billion in CPP contributions not needed to pay current pension benefits.
“We are pleased with the $11.1 billion increase in the Fund and the positive 7.1 percent return for the first quarter,” said David Denison, President and CEO, CPP Investment Board. “At the same time, the negative returns of our past fiscal year and the positive results of this first quarter both need to be viewed within the context of our long-term strategy. We continue to focus on delivering solid returns over the span of multiple years and indeed decades.”
“With no need to use current income to pay benefits for another 11 years and with approximately $28 billion of additional cash inflows anticipated between now and 2019, we will maintain the strategic asset weightings for the portfolio,” said Mr. Denison. “We will also continue to emphasize our strengths as a large, long-term investor to capitalize on investment opportunities we see in current market conditions.”
“Since the primary objective of the CPP Investment Board is to generate long-term investment returns to help sustain the CPP for decades and generations, we measure returns over several longer time frames in addition to the quarter and year-to-date results we release every three months,” said Mr. Denison.
In just over 10 years since the CPPIB began investing in April 1999, the CPPIB has generated $31.8 billion in investment income for the Fund reflecting an annualized rate of return of 4.9 per cent. Another relevant measure is the four-year annualized investment rate of return through June 30, 2009 which was 2.3 per cent representing $6.9 billion in investment income.
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