Évaluation actuarielle du Régime de rentes du Québec au 31 décembre 2024
(Actuarial Valuation of the Québec Pension Plan as at 31 December 2024: French only)
The
Évaluation actuarielle du Régime de rentes du Québec au 31 décembre 2024 (Actuarial Valuation of the Québec Pension Plan as at 31 December 2024; French only) serves to inform the government, contributors and beneficiaries of the financial situation of the Québec Pension Plan (QPP). It provides an overview of the
QPP's health.
Distinct projections are carried out for the base plan and the additional plan using assumptions and demographic and economic data, as well as data regarding benefits.
The document provides a projection of the
QPP's cash inflows and outflows for the next 50 years, that is, from 2025 to 2074. It also includes a projection of the base and additional plans' reserves and the calculation of the
QPP's funding indicators.
Highlights
The Québec Pension Plan is financially sound.
No increase of the contribution rate is necessary to maintain the
QPP's good financial health.
The funding indicators calculated in the actuarial valuation, that is, the steady-state contribution rate for the base plan and the reference contribution rate for the additional plan, are lower than the
contribution rates provided for by law.
Under the
base plan and the additional plan, cash inflows are sufficient to fund cash outflows for each of the 50 years in the projection period.
Base plan
Additional plan
A financial situation that improved between 2022 and 2024
- The funding indicators of both plans decreased since the last actuarial valuation, which shows an improvement of the financial situation.
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The financial results were better than expected between 2022 and 2024:
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contributions were higher than the projections (higher salaries and more contributors);
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investment incomes were higher than expected.
- Reserves have therefore surpassed the projections. As at 31 December 2024, they reached:
- $126 billion for the base plan, that is, the equivalent of 6 years of cash outflows;
- $16B for the additional plan (gradual implementation since 2019).
- The reserves and investment income they generate reduce financing costs. The increased contribution of financial capital is particularly welcome in the context of an aging population. However, a larger reserve exposes the
QPP to a greater rate of return risk.
Uncertainty factors and risks to monitor
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Population growth: uncertainty surrounding fertility, immigration, and participation in the labour market increases the variability of long-term projections. After an unprecedented population growth, the population is now expected to stabilize.
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Changes in the labour market: they directly impact the contributory payroll, which is a major source of funding for the
QPP (e.g., automation, mitigation of labour shortages).
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Climate change: by modifying demographic and economic environments, climate change can have a significant impact on the results of the actuarial valuation.
Good to know
For the first time, the actuarial report includes an analysis of the potential effects of climate change risks on
QPP funding. This analysis highlights the uncertainty surrounding different climate trajectories.
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Economic and geopolitical instability: the global environment is experiencing rapid and profound changes that can have an impact on returns on reserves, salary growth, and employment rates, among other things.
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