CPP sanguine despite loss of $10 billion

James Daw Toronto Star 11/13/2008 09:31
CPP sanguine despite loss of $10 billion


The Canada Pension Plan lost $10.3 billion during the early weeks of the worst global stock market crash in generations. John Denison, president of the CPP Investment Board, acknowledges more of Canadians' retirement savings have evaporated since the end of September.



But Denison would not confirm a reporter's estimate that another $12 billion or more has disappeared after North American stock markets plunged another 5 per cent yesterday, leaving the Toronto market down 24 per cent since the end of the CPP's latest reporting period.

Yet, Denison urged 17 million pensioners and contributors to remain calm: "There is no need for concern," he told reporters during a conference call.

CPP's reserve fund shrank from $127.7 billion to $117.4 billion during the July to September quarter. But, as Denison pointed out, none of that money was needed to pay disability and retirement pensions right away, and there is plenty of time to rebuild the fund.

The CPP is expected to take in more contributions from employees and employers than it pays in pension benefits until about 2020. The excess would provide investment managers another $28 billion to deploy at what may now be bargain prices.


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