CPP Investments has abandoned us. Here is why.

We Canadians should be both delighted and disappointed with CPP Investments.  We should be delighted because CPP Investments has invested so successfully that the fund now has a $257 billion surplus which is arguably 464% more than is needed to fund all pensions for the next 75 years.

However, we should be disappointed with CPP Investments because they have repeatedly understated their incredible success. Consider the notification below that was in the Globe and Mail on Dec. 11, 2021.

Instead of ethically reporting the truth about the CPP fund, the ad states

“The sustainability of the CPP Fund remains secure.”

That might be the understatement of the century.

If CPP Investments exactly met the Chief Actuary’s target of $293 billion on Dec. 31, 2021, the fund should be described as “sustainable”. However, CPP Investments exceeded that target by $257 billion. An appropriate message that tells the true status of the fund would be:

“At CPP Investments, we are proud of our investment success. Since 2010 we have grown your CPP fund from $127 billion on Dec. 31, 2009, to $550 billion on Dec. 31, 2021. This is $257 billion more than the Chief Actuary specified he needs for “sustainability”, the ability to fund all pensions for the next 75 years.

Based on standard pension protocol but remaining cautious, we feel the fund could, at virtually zero risk, release $170 billion of that fund to 17 million deserving Canadians today. This would give 14 million working Canadians an average of $9,000 each and three million pensioners an average of $15,000 each.

And we think that the first $1,000 that every working Canadian contributes each year, combined with their employer’s matching $1,000, should be directly invested with CPP Investments. Based on our track record, it is likely a 25-year-old will have $1.4 million by age 65. While there are no guarantees, we are proud to supply a likely solution to much of the income inequality problem in Canada.”

We stakeholders of $550 billion are not even represented. Moreover, we are paying complicit executives who feed us misinformation huge amounts of money.

It appears the complicit CPP Investments Board of Trustees has an agreement with our disgraceful Chief Actuary to downplay the surplus with deceptive reporting that is bordering on lies. Clearly, 20 million Canadians need stakeholders like you and me on CPP Investments’ Board of Trustees. This is because the CPP Investment's executives who we pay to communicate an accurate picture of our fund’s status cannot be trusted.

The CPP Investments’ website further deceives Canadians. Below is a graph from their website.

The graph is accurate, but it buries the surplus. A newcomer might conclude

“Ho hum. The CPP seems to be maybe a little better than on track. Nothing interesting here”.  

CPP Investments could have supplied Canadians with the following accurate graph.

This graph would make Canadians wonder

“With such a large surplus, should I be receiving some of it now because pension protocol dictates a surplus distribution when a surplus is 25% above target.”

It is our contributions to the CPP that pay for

  • Many misinformation ads like the one above, in The Globe and Mail,

  • The income of the 2,000 employees who work at CPP Investments,

  • The top five executives at CPP Investments, who, in 2020, averaged $4.5 million in compensation each. For perspective, Prime Minister Trudeau earned $360,000 in 2020, 8% of $4.5 million.

For these grotesques salaries, we Canadians have a right to expect excellence in both investment performance and accurate reporting, not some deceptive ad that falsely downplays a $257 billion surplus with the word “sustainable”.

We expect a more accurate word like “gigantic”, the word The Economist used in 2019 to describe our fund. And “gigantic” was used when the $550 billion fund was “only” $376 billion.

It appears the complicit CPP Investments has an agreement with our disgraceful Chief Actuary to downplay the surplus with deceptive reporting that is bordering on lies. Clearly, 20 million Canadians need stakeholders like you and me on CPP Investments’ Board of Trustees. This is because the CPP Investment executives who we pay to communicate an accurate picture of our fund’s status cannot be trusted.