Glossary

Clicking the term below will show the definition.

Active Member

A member who is making contributions to MEPP or would be making contributions if not for being:

  • on leave;
  • in receipt of benefits under the employer's disability plan; or
  • at the maximum pensionable service limit (35 years).
Actuarial Liability

The MEPP actuarial liability is the total value of all benefits accrued by MEPP members and other costs for which the pension plan is responsible.

Actuarial Reserve

The estimated cost to MEPP of providing the increased benefits gained by a member who buys or transfers prior service. An actuarial reserve calculation takes into account a number of factors including salary scaling and mortality tables.

Actuarial Valuation

A mathematical analysis of the financial condition of a pension plan. An actuary prepares a plan valuation at least once every three years. The valuation shows if the contribution rates are higher or lower than what is needed to ensure the long-term funding of the plan.

Actuarial Value of Assets

The adjusted value of a pension plan's assets used by the actuary to determine the funded status of the Plan.

Actuary

A person authorized by their designation as a Fellow of the Canadian Institute of Actuaries to prepare and sign actuarial valuations.

Alberta Consumer Price Index (ACPI)

A weighted average measure of the cost of a group of goods and services that are normally purchased by Alberta households. This includes things such as clothing, food, housing, gasoline, health and personal care services, recreation, and education.

Alberta Pensions Services Corporation (APS)

Alberta Pensions Services Corporation (APS) is MEPP's pension administrator. APS is responsible for providing services to the Management Employees Pension Board, members, pensioners and employers.

Allocation

The designation of your pension benefits to one or more beneficiaries.

Approved Long-Term Disability Income (LTDI) Plan
An income replacement plan sponsored by an employer for its employees that will pay you a portion of your pre-disability salary while you are off work. Where the LTDI plan is approved by APS, the period of LTDI coverage is considered mandatory service for pension purposes.
The criteria used by APS to approve LTDI plans are:
  • All members employed by the employer in the group to whom the LTDI plan applies, except for those ineligible for coverage by reason of not meeting the medical requirements, must be covered by the LTDI plan;
  • A member must not be required to apply for a pension as long as the member qualifies for benefits under the LTDI plan; and
  • The LTDI plan must be filed with APS.
Asset(s)

Any item of economic value owned by an individual or entity, especially one that could be bought and sold.

Beneficiary
Your pension partner is automatically your sole beneficiary if you die before retirement.
If you have no pension partner, you should let MEPP know who would receive the benefit.

A Beneficiary is the person(s) you designate to receive a benefit if:
  • you die before retirement; or
  • you die before the end of the guaranteed period. This is only applicable if:
  • you chose one of the Single Lifetime Guaranteed Term options; or
  • you chose one of the Joint Lifetime options and both you and your pension partner die within the guaranteed period.

You can designate one or more beneficiaries or a charitable organization.

Even if you have a pension partner you should designate a beneficiary. That way MEPP knows to whom the benefit is to be paid if your pension partner predeceases you, or if your pension partner has waived the right to a benefit. If you have not designated a beneficiary and your Will does not specifically mention MEPP, payment will be made to your estate.
Canada Pension Plan (CPP)

The federal pension plan administered by Human Resources and Social Development Canada on behalf of employees in all provinces and territories of Canada except Quebec, which operates the equivalent Quebec Pension Plan.

Closed Plan
Managers of the Government of Alberta contributed to the Public Service Management Pension Plan until MEPP was formed. The Public Service Management Pension Plan is now a closed plan, meaning it continues to pay out benefits (to those who left the plan, retired or had 35 years of service before August 1, 1992) but does not accept new members.
Combined Pensionable Service (CPS)
By staying with the same employer and moving between the Public Service Pension Plan and MEPP with no break in pensionable service, you become eligible for combined pensionable service, provided the move occurred on or after January 1, 1994. Once a CPS relationship has been established, service and salary information under both plans will be used in key elements of the calculation of your MEPP pension.

  • Your pensionable service from both plans will be used to determine if you are vested under each plan. Under MEPP, you become vested once you have five years of pensionable service, which will consider service under a CPS relationship.
  • Your pensionable service from both plans will be used to determine if you are entitled to an unreduced pension under each plan.
  • Your pensionable salaries from both plans will be used to determine the highest average salary under each plan.

Your pensionable service from both plans will be used to determine when you will reach the 35-year maximum service limit.
Commuted Value

The actuarial present value of accrued benefits, determined using actuarial assumptions and methods recommended by the Canadian Institute of Actuaries. This represents the amount of money that must be set aside today, based on current interest rates, to provide pension payments at a future date.

Consumer Price Index (CPI)
An increase in a pension benefit to compensate for inflation. Your pension will increase each January by 60% of the Alberta Consumer Price Index (CPI). The CPI is a weighted average of the cost of a basket of goods and services that are normally purchased by ALberta households. This includes things such as clothing, food, housing, gasoline, health and personal care, recreation and education. COLA increases are calculated by taking the average of the CPI during the 12 month period ending each October and comparing it to the previous year's 12 month average.
Contributions
Money paid into a pension plan by you and your employer. Your contributions are tax deductible and are made through payroll deduction. All contributions go directly to the MEPP Fund. Contributions may also include payments towards prior service such as a period of qualifying leave without salary.
Cost-of-Living Adjustment (COLA)

An increase in a pension benefit to compensate for an increase in the cost of living. Your pension will increase each January by 60 per cent of the Alberta Consumer Price Index (CPI). The CPI is a weighted average of the cost of a basket of goods and services that are normally purchased by Alberta households. This includes things such as clothing, food, housing, gasoline, health and personal care, recreation, and education. COLA increases are calculated by taking the average of the CPI during the 12-month period ending each October and comparing it to the previous year's 12-month average.

Current Employment Status

Your current status of employment with your employer. This can be full-time, part-time or terminated (no longer contributing to the Plan).

Deferred Member
A member who is no longer an active member of MEPP but has left pension benefits in the Plan. A deferred member may leave their benefit entitlement in MEPP until retirement.
Deferred Pension

A pension that does not commence immediately following termination from MEPP. A deferred pension may not commence earlier than the member's 55th birthday, unless the member qualifies for a disability pension, but must commence before December 31 of the member's 71st birthday.

Defined Benefit (DB) Plan

Defined Benefit Plans pay a monthly pension based on your salary and your length of service. The pension plan's obligation is to pay a stated benefit to each employee that depends on the employee's salary and length of service. The main benefits of a defined benefit plan are:

  • Your benefit is guaranteed and you are provided a specified lifetime income regardless of market conditions or how long you live.
  • You can plan for your retirement because you can estimate your future pension income. The pension estimator allows you to estimate your future monthly payments.
Dependent Minor Child

To qualify as a dependent minor, a child must be:

  • Dependent - financially supported and not married
  • Minor - under 18 years of age
Early Retirement

Retirement before being eligible to receive an unreduced pension. See "normal retirement" and "postponed retirement".

Excess Contributions
The amount of contributions with interest returned to the member to ensure that the member's contributions with interest in the account do not exceed 50% of the commuted value of a pension on service after 1991. Contributions paid and service credited for prior service are not included when calculating excess contributions.
Fund

A fund was established under the legislation governing the MEPP to hold all employee and employer contributions and investment income. All benefits are paid from the MEPP Fund. All assets in the MEPP Fund can only be used to pay the promised benefits and cover administrative costs.

Guaranteed Term
A Single Lifetime Guaranteed Term pension (5, 10 or 15 years) is paid for your lifetime. If you die before the end of the guaranteed period, payments will continue to your designated beneficiary(ies) until the end of the guaranteed period. For example, if you choose the Single Lifetime Guaranteed At Least 10 years option and die 4 years later, the pension will be paid to your beneficiary(ies) for the remaining 6 years.
Highest Average Salary

The average of your five highest consecutive years of salary used to calculate your pension benefits. For the purposes of calculating your highest average salary, the salary for a given year may not exceed the corresponding salary cap.

Joint Lifetime
A Joint Lifetime pension is payable for the lives of the member and pension partner. Members who have a pension partner at the time of their retirement must select one of the Joint Lifetime pension options unless the pension partner signs a Pension Partner Waiver, waiving his or her rights to the survivor benefit.

If you choose the Joint Lifetime with Reduced Survivor Benefit Guaranteed At Least 10 Years option, and you die before your pension partner, pension benefits are paid to the pension partner for his or her life. For service before 1992, the pension partner benefit is 75% of your pension. For service after 1991, the pension partner benefit is 66 2/3% of your pension.

If you choose the Joint Lifetime Guaranteed At Least 10 Years option, on the death of either you or your pension partner, the same pension is paid to the survivor for his or her life.

If you choose the Joint Lifetime Reduced by 1/3 Guaranteed At Least 10 Years option, at the first death of either you or your pension partner, the monthly payment is reduced by 1/3. This means that if the pension partner dies before the member, the member's pension will be reduced to 2/3 of the pension amount.

In all options, the pension is guaranteed for ten years. If both you and your pension partner die before the end of the ten year term, the pension will be paid to your beneficiary(ies) for the remainder of the term.
Leave with Partial Salary
A period of service during which a member is, with the approval of his/her employer, on leave from all or a portion of his/her regular duties of employment and is receiving pensionable salary that is less than his/her regular pensionable salary from the employer. During periods of leave with partial salary, the member remains an active member and contributions are remitted through the employer as if the member were at work.

Note: If the member does not have 36 months of prior employment, the employer will not remit any contributions because the member will have to pay an actuarial reserve cost to establish the leave period as pensionable service.
Liability / Liabilities

The MEPP liability is the total value of all benefits earned by MEPP members and other costs for which the MEPP Fund is responsible.

Locked-in-Retirement Account (LIRA)
A special type of RRSP designed specifically to hold locked-in pension funds. Alberta public sector pension plans, like MEPP, are not subject to the Employment Pension Plans Act (EPPA) however, once locked money is transferred out of MEPP it must be locked-in under the rules of the EPPA. If you have a LIRA and are at least 50 years old, you can start receiving pension income. Most financial Institutions offer LIRAs however APS will only send the locked-in funds to a financial institution that appears on the Alberta Superintendent of Pensions list of approved LIRA contracts.
Long-Term Disability Income Continuance Plan (LTDI)
A type of disability insurance offered by an employer for employees who become unable to perform their normal work because of a physical or mental disability. If the LTDI plan is approved by MEPP's administrator, APS, the period of LTDI coverage is included as service for pension purposes.
Marital Status

Marital status can be single, married, common-law, separated, widowed or divorced. See "pension partner" for further information.

Matrimonial Property Order (MPO)
If you are currently undergoing a marital breakdown, your pension benefits may be subject to division and distribution between you and your soon to be ex-spouse. For pension benefits to be divided and distributed, a court-certified copy of a Matrimonial Property Order (MPO) must be obtained and filed with Alberta Pensions Services Corporation. You should consult your legal counsel about obtaining and filing an MPO and the division and distribution of your pension benefits.

Under the Matrimonial Property Act, an MPO can only be obtained in respect of a legal marriage. In certain circumstances, the regulations governing MEPP allow for the division and distribution of your pension benefits by making a one-time payment to the non-member ex-spouse without having to wait for the member to become eligible for a benefit. If you are a MEPP member going through a marital breakdown, your legal counsel should take these regulations into account when working on your matrimonial property settlement.
Member ID
The unique number assigned to you by APS' previous pension administration system. The Member ID is printed on publications sent between January 2004 and May 2016, including your annual statement, enrolment package or benefit estimate package.
Member Identifier

The unique number assigned to you by APS' current pension administration system. The identifier is printed on publications sent after May 2016, including your pension highlights (annual statement) or Termination Statement Estimate.

Member Plan Status

Your status under the Plan. See "active member", "deferred member" and "suspended member".

mypensionplan

mypensionplan is a secure website that provides active members and deferred members of the Management Employees Pension Plan with access to personalized pension information.

Nominee
The person you name to receive your Joint Lifetime pension if you die first. If you have a pension partner on the effective date of your pension, the nominee must be your pension partner unless they sign a waiver sent with the Retirement Benefit Statement. The nominee must be a valid nominee under the Income Tax Act (e.g. an ex-spouse or ex-common-law partner).
Normal Form
The normal form is the base from which all other pension options are calculated. At present the normal form of pension is the Joint Lifetime with Reduced Survivor Benefit. All other optional forms of pension are the actuarial equivalent of the current normal form.

If you have a pension partner at retirement:

  • The normal form of pension for pre-1992 is payable for your lifetime, and if your pension partner is still alive when you die, they will receive a pension equal to 75% of your pension.
  • The normal form of pension for post-1991 is payable for your lifetime, and if your pension partner is still alive when you die, they will receive a pension equal to 66 2/3% of your pension for the rest of his or her life.
Normal Retirement

Retirement at exactly age 60. See "early retirement" and "postponed retirement".

Old Age Security (OAS)
The basic federal income security program for seniors who are age 65 and older who meet the Canadian legal status and residence requirements.
Payment Due Date
The last date payment can be accepted towards the purchase of service. The date is shown in the Buyback Proposal mailed to you if you are buying prior service or a leave of absence. You must be an active MEPP participant in order to make payments towards your prior service. If you stop participating in MEPP, you will have 90 days from your termination date in MEPP to complete payments. If you do not pay the outstanding balance, the credited pensionable service will be prorated accordingly.
Pension Partner
"pension partner" means
(i) a person who, at the relevant time, was married to a participant or former participant and had not been living separate and apart from him or her for 3 or more consecutive years,
or
(ii) if there is no person to whom subclause (i) applies, a person who, as at and up to the relevant time, had lived with the participant or former participant in a conjugal relationship
(A) for a continuous period of at least 3 years, or
(B) of some permanence, if there is a child of the relationship by birth or adoption;
Persons are living separate and apart
  • if they are living apart and either of them has the intention to live separate and apart from the other, or
  • if, before the relevant time,
  • they had been living separate and apart for any period, and
  • that period was interrupted or terminated by reason only that either of them become incapable of continuing to live separate and apart or of forming or having the intention to continue to live separate and apart of that person's own volition,
  • and the separation would probably have continued if that person had not become so incapable.
Pensionable Salary
Basic pay for the performance of your regular duties. Salary also includes acting pay if the employer treats it as pensionable salary under the employer's salary policy. Salary does not include earnings such as expense allowances or overtime payments. The salary used in the calculation of your MEPP benefit entitlement will be subject to any limits set out under the tax rules.
Pensionable Service
Your years of service during which you contribute to the pension plan, plus service recognized from a transfer or purchase of prior service. The maximum pensionable service limit in MEPP is 35 years.
Pensioner

A member, surviving pension partner, or beneficiary who is receiving a pension from the Plan.

Plan Valuation

A mathematical analysis of the financial condition of a pension plan. An actuary prepares a plan valuation at least once every three years. Following a valuation, the Board may recommend to the President of Treasury Board and Minister of Finance that the contribution rates are adjusted so the rates meet the funding requirements of the Plan.

Portable Document Format (PDF)

Portable Document Format (PDF) is a format used to deliver documents over the Internet. Adobe® Reader® (TM) is the standard software used to access PDF documents and can be downloaded, for free, from the Adobe® website.

Postponed Retirement

Retirement after age 65 or after the age of entitlement to an unreduced pension. See also "early retirement" and "normal retirement".

Pre-retirement Death Waiver
The pension partner may waive his/her right to a lifetime pension by completing the Pension Partner Waiver of Pre-Pension Commencement of Death Benefit. This allows the pension to be paid to the beneficiary(ies) on file with APS instead of the pension partner. This waiver can be completed by the pension partner any time before pension commencement but it may only be rescinded by the pension partner prior to the member's death.
Prior Service (Buyback or Past Service)
Previous employment during which you did or didn't belong to a pension plan. You may be able to buy back this period of service if you're not receiving a current or future pension from your former employer. Only some types of public service are eligible.

By buying prior service you can increase your length of pensionable service thereby increasing your future benefits.
Reciprocal Transfer

An agreement negotiated with another pension plan that allows members to transfer their pension when they move between plans.

Reduced Pension
If you retire between age 55 and 60 and your age plus service totals less than 80 (we call this points), your pension is subject to reduction. This is because based on average life expectancy statistics, we will be paying out money over a longer period of time than if you retired at age 60. Currently, this reduction is 3 percent for each year you retire early. (This reduction only applies to pension benefits for service after 1991.) The reduction is based on your age short of 60, or your age plus years of service short of 80, whichever you would reach first.
Registered Retirement Savings Plan (RRSP)

A type of tax-deferred investment that is set up to hold and invest your savings until you retire. Most can be withdrawn at any time, but you will be taxed on the amount withdrawn.

Salary
See "pensionable salary".
Salary Cap
The salary cap is the maximum salary upon which a defined benefit can be based. This cap is derived from the Defined Benefit Limit set under the federal Income Tax Act. The 2017 salary cap for MEPP is $145,722.
Service

See "pensionable service".

Service Year
The year specified by the employer as the employer's annual payroll pay period cycle. This is the year for which members' pensionable service is reported by the employer and which will have specific "From" and "To" dates. The service year may not coincide exactly with the calendar year.
Social Insurance Number (SIN)

A nine-digit number used in the administration of various Canadian government programs. You require a SIN to work in Canada or to receive government benefits.

Spouse

See "pension partner".

Surplus

A surplus exists when the actuarial valuation determines the Plan's accrued benefit payments (liabilities) are less than the net assets available for the payment of those benefits.

Suspended

When a member has a Combined Pensionable Service (CPS) relationship, the term "suspended" describes the member's status in the plan(s) to which the member is no longer contributing. For example, a MEPP member who moved from PSPP (forming a CPS relationship) is deemed "suspended" in PSPP, since they are no longer actively contributing to PSPP.

Termination
The point at which a member ceases to participate in the Plan (e.g. retires or moves into a non-participating position).
Transfer Agreement

An agreement negotiated with another pension plan that allows members to transfer their pension entitlements when they move between plans. By transferring pension entitlements, you may increase your pension income.

Unreduced Pension

A pension that will not be reduced for early retirement. See "reduced pension" and "early retirement".

Vested
A term used by pension plans that means you are eligible to receive a monthly pension. Members of MEPP are vested after five years of combined pensionable service, or immediately if you are age 65.
Withholding Date

The date on which the employer issues a member's pay for a particular pay period. Pension contributions for a particular pay period must be remitted to Alberta Pensions Services Corporation (APS) within 15 days of the withholding date.

Withholding Year

The year in which the employer withheld contributions that were remitted to the pension plan.

Year’s Maximum Pensionable Earnings (YMPE)
The Canada Pension Plan (CPP) sets a maximum amount of earnings on which you can contribute to the CPP. The YMPE is used by your pension plan in determining contribution rates, benefits, and the cost of service.