Pension Contributions

Both members and employers make regular contributions to MEPP. These contributions are automatically deducted from a member’s pay and remitted with the employer’s portion for investment into the MEPP fund by the fund's Investment Manager.

Members’ contributions to MEPP are tax-deductible, meaning they reduce the income on which a member pays taxes every year. Year-end tax slips from employers reflect the adjustment. Visit the Canada Revenue Agency's website for more information.

The Management Employees Pension Board (MEPB, or the Board) routinely monitors the financial health of the Plan and sets the total contribution rate required to fund the Plan. This rate necessarily changes over time; it is determined by the results of regular actuarial valuations performed by the Plan's actuary. The Government of Alberta sets the split of the total contribution rate between the employer and Plan members.

A member’s pensionable salary, up to an annual maximum limit, determines their pension contribution amount. Pensionable salary includes gross basic pay for the performance of regular job duties.

In MEPP, pensionable salary might also include additional pay received while covering another position (sometimes called an "acting pay").

There are some types of pay that are not pensionable:

• Overtime pay
• Expense allowances
• Variable pay (such as bonuses)

For questions about whether a type of pay is pensionable, members can speak with their employer.

The salary cap is the highest amount of pensionable salary that can be used to calculate a member’s MEPP pension contributions and pension benefit. MEPP determines the salary cap each year in accordance with the Plan Rules and the maximum pension limits established under the federal Income Tax Act.

If a member’s pensionable salary exceeds the annual MEPP salary cap and their employer participates in the Supplementary Retirement Plan (SRP), the member and employer make contributions to the SRP on the eligible salary above the MEPP salary cap.

MEPP's 2026 salary cap is $196,611.00.

How the salary cap affects your pension calculation

When MEPP calculates a member’s Highest Average Salary, it uses the five highest consecutive years of pensionable salary.

For each of those years:

• Pensionable salary is compared to the salary cap for that year.
• MEPP uses either the actual pensionable salary or the salary cap, whichever amount is lower.
• This comparison is made separately for each of the five years included in the calculation.

What this means for MEPP members

If a member’s pensionable salary was below the applicable salary cap in each of the five years used to calculate their Highest Average Salary, the salary cap will not affect their pension calculation.

If their pensionable salary was higher than the salary cap in one or more of those years, MEPP will use the salary cap amount for those years when calculating the Highest Average Salary and pension benefit.

For example: The following example shows a member’s five highest consecutive years of pensionable salary. In each year, the member’s pensionable salary exceeded the applicable MEPP salary cap. As a result, MEPP uses the salary cap for each year when calculating the member’s Highest Average Salary and pension benefit.

One component of pension calculation is pensionable service. The Plan's maximum pensionable service is 35 years, or 35 years between MEPP and the Public Service Pension Plan (PSPP) if a member has Combined Pensionable Service (CPS). Service purchased through a buyback or transfer into MEPP also counts towards pensionable service.

While members no longer make pension contributions once they reach the 35-year service cap, they can continue to work. For members who work for a MEPP employer, any increases to their salary will be considered in their pension calculation. If salary increases after 35 years, pension payments might also increase.