Why the CPP is one of the best in the world

The Canada Pension Plan (CPP) provides a foundation for millions of Canadians to build their retirement.

Whether you choose to retire in Alberta, British Columbia, or Nova Scotia, the CPP stays with you. It’s one of the great safeguards of a national plan. That means regardless of where in Canada you choose to work, live, or retire, the CPP is there for you when you need it.

The success of the CPP is a direct result of 22 million Canadians pooling contributions to safeguard against market volatility and changing demographics.

CPP Investments, the global investment management organization responsible for investing the CPP Fund, has a clear mandate to maximize returns without taking unnecessary risks, independent from government interference. Our diversified portfolio has achieved a 10-year net rate of return of 9.3% – a proven track record of performance.

How has the CPP changed over time?

Federal and provincial governments created the CPP in the 1960s to help address poverty among seniors.  However, due to changing demographics and economic conditions, the Chief Actuary of Canada found in 1995 that the CPP was in danger of running out of funds by 2015 unless action was taken.

In response, the federal government and the provinces came together with a common goal – help secure the CPP for future generations of Canadians.

The solution? Governments agreed that a professional investment organization with a clear goal to maximize returns, free from political interference, would be the best way to secure the future of the CPP.

With an initial transfer of $12.1 million from the CPP, the Fund was born. Nearly a quarter-century later, CPP Investments now manages more than $590 billion dollars in the best interests of CPP contributors and beneficiaries. We are always seeking to generate above-market returns by searching the world for the most promising investment opportunities and constructing a broadly diversified, multi-asset class portfolio.

A key element of the Fund’s success is that we operate without any government interference. We report to all the participating provinces, as well as the federal government. This protects our ability to make decisions free from political agenda, strengthening the integrity of our decision-making process. Through years of government mandates, as well as wide-ranging political, social, and economic cycles, CPP Investments has stayed the course. We are steadily growing, diversifying, and helping build a solid source of retirement security to last for generations.

The impact? The foundation of Canada’s retirement system is solid today and for decades to come.

In an era of uncertainty, Canadians can find confidence in a strong, stable, and resilient CPP Fund. Economic and political winds may change, yet we remain rooted, drawing strength from our guiding principles of integrity, partnership, and high performance. More than 22 million contributors and beneficiaries, like you, are counting on us to deliver.

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