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We started this project in 2011 because of concerns expressed by elected officials, the media and the public about the financial health of Alberta’s public sector pension plans. As part of our audit planning, we met with those involved in Alberta’s public sector pension system, including plan board members, officials from the department and others.

Objective and Scope

We audited the Department of Treasury Board and Finance’s systems to monitor and evaluate the performance and sustainability of the following Alberta public sector pension plans:

  • Local Authorities Pension Plan (LAPP)
  • Management Employees Pension Plan (MEPP)
  • Public Service Pension Plan (PSPP)
  • Special Forces Pension Plan (SFPP)


Pension plans are facing funding challenges—Alberta’s public sector pension plans have significant unfunded liabilities and contribution rates that have risen to levels where some employers and employees do not want to pay more. At December 31, 2012 those unfunded liabilities totalled $7.4 billion. Unfunded liabilities, simply put, are the amount of money needed to be put into the plans today to fully support promises made to retirees and current employees for services already provided. Unfunded liabilities do not include amounts required to pay for benefits related to future service.

To fix the plans—The minister needs to ensure plan benefits are secure and commensurate with an affordable and available amount of funding from both employees and employers.