CalPERS $100K Pension Club up 63% Since 2012, Watchdog Says

A California watchdog released 2016 pension data last week that found a 63% increase in the number of retired public workers in the state earning six-figure pensions since 2012.

Transparent California’s report notes that the California Public Employee Retirement System (CalPERS) paid out more than $20 billion to 646,843 pensioners. Of those retirees, 22,826 earned pensions more than $100,000 in 2016. The average pension for a full-career former CalPERS employee in 2016 was $66,400.

The largest CalPERS pension went to former Solano County administrator Michael Johnson at $390,485.

The most CalPERS pensions over $100,000 went to Santa Clara County, where 861 recipients collected their six-figure retirements. Trailing at second and third were Oakland and Riverside County, with 523 and 469 respective pensioners.

For more stories like this, sign up for the CIO Alert newsletter. 

In 2016, there were 52,963 total statewide six-figure retirees from all pension systems. The largest California pension last year went to former Deputy Chief of Police Earl C. Paysinger, who received a payout of almost $1.5 million. Paysinger’s pension includes a one-time DROP payout of $1,338,232.

In regards to Transparent California’s information, CalPERS is still analyzing the data —with more information to be made available early this week.

According to the fund the overall statewide average pension of a CalPERS retiree is $33,528 —although 76% of retirees receive an average non-safety pension of $29,088. Only 3% of CalPERS service retireesoverall receive pensions of $100,000 or more per year. They are usually executives who hold seats in either city or county offices, or are physicians, or senior managers for police and fire departments.

“Unlike the private sector, about 24% of CalPERS retirees don’t coordinate with Social Security for benefits and their CalPERS pension may be their sole source of retirement income,” Amy Morgan, Information Officer, Pensions and Retirement, CalPERS told CIO in an email. “Pensions are funded by both the employee who contribute every month out of their paycheck and the employer contributions, which are invested for fund growth over time. Some workers currently contribute up to 15.25 percent of their paycheck.”

Transparent California has more than 1.1 million pension records from 33 public California plans. According to the watchdog’s research director Robert Fellner, Californians will spend “over $30 billion on pension costs in the coming year.”

Tags: CalPERS, Pension, Transparent California

In addition to the strengthening Canadian dollar, Canada’s largest pension plan received a “significant uplift” from global equity markets during the first quarter of fiscal 2018, ended June 30, 2017, returning 1.9% gross (1.8% net of all costs).

This increased the net assets to $326.5 billion CAD (roughly $257 billion USD), up $9.8 billion from the end of fiscal 2017. According to the Canadian Pension Plan Investment Board (CPPIB), this came from $5.7 billion in net income after all CPPIB costs and $4.1 billion in net contributions to the fund.

The portfolio achieved five- and 10-year nominal returns of 12.1% ($134.6 billion) and 6.9% ($151.1 billion), respectively.

Global public equities returned 29.8% at $97.3 billion for the quarter while private equities returned 16.1% at $52.7 billion. Although less impressive, domestic equities were also positive, returning 3.1% ($10.1 billion) and 0.4% ($1.2 billion) in the public and private sectors, respectively.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news. 

Government bonds returned a total of 26.7% ($87.4 billion), with the majority coming from marketable bonds at 19.3% ($63.1 billion). Canadian provincial non-marketable bonds returned 7.4% ($24.3 billion).

Credit investments returned 5.7% for the quarter at $18.6 billion.

Real assets yielded 22.4% ($73.1 billion)—the largest chunk from real estate at 12.6% ($40.9 billion). The remainder came from infrastructure, natural resources, and agricultural investments at 7.3% ($23.9 billion) and 2.5% ($8.3 billion).

The only negative returns were external debt issuance and cash and absolute return strategies, resulting in 6.7% ($21.9 billion) and 5.3% ($17.4 billion) losses.

“Our strategy has delivered strong and stable returns over the five- and 10-year periods. We continue to position the Fund for future growth while seeking stability through diversification,” Mark Machin, CPPIB’s president and CEO, said in a statement. “Each major CPPIB investment program contributed to first quarter results. Global equity markets produced a significant uplift and gains from fixed income improved. Meanwhile, the strengthening Canadian dollar against most major currencies applied downward pressure, a trend that accelerated in the first half of the current quarter.”

Tags: Canada, Canada Pension Plan, Pension, Q1

Canada’s Largest Pension Fund Hits $326.5 Billion at Q1 Fiscal 2018