Actuary Explains What Happened to the Pension Surplus

The city's pension plan was the unlucky casualty of market downturns--that testimony from Fred Lewis at the John Ferguson defamation trial. Lewis was an actuary with Morneau Sobeco, one of the top consulting firms in the country, and worked with the city of Saint John's pension board in 1993 to 2009.



Lewis testified in the three year period between 2000 and 2003, the pension plan had a 24 million dollar surplus that would have become 38 million dollars if things had gone according to plan--but instead turned into in a 45.2 million dollar unfunded liability.


He attributed the downturn to salary decreases, retirements earlier than assumed, and higher than expected losses from disability pensions.


Lewis said many pension plans weathered big economic downturns in the late 1980's, but managed to come back.