Notes to the Financial Statements
Year ended March 31, 2011
(a) Pension benefits
The Agency's employees participate in the Public Service Pension Plan (Plan), a multi-employer plan, which is sponsored and administered by the Government of Canada. Pension benefits accrue up to a maximum period of 35 years at a rate of 2 percent per year of pensionable service times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Quebec Pension Plans benefits and are indexed to inflation.
Both the employees and the Agency contribute to the cost of the Plan. In 2010-2011, the Agency contributed $59,151,000 (2010 - $61,268,000), which represents approximately 1.9 times (2010 â€" 1.9 times) the contributions by employees.
The Agency's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.
(b) Severance benefits
The Agency provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded and thus have no assets, resulting in a plan deficit equal to the accrued benefit obligation. Benefits will be paid from future authorities. Information about the severance benefits, measured for March 31, is as follows:
| (in thousands of dollars) | 2011 | 2010 |
|---|---|---|
| Accrued benefit obligation, beginning of year | $97,591 | $107,509 |
| Expense (recovery) for the year | 16,178 | (2,392) |
| Benefits paid during the year | (7,733) | (7,526) |
| Accrued benefit obligation, end of year | $106,036 | $97,591 |