By Lauren Bailey
As the two-year anniversary of the Medicus Pension Plan approaches, Simone Reitzes, its managing director, has growth on the mind — for the plan’s membership and its asset allocations.
When tapped to helm the new defined benefit
pension plan for Canadian physicians, which launched in May 2023, Reitzes saw
an opportunity to leverage her financial expertise to help expand access to
retirement security to a largely overlooked group.
Many people have this misperception that physicians
don’t need support saving for retirement and that, often, isn’t the case, she
said, noting a career in medicine involves years of education, which can lead
these students to accrue massive debt by the time they enter their chosen
field. “This leaves them with a shorter time frame to pay down debt and save
for retirement.”
What’s more, physicians with private practices experience a lot of uncertainty and volatility, much like any other entrepreneur, said Reitzes, pointing out those who choose to incorporate and aren’t employees of a province or the federal government have to cover overhead costs of their business and are subject to the same pressures of an uncertain economy. “If you're a physician and relying on importing medical equipment, for example, and are now faced with new expenses, there's no ability to pass that on.”
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Physicians have been seeking a national pension plan for decades, and this was the opportunity to finally make that vision a reality, Reitzes added. No stranger to the complex regulatory environment under which Canadian pension plans are governed, she was able to draw from both her actuarial and advocacy experience to help bring the plan to fruition. Indeed, prior to leading the Medicus Pension Plan, her role at Scotiabank tasked her with oversight of more than CA$10 billion in assets and liabilities across a global footprint.
Reitzes also has the support of the plan’s Administrative
Board, which sets the course for the investment strategy and engages external
asset managers. A year after its inception, the plan was operating in six
provinces and all three territories. As well, its funding status reached 158% on a going-concern basis and 115%
on a solvency basis. Heading toward the two-year mark, she said its funded
status remains well above 100%, which will allow it to
move into new opportunities.
As of January 2025, the lion’s share of the
fund’s investments was in equities (70%), with the remaining in fixed income
(30%). Looking forward, Reitzes noted the plan is aiming to increase its
exposure to more asset classes.
“We're now fully invested in our growth
portfolio,” she said. “We have the ability to further diversify that
portfolio and are looking in 2025 to start to move into certain private asset
classes, which we know has helped some of the other large plans in Canada be
extremely successful in their strategy over decades.”
Before the plan was available, many of
its members would, typically, have invested their savings in their own retail
market savings vehicles. The fact that members have elected to hand over the
reins to Medicus’ team, particularly in the post-COVID economic environment, is a
responsibility that Reitzes doesn’t take lightly.
“The pension plan’s fiduciary body ensures
it is following best-in-class practices and holds itself to as high a standard
as possible in terms of making informed decisions and delivering positive
results for plan members,” she said. “We knew returns in our early years would be important to establishing a
strong foundation, and our disciplined measured approach took all of these
risks into consideration.”
