Federal government pension plans — and, by extension, federal debts — are in much worse shape than currently reported, argues new research from the C.D. Howe Institute.

The federal government’s unfunded liabilities for employee pensions are $118 billion worse than reported in the government’s accounts, according to a report published by the Toronto-based think tank on Tuesday.

The report estimates that the actual liabilities sit at $269 billion, as of the end of fiscal 2015.

The difference between the government’s reporting and the think tank’s estimates comes down to accounting. The official figures use notional interest rates to calculate their value, the report says, whereas “fair-value” estimates, which are based on actual yields rather than assumptions, produce much higher numbers.

Moreover, the unfunded pension liability is part of the federal government’s debt. According to the report, using the C.D. Howe Institute’s estimates would raise net public debt by $118 billion, from the $612.3 billion reported at the end 2014/15 to an adjusted $730.2 billion.

“Our goal is twofold: to alert Canadians to the fiscal burdens and risks created by these plans and to prompt discussion of reforms that could produce more durable and affordable pensions for federal employees,” say William Robson and Alexandre Laurin, authors of the report, in a statement.

The authors also recommend that Ottawa switch to “the shared-risk, target-benefit pension model already common in much of the provincial public sector, a fairer and more sustainable approach.”

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