Archived - Government Introduces Legislation for a Stronger Canada Pension Plan and a More Secure Retirement for Canadians

October 6, 2016 – Ottawa, Ontario – Department of Finance Canada

Middle class Canadians are working harder than ever, but many are worried that they won’t have enough put away for their retirement. One in four families approaching retirement—1.1 million families—are at risk of not saving enough. That’s why the Government of Canada is committed to helping Canadians achieve their goal of a safe, secure and dignified retirement, and has worked with the provinces and territories to strengthen the Canada Pension Plan (CPP).

Canada’s governments agreed on June 20, 2016 to enhance the CPP to give Canadians a more generous public pension that will help them retire in dignity. All nine CPP participating provinces have now confirmed their support for the agreement concluded on June 20, 2016 in Vancouver.

On behalf of Minister of Finance Bill Morneau, Minister of Families, Children and Social Development Jean-Yves Duclos today introduced legislation in Parliament that, upon receiving Royal Assent, will mark a major step towards making this commitment a reality. By implementing the agreed-upon enhancement, Parliamentarians will be ensuring that future generations of Canadians can count on a more generous public pension in their retirement years.

The enhancement that Canada’s governments have agreed to does two things to make this happen for contributors. First, it will increase the share of annual earnings received during retirement from one-quarter to one-third. This means that an individual making $50,000 a year in today’s dollars over their working life will receive about $16,000 per year in retirement instead of roughly $12,000 today. Second, it will increase by 14 per cent the maximum income range covered by the CPP. The legislation also includes enhancements to CPP disability and survivor benefits that are proportional to the enhanced contributions going forward.

To make sure that individuals and their employers have time to adjust, increased annual CPP contributions will be phased in slowly over seven years—from 2019 to 2025—so that their impact is small and gradual.

Annie Donolo
Press Secretary
Office of the Minister of Finance
613-769-7187

Media Relations
Department of Finance Canada
613-369-4000

Mathieu Filion
Director of Communications
Office of the Hon. Jean-Yves Duclos, P.C., M.P.
Minister of Families, Children and Social Development
819-654-5546

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