Consolidated statement of administrative costs charged to the CPP Accounts by ESDC, March 31, 2025
Official title: Consolidated Statement of Administrative Costs Charged to the Canada Pension Plan Accounts by Employment and Social Development Canada, for the period from April 1, 2024, to March 31, 2025.
On this page
- List of Abbreviations
- List of Tables
- Independent auditor's report
- Notes to the consolidated statement of administrative costs charged to the Canada Pension Plan Accounts
- Schedules to the consolidated statement of administrative costs charged to the Canada Pension Plan Accounts
Alternate formats
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List of Abbreviations
- CPP
- Canada Pension Plan
- ESDC
- Employment and Social Development Canada
- ISSDB
- Income Security and Social Development Branch
- MoU
- Memorandum of Understanding
- NHQ
- National Headquarters
List of Tables
- Table 1: Consolidated statement of administrative costs charged to the CPP Accounts by ESDC
- Schedule 1: Administrative costs charged to the CPP Accounts by Deputy Minister's Office
- Schedule 2: Administrative costs charged to the CPP Accounts by Chief Operating Officer
- Schedule 3: Administrative costs charged to the CPP Accounts by Income Security and Social Development Branch
- Schedule 4: Administrative costs charged to the CPP Accounts by Corporate Secretariat
- Schedule 5: Administrative costs charged to the CPP Accounts by Public Affairs and Stakeholder Relations Branch
- Schedule 6: Administrative costs charged to the CPP Accounts by Human Resources Services Branch
- Schedule 7: Administrative costs charged to the CPP Accounts by Legal Services Branch
- Schedule 8: Administrative costs charged to the CPP Accounts by Internal Audit and Enterprise Risk Management Branch
- Schedule 9: Administrative costs charged to the CPP Accounts by Strategic and Service Policy Branch
- Schedule 10: Administrative costs charged to the CPP Accounts by Business Delivery Modernization Programme Strategy and Design
- Schedule 11: Administrative costs charged to the CPP Accounts by Business Lead, Benefits Delivery Modernization
- Schedule 12: Administrative costs charged to the CPP Accounts by Business Delivery Modernization Implementation
- Schedule 13: Administrative costs charged to the CPP Accounts by the Technical Change Authority and Deputy Chief Information Officer
- Schedule 14: Administrative costs charged to the CPP Accounts by Integrated Services Strategy Operations
- Schedule 15: Administrative costs charged to the CPP Accounts by Client Experience Office
- Schedule 16: Administrative costs charged to the CPP Accounts by Integrity Services Branch
- Schedule 17: Administrative costs charged to the CPP Accounts by Social Insurance Register
- Schedule 18: Administrative costs charged to the CPP Accounts by Innovation, Information and Technology Branch
- Schedule 19: Administrative costs charged to the CPP Accounts by Chief Financial Officer Branch
- Schedule 20: Administrative costs charged to the CPP Accounts by Strategic Services Bureau and Regional Assistant Deputy Minister
- Schedule 21: Administrative costs charged to the CPP Accounts by Corporate Reserve
- Schedule 22: Administrative costs charged to the CPP Accounts by ESDC Ombuds Office
- Schedule 23: Administrative costs charged to the CPP Accounts by Chief Data Officer Branch
- Schedule 24: Administrative costs charged to the CPP Accounts by Service Canada Transition Office
Independent auditor's report
To the Chief Audit Executive of the Internal Audit and Enterprise Risk Management Branch of Employment and Social Development Canada
Our opinion
In our opinion, the accompanying financial information of Employment and Social Development Canada (ESDC) for the period from April 1, 2024 to March 31, 2025 is prepared, in all material respects, in accordance with the financial reporting provisions of Part A (Section 6.0) and Part B of the Memorandum of Understanding dated March 31, 2025 between ESDC and the Canada Pension Plan (CPP) (the MoU).
What we have audited
ESDC's financial information comprises the consolidated statement of administrative costs charged to the CPP Accounts for the period from April 1, 2024 to March 31, 2025 and the notes to the financial information, comprising material accounting policy information and other explanatory information.
Basis for opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial information section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of ESDC in accordance with the ethical requirements that are relevant to our audit of the financial information in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.
Emphasis of matter ‒ basis of accounting and restriction on distribution and use
We draw attention to note 1 to the financial information, which describes the basis of accounting. The financial information is prepared to assist ESDC to comply with the financial reporting provisions of Section 8.2 of the MoU. As a result, the financial information may not be suitable for another purpose. Our report is intended solely for ESDC. We acknowledge the disclosure of our report, in full only, by ESDC at its discretion, to the Office of the Auditor General of Canada (the OAG) without assuming or accepting any responsibility or liability to the OAG or any other third party in respect of this report. Our report should not be distributed to parties other than ESDC or the OAG. Our opinion is not modified in respect of this matter.
Responsibilities of management and those charged with governance for the financial information
Management is responsible for the preparation of the financial information in accordance with the financial reporting provisions of Part A (Section 6.0) and Part B of the MoU, and for such internal control as management determines is necessary to enable the preparation of financial information that is free from material misstatement, whether due to fraud or error.
Those charged with governance are responsible for overseeing ESDC's financial reporting process.
Auditor's responsibilities for the audit of the financial information
Our objectives are to obtain reasonable assurance about whether the financial information as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial information.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- identify and assess the risks of material misstatement of the financial information, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control
- obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of ESDC's internal control
- evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates, if any, and related disclosures made by management
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
PricewaterhouseCoopers LLP
Chartered Professional Accountants, Licensed Public Accountants
Ottawa, Ontario
August 8, 2025
| Service area as per the Memorandum of Understanding | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Deputy Minister's Office (Schedule 1) | 1,079 | 914 |
| Chief Operating Officer (Schedule 2) | 629 | 557 |
| Income Security and Social Development Branch (Schedule 3) | 19,129 | 19,873 |
| Corporate Secretariat (Schedule 4) | 2,414 | 2,609 |
| Public Affairs and Stakeholder Relations Branch (Schedule 5) | 4,931 | 4,621 |
| Human Resources Services Branch (Schedule 6) | 24,602 | 22,074 |
| Legal Services Branch (Schedule 7) | 3,453 | 3,275 |
| Internal Audit and Enterprise Risk Management Branch (Schedule 8) | 1,305 | 1,366 |
| Strategic and Service Policy Branch (Schedule 9) | 3,866 | 3,954 |
| Business Delivery Modernization Programme Strategy and Design (Schedule 10) | 5,242 | 7,856 |
| Business Lead, Benefits Delivery Modernization (Schedule 11) | 621 | 498 |
| Business Delivery Modernization Implementation (Schedule 12) | 97 | 29 |
| Technical Change Authority and Deputy Chief Information Officer (Schedule 13) | 577 | 1,080 |
| Integrated Services Strategy Operations (Schedule 14) | 377,657 | 373,362 |
| Client Experience Office (Schedule 15) | 941 | - |
| Integrity Services Branch (Schedule 16) | 14,540 | 15,667 |
| Social Insurance Register (Schedule 17) | 8,068 | 7,860 |
| Innovation, Information and Technology Branch (Schedule 18) | 116,537 | 119,807 |
| Chief Financial Officer Branch (Schedule 19) | 56,354 | 57,804 |
| Strategic Services Bureau and Regional Assistant Deputy Minister (Schedule 20) | 6,412 | 7,366 |
| Corporate Reserve (Schedule 21) | 14,446 | 2,389 |
| ESDC Ombuds Office (Schedule 22) | 215 | 174 |
| Chief Data Officer Branch (Schedule 23) | 767 | 681 |
| Service Canada Transition Office (Schedule 24) | 452 | - |
| Provision of Pay Administration Services | 350 | 350 |
| Canada School of Public Service | 515 | 515 |
| Financial Management Transformation | 125 | 125 |
| Total administrative costs charged to the Canada Pension Plan Accounts | 665,324 | 654,806 |
The accompanying notes form an integral part of the consolidated statement of administrative costs charged to the Canada Pension Plan Accounts.
Notes to the consolidated statement of administrative costs charged to the Canada Pension Plan Accounts
Note 1: Introduction and Basis of Accounting
Introduction
Under the Canada Pension Plan (CPP), the Minister of Employment and Social Development Canada (ESDC) has the responsibility for the administration of Parts II and III (except for some sections of Part III), that pertains to the general administration of the CPP. The CPP is administered by ESDC, with support from the Income Security and Social Development Branch (ISSDB), the Department of Finance, the Canada Revenue Agency, Public Services and Procurement Canada, the Office of the Superintendent of Financial Institutions, the Royal Canadian Mounted Police, CPP Investments, and the Administrative Tribunals Support Service of Canada.
Basis of Accounting
The Memorandum of Understanding (MoU) for the period from April 1, 2024 to March 31, 2025, between the CPP and ESDC was signed on March 28, 2025. This MoU is comprised of 2 parts (including all appendices): the first part (Part A) sets out the framework and basic principles regarding the services to be provided by ESDC to the CPP, specifically Section 6.0 (Financial Arrangements). The second part (Part B) specifies the cost allocation methodologies used by ESDC to calculate the charges for its services to the CPP Accounts for each of the areas recovering costs from the CPP, in accordance with the costing principles approved by Treasury Board in January 1988 (TB Decision 807225).
The framework and basic principles for the comparative figures shown in the consolidated statement of administrative costs under the 2024 header is set out in a Memorandum of Understanding for the period from April 1, 2023, to March 31, 2024, which was signed on March 22, 2024.
The consolidated statement of administrative costs charged to the CPP Accounts focuses on authority for payments in a fiscal year and is prepared on a modified cash basis.
Note 2: Canada Pension Plan Enhancement
On December 15, 2016, legislation to enact the CPP enhancement received Royal Assent. The CPP represents two separate accounts, the CPP Account (base or existing CPP), and the Additional CPP Account (enhanced CPP), where the financial activities of each account are accounted for separately. For the purpose of the MoU and the consolidated statement of administrative costs, CPP refers to the whole of the Canada Pension Plan, which includes both the base and enhanced components of the CPP.
Based on benefit projections at maturity, a fixed percentage cost allocation ratio (entitled "fair share" under section 3.0, Part B of the MoU) was determined, where 27% of the indirect costs would be paid by the Additional CPP Account, and the remaining 73% by the CPP Account. This ratio was determined to accurately reflect the scope of the enhancement relative to the base CPP while considering the volume and the complexity of work being done by ESDC. In addition, costs directly attributable to either the Base CPP Account or the Additional CPP Account are charged to the appropriate account.
The consolidated statement of administrative costs charged to the CPP Accounts for the period from April 1, 2024 to March 31, 2025 of $665,324,135 ($654,806,388 for the period from April 1, 2023 to March 31, 2024), includes Contributions to Employee Benefit Plans and Public Service Insurance. These amounts include costs of $476,809,497 ($468,360,950 for the period from April 1, 2023 to March 31, 2024) associated with the Base CPP Account and $188,514,638 ($186,445,438 for the period from April 1, 2023 to March 31, 2024) associated with the Additional CPP Account (enhanced CPP).
Note 3: Comparative Information
Comparative figures have been reclassified to conform to the current year's presentation.
The previous Benefits and Integrated Services Branch and Citizen Service Branch have been consolidated into one branch: Integrated Services Strategy Operations (Schedule 14);
A new Client Experience Office branch (Schedule 15) was introduced in 2024 to 2025 to oversee client experience across all ESDC. The branch is committed to improving service consistency, service excellence and ensuring a seamless changeover for both employees and clients.
A new Service Canada Transition Office (Schedule 24) was created to support the Chief Operating Officer and ESDC senior leadership team by providing a portfolio view and early warning signals on risks and opportunities that could impede the achievement of service ambitions related to the Service Delivery Network.
Note 4: Contingencies
Due to the nature of its operations, ESDC as a department within the Government of Canada is sometimes subject to grievances filed by its employees. A grievance has been raised that will result in a change of classification, which may impact charges relating to the CPP Accounts for future periods beyond the period ended March 31, 2025. The resolution of this grievance could have a material effect on the expenses included in the consolidated statement of administrative costs charged to the CPP Accounts; however, the financial impact is not determinable at this time.
Schedules to the consolidated statement of administrative costs charged to the Canada Pension Plan Accounts
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Deputy Minister's Office | 879 | 741 |
| Contributions to Employee Benefit Plans | 126 | 107 |
| Public Service Insurance | 74 | 66 |
| Total | 1,079 | 914 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Chief Operating Officer | 514 | 452 |
| Contributions to Employee Benefit Plans | 72 | 65 |
| Public Service Insurance | 43 | 40 |
| Total | 629 | 557 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Income Security and Social Development Branch | 15,584 | 16,114 |
| Contributions to Employee Benefit Plans | 2,231 | 2,332 |
| Public Service Insurance | 1,314 | 1,427 |
| Total | 19,129 | 19,873 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Corporate Secretariat | 1,977 | 2,147 |
| Contributions to Employee Benefit Plans | 275 | 287 |
| Public Service Insurance | 162 | 175 |
| Total | 2,414 | 2,609 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Public Affairs and Stakeholder Relations Branch | 4,018 | 3,754 |
| Contributions to Employee Benefit Plans | 575 | 538 |
| Public Service Insurance | 338 | 329 |
| Total | 4,931 | 4,621 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Human Resources Services Branch | 20,342 | 18,078 |
| Contributions to Employee Benefit Plans | 2,681 | 2,479 |
| Public Service Insurance | 1,579 | 1,517 |
| Total | 24,602 | 22,074 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Legal Services Branch | 3,281 | 3,088 |
| Contributions to Employee Benefit Plans | 108 | 116 |
| Public Service Insurance | 64 | 71 |
| Total | 3,453 | 3,275 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Internal Audit and Enterprise Risk Management Branch | 1,092 | 1,131 |
| Contributions to Employee Benefit Plans | 134 | 146 |
| Public Service Insurance | 79 | 89 |
| Total | 1,305 | 1,366 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Strategic and Service Policy Branch | 3,389 | 3,445 |
| Contributions to Employee Benefit Plans | 300 | 316 |
| Public Service Insurance | 177 | 193 |
| Total | 3,866 | 3,954 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Business Delivery Modernization Programme Strategy and Design | 4,665 | 7,018 |
| Contributions to Employee Benefit Plans | 363 | 520 |
| Public Service Insurance | 214 | 318 |
| Total | 5,242 | 7,856 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Business Lead, Benefits Delivery Modernization | 504 | 403 |
| Contributions to Employee Benefit Plans | 74 | 59 |
| Public Service Insurance | 43 | 36 |
| Total | 621 | 498 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Business Delivery Modernization Implementation | 79 | 29 |
| Contributions to Employee Benefit Plans | 11 | - |
| Public Service Insurance | 7 | - |
| Total | 97 | 29 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Technical Change Authority and Deputy Chief Information Officer | 506 | 979 |
| Contributions to Employee Benefit Plans | 45 | 63 |
| Public Service Insurance | 26 | 38 |
| Total | 577 | 1,080 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Processing & Payments - NHQ | 61,355 | 49,577 |
| Processing & Payments - Regions | 197,275 | 202,218 |
| Call Centers - NHQ | 2,913 | 2,052 |
| Call Centers - Regions | 27,467 | 28,799 |
| Citizen Service Branch - NHQ | 1,367 | 2,506 |
| Citizen Service Branch - Regions | 19,532 | 19,779 |
| Contributions to Employee Benefit Plans | 42,635 | 42,451 |
| Public Service Insurance | 25,113 | 25,980 |
| Total | 377,657 | 373,362 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Client Experience Office | 766 | - |
| Contributions to Employee Benefit Plans | 110 | - |
| Public Service Insurance | 65 | - |
| Total | 941 | - |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Integrity Services Branch - NHQ | 3,656 | 4,124 |
| Integrity Services Branch - Regions | 8,376 | 8,901 |
| Contributions to Employee Benefit Plans | 1,578 | 1,639 |
| Public Service Insurance | 930 | 1,003 |
| Total | 14,540 | 15,667 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Social Insurance Register | 8,254 | 8,028 |
| Contributions to Employee Benefit Plans | 920 | 912 |
| Public Service Insurance | 542 | 558 |
| Total Administrative Costs | 9,716 | 9,498 |
| Less: Funding from Treasury Board | (1,648) | (1,638) |
| Total | 8,068 | 7,860 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Innovation, Information and Technology Branch - Regular Operating | 76,933 | 80,341 |
| Shared Services Canada | 29,077 | 29,411 |
| Contributions to Employee Benefit Plans | 6,625 | 6,238 |
| Public Service Insurance | 3,902 | 3,817 |
| Total | 116,537 | 119,807 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Chief Financial Officer Branch - Regular Operating | 15,546 | 16,387 |
| National Accommodation Plan | 37,525 | 37,954 |
| Contributions to Employee Benefit Plans | 2,066 | 2,148 |
| Public Service Insurance | 1,217 | 1,315 |
| Total | 56,354 | 57,804 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Strategic Services Bureau and Regional Assistant Deputy Ministers | 5,254 | 6,002 |
| Contributions to Employee Benefit Plans | 729 | 846 |
| Public Service Insurance | 429 | 518 |
| Total | 6,412 | 7,366 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Corporate Reserve | 11,700 | 1,928 |
| Contributions to Employee Benefit Plans | 1,728 | 286 |
| Public Service Insurance | 1,018 | 175 |
| Total | 14,446 | 2,389 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| ESDC Ombuds Office | 176 | 143 |
| Contributions to Employee Benefit Plans | 25 | 19 |
| Public Service Insurance | 14 | 12 |
| Total | 215 | 174 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Chief Data Officer Branch | 760 | 672 |
| Contributions to Employee Benefit Plans | 4 | 6 |
| Public Service Insurance | 3 | 3 |
| Total | 767 | 681 |
| Cost description | 2025 cost in thousands of dollars | 2024 cost in thousands of dollars |
|---|---|---|
| Service Canada Transition Office | 370 | - |
| Contributions to Employee Benefit Plans | 52 | - |
| Public Service Insurance | 30 | - |
| Total | 452 | - |