PUBLIC HEALTH AGENCY OF CANADA Future-oriented Statement of Operations (unaudited) For the year ended March 31, 2011

Notes to the Financial Statement (unaudited)

7. Employee Benefits

(a) Pension Benefits:

The Agency's employees participate in the Public Service Pension Plan which is sponsored and administered by the Government of Canada. Pension benefits accrue at a rate of 2 percent per year of pensionable service to a maximum of 35 years.

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.

Both employees and the Agency contribute to the Public Service Pension Plan. The anticipated expenses for 2009-2010 and 2010-2011 are estimated based on actual for 2008-2009, amounting to approximately 8.56% of salaries and wages.

(b) Severance Benefits:

Employees are entitled to severance benefits under labour contracts or conditions of employment. These benefits are accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits for the Government as a whole. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information concerning the estimated severance benefits is as follows:

Severance benefits expenses for 2010 and 2011 have been calculated as 1/52 of total salaries for the year.

Anticipated benefits to be paid during the future years are based on 2008-2009 actual.