Pension contribution rates effective January 1, 2018 for the three major public sector pension plans
Since 2013, public sector pension plan contribution rates have gradually increased to reach the 50:50 employer-employee cost-sharing ratio for the public service pension plan. The contribution rates for the Canadian Armed Forces–Regular Force and the Royal Canadian Mounted Police pension plans also increased by a comparable amount. The targeted cost-sharing ratio was reached by the end of 2017.
Due to the persistent low interest rate environment, the Chief Actuary lowered his long-term rate of return assumption, which impacts the cost of the pension plans. In order to ensure the plans remain appropriately funded, contribution rates will increase as of , for the public service, the Canadian Armed Forces–Regular Force and the Royal Canadian Mounted Police pension plans. These changes result in contribution increases for both the Government of Canada and plan members, and will also ensure that costs remain shared equally between the Government and the public service pension plan.
Plan members contribute a percentage of salary to the public sector pension plans through payroll deductions. The contribution rates tables below show the rates for 2017 and 2018.
Contribution rates table AFootnote * below applies to the following plan members:
- Public service pension plan members who were participating in the plan before ;
- Public service pension plan members with operational service with Correctional Services of Canada (employees who participate in the plan before and after );
- Canadian Armed Forces–Regular Force pension plan members (Part I); and
- Royal Canadian Mounted Police pension plan members.
| On your salary… | In 2017, you contributed… | In 2018, you will contribute… |
|---|---|---|
| On earnings up to the maximum covered by the Canada/Quebec Pension Plan ($55,900 in 2018) | 9.47% | 9.83% |
| On earnings over the maximum covered by the Canada/Quebec Pension Plan | 11.68% | 12.13% |
Contribution rates table BFootnote * below applies to public service pension plan members who began participating in the plan on or after .
| On your salary… | In 2017, you contributed… | In 2018, you will contribute… |
|---|---|---|
| On earnings up to the maximum covered by the Canada/Quebec Pension Plan ($55,900 in 2018) | 8.39% | 8.77% |
| On earnings over the maximum covered by the Canada/Quebec Pension Plan | 9.94% | 10.46% |
Why are the contribution rates in table B different than those in table A?
Employees who became public service pension plan members on or after , are eligible for an unreduced pension at age 65. These plan members pay lower contribution rates because they must generally wait 5 years longer before they can access a retirement benefit (i.e. they receive a benefit that has a lower overall cost and therefore do not pay as much as those who are eligible to an unreduced pension at age 60).
For more information about contribution rates, visit the Contribution rates page on Canada.ca.
More information about the public service pension plan is also available on Canada.ca/pension-benefits.
More information about the Canadian Armed Forces Pension is available on the National Defence and the Canadian Armed Forces website.
More information about the Royal Canadian Mounted Police pension plan is available on Your RCMP Pension and Benefits website.
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