Information concerning changes to the public sector pension plans
Budget 2012 announced the federal government's intention to propose changes to plan member contribution rates and the age at which future public service pension plan members would be eligible for a pension benefit.
Consultations to discuss the changes with the pension advisory committees, which include representation from employees, retirees and member representatives from the public service, Canadian Forces and Royal Canadian Mounted Police, are ongoing.
To allow the changes, the following Acts will be amended and, if enacted in Parliament, will become effective :
- the Public Service Superannuation Act;
- the Canadian Forces Superannuation Act; and
- the Royal Canadian Mounted Police Superannuation Act
Contribution rate change
Contribution rates will increase beginning in January 2013 for all active pension plan members of the public service pension plan, Regular Force members of the Canadian Forces pension plan, and the Royal Canadian Mounted Police pension plan.
Legislation amendments, if enacted in Parliament, will allow public service pension plan member contribution rates to gradually increase over time to an employer:employee cost-sharing ratio of 50:50. The contribution rates for Regular Force members of the Canadian Forces and the Royal Canadian Mounted Police pension plans will also increase by a comparable amount.
Increasing contribution rates ensures that pension plan members and the Government of Canada, as employer, contribute to the pension plans in a more balanced way.
Age of retirement change for new public service pension plan members
Effective , new employees who become public service pension plan members on or after may be eligible to retire with an unreduced pension benefit from the public service pension plan at age 65.
Note: The change in the age of retirement does not affect plan members who were participating in the public service pension plan before and they will continue to be able to retire with an unreduced pension at age 60 (or at age 55 with at least 30 years of service).
These changes will ensure that public sector pension plans continue to provide appropriate benefits to plan members at a fair cost. The Government of Canada remains committed to ensuring the long-term sustainability and financial integrity of the public sector pension plans.
More detailed information about theses changes will be provided in the upcoming weeks. For information about the public service pension plan, please visit the Public Service Pension and Benefits Web Portal.