Every three years, federal, provincial and territorial Finance ministers review the Canada Pension Plan (CPP) to determine if benefits and/or contribution rates should be changed. Recommendations are based on a number of factors, including whether or not the Plan is meeting the needs of Canadians.
Following their review of the CPP in May 2009, the ministers unanimously recommended changes to the CPP to enhance flexibility and to support both older and younger workers in a fair and affordable way. The changes are being implemented gradually over a six-year period since January 2011, with full implementation in 2016.
What are the highlights of the changes to CPP?
- CPP retirement pensions will be higher if taken after age 65
- CPP retirement pensions will be lower if taken before age 65
- Changes to the general drop-out provision
- Elimination of the Work Cessation Test
- Introduction of the Post-Retirement Benefit
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