Treasury Board has announced the new pension contribution rates for members of the public service of Canada. These rates will come into effect on January 1, 2016.
Employees who were participating in the pension plan before January 1, 2013, will see the rate on earnings up to the maximum covered by the Canada/Quebec Pension Plan ($54,900) increase from 8.15% in 2015 to 9.05% in 2016. The rate on earnings over the maximum covered by the Canada/Quebec Pension Plan, which was 10.40% in 2015, will go up to 11.04% in 2016.
For employees who began participating in the pension plan on or after January 1, 2013, the rate on earnings up to $54,900 will increase to 7.86%, and the rate on earnings over that amount will rise to 9.39%.
The full details concerning these increases are available on the Treasury Board of Canada Secretariat website.
Under the provisions of the Public Service Superannuation Act, the terms of the federal public service pension plan are not subject to collective bargaining. The employer may thus legislate changes to the terms of the plan and its contribution rates. The new rates were introduced in the Jobs and Growth Act, 2012, which was enacted by the Conservative government on December 14, 2012; this legislation also changed the age of eligibility for an unreduced pension benefit from age 60 to age 65 for employees hired on or after January 1, 2013.
