Social Development Canada announces 2009 benefit rates for the Canada Pension Plan (CPP) and Old Age Security (OAS).
Ottawa (6 December 2008) - Human Resources and Skills Development Canada announced yesterday the next benefit rates for the Canada Pension Plan (CPP) and Old Age Security (OAS).
Canadians already receiving CPP benefits as of December 2008 will see their benefits increase by 2.5 percent on January 1, 2009. Canada Pension Plan benefits are revised once a year, in January. Increases are based on changes over a 12-month period in the Consumer Price Index, which is the cost-of-living measure used by Statistics Canada. The maximum CPP retirement benefit will increase on January 1, 2009, from $884.58 to $908.75 per month.
The OAS program consists of the basic pension, the Guaranteed Income Supplement (GIS) and the Allowance. The GIS and the Allowance provide additional benefits to eligible low-income pensioners and their spouses or common-law partners, as well as to eligible survivors. These payments are also based on the Consumer Price Index but are revised quarterly, in January, April, July and October.
As of January 1, 2009, the basic OAS pension, paid to people 65 years of age and over, will remain unchanged at $516.96 per month. GIS and Allowance payments will also remain the same. Although there has been no increase over the previous quarter, the OAS benefit rates have increased by 2.9 percent overall over the past year.
Funded through general tax revenues, the OAS program provides a basic minimum income for Canadian seniors. It provided 4.5 million seniors with approximately $32 billion in 2007-2008.
The CPP (or the Quebec Pension Plan in Quebec) is funded through contributions by Canadian workers, their employers and the self-employed, as well as through earnings on investment of the Plan's funds. In addition to retirement benefits, the Plan provides disability benefits, death benefits, survivor benefits, and benefits for children.
Maximum Old Age Security benefit rates as of Jan. 1, 2009
|Type of Benefit||Maximum Monthly Rate Jan – Mar 2009|
Basic Old Age Security pension
Guaranteed Income Supplement
Spouse/Common-law partner of
$652.51 $430.90 $430.90
Maximum CPP benefit rates as of Jan. 1, 2009
|Type of CPP Benefit||Maximum Rates for 2009|
|Retirement pension (at age 65)||$908.75|
|Survivor's pension (under age 65)||$506.38|
|Survivor's pension (age 65 & over)||$545.25|
Survivor/Retirement ( at age 65)
|Disabled contributor's child benefits||$213.99|
|Deceased contributor's child benefits||$213.99|
|Yearly Maximum Pensionable Earnings (YMPE)||$46,300.00|
|Year's Basic Exemption (YBE)||$3,500.00|
|Employer / Employee CPP Contribution Rate||4.95% each - up to a maximum of $2,291.85 annually|
|Self-Employed CPP Contribution Rate||9.9% - up to a maximum of $4,583.70 annually|
(Published as pen-n88-jan-16-08.htm)