1. Income Security Programs Old Age Security Canada Pension Plan International Agreements

2. In general, 70% of pre- retirement income is required OAS and CPP retirement pensions are designed to replace about 40% of the pre-retirement income $14,500 (2001) Canada’s Retirement Income System

3. Cornerstone of Canada’s Retirement income system Financed from general tax revenues Old Age Security

4. Financed from general tax revenues of the Government of Canada OAS on solid ground - Actuarial studies Canada’s Gross Domestic Product (GDP) and individual incomes to rise Old Age Security Sustainability

5. Old Age Security Benefits Old Age Security pension Guaranteed Income Supplement The Allowances

6. Based on: Age Legal Status Years of Residence OAS Pension

7. Residence Requirement Full Partial Full or Partial OAS pension depends on the years of living in Canada OAS Pension

8. in People living in Canada 10 yearsneed 10 years after 18 outside People living outside of Canada 20 yearsneed 20 years after 18 Partial OAS Pension

9. Rate = 1 for each year in Canada 40 after age 18 International Agreements can be used when there are not enough years in Canada. Partial OAS Pension

10. Protects social security rights Current Agreements: 38 countries International Agreements

11. Antigua/ Finland Korea St. Kitts/Nevis BarbudaFranceLuxembourgSt. Lucia Australia Germany Malta St. Vincent/ Austria Greece Mexico Grenadines Barbados Grenada Netherlands Sweden BelgiumIceland New Zealand Switzerland ChileIreland Norway Trinidad / Croatia Italy Philippines Tobago Cyprus JamaicaPortugal United Kingdom Denmark Jersey /Spain United States Dominica Guernsey International Agreements

12. Help to meet eligibility rules * Total Time * Prorate payment International Agreements

13. Must: receive OAS pension reside in Canada have low income Supplement - GIS Supplement - GIS

14. Based on: rate of OAS pension income marital status Paid on a sliding scale GIS Amount

15. Spouse legally married person Common-law partner person cohabiting in a conjugal relationship for at least one year same sex or opposite sex Definitions

16. Allowance Paid to the younger partner if: age 60 to 64 couple’s income is low residence rules are met Paid on sliding scale

17. Paid if: age 60 to 64 a survivor residence rules are met Paid on sliding scale Allowance for the Survivor

18. Began in January 1966 Compulsory contributions based on earnings Self-supporting Payable outside Canada Québec has a similar program Canada Pension Plan

19. Workers pay into CPP during earning years To protect against future loss of retirement income due to retirement disability disability death death Canada Pension Plan

20. Contribution Rates Schedule Employee Employer Self-Employed 2000 3.9% 3.9% 7.8% 2001 4.3% 4.3% 8.6% $1,496.40 $1,496.40 $2,992.80 2002 4.7% 4.7% 9.4% 2003 4.95% 4.95% 9.9%

21. $3,500 - Year’s Basic Exemption (YBE) $38,300 - Year’s Maximum Pensionable Earnings (YMPE) Pensionable Earnings $3,500$0 $38,300 Pensionable Earnings for 2001

22. Starts January 1966 or month after 18th birthday Contributory Period Ends month before Retirement pension month age 70 month of death

23. Periods of CPP disability Periods during which children were raised Plus 65 years of age 15% Drop-Out Provisions

24. Drop-Out Provisions Example January 1966 Year 2001 Age 65 Contributory Period 36 Years 20 years after drop-outs 1.Periods of CPP Disability (1985 to 1990)6 Years 2.Raising Children (1968 to 1974)7 Years 3.15% (36 - 13 = 23 years x 15%)3 Years 1968 - 1974 1977 - 1978 1985 - 1990 1982

25. Statement of Contributions Sent annually Records earnings after age 18 Canada Pension Plan

26. Employment-based contributions Self-supporting (contributions, interests and earnings from investments) Financially sound - 17th Actuarial Report Canada Pension Plan Sustainability

27. Separate Act - Minister of Finance 12 members - Provincial representation Operates at arm’s length from government Professionally manages the CPP surplus accrued since 1998 Subject to the same investment rules as other pension funds Reports investments and returns regularly CPP Investment Board

28. RetirementRetirement DisabilityDisability - Children’s benefits SurvivorSurvivor - Death benefit - Survivor pension - Children’s benefits CPP Benefits

29. Need one valid contribution Retirement Choices Early Early - age 60 to 65 Standard Standard - age 65 Late Late - age 65 - 70 CPP Retirement Pension

30. stopped or substantially stopped workmust have stopped or substantially stopped work reducedpension is reduced by 0.5% for each month under age 65 Early Retirement Pension

31. nono need to stop work increasedpension is increased by 0.5% for each month over age 65 Late Retirement Pension

32. Rules: Under age 65 Paid long enough and recently enough Disability must be both severe and prolonged CPP Disability Benefit

33. A child of the disabled contributor under 18 or 18 to 25, at school flat rate Children’s Benefit

34. Vocational RehabilitationProgram Vocational Rehabilitation Program designed to help recipients of CPP Disability benefits return to work Voluntary Disability Benefit

35. Earnings Requirements Earnings Requirements 1/3 10 years1/3 of years in contributory period up to 10 years 3 yearsnever less than 3 years Survivor Benefits

36. Paid to the survivor of the deceased contributor legal spouse or common-law partner CPP Survivor’s Pension CPP Survivor’s Pension

37. A child of the deceased contributor under 18 or 18 to 25, at school payment is a flat rate Children’s Benefit

38. billionRetirement $ 13.3 billion billionDisability$ 2.5 billion billionSurvivor$ 2.7 billion millionDeath benefit $ 232 million millionChildren$ 440 million Amounts Paid

39. CPP Current Benefit Payments

40. How to reach us ? Call toll free: 1 800 277-9914 English 1 800 277-9915 French 1 800 255-4786 TDD/TTY Visit our web at: Visit our web at: www.hrdc-drhc.gc.ca/isp www.hrdc-drhc.gc.ca/isp