Most of Canada’s finance ministers reached an agreement in principle to revamp the Canada Pension Plan. Quebec and Manitoba have not signed on to the deal.
The agreement will go into effect in 2019. The average Canadian worker earning about $55,000 will pay an additional $7 a month. That would increase to $34 a month by 2023. Once the plan is fully implemented, the maximum annual benefits will increase by about one-third to $17,478.
Quebec, which has its own pension plan, and Manitoba will continue to be part of the process, despite not signing on to the agreement. The new government in Manitoba has requested more time to evaluate the deal.
A change to the CPP requires the consent of Ottawa and a minimum of seven provinces representing at least two-thirds of the country’s population. There hasn’t been such a level of consensus on CPP reform at a national scale since the 1990s.
Critics have warned that expanding the CPP would squeeze workers and employers for additional contributions and hurt the still-fragile Canadian economy.
Update: Manitoba has agreed to sign the deal.