Pension Legislative Update for November and December 2017

Cowan Insurance Group’s Guide to Canadian Benefits Legislation and Guide Supplement are valuable tools that help educate how changes in legislation may impact the benefits and insurance community. Along with the following monthly pension legislative news updates, these documents offer a high level overview of some of the benefits currently available through various Canadian government programs.



CPP contribution rates, maximums and exemptions for 2018. Maximum annual pensionable earnings $55,900. Basic exemption amount $3,500. Maximum contributory earnings $52,400. Employee and employer contribution rate 4.95%. Maximum annual employee and employer contribution $2,593.80. Maximum annual self-employed contribution $5,187.60. For details visit the Government of Canada website.



On November 21, 2017, the Government of Alberta amended the Employment Pension Plans Regulation (Regulation) to establish a new commuted value payout option available to Collectively Bargained Multi-Employer Plans (CBMEPs) that are under a solvency moratorium. Details can be found in EPPA Update 17-03 (opens as a pdf). Source:  Alberta Treasury Board and Finance website.



The Pooled Registered Pensions Plans (Manitoba) Act and Pooled Registered Pension Plans Regulation came into force August 1, 2017. Manitoba entered into the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans effective November 15, 2017. The legislation allows licensed providers to offer Pooled Registered Pension Plans (PRPPs) to employees of employers and self-employed individuals in Manitoba.   Pension Benefits Regulation 80/2017 came into force August 1, 2017.  The regulation allows transfers to and from PRPPs to Locked-in Retirement Accounts, Life Income Funds and Registered Pension Plans. Source: Province of Manitoba website.



The Quebec government has announced a plan to expand the Quebec Pension Plan in line with reforms to the Canada Pension Plan. The bill will see Quebecers’ contributions to the province’s public pension plan start to rise in 2019. The retirement pension will also change from an income replacement rate of 25 per cent to 33.33 per cent. For more information visit Retraite Quebec and Montreal Gazette.

Quebec Pension Plan, Child Assistance, and Public-sector pension plans (RREGOP, PPMP, etc.) Benefits amounts and key data for 2018. Pensions and benefits paid by Retraite Québec are indexed annually on January 1. In 2018 pensions will increase by 1.5% based on the cost of living. For details visit Retraite Quebec.

Quebec Parental Insurance Plan premium rates to remain the same in 2018. The maximum pensionable earnings for QPP for 2018 is $55,900. The premium rate (as a percentage of insurable income) is 0.548% for salaried workers, 0.767% for employers and 0.973% for self-employed workers. For details visit the Province of Quebec website.

Retirement Pension Supplement:  Workers who are already receiving a retirement pension under the Québec Pension Plan and who work must contribute to the Plan once their earnings exceed the 3 500 $ basic exemption. For details about the Retirement Pension Supplement visit Retraite Quebec.

Increase in the default contribution rate for VRSPs. In 2018 the default contribution rate for voluntary retirement savings plans (VRSPs) will increase from 2% to 3% of the employee’s gross salary. That rate applies to employees who have signed up for a VRSP offered by their employer but who do not choose the amount they wish to contribute by the given deadline. For details visit Retraite Quebec.