Canada’s New Government Improves Access to Canada Pension Plan and Old Age Security Benefits

May 03, 2007

OTTAWA, ONTARIO — Bill C-36, which makes amendments to the Canada Pension Plan (CPP) and the Old Age Security Act is now law. Once in force, the changes will make it easier for people to apply for benefits and will make it easier for more Canadians with disabilities to receive benefits.

“We have listened to Canadian seniors and taken action to make sure that the Canada Pension Plan and the Old Age Security (OAS) program meet their needs today and in the future,” said the Honourable Monte Solberg, Minister of Human Resources and Social Development. “These changes demonstrate the commitment of Canada’s New Government to Canada’s seniors and to persons with disabilities, reinforcing Canada’s public pensions as cornerstones for retirement and income security.”

Thanks to the amendments, applications for OAS benefits can be modernized and streamlined, leading to easier access for eligible seniors. For example, when seniors apply for their OAS benefit, they will be able to make a one-time application for the Guaranteed Income Supplement. As a result, virtually all eligible seniors will receive GIS if their income drops below a certain threshold, as long as they file their annual income tax returns.

“Canada’s public pensions are a source of pride for all Canadians,” said the Honourable Marjory LeBreton, Leader of the Government in the Senate and Secretary of State (Seniors). “Seniors built the CPP from the ground up and worked hard to make our public pension system a world leader. They deserve fair and easy access to every penny of their retirement benefits.”

Two key amendments to the CPP are based on recommendations made by federal, provincial and territorial ministers of finance at the conclusion of the triennial review of the CPP last June. These two amendments to the CPP, which are expected to come into effect later this year after formal provincial consent, will mean that:

• More individuals will qualify for CPP disability benefits; specifically, applicants with 25 years or more of CPP contributions will require valid contributions in three of the last six years, instead of the current requirement of four of the last six years. Medical eligibility requirements for CPP disability benefits will remain the same.

• The CPP’s full funding provision will be integrated into actuarial reporting and contribution rate-setting. The full funding provision requires that benefit increases or new benefits be paid for in full so that their costs are not passed on to future generations.

Some amendments will apply to both the Canada Pension Plan and the Old Age Security Act. For example, Bill C-36 provides for the creation of electronic services such as online applications. This will mean that people will have more flexibility when they apply for their pensions.