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Canada Pension Plan and Old Age Security Benefit Rates

  • Synopsis: Published: 2011-12-04 (Revised/Updated 2016-06-13) - Human Resources and Skills Development Canada benefit rates for the Canada Pension Plan CPP and Old Age Security OAS effective January 1 2012 - Human Resources and Skills Development Canada.
Canada Pension Plan (CPP)

A contributory, earnings-related social insurance program. It forms one of the two major components of Canada's public retirement income system, the other component being Old Age Security (OAS). Other parts of Canada's retirement system are private pensions, either employer-sponsored or from tax-deferred individual savings (known in Canada as a Registered Retirement Savings Plan).

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Quote: "The OAS program is funded through general tax revenues and provides a basic minimum income for Canadian seniors. It provided 4.9 million seniors with $35.7 billion in 2010-2011."

Human Resources and Skills Development Canada announce the benefit rates for the Canada Pension Plan (CPP) and Old Age Security (OAS), effective January 1, 2012.

CPP benefits will increase by 2.8 percent for those already receiving CPP benefits. CPP benefits are revised once a year, in January, based on changes over a 12-month period (November 2010 to October 2011) in the Consumer Price Index (CPI), which is the cost-of-living measure used by Statistics Canada.

The maximum CPP retirement benefit for new recipients will increase from $960 to $986.67 per month. This increase is calculated based on the average yearly maximum pensionable earnings for the last five years.

The new CPP rates will be in effect until December 31, 2012.

The basic OAS pension, the Guaranteed Income Supplement and the Allowances will increase by 0.4 percent. These payments are also based on the CPI but are reviewed quarterly (in January, April, July and October) and are revised as required to reflect increases in the cost of living as measured by the CPI. The maximum basic OAS pension will increase from $537.97 to $540.12 per month.

The Guaranteed Income Supplement and the Allowances provide additional income to low-income pensioners, their spouses or common-law partners, and eligible survivors. Since July 1, 2011, these beneficiaries also receive a GIS and Allowances top-up benefit of up to $600 for single seniors and $840 for couples per year. This top-up will also be indexed and is included in the GIS and the Allowances rate.

Although OAS and CPP benefits are not indexed at the same time, they are both adjusted with the cost of living over a given year.

Maximum Canada Pension Plan benefit rates as of January 1, 2012

Type of Canada Pension Plan benefitMaximum benefit rates for 2012
Retirement pension (at age 65)$986.67
Disability pension$1,185.50
Survivor's pension (under age 65)$543.82
Survivor's pension (age 65 and over)$592
Disabled contributor's child benefits

Deceased contributor's child benefits

$224.62

$224.62

Death benefit$2,500
Combined pensions:

Survivor/Retirement (retire at age 65)

Survivor/Disability

$986.67

$1,185.50

Flat rate:

Survivor's pension

Disability pension

$173.82

$445.50

Maximum OLD AGE SECURITY benefit rates as of JANUARY 1, 2012

Type of Old Age Security benefitMaximum monthly benefit rates

January-March 2012

Previous quarter

October-December 2011

Basic Old Age Security pension$540.12$537.97
Guaranteed Income Supplement
Single$732.36$729.44
Spouse/Common-law partner of
  • a non-pensioner

$732.36

$729.44
  • a pensioner
$485.61$483.68
  • an Allowance recipient

$485.61

$483.68
The Allowances
  • regular
  • survivor

$1,025.73

$1,148.35


$1,021.65

$1,143.78

The above amounts, aside from the basic OAS pension, include the GIS and the Allowances top-up benefit.

The Old Age Security (OAS) pension and the Canada Pension Plan (CPP) enhance the quality of life of Canadian seniors by providing a modest base upon which to build additional income for retirement.

The OAS program is funded through general tax revenues and provides a basic minimum income for Canadian seniors. It provided 4.9 million seniors with $35.7 billion in 2010-2011.

The CPP (or the Quebec Pension Plan in Quebec) is funded through contributions by Canadian workers, their employers, the self-employed and through investment earnings on the Plan's funds. In addition to retirement benefits, the Plan provides disability benefits, death benefits, survivor benefits and benefits for children.

The CPP is a stable, well-designed plan that is portable from province to province and fiscally sustainable over the long run. The Chief Actuary of Canada has confirmed that the CPP is financially sound and fully sustainable for generations to come.

Canada's strong public pension system including the GIS has had great success in reducing poverty among seniors. In fact, the incidence of poverty among seniors in Canada has dropped from a rate of 21 percent in 1980 to 5.2 percent in 2009.

For further information, please consult the Human Resources and Skills Development Canada website at www.hrsdc.gc.ca



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