MISSISSAUGA, Ont. – Finance Minister Bill Morneau says any more changes to the Canada Pension Plan will have to wait for a regular review of the national pension scheme, including a provision aimed at helping women who stay home to raise children.
The Liberals had previously said Morneau would raise the issue of this so-called drop-out provision with his provincial counterparts before the end of 2016.
Any time out of the workforce could be a knock against someone in retirement, because CPP benefits are calculated on average annual earnings.
The existing system allows parents who temporarily leave the workforce during child-rearing years to exclude that time from the calculation.
There is also a general drop-out clause for those who have lost a job or returned to school.
The new, expanded CPP benefit has a general drop-out clause, but no specific provision for child-rearing.
“What we will do is continue to look at other ways we can enhance it to make sure that Canadians that have time off of work can get access to benefits and that’s something we’re working together with the finance ministers,” Morneau said Thursday.
In June, finance ministers agreed to changes to the CPP that will raise retirement benefits, increase how much income is eligible for CPP coverage to $82,700 and also increase premiums for both workers and employers.
Contributions by employees and employers will gradually rise over seven years starting in 2019. Future retirees would receive benefits equal to about one-third of their average annual incomes, up from one-quarter.
The Liberals said all the necessary legislative requirements are now taken care of, paving the way for the changes to come into force.