VANCOUVER (GNB) – The provincial government has joined the federal government and other provinces in an agreement in principle to recommend a modest and balanced incremental enhancement to the Canada Pension Plan, starting in 2019 and phased in over seven years until 2025.

“The full benefit of the enhancements will be realized by today’s younger workers when they retire and it will ensure that future generations of New Brunswick seniors will be able to live independently,” said Finance Minister Cathy Rogers. “Furthermore, because of lowering employment insurance premiums and because it will be phased in over time, this will not be a burden on business.”

The agreement was reached on June 20, at the federal, provincial and territorial meeting of finance ministers in Vancouver.

Under the agreement in principle, starting in 2019, the ministers have agreed to:

  • increase income replacement from one quarter to one third of pensionable earnings. This means that, at maturity, a Canadian with $50,000 in constant earnings throughout their working life would receive a yearly pension benefit of about $16,000 instead of the $12,000 they would currently receive, or $4,000 more per year; and
  • increase the maximum amount of income subject to the plan by 14 per cent, which is projected to be equal to roughly $82,700 in 2025.

“The agreement that has been reached encapsulated a shared vision of the country, one that will benefit future generations of Canadians to allow them a more secure environment with a national pension plan,” said Rogers.

The agreement in principle requires final ratification by seven of 10 provinces representing two thirds of the national population.

More information is available online.