Actuarial Science 1021A/B Lecture Notes - Disability Pension, 6 Years, Canada Pension Plan
6 Nov 2013
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Document Summary
The level of benefits was set to provide, along with oas, a replacement ratio of approximately 40% of income up to the national average wage: 15% from oas, 25% from cpp. From 1966 to 1986, the contribution rate was: 1. 8% for ees, 1. 8% for ers, 3. 6% for self-employed. In the 1985 actuarial report on the cpp, it was determined that the 3. 6% rate was inadequate to meet the long-term benefit obligations of the cpp: the contribution rate was progressively increased starting in 1987: In the 1997 actuarial report, it was reported that if the contribution rate continued to rise by only 0. 2% per year, cpp would run out of money by 2015. Suggested solutions: continue to raise the rate by 0. 2% per year until reaching 14. 2% Or: start raising contribution rates by more than 0. 2% per year until reaching 9. 9% in 2003 (this was the solution that was adopted!)
