According to a report, the Canada Pension Plan (CPP) is expected to be able to meet its obligations to remain financially sustainable over the long term, despite the projected substantial increase in benefits paid as a result of an aging population.
The 26th Actuarial Report on the Canada Pension Plan finds that, with the legislated contribution rate of 9.9%, contributions are projected to be more than sufficient to cover the expenditures over the period from 2013 to 2022.
“Thereafter, a proportion of investment income is required to make up the difference between contributions and expenditures,” the report notes. “In 2050, 27% of investment income is required to pay for expenditures.”
The report also finds that total assets are expected to grow to $300 billion by the end of 2020 from $175 billion at the end of 2012; the number of contributors is expected to grow to 14.5 million by 2020 from 13.5 million in 2013; contributions are expected to increase to $56 billion in 2020 from $42 billion in 2013; and the number of retirement beneficiaries is expected to increase to 10.2 million in 2050 from 4.6 million in 2013.
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