Most Canadians don’t understand the CPP

Reports recommend more outreach and advertisements



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OTTAWA – Internal evaluations of the Canada Pension Plan show the retirement system is poorly understood by most of the public — a problem retiree Evan Brett avoided only through luck and meticulous record keeping.

The 76-year-old realtor and his wife Latifah dove into their files at their Langley, B.C., home a decade ago when Latifah applied for retirement benefits. The documents they happened to have stockpiled ensured they were able to maximize the benefits they receive today.

Evan Brett said he knew enough about the Canada Pension Plan to avoid tripping over application hurdles.

But he is sure others aren’t nearly as well-versed — and documents obtained by The Canadian Press under the Access to Information Act suggest he is right.

Evaluations drawing from workers, retirees and Service Canada officials show Canadians are often confused about what they need when applying for CPP benefits, have a hard time understanding information on government websites, and don’t completely understand the cornerstone retirement program.

The reports recommend more outreach and advertisements to help seniors navigate the system and avoid frustration and shock when they apply for benefits.

Take the child-rearing provision, which caused the Bretts’ headaches. The provision allows a retiree to exempt up to seven years that they were out of the workforce raising children so the lower wages during those years don’t bring down how much they are eligible to receive in retirement.

One evaluation suggested Canadians often don’t know the provision helps them earn more in retirement. And when they do realize the difference, they have issues tracking down documentation such as birth certificates from adult children.

The Bretts had enough paperwork handy a decade ago that they were able to convince the government it was using the wrong seven-year period to calculate Latifah’s child-rearing years, eliminating a possible reduction in monthly payments.

The reviews also found that generally, retirees don’t know that CPP retirement and survivor benefits — the latter paid out to widows or widowers — are blended into one capped payment that is usually lower than the sum of the two separate benefits.

Public opinion research done as part of the CPP evaluation recommended the government remove the cap on the blended benefit.

Talking to Brett about calculating the blended benefit gives a window into how dizzying the calculation can be, and how he struggled to figure the financial hardship a cap on benefits would have on the surviving spouse.

“As it is, we’re constantly behind in our payments of our rent and our mortgage and our groceries,” he said.

The reviews turned up other troubling issues with Canadians’ knowledge about CPP.

Service Canada officials noted that many clients don’t know they have to ask the government to deduct taxes from CPP payments. “They assume that such taxes are automatically deducted from their CPP benefits,” one report said.

The reviews showed aboriginals who live on reserve often don’t learn until they turn 65 that they won’t receive CPP retirement benefits because employers on reserve aren’t required to contribute to CPP.

It’s not just the existing program that requires more outreach. Public opinion research ordered by the Privy Council Office late last year found that few participants recalled that CPP benefits and contributions were going up starting in 2019 as part of an expansion federal and provincial leaders agreed to over the summer.

6 comments on “Most Canadians don’t understand the CPP

  1. Great read, here is a question. My freind has never paid into cpp because of a brian tumour at the age of 20. HIs wife is tthe bread winner. Is there anyway he can get cpp at 65. He has been denied cpp disability because he never paid into it.


    • no if he never paid in he cannot collect he can do peon sharing but will most likely not be 50 / 50 unless he married prior to 18 years of age. AdminStation of cpp is atrosuous management has no knowledge of what actually works the minister as pm are clie less. 10’s of millions of dollars are waisted on administration of the program each year


  2. The information required to exempt the child caring years is not as onerous as you report. For Canadian born children you simply need to provide their SIN, not a birth certificate.


    • There is supposed to be some payment for years when parents took time off work for raising children. I found out, the hard way, that this seems to be a payment that mothers will get and fathers won’t. Sad, really, in this day and age.


  3. what is the total amount of a capped survivor benefit on a monthly basis , provided that both contributed to CPP while they worked until retirement?


  4. My survivor benefit was cancelled last year because I took out $10,000. to purchase a needed vehicle and that put my total income for the year just over the $30,000. mark. Do I have to reapply in order to have it reinstated?


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