Pensions and other future benefits

Public Accounts of Canada 2016 Volume I—Top of the page Navigation

The obligations arising from public sector pensions and other employee and veteran future benefits, sponsored by the Government or some of the consolidated Crown corporations and other entities, are measured on an actuarial basis and are presented net of pension assets and unrecognized net actuarial gain or loss, as well as contributions and benefits paid by some of the consolidated Crown corporations and other entities after their measurement date of December 31 up to March 31.

Public sector pensions

The Government sponsors a number of defined benefit pension plans covering substantially all its employees, principally members of the federal public service, the Canadian Forces, including the Reserve Force, and the Royal Canadian Mounted Police, as well as employees of certain Public Service corporations and territorial governments. The Government also sponsors several other pension plans; the two most significant ones being for Members of Parliament and federally appointed judges. The Government has a statutory obligation to pay the pension benefits it sponsors.

The liabilities for public sector pensions sponsored by the Government are initially recorded through pension accounts, which are generally established pursuant to legislation. The pension accounts track transactions such as contributions, interest credits, benefit payments, transfers and administrative expenses. Any adjustments required under the Government's accounting policies are then recorded through allowance for pension adjustment accounts. The allowance accounts reflect the differential between accrual and cash accounting recognized through the years. They also reflect the accumulated difference in interest calculations and consolidation adjustments related to refundable tax amounts remitted to or refunded from the Canada Revenue Agency.

The Government's pension plans are generally financed from employer and employee contributions or from Government and member contributions. The contributions are either part of general funds or transferred to the Public Sector Pension Investment Board (PSPIB) for investment in capital markets. Since April 1, 2000, amounts equal to contributions less benefits and other payments related to the public service, Canadian Forces—Regular Force and Royal Canadian Mounted Police pension plans, and since 2007 for the Canadian Forces—Reserve Force pension plan, that fall within the Income Tax Act limits are transferred to the PSPIB. The goal of the PSPIB is to maximize returns on investments without undue risk of loss, while having regard to the requirements and financial obligations of each of the pension plans. The PSPIB, a Canadian Crown corporation established by the Public Sector Pension Investment Board Act, reports the results of the investments in an annual report tabled in Parliament. Contributions for all the other pension plans sponsored by the Government are part of general funds.

More information on the above mentioned plans can be found in the respective annual report on the administration of the plans tabled in Parliament.

In addition, some of the consolidated Crown corporations and other entities maintain their own defined benefit pension plans covering substantially all of their employees. The majority of the defined benefit pension plans are contributory plans. Employer and employee contributions are made in accordance with the provisions of the plans. Pension plans' funds are held in external trusts that are legally separate from Crown corporations and other entities.

i. Pension plans

Public Service Pension Plan, Canadian Forces Pension Plan including the Reserve Force Pension Plan and Royal Canadian Mounted Police Pension Plan

The pension plans for the public service, Canadian Forces—Regular Force and the Royal Canadian Mounted Police provide for the payment of a lifetime pension and a temporary bridge benefit payable normally until age 65, the age at which members generally become eligible for the Canada Pension Plan (CPP) or Quebec Pension Plan (QPP). The annual lifetime pension is based on the average salary of five consecutive years of highest paid service and the years of pensionable service. For the Canadian Forces—Reserve Force pension plan, the annual lifetime pension is based on a percentage of indexed pensionable earnings with a temporary bridge benefit until members become eligible for the CPP or QPP. Pension benefits are indexed annually on January 1 to take into account the cost of living.

Pension benefits accrue at a rate of two per cent per year of pensionable service up to a maximum of 35 years, the exception being the benefits offered under the Canadian Forces—Reserve Force pension plan which accrue at a rate of 1.5 per cent up to a maximum of 35 years. Pension benefits are coordinated with those of the CPP or the QPP. Pension benefits for the public service pension plan members will accrue under either Group 1 for employees who were plan members prior to January 1, 2013, or Group 2 for employees joining the public service pension plan on or after that date. The normal retirement age for Group 1 members is 60. For Group 2 members, the normal retirement age is 65 and other age related thresholds were increased by 5 years.

The contribution rates for current service for all members of the public service will increase gradually to a 50:50 cost sharing ratio with the government by 2017. Public service Group 1, Canadian Forces—Regular Force and Royal Canadian Mounted Police members contribute at different rates than public service Group 2 members. These rates are as follows:

Public service Group 1, Canadian Forces—Regular Force and Royal Canadian Mounted Police pension plan members contributed:

Public service Group 2 plan members contributed:

Contribution rates for Group 2 members were lower than for Group 1 members due to the lower cost of the benefits related to increasing the normal age of retirement from 60 to 65.

Members of the Canadian Forces—Reserve Force contribute 5.2 per cent on salary up to two thirds of the YMPE.

Employer contributions are made monthly to provide for the cost (net of employee contributions) of the benefits that have accrued in respect of that month at a rate determined by the President of the Treasury Board. For 2016, the employer contribution rates were about 1.2, 1.7 and 1.4 (1.4, 1.9 and 1.6 respectively in 2015) times the current year's employee contribution for the plans under the Public Service Superannuation Act, the Canadian Forces Superannuation Act (Regular Force pension plan) and the Royal Canadian Mounted Police Superannuation Act, respectively. With respect to the Reserve Force pension plan, the employer contributions were reinstated in December 2014 and a one-time payment in arrears of $42 million was credited to the Reserve Force Pension Fund Account in 2015. For 2016, the employer contribution rate was about 1.9 (1.8 in 2015) times the current year's employee contribution for the Reserve Force pension plan.

The superannuation accounts, which record the transactions that pertain to pre April 1, 2000 service, are credited with interest at rates that are based on the Government of Canada long-term bond rate. The average interest rate credited to the superannuation accounts was approximately 4.8 per cent (5.1 per cent in 2015).

The pension fund accounts, which record the transactions that pertain to service since April 1, 2000, are flow through accounts used to transfer funds to the PSPIB. The balance in the pension fund accounts at year-end represents the amounts awaiting transfer to the PSPIB.

The retirement compensation arrangements (RCA) accounts records transactions for those pension benefits above the pension limits set under the Income Tax Act. The RCA, Regulations No. 1 and No. 2 are registered with the Canada Revenue Agency and a transfer is made annually between these RCA regulations and the Canada Revenue Agency, either to remit a 50 per cent refundable tax in respect of the net contributions and interest credits or to receive a refund based on the net benefit payments.

Members of Parliament retiring allowances

Members of Parliament are eligible at a certain age to receive a basic allowance upon termination of membership and after having contributed to the plan for at least six years. Retirement age is set at 55 for pensionable service accrued before January 1, 2016 and at 65 for pensionable service accrued on or after January 1, 2016, with the option of reduced benefits for early retirement at age 55. The basic allowance accrues at a rate of 3 per cent per year of pensionable service for both Members of the House of Commons and for Senators. For service accrued before January 1, 2016, the accrual rate is multiplied by the average of the best five consecutive years of sessional indemnity up to a maximum of 75 per cent of the plan member's average sessional indemnity. For service accrued after December 31, 2015, the accrual rate is multiplied by the average of the best five consecutive years of pensionable earnings up to a maximum of 75 per cent of the plan member's average pensionable earnings. Basic allowances are indexed annually on January 1 to the cost of living once recipients reach age 60. Pensionable service accrued on or after January 1, 2016, under the Members of Parliament pension plan, is coordinated with the CPP or QPP at age 60.

The contribution rates will increase over time to bring the plan members' share to 50 per cent by no later than January 1, 2017. For the 2016 fiscal year, plan members contributed at a rate of 10 per cent (9 per cent in 2015) of their salary for the first 9 months and a blended rate of approximately 15.8 per cent (a flat rate of 10 per cent in 2015) for the last three months.

The Government contributions are made monthly to provide for the cost (net of plan member contributions) of the benefits that have accrued in respect of that month at a rate determined by the President of the Treasury Board. The Government contributions, expressed as a multiple of plan member contributions, are on average as follows:

Table summary

The table presents a two-year comparative of the average of the Government contributions expressed as a multiple of Members' contributions. It consists of three columns: a listing of the contribution accounts for Members of Parliament; current year; previous year.

  2016 2015
Members of Parliament
Retiring Allowances Account 3.7 4.5
Compensation Arrangements Account 3.0 4.1

Contributions are credited to the appropriate pension account, either the Members of Parliament Retiring Allowances Account or the Members of Parliament Retirement Compensation Arrangements Account. The pension accounts are also credited with interest at a rate determined by the Chief Actuary of Canada. The average interest rate credited to the pension accounts in 2016 was approximately 4.1 per cent (3.4 per cent in 2015).

Pension plan for federally appointed judges

This plan provides fully indexed annuities to judges and to all eligible survivors providing they meet minimum age and service requirements. The full benefit amount is generally payable when the member has completed 15 years of pensionable service and the sum of the member's age and years of service totals 80.

Judges appointed to the bench before February 17, 1975, make required contributions of 1.5 per cent of salary. All other judges contribute 7 per cent of salary.

Legislation does not require a specific pension account to be maintained to record the transactions pertaining to this plan. Therefore, except for the portion recorded in the Supplementary Retirement Benefit Account, the liability pertaining to this plan is recorded through an allowance account. During the year, benefits paid are recorded as expenditures against the statutory payment authority. The expense is adjusted at year-end through an allowance account, to bring the current year expense from cash to an accrual accounting basis, similar to that of the other pension plans. During the year, the benefit payments charged to the expenditure authority amounted to $143 million ($136 million in 2015). At March 31, 2016, the portion of the pension liability recorded through an allowance account for the judges' pension plan amounted to $2,421 million ($2,314 million in 2015).

Consolidated Crown corporation and other entity pension plans

Pension benefits provided under consolidated Crown corporations and other entities defined benefit pension plans vary depending on the terms of the plans. Generally, they are based on a combination of an accrual rate per years of pensionable service and some type of pensionable earnings average. Some of the consolidated Crown corporations and other entities defined benefit pension plans are closed to new entrants.

ii. Actuarial valuations

As required under the Public Pensions Reporting Act, actuarial valuations of the pension plans sponsored by the Government are performed at least every three years for funding purposes. The actuarial valuations are performed by the Office of the Chief Actuary, submitted to the President of the Treasury Board, and tabled in Parliament.

The most recent date for the actuarial valuation of each pension plan sponsored by the Government is as follows:

  1. Royal Canadian Mounted Police—March 31, 2015, valuation currently in progress;
  2. Public Service—March 31, 2014;
  3. Canadian Forces—Regular Force—March 31, 2013;
  4. Canadian Forces—Reserve Force—March 31, 2013;
  5. Members of Parliament—March 31, 2013; and
  6. Federally appointed judges—March 31, 2013.

The actuarial valuations for the public service, Canadian Forces, Royal Canadian Mounted Police and Members of Parliament pension plans include the valuation of the Retirement Compensation Arrangements (RCA) component related to each plan.

Where applicable, the funding valuations provide the Government with recommendations for setting both employer and employee contribution rates, as well as any actuarial adjustment to amortize deficiencies or excesses. These actuarial adjustments are made in equal instalments over a period not exceeding 15 years commencing in the year in which the actuarial report is laid before Parliament.

To address deficiencies, an actuarial adjustment of $681 million (nil in 2015) was credited to the Public Service Superannuation Account, $340 million ($435 million in 2015) to the Public Service Pension Fund Account, $170 million ($170 million in 2015) to the Canadian Forces Pension Fund Account, $2 million ($2 million in 2015) to the Reserve Force Pension Fund Account, $12 million ($12 million in 2015) to the Royal Canadian Mounted Police Superannuation Account, $74 million ($74 million in 2015) to the Royal Canadian Mounted Police Pension Fund Account, $129 million ($8 million in 2015) to the Public Service Retirement Compensation Arrangements (RCA) Account No. 2, and $12 million (nil in 2015) to the Public Service Retirement Compensation Arrangements (RCA) Account No. 1. The actuarial adjustments recorded in pension fund accounts are transferred to the PSPIB for investment in capital markets. To address deficiencies, the consolidated Crown corporations and other entities made special funding payments of $59 million in 2016 ($60 million in 2015).

Table 6.15 presents a summary of the balances and transactions for public sector pension plan liabilities. In particular, receipts and other credits for the Government's pension accounts consist of contributions from plan members, the Government of Canada, participating Public Service corporations and territorial governments, as well as transfers from other pension funds, actuarial adjustments to amortize deficiencies, refunds of refundable tax and interest. Payments and other charges for the Government's pension accounts consist of annuity payments, minimum benefits, cash termination allowances (lump sum payments to employees suffering a disability), returns of contributions, pension division payments, transfer value payments, transfers to other funds, remittances of refundable tax, payments of administrative expenses, actuarial adjustments to amortize excesses, and transfers to PSPIB. Adjustments to the Government's allowance accounts result from the differential with annual actuarial valuations performed for accounting purposes. These include differences between benefits earned and contributions and interest calculations, as well as from other adjustments required under the Government's accounting policies such as recognition of actuarial gains and losses and consolidation adjustments related to refundable tax amounts.

Pension benefits funded by the Government relate to post March 2000 service that falls within the Income Tax Act limits for the three main public sector pension plans and all service for the Canadian Force—Reserve Force pension plan, as funds are invested in capital markets through the PSPIB. Funded pension benefits also relate to consolidated Crown corporations and other entities where pension plans' funds are held in external trusts that are legally separate from Crown corporations and other entities. For unfunded pension plans, separate market invested funds are not maintained. These relate to all pre April 2000 service and only to post March 2000 service that falls above the Income Tax Act limits for the three main public sector pension plans, all service periods for the pension plans of the federally appointed judges and Members of Parliament, and some of the consolidated Crown corporation and other entity pension plans.

Table summary

The table presents, in millions of dollars, a transactions and balances summary for public sector pension plan liabilities. It consists of five columns: a listing of public sector pension accounts and related allowances for pension adjustments; the opening balance for the accounts as at April 1 of the current year; Receipts and other credits; Payments and other charges; the closing balance for the accounts as at March 31 of the current year. The first series of rows presents the funded pension benefits. It includes pension fund accounts; related allowance for pension adjustments; and related subtotals. The following rows of the series present the totals for pension fund accounts and the allowance for pension adjustments; the pension benefit liabilities related to funded plans sponsored by the Government; the pension benefit assets related to funded plans sponsored by consolidated Crown corporations and other entities; and the net pension benefit liabilities related to funded plans. The second series of rows presents the unfunded pension benefits. It includes superannuation, retiring allowances, retirement compensation arrangements and benefits accounts; related allowance for pension adjustments; and related subtotals. The following rows of the series present the totals for superannuation accounts and allowance for pension adjustments; the pension benefit liabilities related to unfunded pension plans sponsored by the Government as well as those sponsored by consolidated Crown corporations and other entities; the pension benefit liabilities related to unfunded plans; and the net pension benefit liabilities. A final series of rows presents the public sector pension liabilities minus the public sector pension assets for the net pension benefit liabilities that were recognized and presented in the Consolidated Statement of Financial Position.

Table 6.15
Public sector pensions
(in millions of dollars)

  April 1, 2015 Receipts and other credits Payments and other charges March 31,2016
Funded pension benefits
Public Service Pension Fund Account, Table 6.18 402 4,768 4,815 355
Allowance for pension adjustments 3,585 206 558 3,233
Subtotal 3,987 4,974 5,373 3,588
Canadian Forces Pension Fund Account, Table 6.20 183 1,461 1,475 169
Allowance for pension adjustments 968 209 170 1,007
Subtotal 1,151 1,670 1,645 1,176
Reserve Force Pension Fund Account, Table 6.21 (negative 2) 72 121 (negative 51)
Allowance for pension adjustments 277 106 171
Subtotal 275 72 227 120
Royal Canadian Mounted Police Pension Fund Account, Table 6.23 7 540 532 15
Allowance for pension adjustments 303 5 88 220
Subtotal 310 545 620 235
Total pension fund accounts 590 6,841 6,943 488
Total allowance for pension adjustments 5,133 420 922 4,631
Pension benefit liabilities related to funded plans sponsored by the Government 5,723 7,261 7,865 5,119
Pension benefit assets related to funded plans sponsored by consolidated Crown corporations and other entities (negative 1,263) 105 481 (negative 1,639)
Net pension benefit liabilities related to funded plans 4,460 7,366 8,346 3,480
Unfunded pension benefits
Public Service Superannuation Account, Table 6.17 95,876 5,149 5,459 95,566
Allowance for pension adjustments (negative 9,472) 866 706 (negative 9,312)
Subtotal 86,404 6,015 6,165 86,254
Canadian Forces Superannuation Account, Table 6.19 46,119 2,145 2,569 45,695
Allowance for pension adjustments (negative 4,922) 446 25 (negative 4,501)
Subtotal 41,197 2,591 2,594 41,194
Royal Canadian Mounted Police Superannuation Account, Table 6.22 13,197 626 668 13,155
Allowance for pension adjustments (negative 1,291) 112 13 (negative 1,192)
Subtotal 11,906 738 681 11,963
Members of Parliament Retiring Allowances Account, Table 6.24 501 32 31 502
Allowance for pension adjustments (negative 72) 6 12 (negative 78)
Subtotal 429 38 43 424
Members of Parliament Retirement Compensation Arrangements Account, Table 6.25 238 30 19 249
Allowance for pension adjustments 209 5 6 208
Subtotal 447 35 25 457
Retirement Compensation Arrangements (RCA) Account, Table 6.26 2,220 385 209 2,396
Allowance for pension adjustments 1,736 133 172 1,697
Subtotal 3,956 518 381 4,093
Supplementary Retirement Benefits Account (Judges), Table 6.27 206 9 215
Allowance for pension adjustments 2,314 125 18 2,421
Subtotal 2,520 134 18 2,636
Supplementary Retirement Benefits Account (Others), Table 6.27 1 1
Total superannuation accounts 158,357 8,377 8,955 157,779
Total allowance for pension adjustments (negative 11,498) 1,693 952 (negative 10,757)
Pension benefit liabilities related to unfunded plans sponsored by the Government 146,859 10,070 9,907 147,022
Pension benefit liabilities related to unfunded plans sponsored by consolidated Crown corporations and other entities 82 8 4 86
Pension benefit liabilities related to unfunded plans 146,941 10,078 9,911 147,108
Net pension benefit liabilities 151,401 17,444 18,257 150,588
The net pension benefit liabilities were recognized and presented in the Consolidated statement of financial position as follows:
Public sector pension liabilities 152,664 17,339 17,776 152,227
Public sector pension assets (negative 1,263) 105 481 (negative 1,639)
Net pension benefit liabilities 151,401 17,444 18,257 150,588

Table 6.16 presents a summary of transactions in public sector pensions that resulted in charges to expenses. Interest is calculated based on the accrued pension obligations under the various plans. The net interest expense represents interest of $7,333 million ($7,906 million in 2015) credited to the superannuation accounts in accordance with the pension legislation, a provision of $4,439 million ($4,240 million in 2015) and interest of $421 million ($414 million in 2015) on the consolidated Crown corporations and other entities' obligations, shown net of $4,899 million ($4,764 million in 2015) in expected return on pension investments.

Table summary

The table presents, in millions of dollars, a summary of transactions in public sector pensions that resulted in charges to expenses. It consists of three columns: a listing of pension benefits; current year, divided into nine columns—Government contributions and other, Adjustment, Net benefits earned, Actuarial adjustments, Less costs recorded in previous years, Plan amendments, Actuarial losses (gains) recognized, Pension expense, Net interest expense; previous year, divided into two columns—Pension expense, and Net interest expense. The first series of rows presents the funded pension benefits. The second series of rows presents the unfunded pension benefits. A final row presents the total of both funded and unfunded pension benefits reported in the Consolidated Statement of Operations and Accumulated Deficit.

Table 6.16
Summary of transactions in public sector pensions that resulted in charges to expenditures
(in millions of dollars)

  2015–2016 2014–2015
Government contributions and otherLink to footnote 1 Adjustment Net benefits earned Actuarial adjustmentsLink to footnote 2 Less costs recorded in previous yearsLink to footnote 3 Plan amendments Actuarial losses (gains) recognized Pension expense Net interest expense Pension expense Net interest expense
Funded pension benefits
Public Service Pension Fund Account 2,205 195 2,400 340 (negative 340) (negative 218) 2,182 11 2,417 193
Canadian Forces Pension Fund Account 757 52 809 170 (negative 170) 60 869 41 907 101
Reserve Force Pension Fund Account 42 (negative 26) 16 2 (negative 2) (negative 18) (negative 2) (negative 4) (negative 6) (negative 3)
Royal Canadian Mounted Police Pension Fund Account 270 5 275 74 (negative 74) (negative 12) 263 (negative 2) 297 18
Consolidated Crown corporations and other entitiesLink to footnote 1 92 (negative 6) 86 59 (negative 59) 19 (negative 167) (negative 62) (negative 164) (negative 2) (negative 110)
Total funded pension benefits 3,366 220 3,586 645 (negative 645) 19 (negative 355) 3,250 (negative 118) 3,613 199
Unfunded pension benefits
Public Service Superannuation AccountLink to footnote 4 11 (negative 25) (negative 14) 681 (negative 681) 832 818 4,477 472 4,558
Canadian Forces Superannuation Account 3 (negative 5) (negative 2) 446 444 2,119 294 2,185
Defence Services Pension Continuation ActLink to footnote 1 3 3 3 3
Royal Canadian Mounted Police Superannuation Account (negative 1) (negative 1) 12 (negative 12) 106 105 619 70 634
Royal Canadian Mounted Police Continuation ActLink to footnote 1 10 10 10 11
Members of Parliament Retiring Allowances Account 9 (negative 3) 6 6 12 11 14 16
Members of Parliament Retirement Compensation Arrangements Account 15 (negative 2) 13 4 17 6 20 8
Retirement Compensation Arrangements (RCA) Account 87 19 106 141 (negative 141) 27 133 107 65 99
Supplementary Retirement Benefits Account 4 4 4 1 4
Judges ActLink to footnote 1 143 (negative 18) 125 57 182 69 157 93
Other (diplomatic services, lieutenant governors, etc.)Link to footnote 1 2 2 2 2
Consolidated Crown corporations and other entities 2 2 3 5 3 3 4
Subtotal 287 (negative 33) 254 834 (negative 834) 1,481 1,735 7,412 1,115 7,597
Less: contributions from the Judges' plan recorded to revenues (negative 15) (negative 15) (negative 15) (negative 14)
Total unfunded pension benefits 272 (negative 33) 239 834 (negative 834) 1,481 1,720 7,412 1,101 7,597
Total reported in the Consolidated statement of operations and accumulated deficit 3,638 187 3,825 1,479 (negative 1,479) 19 1,126 4,970 7,294 4,714 7,796

Public Service Superannuation Account

This account, established by the Public Service Superannuation Act, is used to record all transactions (contributions, benefit payments, transfers and interest credits) in respect of service accrued by public service members up to March 31, 2000.

Table summary

The table presents, in dollars, a two-year comparative of the Public Service Superannuation Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total for the objects of the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.17
Public Service Superannuation Account
(in dollars)

  2015–2016 2014–2015
Opening balance 95,875,945,459 96,423,778,971
Receipts and other credits
Employee contributions
Government employees 2,066,031 2,613,256
Retired employees 11,616,885 14,933,384
Public Service corporation employees 102,705 196,820
Employer contributions
Government 11,189,841 14,472,374
Public Service corporations 61,360 112,735
Actuarial adjustment 681,000,000
Transfers from other pension funds 6,789
Interest 4,443,345,828 4,797,893,981
Total receipts and other credits 5,149,389,439 4,830,222,550
Subtotal 101,025,334,898 101,254,001,521
Payments and other charges
Benefit payments
Annuities 5,328,099,116 5,240,665,149
Minimum benefits 12,803,758 16,184,060
Pension division payments 22,922,806 18,100,278
Pension transfer value payments 29,994,197 34,531,513
Return of contributions
Government employees 38,788 721,888
Public Service corporation employees 41,606 31,857
Transfers to other pension funds 5,416,461 9,343,265
Administrative expenses 59,769,165 58,478,052
Total payments and other charges 5,459,085,897 5,378,056,062
Closing balance 95,566,249,001 95,875,945,459

Public Service Pension Fund Account

This account is used to record the transactions in respect of service accrued on or after April 1, 2000, under the Public Service Superannuation Act. An amount equal to contributions less benefits and other payments is transferred to the PSPIB for investment in capital markets. The closing balance in this account represents the net cash position prior to transfer to the PSPIB.

Table summary

The table presents, in dollars, a two-year comparative of the Public Service Pension Fund Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits. The second series of rows presents the various applicable classification objects related to payments and other charges. The third series of rows presents receipts and other credits less payments and other debits as well as transfers to PSPIB. A final row presents the closing balance for the account.

Table 6.18
Public Service Pension Fund Account
(in dollars)

  2015–2016 2014–2015
Opening balance 402,290,387 499,943,338
Receipts and other credits
Employee contributions
Government employees 1,773,737,501 1,667,207,395
Retired employees 41,559,748 38,077,475
Public Service corporation employees 168,640,289 157,358,746
Employer contributions
Government 2,205,355,883 2,342,382,010
Public Service corporations 206,059,867 218,193,085
Actuarial adjustment 340,000,000 435,000,000
Transfers from other pension funds 33,350,235 29,619,344
Total receipts and other credits 4,768,703,523 4,887,838,055
Payments and other charges
Benefit payments
Annuities 1,558,724,353 1,343,904,637
Minimum benefits 12,641,148 11,322,140
Pension division payments 30,273,474 26,204,917
Pension transfer value payments 316,963,114 279,072,403
Return of contributions
Government employees 10,507,898 7,572,183
Public Service corporation employees 4,837,063 3,533,886
Transfers to other pension funds 47,446,792 52,019,965
Administrative expenses 42,400,198 41,056,225
Total payments and other charges 2,023,794,040 1,764,686,356
Receipts and other credits less payments and other charges 2,744,909,483 3,123,151,699
Transfers to PSPIB 2,792,147,670 3,220,804,650
Closing balance 355,052,200 402,290,387

Canadian Forces Superannuation Account

This account, established by the Canadian Forces Superannuation Act, is used to record all transactions (contributions, benefit payments, transfers and interest credits) in respect of service accrued by Canadian Armed Forces members up to March 31, 2000.

Table summary

The table presents, in dollars, a two-year comparative of the Canadian Forces Superannuation Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.19
Canadian Forces Superannuation Account
(in dollars)

  2015–2016 2014–2015
Opening balance 46,118,650,563 46,297,375,844
Receipts and other credits
Contributions from personnel 2,618,412 2,717,194
Contributions by the Government 2,618,412 2,717,194
Interest 2,139,615,656 2,308,115,023
OtherLink to footnote 5 1,032,682 1,066,108
Total receipts and other credits 2,145,885,162 2,314,615,519
Subtotal 48,264,535,725 48,611,991,363
Payments and other charges
Benefit payments
Pensions and retiring allowances 2,506,191,226 2,426,059,524
Minimum benefits 151,581 658,347
Pension division payments 23,313,757 33,211,687
Pension transfer value payments 1,690,394 1,906,716
Return of contributions 1,669 18,298
Transfers to other pension funds 239,863 205,620
Administrative expenses 37,794,142 31,280,608
Total payments and other charges 2,569,382,632 2,493,340,800
Closing balance 45,695,153,093 46,118,650,563

Canadian Forces Pension Fund Account

This account is used to record the transactions in respect of service accrued on or after April 1, 2000, in accordance with Part I of the Canadian Forces Superannuation Act. An amount equal to contributions less benefits and other payments is transferred to the PSPIB for investment in capital markets. The closing balance in this account represents the net cash position prior to transfer to the PSPIB.

Table summary

The table presents, in dollars, a two-year comparative of the Canadian Forces Pension Fund Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits. The second series of rows presents the various applicable classification objects related to payments and other charges. The third series of rows presents receipts and other credits less payments and other debits as well as transfers to PSPIB. A final row presents the closing balance for the account.

Table 6.20
Canadian Forces Pension Fund Account
(in dollars)

  2015–2016 2014–2015
Opening balance 183,465,777 263,355,393
Receipts and other credits
Contributions from personnel 450,157,686 423,930,301
Contributions by the Government 756,955,116 795,171,662
Actuarial adjustment 170,000,000 170,000,000
Transfers from other pension funds 83,887,837 48,449,248
OtherLink to footnote 6 390,497 14,476
Total receipts and other credits 1,461,391,136 1,437,565,687
Payments and other charges
Benefit payments
Pensions and retiring allowances 442,037,547 375,524,290
Minimum benefits 634,061 1,236,235
Pension division payments 23,871,536 28,887,588
Pension transfer value payments 133,358,475 152,155,635
Return of contributions 902,196 927,893
Transfers to other pension funds 1,310,261 505,487
Administrative expenses 24,572,429 18,292,463
Total payments and other charges 626,686,505 577,529,591
Receipts and other credits less payments and other charges 834,704,631 860,036,096
Transfers to PSPIB 849,312,367 939,925,712
Closing balance 168,858,041 183,465,777

Reserve Force Pension Fund Account

This account is used to record the transactions in respect of service accrued on or after March 1, 2007, in accordance with Part I.1 of the Canadian Forces Superannuation Act. When the closing balance of this account is in a positive net cash position, an amount equal to contributions less benefits and other payments is usually transferred to the PSPIB for investment in capital markets.

Table summary

The table presents, in dollars, a two-year comparative of the Reserve Force Pension Fund Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits. The second series of rows presents the various applicable classification objects related to payments and other charges. The third series of rows presents receipts and other credits less payments and other debits as well as transfers to PSPIB. A final row presents the closing balance for the account.

Table 6.21
Reserve Force Pension Fund Account
(in dollars)

  2015–2016 2014–2015
Opening balance (negative 2,551,843) 1,609,568
Receipts and other credits
Contributions from personnel 27,843,256 28,285,286
Contributions by the Government 41,716,967 65,160,998
Actuarial adjustment 1,900,000 1,900,000
OtherLink to footnote 7 11,955 1,550
Total receipts and other credits 71,472,178 95,347,834
Payments and other charges
Benefit payments
Pensions and retiring allowances 6,061,830 5,233,714
Minimum benefits 110,167 60,485
Pension transfer value payments 13,529,206 12,934,442
Return of contributions 45,315 90,747
Transfer to other pension funds 83,889,742 48,426,486
Administrative expenses 16,476,141 13,703,701
Total payments and other charges 120,112,401 80,449,575
Receipts and other credits less payments and other charges (negative 48,640,223) 14,898,259
Transfers to PSPIB 19,059,670
Closing balance (negative 51,192,066) (negative 2,551,843)

Royal Canadian Mounted Police Superannuation Account

This account, established by the Royal Canadian Mounted Police Superannuation Act, is used to record all transactions (contributions, benefit payments, transfers and interest credits) in respect of service accrued by Royal Canadian Mounted Police members up to March 31, 2000.

Table summary

The table presents, in dollars, a two-year comparative of the Royal Canadian Mounted Police Superannuation Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.22
Royal Canadian Mounted Police Superannuation Account
(in dollars)

  2015–2016 2014–2015
Opening balance 13,197,207,777 13,184,685,451
Receipts and other credits
Contributions from personnel (current services and arrears) 512,522 445,328
Contributions by the Government 466,488 433,433
Actuarial adjustment 12,000,000 12,000,000
Interest 613,018,941 657,522,222
Total receipts and other credits 625,997,951 670,400,983
Subtotal 13,823,205,728 13,855,086,434
Payments and other charges
Benefit payments
Annuities and allowances 650,137,646 629,035,127
Cash termination allowance and gratuities 258,112
Pension division payments 10,561,426 11,624,932
Pension transfer value payments 1,296,063 1,816,571
Return of contributions 324,530 344,657
Transfers to other pension funds 77,096
Administrative expenses 6,364,695 14,722,162
Total payments and other charges 668,684,360 657,878,657
Closing balance 13,154,521,368 13,197,207,777

Royal Canadian Mounted Police Pension Fund Account

This account is used to record the transactions in respect of service accrued on or after April 1, 2000, under the Royal Canadian Mounted Police Superannuation Act. An amount equal to contributions less benefits and other payments is transferred to the PSPIB for investment in capital markets. The closing balance in this account represents the net cash position prior to transfer to the PSPIB.

Table summary

The table presents, in dollars, a two-year comparative of the Royal Canadian Mounted Police Pension Fund Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits. The second series of rows presents the various applicable classification objects related to payments and other charges. The third series of rows presents receipts and other credits less payments and other debits as well as transfers to PSPIB. A final row presents the closing balance for the account.

Table 6.23
Royal Canadian Mounted Police Pension Fund Account
(in dollars)

  2015–2016 2014–2015
Opening balance 6,467,393 10,962,617
Receipts and other credits
Contributions from personnel (current services and arrears) 187,351,388 169,627,163
Contributions by the Government 270,691,194 277,612,254
Actuarial adjustment 74,000,000 74,000,000
Transfers from other pension funds 8,723,354 11,864,616
Total receipts and other credits 540,765,936 533,104,033
Payments and other charges
Benefit payments
Annuities and allowances 140,259,560 117,650,733
Minimum benefits 133,539 212
Pension division payments 12,771,171 12,756,823
Pension transfer value payments 27,393,208 23,648,648
Return of contributions
Personnel 4,317 415,768
Interest 355,247 1,500
Transfers to other pension funds 662,728 473,148
Administrative expenses 3,835,137 8,209,554
Total payments and other charges 185,414,907 163,156,386
Receipts and other credits less payments and other charges 355,351,029 369,947,647
Transfers to PSPIB 346,478,737 374,442,871
Closing balance 15,339,685 6,467,393

Members of Parliament Retiring Allowances Account

This account was established by the Members of Parliament Retiring Allowances Act to provide pension benefits to eligible Members of Parliament who contributed to the plan. "Member" means a Member of the Senate or the House of Commons. Benefits are also available to eligible surviving spouses or eligible dependent children of Members who served on or after a certain date and contributed under the Act.

Table summary

The table presents, in dollars, a two-year comparative of the Members of Parliament Retiring Allowances Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.24
Members of Parliament Retiring Allowances Account
(in dollars)

  2015–2016 2014–2015
Opening balance 501,020,777 496,466,754
Receipts and other credits
Members' contributions
Current services 2,680,532 1,973,821
Arrears of principal, interest and mortality insurance 11,779 12,477
Government contributions (current services) 8,530,567 8,855,514
Interest 20,267,602 20,367,021
Total receipts and other credits 31,490,480 31,208,833
Subtotal 532,511,257 527,675,587
Payments and other charges
Benefit payments
Annual allowances 27,556,977 26,640,665
Pension division payments 571,436
Return of contributions
Withdrawals 2,001,009 13,936
Interest 82,407 209
Total payments and other charges 30,211,829 26,654,810
Closing balance 502,299,428 501,020,777

Members of Parliament Retirement Compensation Arrangements Account

This account was established by the Members of Parliament Retiring Allowances Act to provide for benefits in respect of pension credits accrued by Members of Parliament which are not payable out of the Members of Parliament Retiring Allowances Account. Benefits are also available to eligible surviving spouses or eligible dependent children of Members.

Table summary

The table presents, in dollars, a two-year comparative of the Members of Parliament Retirement Compensation Arrangements Account. It consists of three columns: a listing of transactions grouped by activity type and object; current year; previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.25
Members of Parliament Retirement Compensation Arrangements Account
(in dollars)

  2015–2016 2014–2015
Opening balance 237,813,956 224,403,100
Receipts and other credits
Members' contributions
Current services 4,939,343 4,149,123
Arrears of principal, interest and mortality insurance 22,821 27,370
Government contributions (current services) 14,516,972 17,061,626
Interest 9,922,095 9,435,453
Total receipts and other credits 29,401,231 30,673,572
Subtotal 267,215,187 255,076,672
Payments and other charges
Benefit payments
Annual allowances 14,291,992 12,912,355
Pension division payments 539,467
Return of contributions
Withdrawals 3,289,508 45,225
Interest 109,969 522
Refundable tax 349,568 4,304,614
Total payments and other charges 18,580,504 17,262,716
Closing balance 248,634,683 237,813,956

Retirement Compensation Arrangements (RCA) Account

This account was established by the Special Retirement Arrangements Act to provide pension benefits for federal employees under retirement compensation arrangements.

The RCA Regulations, No. 1 (RCA No. 1) pays those pension benefits above the amount that may, in accordance with the Income Tax Act restrictions on registered pension plans, be paid under the Public Service Superannuation Act, the Canadian Forces Superannuation Act and the Royal Canadian Mounted Police Superannuation Act. The RCA No. 1 was created effective December 15, 1994.

The RCA Regulations, No. 2 (RCA No. 2) pays benefits to public service employees between the ages of 50 and 54, who were declared surplus as part of a three year Government downsizing initiative which ended on March 31, 1998. It pays the difference between an unreduced pension and the reduced pension for early retirement payable from the Public Service Superannuation Account. The RCA No. 2 was created effective April 1, 1995, and is funded entirely by the Government.

Table summary

The table presents, in dollars, a two-year comparative of transactions and balances under the Retirement Compensation Arrangements (RCA) Account. It consists of four columns: a listing of transactions grouped by activity type and object; RCA No. 1, divided into three columns—Public Service, sub-divided into current year and previous year, Canadian Forces, sub-divided into current year and previous year, Royal Canadian Mounted Police, sub-divided into current year and previous year; RCA No. 2—Public Service, sub-divided into current year and previous year; Total, sub-divided into current year and previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.26
Retirement Compensation Arrangements (RCA) Account
(in dollars)

  RCA No. 1 RCA No. 2 Total
Public Service Canadian Forces Royal Canadian Mounted Police Public Service
2015–2016 2014–2015 2015–2016 2014–2015 2015–2016 2014–2015 2015–2016 2014–2015 2015–2016 2014–2015
Opening balance 1,104,326,126 1,040,164,699 373,530,812 351,185,693 33,159,245 32,475,115 708,848,795 729,836,159 2,219,864,978 2,153,661,666
Receipts and other credits
Employee contributions
Government employees 8,426,624 10,065,769 2,389,298 2,545,185 59,511 124,274 10,875,433 12,735,228
Retired employees 448,109 420,128 592 1,885 448,701 422,013
Public Service corporation employees 2,349,289 2,006,026 2,349,289 2,006,026
Employer contributions
Government 60,783,610 75,678,400 26,464,154 28,844,798 290,768 628,765 87,538,532 105,151,963
Public Service corporations 16,570,859 14,750,273 16,570,859 14,750,273
Actuarial adjustment 12,000,000 129,000,000 8,000,000 141,000,000 8,000,000
Transfers from other pension funds 1,560 696,131 905 1,560 697,036
Refundable tax 21,937,738 20,127,193 21,937,738 20,127,193
Interest 53,426,014 54,330,519 18,043,320 18,267,496 1,558,394 1,649,328 32,077,055 35,493,565 105,104,783 109,740,908
OtherLink to footnote 7 1,691 1,691
Subtotal 154,006,065 157,947,246 46,898,463 49,657,479 1,909,265 2,405,157 183,014,793 63,620,758 385,828,586 273,630,640
Total 1,258,332,191 1,198,111,945 420,429,275 400,843,172 35,068,510 34,880,272 891,863,588 793,456,917 2,605,693,564 2,427,292,306
Payments and other charges
Benefit payments
Annuities 35,959,883 30,744,211 6,151,861 5,314,519 1,018,178 907,151 84,806,709 84,608,122 127,936,631 121,574,003
Minimum benefits 181,518 165,375 130,424 181,518 295,799
Pension division payments 1,263,060 737,864 240,394 82,572 1,586,026 737,864
Pension transfer value payments 587,002 548,456 1,252,386 1,458,834 2,266 4,170 1,841,654 2,011,460
Return of contributions
Government employees 11,141 6,225 2,927 11,141 9,152
Public Service corporation employees 9,896 55,168 9,896 55,168
Transfers to other pension funds 174,463 267,634 967 1,847 3,445 177,277 271,079
Refundable tax 57,017,923 61,260,886 20,683,833 20,408,583 421,862 803,334 78,123,618 82,472,803
Total 95,204,886 93,785,819 28,329,441 27,312,360 1,526,725 1,721,027 84,806,709 84,608,122 209,867,761 207,427,328
Closing balance 1,163,127,305 1,104,326,126 392,099,834 373,530,812 33,541,785 33,159,245 807,056,879 708,848,795 2,395,825,803 2,219,864,978

Supplementary Retirement Benefits Account

This account was established by the Supplementary Retirement Benefits Act to provide for pension benefit increases resulting from changes in the Consumer Price Index. The account continues to provide for increased pension benefits resulting from indexation for pensions of federally appointed judges, and recipients of pensions under various continuation acts and other related acts.

Table summary

The table presents, in dollars, a two-year comparative of the Supplementary Retirement Benefits Account. It consists of four columns: a listing of transactions grouped by activity type and object; Judges, divided into two columns—current year and previous year; Others, divided into two columns—current year and previous year; Total, divided into two columns—current year and previous year. The first row presents the opening balance for the account. The following series of rows presents the various applicable classification objects related to receipts and other credits type transactions, the total of the objects for the transaction type and the subtotal, which includes the opening balance. The second series of rows presents the various applicable classification objects related to payments and other charges. A final row presents the closing balance for the account.

Table 6.27
Supplementary Retirement Benefits Account
(in dollars)

  Judges OthersLink to footnote 8 Total
2015–2016 2014–2015 2015–2016 2014–2015 2015–2016 2014–2015
Opening balance 206,383,198 196,642,456 688,982 651,476 207,072,180 197,293,932
Receipts and other credits
Employee contributions
Government 3,576,318 3,393,911 49,217 31,265 3,625,535 3,425,176
Employer contributions
Government 3,576,318 3,393,911 49,217 31,265 3,625,535 3,425,176
Interest 1,553,166 2,952,920 5,595 10,509 1,558,761 2,963,429
Total receipts and other credits 8,705,802 9,740,742 104,029 73,039 8,809,831 9,813,781
Subtotal 215,089,000 206,383,198 793,011 724,515 215,882,011 207,107,713
Payments and other charges
Annuities 25,819 35,533 25,819 35,533
Closing balance 215,089,000 206,383,198 767,192 688,982 215,856,192 207,072,180

Allowance for pension adjustments

This account records the accounting adjustments resulting from annual actuarial valuations of public sector pension plans sponsored by the Government.

Actuarial losses of $1,290 million ($1,076 million in 2015), due to plan experience and changes in actuarial assumptions, were recognized in this account and increased pension expenses for the year.

An amount of $1,420 million ($701 million in 2015) was recorded in this account to offset the amortization of deficiencies charged to the account during the year but already accounted for in previous year's expenses or in actuarial gains and losses.

An amount of $191 million was credited ($82 million debited in 2015) to this account and increased (decreased in 2015) pension costs to adjust for the difference between the Government contributions and the net cost of benefits earned.

No amount ($51 million in 2015) was recorded in this account and pension costs were not adjusted (reduced in 2015) for a past service cost reduction related to a curtailment.

An amount of $4,439 million ($4,240 million in 2015) was credited to this account to adjust for the difference between interest based on the accrued pension obligations and interest credited to the superannuation accounts. In addition, an amount of $4,317 million ($4,244 million in 2015) was debited to this account to record the expected return on the pension investments.

As well, a consolidation adjustment of $56 million ($67 million in 2015) was credited to this account and debited against personal tax revenues to eliminate the effect of internal transactions resulting from tax amounts debited to the RCA accounts that were previously recorded as tax revenues.

The unrecognized net actuarial loss of $11,674 million ($11,164 million in 2015) will be recognized in this account and will affect expenses in future years.

As a result of annual actuarial valuations for accounting purposes, the accrued pension obligations of $276,119 million ($265,103 million in 2015) less the pension assets of $112,304 million ($101,357 million in 2015) were found to be $5,548 million ($4,799 million in 2015) higher than the balance of the pension fund accounts of $488 million ($590 million in 2015) and the superannuation accounts of $157,779 million ($158,357 million in 2015). The excess or shortfall is made up of the following:

Table summary

The table presents, in millions of dollars, a two-year comparative of the public sector pension plans for which excesses or shortfalls have been determined through annual actuarial valuations for accounting purposes. It consists of two columns: a listing of five public sector pension plans; Excess (shortfall), divided into two columns—current year, and previous year. Each of the five series of rows presents a pension plan, the related accounts and the total allowance for the plan. A final row presents the total for all plans presented in this table.

(in millions of dollars)

  Excess (shortfall)
2016 2015
Public Service Pension Plan
Public Service Superannuation Account (negative 1,461) (negative 123)
Public Service Pension Fund 2,374 486
Retirement Compensation Arrangements (negative 1,691) (negative 1,960)
Total allowance for Public Service Pension Plan (negative 778) (negative 1,597)
Canadian Forces Pension Plan
Canadian Forces Superannuation Account (negative 716) 694
Canadian Forces Pension Fund (negative 158) (negative 648)
Reserve Force Pension Fund (negative 78)Link to footnote 9 (negative 27)
Retirement Compensation Arrangements (negative 314)Link to footnote 9 (negative 282)
Total allowance for Canadian Forces Pension Plan (negative 1,266) (negative 263)
Royal Canadian Mounted Police Pension Plan
Royal Canadian Mounted Police Superannuation Account (negative 424) (negative 38)
Royal Canadian Mounted Police Pension Fund 95 11
Retirement Compensation Arrangements (negative 22) (negative 16)
Total allowance for Canadian Mounted Police Pension Plan (negative 351) (negative 43)
Members of Parliament Pension Plan
Members of Parliament Retiring Allowances (negative 5) 17
Retirement Compensation Arrangements (negative 259) (negative 238)
Total allowance for Members of Parliament Pension Plan (negative 264) (negative 221)
Pension plan for federally appointed judges (negative 2,889) (negative 2,675)
Total (negative 5,548) (negative 4,799)

Other employee and veteran future benefits

The Government and the consolidated Crown corporations and other entities sponsor different types of future benefit plans with varying terms and conditions. The benefits are available to employees and former employees (including military or Royal Canadian Mounted Police members) during or after employment, or upon retirement. Some are considered retirement benefits, whereby benefits are expected to be provided after retirement to employees and their beneficiaries or dependants. Others are considered post-employment benefits, whereby benefits are expected to be paid after employment but before retirement. Benefits for veterans are paid to war veterans, as well as to Canadian Forces retired veterans and Canadian Forces still-serving members. Benefits for members of the Royal Canadian Mounted Police are paid to both current and former members. These are primarily post-employment benefits, but some benefits are also paid during employment to still-serving members. They include disability and associated benefits paid to veterans or Royal Canadian Mounted Police members, or to their beneficiaries and dependants.

The other major future benefits include health care and dental benefits available to retired employees and retired military and Royal Canadian Mounted Police members, accumulated sick leave entitlements and post-employment benefits such as workers' compensation benefits and severance benefits that accumulate.

Table 6.28 presents the balance of these liabilities at year-end.

Table summary

The table presents, in millions of dollars, the balance at year-end of liabilities related to other employee and veteran future benefits. It consists of five columns: a listing of the other future benefits plans; the opening balance as at April 1 of the current year; Receipts and other credits; Payments and other charges; the closing balance as at March 31 of the current year. A final row presents the total for the future benefit plans listed in this table.

Table 6.28
Other employee and veteran future benefits
(in millions of dollars)

  April 1, 2015 Receipts and other credits Payments and other charges March 31, 2016
Veterans' disability and other future benefits 40,626 10,057 3,221 47,462
Royal Canadian Mounted Police disability and other future benefits 4,781 1,050 181 5,650
Public Service Health Care Plan 22,203 1,827 407 23,623
Pensioners' Dental Services Plan 3,175 357 90 3,442
Severance and other benefits 2,341 328 384 2,285
Accumulated sick leave entitlements 1,560 311 254 1,617
Workers' compensation 1,130 279 136 1,273
Consolidated Crown corporations and other entities 324 28 23 329
Total 76,140 14,237 4,696 85,681

All of the Government and almost all of the consolidated Crown corporations and other entities' sponsored plans are unfunded. The health care and the dental plans are contributory plans. Contributions by retired plan members are made to the plans to obtain coverage. Therefore the liabilities and costs are shown net of members' contributions. The accrued benefit obligations related to these plans is determined actuarially for accounting purposes. As at March 31, the recorded liabilities included the following components:

Table summary

The table presents, in millions of dollars, a two-year comparative of the accrued benefit obligations related to other employee and veteran future benefits. It consists of three columns: a listing of the other future benefit plans; current year, divided into five columns—Accrued benefit obligations, Other future benefit assets, Unrecognized net actuarial (loss) gain, Benefits paid after measurement date up to March 31, and Future benefit liability; previous year—Future benefit liabilities. A final row presents the total for this table.

(in millions of dollars)

  2016 2015
Accrued benefit obligations Other future benefit assets Unrecognized net actuarial (loss) gain Benefits paid after measurement date up to March 31 Future benefit liabilities Future benefit liabilities
Veterans' disability and other future benefits 69,217 (negative 21,755) 47,462 40,626
Royal Canadian Mounted Police disability and other future benefits 10,360 (negative 4,710) 5,650 4,781
Public Service Health Care Plan 29,690 (negative 6,067) 23,623 22,203
Pensioners' Dental Services Plan 4,749 (negative 1,307) 3,442 3,175
Severance and other benefits 3,186 (negative 901) 2,285 2,341
Accumulated sick leave entitlements 1,732 (negative 115) 1,617 1,560
Workers' compensation 1,424 (negative 151) 1,273 1,130
Consolidated Crown corporations and other entities 332 (negative 2) 1 (negative 2) 329 324
Total 120,690 (negative 2) (negative 35,005) (negative 2) 85,681 76,140

The cost of these benefits can accrue either during the service life of employees or upon occurrence of an event giving rise to the liability under the terms of the plans. An interest component is charged to expense based on the average accrued benefit obligation.

Amendments were made to veteran future benefits thereby improving and expanding access for certain benefits. In 2016, this includes the introduction of an individual assessment which measures the impact that service related impairment has on a veteran's future earnings potential and years left to serve to determine the appropriate Career Impact Allowance grade level, an increase of the maximum Disability Award benefit and the provision of retrospective payments to veterans who received a Disability Award since the introduction of the New Veterans Charter in 2006, an increase in the income replacement, before deductions, under the Earnings Loss Benefit, and an increase in the estate exemption for Funeral and Burial benefits. The amendments resulted in one-time past service costs of $3,750 million ($1,828 million in 2015) and the immediate recognition of a previously unrecognized net actuarial gain of $8 million ($69 million in 2015). In 2015, an amendment to employee severance benefits resulted in a one-time past service cost of $3 million and the immediate recognition of a previously unrecognized net actuarial gain of $3 million.

Beginning in 2011, the accumulation of severance benefits for voluntary departures ceased for certain employee groups. Employees subject to these changes are being given the option to be paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits upon departure from the public service. The curtailments this year resulted in the immediate recognition of a previously unrecognized net actuarial loss of $2 million (one-time past service cost reduction of $3 million and immediate recognition of a previously unrecognized net actuarial gain of $37 million in 2015), representing the portion related to the obligation for employees subject to the curtailments.

In 2016, payments of $63 million ($643 million in 2015) were made to employees affected by the curtailments of severance benefits who opted to cash out the full or partial value of their accumulated benefits. The settlements resulted in the immediate recognition of a previously unrecognized net actuarial loss of $28 million (one-time past service cost reduction of $49 million and immediate recognition of a previously unrecognized net actuarial gain of $101 million in 2015), representing the portion related to the obligation for employees subject to the settlements.

During the year, expenses relating to these benefits were as follows:

Table summary

The table presents, in millions of dollars, a two-year comparative of expenses related to other employee and veteran future benefits. It consists of three columns: a listing of the other future benefit plans; the expenses for the current year, divided into six columns—Benefits earned, Plan amendments, Actuarial losses (gains) recognized, Net benefit expense, Interest cost, and Total; the previous year—Total. A final row presents the total for this table.

(in millions of dollars)

  2016 2015
Benefits earned Plan amendments Actuarial losses (gains) recognized Net benefit expense Interest cost Total Total
Veterans' disability and other future benefits 2,223 3,750 2,634 8,607 1,442 10,049 6,901
Royal Canadian Mounted Police disability and other future benefits 436 396 832 218 1,050 806
Public Service Health Care Plan 1,015 188 1,203 624 1,827 1,017
Pensioners' Dental Services Plan 144 108 252 105 357 258
Severance and other benefits 116 132 248 80 328 (negative 53)
Accumulated sick leave entitlements 270 2 272 39 311 260
Workers' compensation 229 18 247 32 279 88
Consolidated Crown corporations and other entities 19 (negative 2) 17 9 26 30
Total 4,452 3,750 3,476 11,678 2,549 14,227 9,307

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