Presentation is loading. Please wait.

Presentation is loading. Please wait.

February 2007 Department of National Defence Modernization of the Canadian Forces Pension Plan Regular Force under Part 1.

Similar presentations


Presentation on theme: "February 2007 Department of National Defence Modernization of the Canadian Forces Pension Plan Regular Force under Part 1."— Presentation transcript:

1 February 2007 Department of National Defence Modernization of the Canadian Forces Pension Plan Regular Force under Part 1

2 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I2 Outline  Eligibility, contributions, and definitions  Benefits  Grandfathering rules  Pension formula  Annuitant employment policy  Coming into force

3 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I3  Presentation focuses on pension policies not administration Consult the CFPMP websitewww.forces.gc.ca/hr/dgcb/cfpmp  For questions on “how do I” and “what happens when”, contact DAPP/Pension services For more information Toll-free On-line

4 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I4 About CFSA Part I  Provides a benefit based on set formulas (defined benefit)  Uses best 5-year average (full-time)

5 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I5 Eligibility rules  Regular Force members join Part I when they join the Regular Force  “Once in, always in” rule Contributions to Part I will continue until retirement

6 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I6 Contributions  A fixed percentage of pensionable earnings  Reduces to 1% of pensionable earnings when member has 35 years of pensionable service  Pensionable earnings include basic pay and pensionable allowance YMPE—Year’s Maximum Pensionable Earnings Canada Pension Plan earnings ceiling (2007 = $43,700)

7 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I7 CF service  Days of service in the Regular Force for which pay was authorized and authorized maternity and parental leaves  Days of service in the Reserve Force for which pay was authorized and authorized maternity and parental leaves Days of training or duty of less than 6 hours = half-day Days of Class “A” service = 1.4 days Definitions After 25 years of CF service, a member is entitled to an immediate annuity. Officers may have to meet different requirements.

8 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I8 Pensionable service  Any period during which the member is a contributor  Any period for which the member has elected to pay Definitions

9 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I9 Vesting  Vesting is the right of a plan member to receive a benefit from the pension plan other than a return of contributions An immediate annuity, or A deferred annuity that may be converted to an annual allowance or transfer value  Vesting occurs after 2 years of pensionable service Definitions

10 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I10 Transfer value  A lump-sum amount, expressed in today’s dollars, of your future pension benefits payable at age 60 Received if... Vested, Not entitled to an immediate annuity, and Younger than age 50 Must be transferred to... Locked-in RRSP, New employer’s plan (if accepted), or Insurance company, to buy an annuity Definitions

11 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I11 Current retirement benefits Terms of Service Less than 10 YOS ROC & Interest CTA 10 to 19 YOS ROC & Interest Deferred Annuity Age 60 Only 20 to 24 YOS or before RA Reduced Annuity 20 YOS-IE 25 NCMs/RA Officers Immediate Annuity

12 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I12 Retirement benefits at CIF  CF service (actual paid time) Regular Force Reserve Force  Pensionable service (elapsed time) CF service Public/RCMP service Miscellaneous service Years of Pensionable Service (YPS) or CF Service Less than 2 YPS ROC & Interest 2 to 24 YPS Deferred Annuity Unreduced 60 YOA Reduced 50 YOA Transfer Value 25 years CF service* Immediate Annuity 30 YPS and 55 YOA Immediate Annuity * Officers may have to meet different requirements (see slide 14)

13 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I13 Benefits at retirement or release With 2 or more years of pensionable service Immediate annuity if… 25 years of CF service (9,131 days)—officers may have to meet different requirements (see chart on next slide) Age 60 Age 55 with 30 years of pensionable service, or Released for workforce reduction (20 years of pensionable service or age 55 or older with 10 years)

14 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I14 Benefits at retirement or release Officer service requirements—immediate annuity RankRelease date betweenCF service Colonel and above March 1, 2007 and December 31, ,227 days (28 years) January 1, 2008 and December 31, 20089,861 days (27 years) January 1, 2009 and December 31, 20099,496 days (26 years) January 1, 2010 and after9,131 days (25 years) Other officers March 1, 2007 and December 31, 20079,496 days (26 years) January 1, 2008 and after9,131 days (25 years)

15 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I15 Benefits at retirement or release With 2 or more years of pensionable service and no immediate annuity If age 50 or older, a reduced annuity (annual allowance) If younger than age 50, a deferred annuity starting at age 60, or option of… Transfer value Reduced annuity (annual allowance) starting at or after age 50 With less than 2 years of pensionable service (not vested) Return of contributions with interest Transitional rules Opt to receive contributions plus interest, instead of deferred annuity, if: Regular Force contributor on February 28, 2007 Release within two years of CIF, and Not entitled to an immediate annuity

16 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I16 Grandfathering rules  At CIF, all members entitled to benefits under new rules  Regular Force contributors who are on track for certain benefits at CIF may opt to have benefits calculated under “old” rules  Grandfathering rules apply only to members who serve continuously from February 28, 2007 to release

17 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I17 Grandfathering rules  Members may opt for an immediate annuity if they meet any of these conditions at release… 1.Reached retirement age, with at least 10 years of Regular Force pensionable service 2.Have completed an IE 20 that started before CIF, but are not on an Indefinite Period of Service 3.Have between 19 and 20 years of Regular Force pensionable service— at least 10 of it at CIF—and: Were never offered an IE 25 years Are not serving an IE or Indefinite Period of Service Did not refuse an offer to re ‑ engage (if a Non Commissioned Member) Did not refuse an offer to serve on an Indefinite Period of Service (if an officer) 4.Have not reached retirement age, and: Have at least 20 years of Regular Force pensionable service— at least 10 of it at CIF Do not meet any of the conditions to opt for a reduced annuity

18 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I18 Grandfathering rules  Members may opt for an annual allowance (immediate reduced annuity) if they meet either of these conditions at release… 1.Are NOT serving on an Indefinite Period of Service and: Have not reached retirement age Have at least 20 years of Regular Force pensionable service— 10 or more of it at CIF Never served on an Intermediate Engagement of 25 years Release without 25 years of Regular Force pensionable service OR did not accept an offered Intermediate Engagement of 25 years (other than while on, or after completing an IE 20) 2.Are serving on an Indefinite Period of Service and: Have not reached retirement age Have at least 20 years of Regular Force pensionable service— 10 or more of it at CIF

19 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I19 Benefits in case of death  At death of vested member or pensioner, his or her… Spouse receives a survivor lifetime pension 1% X pensionable service X best average earnings Dependent children receive a child annual allowance Payable to age 18 or age 25 during periods of full-time school attendance

20 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I20 Benefits in case of disability  If participants have 10 or more years of pensionable service and have not ceased participation, they are entitled to… An immediate annuity  After participation ceases and eligible for a deferred pension or annual allowance and become eligible for C/QPP disability pension, they are entitled to… An immediate annuity Once eligible for C/QPP disability pension, the bridge pension ends You are considered disabled if you suffer from a mental or physical impairment that prevents you from performing your duties.

21 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I21 Other features  Annual increases for inflation—indexing for CPI For annuity and annual allowance, indexing begins at... Age 60, or Age 55 or older, if age plus full years of pensionable service total 85 or more For survivor and child annual allowance and disability pension, indexing is... Immediate  At death, minimum guarantee of 5 years of annuity payments

22 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I22 Pension formula 2 % X pensionable service X best average earnings 0.7 % X pensionable service X best average earnings up to the average YMPE Note: Percentage will gradually decrease from 0.7% in 2007 to 0.625% in 2013 Temporary bridge pension payable to age 65, included in the annuity Annuity

23 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I23 Annuitant employment policy  Members are not permitted to continue to receive their "Regular Force" pension AND contribute under the CFSA  A CFSA annuitant has the option of: Serving up to a maximum of 330 days of Reserve Force service within any one-year period while continuing to receive an annuity Ceasing to be an annuitant at any time and contributing to Part 1 of the CFSA on a voluntary basis Serving more than 330 days, and at least 365 days, at which time the member automatically: Ceases to be an annuitant, and Again becomes a contributor under Part I of the CFSA If re-enrolled, the member will be allowed to elect past service, but, if the election is for time when the member received an annuity, the member will have to return the annuity for the days during which he/she worked and for which he/she wants to elect

24 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I24 Coming into force

25 Modernization of the Canadian Forces Pension Plan—Regular Force under Part I25 Questions? This presentation provides an overview of the some of the provisions under the Canadian Forces Superannuation Act. If there is a discrepancy between this presentation and the Act, the Act prevails.


Download ppt "February 2007 Department of National Defence Modernization of the Canadian Forces Pension Plan Regular Force under Part 1."

Similar presentations


Ads by Google