Government Plans to Address Surplus in Public Service Pension Fund

On November 25, 2024, the Honourable Anita Anand, President of the Treasury Board, announced the government's plan to address a surplus in the public service pension fund. According to the statement, the pension plan is currently in a surplus position due to sound investments. However, under the Income Tax Act, there is a legislated limit to the amount of surplus that can be carried by the plan.

A Special Actuarial Report was tabled in the House of Commons, revealing a "non-permitted surplus" of approximately $1.9 billion as of March 31, 2024. To comply with the Public Service Superannuation Act, the government intends to transfer this surplus to the Consolidated Revenue Fund. This transfer aims to eliminate the non-permitted surplus while further discussions with stakeholders are conducted.

The public service pension plan is designed to provide retirement income to federal public servants, with benefits based on salary, service, age, and termination reason. Both the employer and active members contribute to the plan. The Consolidated Revenue Fund is where taxes and revenues are deposited and from which public service costs are defrayed.

The government assures that federal public servants will continue to benefit from a sustainable pension plan and emphasizes ongoing discussions to determine future steps.