If you want to learn about Alberta’s contribution to CPP—specifically, how much money Alberta is contributing—please stay on this page and continue reading.
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Alberta’s Contribution to CPP
The CPP’s retirement benefits have not kept pace with Alberta’s significant contributions to the program, owing to the province’s higher average income and younger population. Alberta consistently contributes more to the CPP fund compared to other provinces.
The Alberta government’s proposal to exit the Canada Pension Plan (CPP) and create its own Alberta Pension Plan (APP) has stirred controversy. This proposal hinges on Alberta’s overcontribution as a rationale, claiming a 53% share of the CPP’s assets.
This article delves into Alberta’s contributions to CPP and explores the factors contributing to its higher contribution levels. For comprehensive insights, please continue reading.
Canada Pension Plan working
The Canada Pension Plan (CPP) provides a monthly social insurance benefit for retired Canadians, calculated based on factors such as age, CPP contributions, and average income. Participation in CPP contributions and eventual receipt of benefits are fundamental aspects of the program.
With the exception of workers in Quebec, all Canadians aged eighteen and above earning over $3,500 annually are required to contribute a portion of their employment income to CPP. Contributions cease at age 70 or upon retirement from employment. Individuals aged 65 or older who continue working while receiving benefits have the option to opt out of CPP contributions.
Alberta, with a substantial working-age population and fewer retirees, contributes significantly to CPP assets due to higher participation rates in the workforce.
Alberta’s Contribution in CPP Overview
| Post Title | Alberta’s Contribution in CPP |
| Country | Canada |
| Scheme | Canada Pension Plan |
| Contribution Percentage | 15% |
| Net CPP Assets | $575 billion |
How Much Money Alberta is Contributing to CPP?
Alberta accounts for 15% of the population contributing to CPP. According to calculations by the CPPIB, Alberta’s total contributions to CPP amount to approximately $100 billion, constituting 16% of the CPP’s total assets since its establishment.
Should Alberta withdraw from CPP, the contribution rate would need to increase from 9.9% (pre-expansion) to 10.6% to maintain sustainability, considering its current disproportionate contributions. Alternatively, Alberta could establish a standalone contribution rate as low as 5.85%.
Alberta’s Contribution in CPP History
Worker contributions to the CPP in Alberta comprised 16.5% of the total contributions in 2017, whereas retiree contributions accounted for 10.6% of CPP expenditures. Consequently, Albertans provided a net contribution of $2.9 billion to the CPP in 2017 alone. Over the past decade (2008–2017), Alberta has contributed a total net amount of $27.9 billion to the CPP.
Alberta’s disproportionate share of the nation’s working-age population, higher employment rates within this demographic, and above-average incomes compared to the national average contribute significantly to its overrepresentation in CPP and other federal programs.
Similar to other federal initiatives such as equalization, the CPP’s current structure heavily relies on Alberta’s participation. Alberta continues to make substantial contributions to various national and federal programs, including the CPP.
