Canada Pension Plan benefits will increase by 0.9 per cent for those already receiving CPP benefits, Employment and Social Development Canada announced Friday.
CPP benefits are revised once a year, in January, based on changes over a 12-month period (November 2012 to October 2013) in the Consumer Price Index, which is the cost-of-living measure used by Statistics Canada.
The maximum CPP retirement benefit for new recipients will increase from $1,012.50 to $1,038.33 per month. This increase is calculated on the average yearly maximum pensionable earnings for the last five years.
The new CPP rates will be in effect until Dec. 31, 2014.
Old Age Security benefits, which consist of the basic OAS pension, the Guaranteed Income Supplement (GIS) and the Allowances, will increase by 0.1 per cent. These payments are also based on the CPI, but are reviewed quarterly (in January, April, July and October) and revised as required to reflect increases in the cost of living as measured by the CPI. The maximum basic OAS pension will increase from $550.99 to $551.54 per month.
The GIS and the Allowances provide additional income to low-income pensioners, their spouses or common-law partners, and eligible survivors.
The new rates are effective Jan. 1, 2014