CPP benefit changes take effect

Summary#

This Order (SI/2025-1) sets when Division 14 of Part 4 of the Budget Implementation Act, 2024, No. 1 takes effect. It brings into force changes to the Canada Pension Plan that increase some death benefits, add and expand children’s benefits, and change survivor-pension rules; the Order was made on December 16, 2024, comes into force the day after (i.e. December 17, 2024), and was registered in the Canada Gazette on January 1, 2025.

What it does#

• Increases the CPP death benefit for certain cases from $2,500 to $5,000 when the deceased did not receive a retirement pension or disability benefits and no survivor’s pension is payable.
• Creates a new children’s benefit for dependent children aged 18 to 25 who are in school part‑time. That new part‑time benefit is payable at 50% of the full‑time student amount.
• Extends eligibility for a disabled contributor’s child’s benefit so it can continue even after the disabled parent’s disability pension ends at age 65.
• Makes a separated spouse ineligible for a survivor’s pension where there was a division of pensionable earnings (a “credit split”), aligning separated spouses with divorced and former common‑law partners for this rule.
• Notes that the required provincial consent (two‑thirds of included provinces representing two‑thirds of their population) was obtained before these amendments came into force.
• States the Office of the Chief Actuary found these changes do not affect the long‑term financial sustainability of the CPP and that no increase in contribution rates is required.

Who's affected#

• Families or estates of contributors who die without having received other CPP retirement or disability benefits — many of these will see the death benefit top‑up. Projections estimate 13,000 to 14,000 such death beneficiaries per year will be eligible for the top‑up.
• Dependent children (aged 18 to 25) of disabled or deceased contributors who attend school part‑time — the number of children beneficiaries is expected to rise by roughly 8,000 in 2025 and by 15,000 in 2050.
• Children of disabled contributors whose parent reaches age 65 — they may keep receiving the child’s benefit even if the parent’s disability pension stops.
• Separated spouses who previously had CPP credit splitting — about 400 fewer survivor beneficiaries in 2025, growing to around 8,000 fewer by 2050, according to projections.
• General CPP contributors and employers are not expected to see higher contribution rates because of these changes.

Why it matters#

• It puts more money into the hands of certain families and estates: larger death payments for some estates and new or bigger monthly support for many children of disabled or deceased contributors.
• It recognizes part‑time students and later parenthood by expanding who can receive children’s benefits.
• It changes safety nets for separated spouses after a credit split, reducing eligibility for survivor pensions in those specific cases.
• The changes are limited in scale (small numbers relative to the whole plan) and are not expected to affect CPP funding or contribution rates. Information about the changes will be published on the CPP website and in updated public materials.