Increase CPP death benefit

AI summary

Petitioners ask to raise the CPP death benefit to $6,400 with indexation, plus funeral tax relief and green-burial incentives. The government responds that the benefit is currently $2,500 and that major changes require federal-provincial approval.

AI summaries describe petitioners’ requests and claims. Consult the official record for the full text.

Official petition

Petition to the House of Commons in Parliament assembled The Canada Pension Plan (CPP) Death Benefit was indexed to inflation until 1997, then reduced from $3,580 to $2,500 in 1998, and has remained frozen ever since; If it had remained indexed, the benefit would be about $6,400 in 2025; The average cost of a funeral in Canada has more than doubled since 1998, now typically between $15,000 and $20,000; Many Canadians outlive their savings, leaving families to shoulder unaffordable funeral expenses; The estates of most deceased persons are ineligible for the $5,000 CPP “top-up” because it applies only to those who have never received CPP; The number of unclaimed bodies has increased in recent years as next of kin struggle to afford funeral costs; and Every person deserves dignity in death, regardless of their financial situation. We, the undersigned, citizens and residents of Canada, call upon the House of Commons to: 1. Increase the CPP Death Benefit to $6,400 (its inflation-adjusted 2025 value had it remained indexed) and restore annual indexation to prevent further erosion; 2. Provide tax deductions or credits for funeral and final disposition expenses to help families afford a dignified farewell; and 3. Encourage environmentally responsible options, such as green burials, through targeted tax incentives and other supportive measures.

Government response

Response by the Minister of Finance and National Revenue Signed by The Honourable François-Philippe Champagne The Canada Pension Plan (CPP) is funded by the contributions of employees, employers and the self-employed, and by the revenue earned on CPP investments. It covers virtually all employed and self-employed persons in Canada, excluding Quebec, where the Quebec Pension Plan offers similar benefits. The intent of the CPP is to provide Canadian workers and their families with partial income replacement upon the retirement, disability or death of a wage earner. The amount of benefits payable is generally based on how much and for how long a wage earner contributed to the plan. While the CPP is primarily a retirement plan, it also provides supplementary disability and survivor benefits, which include the death benefit. The death benefit is a lump-sum payment made to the estate of an eligible contributor and was designed to help offset a portion of funeral expenses. Until 2019, the value of the death benefit was calculated using the amount of the deceased contributor’s CPP retirement pension, or what that amount would have been had they been 65 years of age at the time of death. The benefit was equal to six months of the calculated retirement pension of the deceased contributor, up to a maximum of $2,500. Starting on January 1, 2019, the CPP death benefit has been changed to a flat rate benefit of $2,500 for all eligible contributors. This change to the death benefit is particularly beneficial for families of low-income workers. More recently, Budget 2024 introduced amendments to the CPP legislation that provide a non-indexed top-up of $2,500 to the existing death benefit for individuals who die without collecting their retirement or disability pension and leave behind no survivors. This change, which came into force on January 1, 2025, has doubled the death benefit to $5,000 for about 13,500 beneficiaries per year. The value of the maximum CPP death benefit has not changed since the 1990s. The benefit’s maximum value of $2,500 was set as part of the broad reforms to the CPP, which restored the plan to a financially sustainable footing. Without these reforms, the Chief Actuary of Canada at the time projected that the CPP contributory rate would have needed to increase to more than 14 percent by 2030 to pay for benefits. However, because of these reforms, which also included increases to contribution rates, a reduction in the growth of benefits over the long term and a new investment policy, the plan’s financial health is sound. This has been confirmed in each subsequent report issued by the Chief Actuary of Canada, including the most recent report on December 8, 2025, which concluded that the CPP is sustainable for the next 75 years at current contribution rates. It is important to note that the CPP is an area of joint federal-provincial responsibility and reflects the views and priorities of all participating jurisdictions. Major changes, such as changes to benefit levels and contribution rates, are arrived at together and require the formal approval of the Parliament of Canada and of seven out of ten provinces representing at least two thirds of the population. Every three years, federal and provincial Ministers of Finance are required under legislation to review the state of the CPP and determine if changes to contribution rates and/or benefits are necessary. The “triennial review” process provides an opportunity for federal and provincial governments to examine the overall functioning of the Plan and discuss ways in which it can be modernized or better respond to broader policy objectives. As part of the 2025-2027 Triennial Review, Canada’s Finance Ministers unanimously agreed to reduce the contribution rate for the base CPP, so that more money remains in the pockets of Canadians while preserving the long-term sustainability of the plan. That is why the Spring Economic Update 2026 announced that the government would reduce the base CPP contribution rate from 9.9 percent to 9.5 percent, effective January 1, 2027. The main function of the income tax system is to raise revenues for public programs and services that are important to Canadians. The personal income tax system raises revenues based on the ability of individuals to pay tax. Canadians are able to deduct or claim a tax credit for certain expenses when calculating their personal income taxes. Expenses that qualify for a deduction or tax credit are generally limited to those that are considered non-discretionary (e.g., mandatory to earn income) and/or that recognize the effect of factors such as age and health/disability status on an individual’s ability to pay income tax. The Income Tax Act generally does not allow for the deduction of expenses that do not meet these criteria. Social assistance is generally within the purview of the provinces and territories, as part of their jurisdiction over property and civil rights. They may provide social programs that offer timely assistance for low-income families unable to pay for funeral expenses. Depending on the jurisdiction, funeral benefits can be paid directly to the funeral home or to the individual that paid the expenses. The government is continually reviewing means by which to improve the tax system while taking into account competing priorities and available fiscal resources. The active participation of Canadians is an integral part of efforts to ensure that the tax system is as fair and effective as possible.