2007
Government Benefits
Government premium rates and maximums for 2007:
-
Employment
Insurance (EI)
-
Quebec
Parental Insurance Plan (QPIP) benefits
-
Canada Pension Plan (CPP/Quebec Pension Plan (QPP)
Increase
in EI maximum insurable earnings will impact Short Term Disability
plans
Both
the federal and Quebec governments have announced rates
and maximums for Employment Insurance (EI), Canada Pension
Plan (CPP) and Quebec Pension Plan (QPP) benefits, and Quebec
Parental Insurance Plan (QPIP) benefits for 2007.
The
most significant change this year is to the EI maximum insurable
earnings threshold, which increases by $1,000 from $39,000
to $40,000 for 2007. This increase, which is the first since
1996, will impact short-term disability (STD) plans where:
-
the maximum STD benefit is based on the EI maximum weekly
benefit ($423 for 2007), or
-
the EI maximum earnings amount is used to calculate the
STD benefit.
Contract
adjustments
If your contract wording indicates that the maximum disability
benefit is based on the EI maximum weekly benefit or earnings,
no contract amendment will be required. STD benefits will
be adjusted automatically.
If your
contract indicates a specific maximum benefit amount that
is less than the EI weekly maximum of $423, your contract
will need to be adjusted to reflect the new EI maximum weekly
benefit. If you choose to continue with the lesser benefit,
please be aware that your plan may no longer continue to
qualify for the EI premium reduction program.
The
attached chart outlines all the rate changes for 2007.
If you
have any questions, please contact your group benefits representative.
Government
rates and maximums for 2007
Employment
Insurance (All provinces except Quebec)
| |
2007 |
2006 |
Maximum
Insurable Earnings |
$40,000.00 |
$39,000.00 |
Maximum
Weekly Benefit |
$423.00 |
$413.00 |
Employee
premium rate (per $100 of insurable earnings) |
$1.80
|
$1.87 |
Employer
premium rate (per $100 of insurable earnings) |
$2.52
|
$2.62 |
Maximum
annual employee premium |
$720.00 |
$729.3 |
Maximum
annual employer premium |
$1008.00
|
$1021.02 |
|
|
|
Premium
Reduction rate*
(For employers with short-term disability plans) |
1.248% |
1.248%
|
* Your
plan must meet standards established by the EI Regulations,
to qualify for the reduced rate.
Employment Insurance and Quebec Parental Insurance Plan
(Quebec only)
Employment
Insurance |
2007 |
2006 |
Maximum
Insurable Earnings |
$40,000.00
|
$39,000.00 |
Maximum
Weekly Benefit |
$423.00
|
$413.00 |
|
|
|
Employee
premium rate (per $100 of insurable earnings)* |
$1.46
|
$1.53 |
Employer
premium rate (per $100 of insurable earnings* |
$2.04
|
$2.14 |
|
|
|
QPIP |
|
|
Maximum
annual insurable earnings |
$59,000
|
$57,000 |
Employee
premium rate (per $100 of insurable earnings) |
$0.416
|
$0.416 |
Employer
premium rate (per $100 of insurable earnings |
$0.583
|
$0.583 |
* Rates
are lower than in the rest of Canada because of the new
Quebec Parental Insurance Plan (QPIP) that took effect January
1, 2006. With this legislation, Quebec now offers its own
parental benefits
Canada
Pension Plan (CPP) and Quebec Pension Plan (QPP)
The
following contributions and benefits data are effective
January 1, 2007.
| |
CPP |
QPP |
| Yearly
Maximum Pensionable Earnings (YMPE) |
$43,700.00 |
$43,700.00 |
| Yearly
Basic Exemption (YBE) |
3,500.00 |
3,500.00 |
| Maximum
Contributory Earnings (YMPE – YBE) |
40,200.00
|
40,200.00 |
| |
|
|
| Maximum
annual employee / employer contributions |
1,989.90
|
1,989.90 |
| Contribution
rate (employee / employer)* |
4.95%
|
4.95% |
| |
|
|
| Maximum
self-employed contributions |
3,979.80
|
3,979.80 |
| |
|
|
| Maximum
Monthly Retirement Pension |
|
|
| At
age 65 |
863.75 |
863.75 |
At
age 60
|
604.63 |
604.63 |
| |
|
|
| Death
Benefits |
|
|
| Lump
sum |
2,500.00
|
2,500.00 |
Maximum
monthly surviving spouse’s pension:
- under age 55
- age 55 to 64
- age 65 or older
Monthly Orphan’s Pension (each child) |
482.30
482.30
518.25
204.68
|
729.84
729.84
518.25
64.99
|
| |
|
|
| Disability
Benefits |
|
|
| Maximum
Monthly Contributor’s Pension |
1,053.77 |
1,053.74 |
| Monthly
Child’s Pension (each child) |
204.68 |
64.99 |
| |
|
|
* In
2007 the employee and employer contributions for the CPP
and QPP are equal to 4.95% of employment earnings (for a
total of 9.9%) up to the YMPE minus the YBE.
Source:
Focus Update #106, January 2007, Sunlife
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