n. — Administration
a Canada-wide, mandatory pension contribution system for workers.
Type: 1. Origin — The CPP was legislated in 1965 and came into effect in 1966 as a mandatory program within Canada's general income scheme for retirees, which also includes direct government subsidies such as the Old Age Security and Guaranteed Income Supplement programs. Since the CPP is a mandatory program, contributions are deducted via payroll taxes and are directly related to an individual's employment. The mandatory nature of the CPP distinguishes it from pension plans of other countries, such as the UK. As a universal public retirement income plan, the CPP covers all eligible Canadians, wherever they may live.
Quebec was the only province to reject the federal scheme, and as a result the Quebec Pension Plan was created in 1965. The QPP is similar in most respects to the CPP.
See also Maple Leaf Web and Canadian Encyclopedia references.