CANADA - At current contribution rates, the reserves of the Québec Pension Plan (QPP) will be completely drained by 2051, the chief actuary of Canada has warned.
The report shows at the current rate of contributions, when taking into account democratic shifts, a rate of 12.6% would be required after 2051 to maintain the viability of the plan. After 2033, outflows will be greater than contributions plus investment income, leading to increasing use of the plan's reserves.
The report projects total annual contributions to amount to CAN$18.3bn in 2060, compared to the $22.3bn annual cost of benefits by the same time.
According to the report, the population of Québec will peak at 8.6m by 2040, before reaching a stable level of 8.4m in 2060. At the same time, beneficiaries of the scheme will more than double from 1.2m at current levels to 2.7m by 2050, while contributors over the same period are set to fall to a ratio of less than 2:1 from 3:1 today.
The QPP was unavailable for comment.
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