Canada Pension Plan

Marginal note:Calculation of pensionable earnings for a month

• 51 (1) The pensionable earnings of a contributor for a month (in this subsection referred to as the “particular month”) are the amount determined by the formula

  A × B

  where

  A

  is the earnings for which the contributor is deemed by section 52 to have made a contribution for the particular month; and

  B

  is

  • (a) where the contributor was born after December 31, 1932 and the contributor’s retirement pension did not commence before January 1, 1998 and, after the contributor’s 60th birthday, a month was excluded from the contributor’s contributory period by reason of disability, the product determined by the formula

    (C/D) × (E/F)

    where

    C

    is the contributor’s Maximum Pensionable Earnings Average for the year in which a benefit first became payable to the contributor under this Act or a provincial pension plan that caused a month after the contributor’s 60th birthday to be excluded from the contributor’s contributory period by reason of disability,

    D

    is the Year’s Maximum Pensionable Earnings for the year that includes the particular month,

    E

    is the Pension Index for the year in which a benefit becomes payable to the contributor under this Act or a provincial pension plan, and

    F

    is the Pension Index for the year referred to in the description of C, and

  • (b) in any other case, the ratio

    G/D

    where

    G

    is the Maximum Pensionable Earnings Average in respect of the contributor for the year in which a benefit becomes payable to the contributor under this Act or under a provincial pension plan, and

    D

    is as described in paragraph (a).

• Marginal note:Exception

  (2) For the purposes of subsection (1), where the year referred to in the description of C is 1987 or earlier, the Maximum Pensionable Earnings Average for the year shall be calculated as if the Year’s Maximum Pensionable Earnings for a particular year before 1986 were calculated as the greatest multiple of $100 that is equal to or less than an amount calculated by multiplying the Year’s Maximum Pensionable Earnings for 1986, which are $25,800, by the ratio

  A/B

  where

  A

  is the average for the twelve month period ending on June 30 of the year preceding that particular year of the average weekly wages and salaries of the Industrial Composite in Canada as published by Statistics Canada for each month in that period, and

  B

  is the average for the twelve month period ending on June 30, 1985 of the average weekly wages and salaries of the Industrial Composite in Canada as published by Statistics Canada for each month in that period.

• Marginal note:Pension Index before 1974

  (3) For the purpose of subsection (1), where the beginning of a period that is excluded from the contributor’s contributory period by reason of disability is in a year before 1974, in calculating the Pension Index for the year in which that period begins, paragraph 43.1(2)(a) of the Canada Pension Plan, R.S.C. 1970, c. C-5, as amended by section 24 of chapter 4 of the Statutes of Canada, 1974-75-76, shall be read without reference to the words “or 1.02 times the Pension Index for the preceding year, whichever is the lesser”.