Coordination is an option that allows eligible MEPP members who retire before 65 to receive a temporary increase to their pension payments. Upon turning 65, when other kinds of retirement income often start to be paid, this temporary increase is removed and a permanent coordination reduction begins, resulting in permanently reduced pension payments.

Canada Pension Plan (CPP) and Old Age Security (OAS) are two examples of other retirement income. The permanent reduction to the retired member’s MEPP pension payment will continue regardless of any changes to their federal benefit amounts or other retirement income sources.

If a member selects the coordination option, it is critical for them to ensure that their retirement income from all sources is enough to compensate for the permanent reduction to their MEPP pension payment, which will occur when they turn 65. Members may wish to seek the advice of an independent financial professional to determine the best choice suited to their financial circumstances. A member’s choice cannot be changed after their first pension payment has been made.

Members should review the facts as they apply to them on their Retirement Benefit Statement. Members should:

• think realistically about how much money they need now, and how much they will likely need after they turn 65; and
• consider all retirement income sources (such as CPP/OAS, and other personal investments), both before and after the age of 65, as well as how their income taxes will be affected in both cases. 

Members may wish to seek the advice of an independent financial professional to determine the best choice suited to their financial circumstances.

This is an important decision. If a member chooses the coordination option for their MEPP pension, they cannot change their mind once their pension payments start.

Coordination is only offered to eligible MEPP members who retire before 65 years of age. If a member is eligible, their Retirement Benefit Statement will show their coordination options. Prior to deciding whether to coordinate their pension, members should carefully review the different pension options available to them and select the one that best suits their individual circumstances.

NOTE: The amount of coordination offered on a member’s Retirement Benefit Statement is based on the maximum amount of CPP and OAS a Canadian can receive, and not based on how much CPP and OAS the member will actually receive.

Members can use the Government of Canada's CPP/OAS calculators, or contact them at 1-800-277-9914 to get an estimate of how much CPP and OAS they will receive.

If a MEPP member’s pension commenced after December 31, 2003, or if they selected Joint Lifetime with Reduced Survivor Benefit:

Coordination of their MEPP pension will continue as long as they live. If they have a coordinated pension and they pass away before the age of 65, the increase in the monthly payment will stop. Any benefits paid to their pension partner or beneficiary will revert to the member’s original pension option amount without coordination. The pension will not be reduced on the date the member would have turned 65.

If the member passes away after 65 years of age, the reduction in the monthly payment will stop and their pension partner or beneficiary will receive the original monthly survivor pension.

If a member’s pension commenced before January 1, 2004, the impact of coordination may differ. Please contact Member Services directly.

Read on to see how coordination can impact a pension.

This graph shows an example of a MEPP pension with the coordination option.

The first column shows the pension with a temporary coordination increase. The member will receive this increase until they turn 65.

The second column shows that, like in the first graph, the member turned 65 and began collecting their CPP and OAS (in gold). But it also shows how their MEPP pension payment was permanently reduced at that time (grey lines). The graph shows how this member’s overall retirement income will be essentially the same both before and after turning 65.

It's important to understand that, by choosing the coordination option, the MEPP pension payment will be reduced as of the member’s 65th birthday, and it will continue to be reduced for the rest of their life, no matter how long they live.

With coordination, the total amount of retirement income paid over the member’s lifetime may not be the same as if they had taken their MEPP pension without coordination. This total amount is unique to the individual and is affected by how much coordination the member chose to take before reaching the age of 65, and for how long they live after 65.