On this blog, we’ve written extensively about Canada Post’s Defined Benefit (DB) Pension Plan. The reason is simple: most DB plans in the profit-driven private sector eventually collapse or require painful bailouts. To understand why, let’s start with the basics.
Defined Benefit vs. Defined Contribution — The Key Difference
- Defined Benefit (DB) Plan: Guarantees a fixed monthly payment for life, based on your salary and years worked. The employer is responsible for funding it.
- Defined Contribution (DC) Plan: Has no guaranteed payout. You and/or your employer contribute to an account, and your retirement income depends on how much is saved and how well investments perform.
The difference is stark. With a DB plan, the employer bears the funding risk. If the employer goes bankrupt or stops contributing, the plan’s sustainability is threatened.
Canada Post’s Current Situation
Canada Post is losing about $10 million per day and already owes the federal government $1 billion for operational costs. At the same time, thousands of postal workers—many of whom have contributed to the DB plan for over 20 years—are approaching retirement.
CUPW, the postal workers’ union, refuses to budge on its demands, even as Canada Post bleeds money. The union also wants more spending on new projects it believes will be profitable. But right now, the corporation is in crisis.
Numbers That Raise Red Flags
On paper, the DB plan’s assets look strong. According to Canada Post’s own reports:
- In 2023, the DB plan’s assets grew from $29.5 billion to $30.8 billion.
- By the end of 2024, net assets increased to $32.5 billion.
- The DC component’s assets rose from $213 million to $303 million in 2024.
But assets don’t tell the whole story. Cash flow matters. If you own an apartment building, but your tenants stop paying rent, the building becomes a liability, not an asset.
The alarming part? No employer contributions were made to the DB plan in 2024. This raises serious questions about sustainability in a downturn. You can verify these facts yourself at cpcpension.com by searching for “Canada Post Pension Plan Report to Members 2024.”
Why DB Plans Get Phased Out
DB plans were phased out by most private employers because they function like legalized pyramid schemes. They depend on a steady flow of new contributions to pay benefits to retirees. When costs rise—due to minimum wage laws, demographic shifts, or market downturns—the system strains.
Now Canada Post faces the same challenge: shrinking revenues, growing retiree obligations, and an inflexible union. Without major changes, the DB plan could implode.
A Governance Problem
We’ve long argued that it would make more sense for the federal government to directly take over Canada Post, rather than leaving it as a Crown corporation operating in limbo. In Ontario, for example, the threat of electoral backlash eventually curbed teachers’ strikes. Canada Post isn’t tied to the election cycle, which allows both the corporation and CUPW to operate with impunity.
We oppose privatizing Canada Post—Canada is not Germany. With the world’s second-largest landmass, a purely private postal service would abandon unprofitable regions. But the current arrangement—two sides acting like “children in a candy store”—is unsustainable.
If nothing changes soon, all signs point to a Canada Post Defined Benefit Pension Plan crisis.
A Christian Perspective
As Christians, we believe in stewardship, honesty, and transparency. A pension promise is a moral obligation, not just a financial one. But systems built on unstable foundations eventually collapse. That’s why we speak plainly about these issues—not to judge, but to warn.
True security does not come from pensions, governments, or corporations. It comes from Christ. If you’re overwhelmed by uncertainty about your future, consider placing your trust in Jesus Christ, the Lord and Savior.
“Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal: But lay up for yourselves treasures in heaven…” — Matthew 6:19–20
Consider making Jesus Christ your Lord and Savior today.
