Canada pension plan disability and return to work: overcoming institutional disincentives

Canada Pension Plan Disability provides benefits to individuals who meet the contributory and medical eligibility criteria. Although few beneficiaries are expected to leave the benefit and return to work, some do recover from their disabilities and regain the ability to work beyond the level the program deems capable of no longer being eligible for benefits. This study analyzes Statistics Canada data and draws on interviews with disability agencies and academics to inform our understanding of institutional disincentives to work. The issues raised through the interview and data analysis lead to the formulation of policy options, which are assessed against a set of criteria. The recommendations include revamping current communications and reforming the Automatic Reinstatement policy as short-term options. Exploring a revised earnings exemption scheme is proposed for the longer term.