Eligible federal employees can now apply for an early retirement package as the government looks to trim the public service. The application portal for the Public Service Early Retirement Program opened Friday, March 27, 2026. This initiative, first announced in the 2025 budget, intends to reduce the federal public service by 28,000 positions by 2029, incorporating 12,000 employees through attrition and early retirement incentives.
The program targets federal employees who joined the public service pension plan before December 31, 2012, and are at least 50 years old. Those who joined the pension plan after that date must be at least 55 years old to apply. All eligible employees must have at least two years of pensionable service and a minimum of 10 years of public service employment. If approved, employees can retire with an immediate pension based on their years of service, without the usual penalties for early retirement. Normally, retiring early would mean a pension reduction of five percent for each year before the standard retirement age.
Treasury Board President Shafqat Ali stated the Early Retirement Incentive emphasizes voluntary, structured options for early retirement with clarity. The government estimates the program will cost $1.5 billion over five years but expects to save approximately $82 million annually, mainly from reduced pension contributions. Employees have until July 24 to apply, and those approved must retire by January 20, 2027.
The Public Service Alliance of Canada (PSAC) has expressed concerns, filing a policy grievance arguing the program circumvents collective agreements. PSAC National President Sharon DeSousa stated the union is not against early retirement options but insists such efforts must be negotiated and protect workers' rights. Despite these concerns, the government is moving forward, offering eligible employees the chance to retire early with financial security.
