Thousands approved for Ottawa’s early retirement program

More than 8,100 federal public servants have had their applications confirmed under Ottawa's Early Retirement Incentive, according to figures published by the Treasury Board of Canada Secretariat.

As of Aug. 11, 8,161 applications had been confirmed to meet the Early Retirement Incentive's criteria, while 42 had been denied, the federal government stated. The figures follow the closure of the program's application window on July 24, 2026, when 10,006 total applications had been received.

The government noted that this data is based on applications submitted through the Early Retirement Incentive tool in the TBS Applications Portal only. Some applications may still be discontinued, the page stated, because they were withdrawn by the employee or closed for administrative reasons — for example, if the employee had already resigned.

With confirmations continuing, the page directs employees whose applications have been approved to guidance on next steps, including how the incentive interacts with workforce adjustment and other separation benefits.

What does the incentive offer?

The Early Retirement Incentive – introduced in Budget 2025 – lets eligible employees retire with an immediate pension based on years of service, with no reduction for retiring early. Under standard rules, a pension is normally reduced by 5% for every year an employee retires before qualifying for an unreduced annuity.

The program was created "to help manage workforce reductions through attrition and voluntary departures to the greatest extent possible," according to the federal government. Eligibility generally requires at least 10 years of federal employment, at least two years of pensionable service, and a minimum age of 50.

The application period ran from March 26, 2026 to July 24, 2026. Employees confirmed under the program have until Jan. 19, 2027 as their last possible day of employment, with Jan. 20, 2027 set as the latest possible retirement date.

“As proposed in Budget 2025, workforce reductions will be managed to the greatest extent possible through attrition and voluntary departures,” Shafqat Ali, president of the Treasury Board, said back in March. “The Early Retirement Incentive is proceeding with an emphasis on voluntary, structured options to retire early with clarity and predictability.”  

How does the pension calculation change?

In the federal government website, the Treasury Board Secretariat's illustrated the financial impact of the early retirement offer using two example calculations. In one, a 53-year-old Group 1 member with 19 years of pensionable service and an average salary of $55,556 would normally face a 35 percent pension reduction for retiring seven years early, producing an annual pension of approximately $13,722. Under the incentive, the same employee would instead receive an unreduced pension of approximately $21,111 per year.

In a second example, a 54-year-old Group 2 member with 10 years of pensionable service and an average salary of $63,448 would normally see a 50 percent reduction, for a pension of approximately $6,344.80 per year. Under the incentive, the same employee's unreduced pension would be approximately $12,690 per year.

Pension amounts are calculated using an employee's average salary based on their best five consecutive years of earnings and their total years of pensionable service up to the early retirement date. Some Group 2 members may also qualify if they turn 55 during the program's window but before the retirement deadline.

The federal government’s Early Retirement Incentive program for public servants had prompted formal labour complaints from the Public Service Alliance of Canada (PSAC), which alleged Ottawa is bypassing negotiated processes and undermining the union’s role as bargaining agent.