People walk past the Peace Tower on Parliament Hill in Ottawa on Nov. 4, 2025. The government launched a buyout application portal for eligible public servants on Friday.Sean Kilpatrick/The Canadian Press
Public servants will have until July 24 to apply for an early retirement incentive from the federal government, which Ottawa is counting on to help meet its target of eliminating 30,000 positions over three years.
The government launched the buyout application portal Friday, one day after the Senate gave its final approval of Bill C-15, the government’s budget bill.
The legislation authorizes the program, which according to the budget, is projected to cost about $1.5-billion and will be funded from a surplus in the Public Service Pension Fund.
Senate approves budget bill, allowing public-sector buyouts to proceed
In December, letters went out to around 68,000 public servants informing them that they may be eligible for the buyout. A new wave of letters will be sent to eligible employees with instructions on how to apply.
Changes to pension eligibility introduced in 2013 have left what unions criticize as a “two-tier” pension system. The normal retirement age for employees who started after Jan. 1 of that year increased to 65, up from 60, before they can qualify for an unreduced pension.
As a result of that divide, the early retirement incentive has two categories. The buyout applies to qualifying public servants in the first group who are age 50 or above and age 55 or above for the second group.
The budget said eligible employees will be able to retire with an immediate pension based on years of service with no penalty for early retirement. Typically, the value of a pension is reduced by five per cent for each year a person retires early.
“As proposed in Budget 2025, workforce reductions will be managed to the greatest extent possible through attrition and voluntary departures,” Treasury Board President Shafqat Ali said in a statement. “The Early Retirement Incentive is proceeding with an emphasis on voluntary, structured options to retire early with clarity and predictability.”
The buyouts are projected to deliver savings of $82.0-million annually, according to the Nov. 4 budget.