Post Living Differential (PLD)

INTRODUCTION

The Post Living Differential (PLD) program was introduced on 1 April 2000 to provide a mechanism to stabilize the cost of living of Canadian Forces (CF) members and families, serving in Canada, with respect to regional differences. PLD provides a means for a CF family to enjoy a relative and predictable standard of living no matter where they serve in Canada. The original PLD methodology was developed in the mid-late 90’s; however, the economic conditions under which the previous methodology was derived, roughly a decade ago, are no longer relevant in today’s environment. Following an intensive review, a new PLD methodology has been approved by Treasury Board effective 1 July 2007. Measures have also been approved by Treasury Board to ease the transition to the new methodology.

METHODOLOGY CHANGES

The following changes have been made effective 1 July 2007.

  1. A “Standard City” approach has been adopted as the threshold to determine a PLD area. Under the original methodology any CF place of duty with costs above the CF Weighted Average was deemed a PLD area. Under the new methodology any CF place of duty with costs above the Standard City will be deemed a PLD area. CBI 205.45 defines Standard City as the cost of living in National Capital Region, as determined by the Minister in consultation with independent firms(s) with the expertise in the field of cost of living determination.
  2. Incorporate an average annual CF salary as the profile used to determine the costs at each CF place of duty instead of using a profile that includes spousal income. A spouse of a CF member is not always guaranteed employment at the new place of duty; thus it is more appropriate to focus on CF members’ salaries.
  3. Use current year data instead of a three-year rolling average. The three-year rolling average was instituted to prevent large fluctuations in rates; but this methodology has proven unresponsive, particularly in booming economies with rapidly increasing shelter costs.

Other Policy changes/clarification are:

  1. A member retains their PLD when they elect an early Intended Place of Residence within the boundaries of their current place of duty (see CBI 205.45 (9));
  2. Clarifies that a Reservist who receives a return move back to where they were moved from (former place of ordinary residence) is not entitled to PLD (see CBI 205.45(5)(c));
  3. A Reservist is entitled to PLD on subsequent Reserve Force employment if they find that employment within 90 days vice one year (see CBI 205.45(6)); and
  4. A Reservist is not disqualified for PLD if they join a local reserve unit (limitation has been removed from CBI 205.45(6)).

TRANSITIONAL MEASURES

Updated PLD rates effective 1 July 2007 are contained in the table to CBI 205.45. These rates reflect the new methodology. Where members currently in receipt of PLD will see decreases, transitional measures have been incorporated into a new CBI 205.452. In general, decreases will be phased in over a three-year period. Officers in the rank of captain or above, and non-commissioned members in the rank of warrant officer or above will have decreases phased in starting 1 April 2008. Officers in rank of lieutenant or below, and non-commissioned member in the rank of sergeant or below will have decreases phased in starting 1 April 2009. For Captain (Navy) and Colonel and above living in the National Capital Region (NCR), the new PLD rate for that location will be implemented in full as of 1 April 2008. For details see CBI 205.452.

PLD OPI: R. Lee (613)-992-3210, Lee.RG@forces.gc.ca