All four national parties support the $12.8 billion increase in Old Age Security (OAS) by 2019/20 that is allocated in the Government of Canada 2015 budget. This is by far the largest single annual increase in spending any party will make over the next four years.
Presently, the OAS pays a maximum $570/month per person age 65+ provided you have lived in Canada for at least 10 years after turning age 18. The monthly OAS benefit declines as annual income surpasses $72,000 a year.
OAS includes a Guaranteed Income Supplement (GIS) of up to $773/month if a senior’s annual income falls below $17,280.
The $12.8 billion increase to OAS preserves current benefit levels for the additional 1 million seniors in 2019 after adjusting for inflation.
On top of the $12.8 billion increase on which all parties agree:
Conservatives will add $315 million for single and widowed seniors to provide an extra $300 annual benefit.
The NDP will add $400 million into the Guaranteed Income Supplement (GIS) to prevent poverty among seniors. Currently, Statistics Canada data show that seniors report the lowest rates of low-income of any age group in the country.
Liberals will outspend all parties on income support for retirees. Liberals will add $840 million into the GIS to prevent poverty among seniors, and another $210 million to ensure that the real value of OAS increases with inflation.
Finally, Opposition parties promise to reverse the Conservative plan to increase the age of eligibility for OAS and GIS to age 67, up from age 65. The plan to increase the age of retirement will not influence anyone who will retire over the next 4 years. In fact, it won’t affect anyone who retires before the year 2023, because the policy does not target today’s retirees, nor those nearing retirement. It is a policy change that asks Generations X, Millennials and those who follow to work two years more than they would under the current policy before claiming the Old Age Security pension.
Since Canadians are living 7 to 10 years longer than when the Old Age Security system was first created, Generation Squeeze concedes it is appropriate for governments to consider postponing the age at which we claim OAS and GIS. Any support for this change is conditional on three things:
- Governments and citizens alike acknowledge it is younger generations who are being asked to adapt the length of their work lives in ways that are not expected from Canadians in their 50s and older.
- After the year 2023, the disability benefits of the Canada Public Pension plan are protected and strengthened so that Canadians under age 67 who are not able to work because of a disability are eligible for income protection in the same way people are today.
- Anticipated savings from adjusting the age of retirement for OAS will be invested in younger Canadians today – not reallocated to achieve savings in other parts of the federal budget.