Should the Old Age Security Be Changed?
By: Cindy Quan
The Old Age Security program, the cornerstone of Canada’s retirement income system, provides Canadian citizens over the age of 65 with a modest pension if they have lived in Canada for at least 10 years.
Prime Minister Harper alluded to a possible change to OAS when he was in Switzerland last week. On Friday he officially confirmed that the Conservative government is giving serious consideration to the issue of increasing the age of eligibility for Canada’s Old Age Security System.
|The fact that Canada will have a lower percentage of its population working will become a significant economic issue. It will keep people in the workforce longer and lighten the immediate load on the OAS system.||The opposition leader, Turmel, encourages the government to focus on job creation and not to cut programs and services that hard-pressed families rely on in tough times. Interim Liberal Leader Bob Rae and his pensions and seniors critic Judy Sgro estimate that seniors lose $30,000 in payments: $15,000 in combined OAS/GIS benefits for each of the two deferred years. Shifting the focus will be able to minimize the issue of paying the OAS at the current eligibility age and prevent seniors from losing out on the money.|
|The budget is expected to slash as much as $8 billion from federal spending, which the government says is needed to erase the deficit built up during the 2008-2009 global recession and to set out a long-term path to ensure OAS remains sustainable.||Hamilton suggests Ottawa should consider tweaking OAS in a similar fashion to how it encouraged CPP recipients to delay receiving benefits to as late as 70. “We should let Canadians voluntarily delay their OAS benefits in return for an increase in the benefit payable, as has already been done for the CPP. Those who want to delay their retirements could then draw their benefits later without losing money.”|
|The CLC frets raising OAS eligibility today would hurt those in physical jobs that take a toll on the body and put more pressure on provincial welfare programs for the two extra years.|