I know many seniors have been asking one question recently – will my Old Age Security cheque stay the same?
Many Canadians close to retirement have also been asking whether Old Age Security will be there for them when they reach 65.
The answer to both questions is yes.
We are committed to protecting retirement income for today’s seniors, and for future generations of retirees. This is why OAS is being reviewed currently – to make sure it is there for the next generation of retirees.
Canadians receive retirement income from a variety of sources, including the Canada Pension Plan and Old Age Security. The Canada Pension Plan is funded by premiums from each of our paycheques and it is on a safe, secure, and sustainable path. Old Age Security, on the other hand, is funded from general government revenue and is not sustainable in its current form.
I will attempt to explain why:
In 1975, there were seven working taxpayers for every senior. Because our population is getting older, today there are only four working-age Canadians for each senior. By 2030, the total number of seniors will nearly double, leaving only two working-age Canadians for each senior. Amidst these changing demographics, the annual cost of the Old Age Security program is projected to increase from $36 billion in 2010 to $108 billion in 2030.
In 2010, there were 4.7 million Canadians who were 65 or older. By 2030, there will be 9.3 million Canadians falling into this age group.
When Old Age Security was introduced in 1952, the age of eligibility was 70 and life expectancy at that time was 66 for men and 71 for women. In 1965, the age of eligibility changed from 70 to 65 and life expectancy was 68 for men and 75 for women. Today, life expectancy is 79 for men and 83 for women.
I hope that this information helps you to understand that if changes are not made to the Old Age Security program, it will become unsustainable in the long-term. Failure to make important decisions now will put the program in jeopardy for future generations.
I can assure you that any changes to Old Age Security will not affect anyone currently receiving benefits, nor will they ever affect any individual now nearing retirement. Other Canadians, who are not near retirement, would receive substantial notice of changes to Old Age Security, to ensure they have ample time to plan for their future.
Twenty-four developed countries have already made changes or indicated that they will make changes to their Old Age Security. There will be more as the world’s ageing demographic changes.
We need to take responsible action to ensure financial stability for future generations of seniors and give them confidence that Old Age Security will be sustainable and available to them in their retirement.
In closing, while Old Age Security is being reviewed, public sector pensions and MP pensions are also being reviewed. There will be major changes in both. While we have frozen MP wages and office budgets for three years, it is clear that the public’s expectation is that MP’s pensions must be overhauled as well. I fully support this initiative.
There has been a lot of misinformation out there about the proposed changes to Old Age Security and about MP pensions. I urge you to ask for the correct information. While absolutely nothing has been finalized on either issue, changes to both are inevitable. I invite all constructive suggestions on how to deal with both.
Doing nothing is simply not an option!
Larry Miller, M.P.
Bruce-Grey-Owen Sound
+ 15 + 16 
