The minute Prime Minister Stephen Harper said this in Davos yesterday:
We have already taken steps to limit the growth of our health care spending…. We must do the same for our retirement income system. Fortunately, the centerpiece of that system, the Canada Pension Plan, is fully funded, actuarially sound and does not need to be changed. For those elements of the system that are not funded, we will make the changes necessary to ensure sustainability for the next generation while not affecting current recipients.
The only major “elements of the system that are not funded” are Old Age Security and the Guaranteed Income Supplement. So naturally, there was much immediate speculation — with a certain amount of justification — that these programs were in Harper’s sights for cuts.
So today, the PMO issued the following talking points to MPs (took a while today for this one to make it into the inbox) a nice little non-denial denial, if you ask me:
Old Age Security
Media are speculating that the federal Government may make changes to Old Age Security.
Our Government is committed to ensuring the retirement security of Canadians.
The Harper Government will ensure that seniors maintain ALL the benefits they currently receive.
To be clear: there will be no changes to the benefits seniors currently receive.
We will ensure any changes are done with substantial notice and adjustment period and in a way that does not affect current retirees or those close to retirement, and gives others plenty of time to adjust and plan for their retirement.
In Canada, there are two important programs that provide financial support to older Canadians: CPP/QPP and OAS.
CPP is funded through premiums that working Canadians pay with each paycheque and is on a secure and sustainable path. It does not need to be changed.
OAS is funded primarily through taxes on working people and is unsustainable on its current course.
For example:
- The number of Canadians over the age of 65 will increase from 4.7 million to 9.3 million over the next 20 years.
- The OAS program was built when Canadians were not living the longer, healthier lives they are today.
- Consequently, the cost of the OAS program will increase from $36B per year in 2010 to $108B per year in 2030.
- Meanwhile, by 2030, the number of taxpayers for every senior will be 2 – down from 4 in 2010.
If we do nothing, OAS will eventually become too expensive and unsustainable.
Our Government will act to protect OAS.
We will not put the financial security and well-being of our seniors at risk.
We will take balanced, responsible, and prudent action to ensure OAS remains sustainable for future generations of Canadians.
Background – Retirement Security
Since 2006, we have:
- Increased the Guaranteed Income Supplement for the most vulnerable seniors
- Introduced pension income splitting and increased the age credit
- Introduced innovative new programs such as the tax-free savings account and the PRPP to help Canadians save for retirement.
As a result of our actions, seniors can individually earn approximately $19,000 per year or $38,000 as a couple before paying federal taxes.
Lines to Define the Expected Opposition Attack
We know the Opposition will attack any adjustments to the OAS program.
We know their approach. It’s the same tired (failed) approach to deficits and debt that led to the economic crisis in Europe.
The NDP prefers a “head in the sand” approach – ignore the problem until it is too late to save OAS benefits.
Their irresponsible, reckless, and dangerous approach to Canada’s finances would put the entire OAS program at risk.
The NDP would put at risk the financial security of millions of middle aged working Canadians – all future generations – who are planning on OAS being there when they need it.
It demonstrates that the NDP is too dangerous for Canadians planning for their retirement.
Cutting back on Health Care and doing the same with retirement……it smacks of creating a system of getting rid of those pensioners who rely upon OAS and GIS below poverty level existance. By lowering health care and retirement, will the death rate rise for people who are retired having not been able to avail themselves the CPP system? If the death rate increases dramactically, the government stands to gain…does it not?
Before we cut OAS benefits we should be looking at cutting MP’s pensions to be in line with standards of businesses where you actually get a company pension when you retire. Some of the best DBB pension plans out there give a lot less to their employees than menbers of parliment get. Typically a private company would pay : about $25,000 a year for a person making $67,000 a year when they retire after 25 year of working for that company.If an MPP gets any more than that they are robbing the Canadian taxpayers. If they serve in parliment for 4 years they do not deserve more than about $4,000 a year if they made $67,000 a year (which I doubt some of them only made)