By indexing the Old Age Security (OAS) pension by 10% for seniors aged 75 and over, the federal government created two classes of retirees. This goes against the principle of universality of the OAS pension.
The Bloc Québécois is therefore right to demand that pensions for those aged 65-74 be increased by 10%. But the cost would be at least $3 billion per year! So what is the solution?
The solution lies, at least in part, in Canada’s Guaranteed Income Supplement (GIS) program. The principle of universality does not apply to the SRG, since this program was set up to specifically help the most deprived retirees.
However, since eligibility for this program depends on income, millionaire retirees who have a low income are eligible for the GIS! However, given their assets, the rich do not need GIS benefits.
“During the 2022-2023 fiscal year, SRG expenditures exceeded $16 billion,” we can read on page 6 of the document Canadian Retirement Income Systemdated May 31, 2024. It is certain that a good part of this sum went to wealthy retirees who had no need for it. The GIS should only be accessible to retirees whose total value of assets is in below a certain ceiling, so that the better off would not have access to it, but would retain their full pension under the principle of universality of the OAS pension.
To achieve this end, the government could include in its tax return form a question similar to this: Is your personal wealth worth more than $500,000? A retired person who answers yes to this question would therefore be deprived of access to the SRG. (We do ask welfare recipients to reveal the value of their assets; why couldn’t we ask the wealthy to indicate the level of their wealth?)
The federal government would thus recover millions (or even billions) of dollars that it could use in particular to improve pensions for 65-74 year olds!
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