National Post (National Edition)
Seniors’ $2.5B aid targets the wrong group, critics say
OTTAWA • Targeting aid at low-income seniors makes sense, public policy experts say, but the federal government’s $2.5-billion package announced on Tuesday hands out too much money to people who don’t need it.
Some also argue that the political expediency of giving broad-based grants to an important voting bloc is likely the reason why.
Prime Minister Justin Trudeau said the pandemic “has been taking its toll on seniors, both emotionally and financially,” and the money will help alleviate some of that stress. “But there’s a lot more work to be done, not only to find short-term fixes, but long-term solutions,” he said.
Nursing homes in Ontario and Quebec have been particularly hard hit, accounting for 80 per cent of Canada’s COVID-19 death toll of 5,000.
The bulk of the aid package announced Tuesday is a $300 one-time payment to seniors who receive Old Age Security and an extra $200 to those receiving the Guaranteed Income Supplement. It also included $20 million for programs that help reduce isolation and improve qualify of life for seniors.
Old Age payments go to seniors with individual taxable income up to $128,137. The income supplement is for seniors living on $18,600 a year.
Seniors Minister Deb Schulte said COVID-19 “has made life more expensive and more difficult for seniors because of the risks of more severe outcomes.
“Many are facing higher costs for food and services due to imposed restrictions,” she said at a news conference. “They’re paying more in dispensing fees to get the same medication. They are paying a premium for deliveries. All the while, their life savings have taken a beating.”
Tammy Schirle, a Wilfrid Laurier University professor who specializes in economic policy for the elderly, said about a third of seniors receive GIS support.
“I expect that the lowest-income seniors — particularly those who rely almost exclusively on OAS and GIS for income — have struggled with the COVID-19 restrictions,” she said. “I think public-health information would support a concern that many low-income seniors are at greater risk than other demographic groups and perhaps have thus had to incur more costs than others.”
But it’s the blanket distribution to OAS recipients that leaves her scratching her head.
“Some of this group continues to work, and I expect some will receive CERB,” she said, referring to the $2,000-a-month emergency grant for those who’ve lost their job. “Moreover, this will include many seniors with savings available to manage any extra costs associated with COVID-19.”
Jack Mintz, a president’s fellow with the University of Calgary’s School of Public Policy, was more blunt in his assessment. “This was a waste,” he said, arguing that most seniors are already well protected due to their regular government payments.
“Some may have lost on the financial markets, but $300 to $500 is unnecessary and far too small in that case any way,” he said. “Yes, prescription drugs have gone up for the general population, but many seniors are on provincial drug plans and get covered.”
He added that the federal government should be focused on preserving more fiscal capacity for later in the year.
“The federal government will have huge demands in the fall when many might not be able to pay back deferred taxes, mortgage payments and utility bills,” he said.
Carleton University political management professor Jennifer Robson said there is much about the aid package she likes, including that seniors receiving GIS won’t have their benefits cut off if they don’t file by June, and that the top-up is tax-free so seniors won’t have other benefits penalized later for taking federal help today.
“Were I in charge, I’m not sure I would have gone with the OAS portion given that non-poor seniors have fixed incomes but generally much higher savings to rely on relative to other adults,” she said. But she said she would need to know more about the reasoning before slamming it. “There may be a good rationale that I’m not thinking of,” she said.
Aaron Wudrick, federal director of the Canadian Taxpayers Federation, said
IT DOESN’T MAKE ANY ECONOMIC SENSE, FOR SURE.
he’s not necessarily opposed to seniors COVID-19 aid, but the package goes too far. “Additional temporary help for low-income seniors who might be facing unexpected higher costs seems reasonable,” he said. “Beyond that, it’s pretty lazy policy.”
“It doesn’t make any economic sense, for sure,” said Rachel Curran, who was policy director to former prime minister Stephen Harper, in a Twitter post. “It’s a political decision entirely.”
Seniors advocacy groups are known to be effective in advancing their causes — and politicians tend to pay attention, given that seniors are reliable voters.
On Tuesday, the Canadian Association for Retired Persons said more COVID-19 aid is still needed.
“The supports announced today for seniors are welcome, but do not directly address many of the concerns we’ve relayed to government from CARP members on retirement security and access to liquidity,” said Marissa Lennox, CARP’s chief policy officer. “Seniors are looking to have as many tools as possible to maximize their cash flow and protect their retirement.”