Old Age Se­cu­rity Re­port

The McLeod River Post - - Viewpoint -

The old age se­cu­rity pro­gram: should it be re­vised in or­der to keep it sus­tain­able? OAS is funded through an­nual tax rev­enues whereas CPP is paid through pay­roll de­duc­tions.

The chief ac­tu­ary’s re­port fore­casts spend­ing to hit about $247 bil­lion by 2060 — five times what it is slated to be this year — due to an im­pend­ing re­tire­ment wave of baby boomer work­ers and peo­ple liv­ing longer.

Our pre­vi­ous Con­ser­va­tive govern­ment raised the age of el­i­gi­bil­ity for OAS to 67 from 65 to save on costs by en­cour­ag­ing peo­ple to work longer. The Lib­er­als re­versed the de­ci­sion in their first bud­get, say­ing the Tories had made the change with­out any data to sup­port it.

A Fe­bru­ary pre­sen­ta­tion to a group of deputy min­is­ters said “younger gen­er­a­tions may be re­quired to pay higher taxes” to cover a short­fall be­tween tax rev­enues and OAS spend­ing if the re­tire­ment age re­mains at 65, Cana­di­ans live longer and there aren’t enough new work­ers to re­place the ones who are go­ing to re­tire.

The ac­tu­ar­ial re­port sug­gests that spend­ing as a per­cent­age of the over­all econ­omy would rise by 2030 and fall through to 2060 as eco­nomic growth and re­sult­ing tax rev­enues off­set ris­ing costs.

Costs to the pro­gram are also ex­pected to be off­set by an ex­pan­sion to CPP that the chief ac­tu­ary es­ti­mates will mean $3 bil­lion less in spend­ing on the Guar­an­teed In­come Sup­ple­ment in 2060 and re­duce over­all spend­ing on OAS ben­e­fits, which are scaled back above $75,000 in an­nual in­come.

The re­port can be found at: http://www.osfi-bsif.gc.ca/Eng/Docs/oas14.pdf

Jim Eglin­ski, MP – Yel­low­head

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