Tories' deceptive attack on pensions jeopardizes future of Canadians under 54
I was part of a powerful forum “Pensions at Risk” hosted by MP Libby Davies a couple of weeks ago. There were speakers from COSCO the Coalition of Senior Citizen Organizations, CARP, the National Union of Public Employees, journalist Bill Tieleman, and myself.
The auditorium was a full, but I don’t think anyone was under 54. We were all discussing the changes proposed in the budget to change the Old Age Security and Guaranteed Income Supplement system but as we talked it became clear that this is part of a much more serious dismembering of the Canada that once made us proud to be Canadians.
This is part of a political attack on Canada, the concept of universality and our wonderful social programs: pensions, education, health care, welfare and housing which have been available to everyone from coast to coast to coast.
These proposals are made in the interests of the corporations who can create private for profit systems such as they are doing with health care and education and make money from what the public has paid for with our taxes.
These changes are a serious attack on democracy and the social programs that have made Canada a great nation. The Harper government is tearing Canada apart by stealth, attack ads, negative campaigning, lies and election fraud including robo-calls.
The recently announced changes to OAS Old Age Security and to GIS Guaranteed Income Supplement are completely fiscally unnecessary, says the Parliamentary Budget Officer Kevin Page.
According to the 2010 paper on Canada’s pension system -- commissioned by the Department of Finance for the federal and provincial finance ministers, Research Working Group, Edward Whitehouse (who leads the pension’s team in the Social policy Division of the OECD) -- “long-term projections show that Canada’s public retirement income system is financially sustainable. There is no pressing financial or fiscal need to increase pension ages in the foreseeable futures.”
Canadians not consulted about pension changes
The Conservatives did not campaign on making any changes to the pension system. The public was not consulted during the election campaign.
The public does not agree and does not support the changes as shown by a February Ipsos Reid poll. Seventy per cent of Canadians polled disagreed that “social programs, seniors pensions, and other benefits in Canada are more generous than we can afford to pay for” and 70 per cent also disagreed with the statement that “we need to keep taxes down, even if it means we have to sacrifice in terms of seniors pensions and other social benefits”.
It is a political choice by Harper and the Conservatives not an economic choice. They are willing to spend billions of our hard earned tax payer’s money on jails which costs taxpayers $88,000 per prisoner annually in the short term. Prison costs will be rising to $4.4 Billion to $9.5 billion in the long term.
They are spending over $20 billion per year on defense, plus the $29.3 billion on the fighter jets and over $60 billion on navy frigates and other boats. They have cut $23 billion in taxes to the corporations and are providing $1.4 - $2 billion per year in subsidies to the oil and gas companies.
Monica Townson, a wonderful Canadian economist, says in her great piece in the Canadian Centre for Policy Alternatives magazine The Monitor:
“Set in the context of the economy, OAS/GIS spending will go from 2.3 per cent of the GDP in 2010 to 3.1 per cent in 2030. That’s an increase of less that 1 per cent point of GDP. The ratio of expenditures to GDP is then projected to drop from 3.1 per cent in 2030 to 2.6 per cent in 2050.”
Canada spends less on pensions than the US and most EU countries, far less than the average 7 per cent of nations in the OECD. She is very clear that we can afford the OAS and GIS.
If there was a concern about baby boomers spending all the money, then why implement a change that doesn’t affect them but will affect their children who are facing a decline in employer pension coverage, heavy debt loads and an impossible housing market?
Who else will these changes affect? They will impact people who are not able to continue to work past 65 because of the state of their physical or mental health -- the ones who have exhausted their bodies in physical jobs, such as nurses, lumberjacks, domestic workers, farm workers, those caring for the elderly, women. They are the people who rely on those funds for 29 per cent of their retirement income.
More than 11 million Canadian workers do not have a workplace pension plan. Less than one-third of individuals entitled to contribute to RRSP actually do so. The combined OAS/GIS provide one third of income for all seniors over 65 and one half of the income of seniors with incomes of less that $20,000. Unattached low-income seniors rely on OAS/GIS for 77 per cent of their income.
There are already 1.6 million seniors living in poverty. The social costs of living in poverty such as homelessness, illness, mental health issues, etc. have yet to be tallied. Immigrants who come from countries that don’t have a reciprocal agreement with Canada will be seriously impacted. Will they have to work 12 years to access their pensions rather than the 10 they now work? The provinces, which don’t seem to have been consulted, will pay a huge amount because everyone who needs the income will have to apply for welfare which is paid out by the provinces. The estimate by Bill Tieleman is that this will cost BC $34 million or more.
Harper says that people can just continue working. But in what kind of jobs? Ask a senior about the last job they were able to find and their experience with age discrimination. About 33 per cent of employees over 65 are in low-wage jobs earning less that two-thirds of the median hourly wage.
A 2008 Statistics Canada survey of older workers 55 and over found only 30 per cent had retired because they were financially ready. One in four fully retired workers over 55 list "poor health" as their reason for retirement. Delaying the age of eligibility for OAS/GIS will result in devastatingly lower incomes.
What to do about it
Harper was very devious in bringing forward these changes to our hard fought for pensions. I bet that some of you, and certainly some of my relatives, fought hard for the OAS/GIS which were brought in 1952 and a national pension plan which were finally established in 1966, because they remember the Great Depression and have seen the cost to the family and to society of seniors living in poverty.
The Conservatives are deliberately pitting young people against older people, and public sector workers against other workers. Harper is bringing in the changes at a time when those who will be impacted are 54 and younger and not aware of how this will impact them. He has hidden these changes in the massive 425-page budget document and in the public debate over many other issues like robocalls, abortion, immigration, Open Internet Surveillance, prison spending, cuts to the CBC and other art groups, cuts to Women’s Health Initiative, cuts to environmental protection laws, spending on fighter jets and navy frigates.
At the forum, one woman stood up and said:
“I am really angry, and I am afraid of him” -- "him" meaning Harper.
South Vancouver Neighbourhood House is having an information session on June 13 about access to pensions. The video of the event, “Pensions at Risk”, will be on MP Libby Davies’s website and is well worth watching. Both Davies and CARP have petition information on their websites. Experts are saying now is the time to expand the CPP which would reduce future OAS costs instead of cutting them. It is important to regulate financial products.
Don’t let the Conservatives allow the corporations to profit from people-driven to private plans. The government is proposing another RRSP-styled Pooled Registered Pension Plan which benefits the banks, mutual funds and insurance companies more than the citizens.
It is your hard work and taxes that created the Canadian pension system so that seniors would not be poor and vulnerable in their old age.
Three out of four Canadian seniors over the age of 65 voted in the previous federal, provincial and municipal elections. But we all need to speak out, write letters, call your MP’s, spread the message via Facebook, twitter and inform those under 54, form coalitions and organize meetings.
The CCPA has excellent information on their website, COSCO, CARP, the BC Forum and Canadian Labour Congress also have great documents on their websites. It is not too late. The future of Canadian pensions is being debated in the House of Commons.
Don’t Mourn. Organize.