I know many seniors have been asking one question recently – will my Old Age Security cheque stay the same?

Many Canadians close to retirement have also been asking whether Old Age Security will be there for them when they reach 65.

The answer to both questions is yes.

Our Government is committed to protecting retirement income for today’s seniors, and for future generations of retirees; our children and grandchildren. Canadians receive retirement income from a variety of sources, including the Canada Pension Plan and Old Age Security.  The Canada Pension Plan is funded by premiums from each of our paycheques and it is on a safe, secure, and sustainable path.  Old Age Security, on the other hand, is funded from general government revenue and is not sustainable in its current form.

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.

So in 20 years we will have twice the number of people on OAS costing three times as much, being paid by one half of the number of people who are paying now.

Simply stated - this is the problem Canadians and seniors of the future face. If we do nothing , OAS will eventually become too expensive and unsustainable.

Canada must act now, with plenty of advance notice , or it will face the same decision as Greece and Italy – cut benefits to seniors because we cannot pay our bills.  Other countries have already introduced measures to take action.

If changes are not made to the Old Age Security program, it will become unsustainable in the long-term.  Failure to make important decisions now will put the program in jeopardy for our children and grandchildren.

Any changes to Old Age Security will not affect anyone currently receiving benefits, nor will they affect any individual now nearing retirement.  Other Canadians, who are not near retirement, will receive substantial notice of changes to Old Age Security, to ensure they have ample time to plan for their future.

Our Government will take responsible action to ensure financial stability for future generations of seniors and give them confidence that Old Age Security will be sustainable and available to them in their retirement.

Bev