As the holidays approach, some Provinces have just finished their pre-budget consultation process and some have yet to initiate it. Here are some of the policy proposals CARP has and will be presenting to Provincial Governments across the country.
Reducing Poverty among Seniors
After tax LICO for 2008 was $12,019 for a single person living in a rural community and $18,373 for a person in a city with a population of 500,000 or more. A majority of low income seniors live in major urban centres and the argument can be made that there should be a higher LICO for major centres such as Montreal, Vancouver and Toronto.
However, even with these programs in place the prevalence of poverty among Canadian seniors is unacceptable; not only in their raw numbers but also because of the differential impact especially the lack of opportunity to materially change their circumstances.
And as noted in the National Seniors Council Report on Low Income among seniors:
“Many seniors live on fixed and limited incomes, slightly above LICO. So while they may not be ‘officially’ living in low income, they may be only one major expense or cost-of-living increase away from the threshold. Consequently, they face many of the same challenges.”
Increase the levels of Provincial retirement income payments. Work with the other provinces and federal government to substantially increase the levels of Old Age Security and Guaranteed Income Supplement payments to bring the guaranteed income from all levels of government to at least the Low Income Cut Offs [LICO].
Ensure that its pension reform initiatives specifically accommodate the needs of the low wage sector.
Harmonized Sales Tax
The Harmonized Sales Tax will place an additional tax burden on retirees and those on fixed income. The increased consumption tax will not be fully offset by proposed income tax cuts and consumer rebates. Fixed income seniors cannot wait for the anticipated pass through of savings from businesses to consumers. Without HST mitigation measures that reflect the unique circumstances of retirees and those on fixed incomes, harmonization will place a disproportionately heavy financial burden on older Canadians.
Mitigate the imposition of the HST on home energy costs through rebate, exemption or tax credit for seniors based on income. Provide a permanent HST relief grant to seniors based on income
Retirement Security through Pension Reform
Most of the public discourse in recent months has centred on Pension Reform, in particular, the regulatory regime covering existing workplace pensions and the provision of a retirement savings vehicle for those without access to a workplace pension.
Three provincial pension review panels [BC-Alberta, Nova Scotia and Ontario] have issued their recommendations. To a greater or lesser degree, they all acknowledged the need to rebalance the interests of the employees/retirees and the employers/plan sponsors and the need to provide broader access to larger well-managed pension funds for Canadians who do not have access to workplace sponsored plans.
Recent events have brought into sharp focus the inadequacies of the current pension regulatory regime to protect employees and pensioners in the event of the insolvency of their employers. CARP has called for changes to better ensure the solvency of pension funds such as a prohibition on contribution holidays and enforcement of deficiency funding obligations as well as legislating a priority for pensioners in the event of a bankruptcy or insolvency.
