We all know that there are far too many seniors who have trouble making ends meet.
Every year, the Canadian Centre for Policy Alternatives releases its Alternative Federal Budget, which proposes solutions to Canada’s most pressing social and economic problems.
This year’s Alternative Federal Budget proposes significant programs aimed at Canada’s seniors.
Canada’s support for seniors living in poverty comes from two programs: Old Age Security (OAS) and the Guaranteed Income Supplement (GIS).
GIS is only accessible by the poorest seniors and every year 1.6 million seniors rely on it. Retired women, in particular, have a heavier reliance on these programs. Between OAS and GIS, seniors can collect $14,000 a year. Statistics Canada defines the poverty line at $18,000 for large cities. If you’re a senior and all you receive is OAS and GIS, you are far below the poverty line.
Leaving seniors, often women, in poverty is not a foregone conclusion; instead it is a policy choice. The AFB thinks it is a terrible one and with a major change to GIS, the AFB tackles the issue of seniors in poverty head on.
Many seniors find retirement financially difficult because of how the pension system was designed. When the Canadian Pension Plan (CPP) was created, it aimed to replace only 25% of a retiree’s income. The idea was that company pension plans would cover the difference. The reality is that companies, particularly smaller ones, are shirking their pension responsibilities. Only 27% of non-union workplaces have a pension plan.
The Alternative Federal Budget proposes a major expansion in CPP to make up for the shortcomings of private plans.
It isn’t just income that concerns seniors; it is also the rising costs of prescription drugs, which can result in seniors being forced to decide between their prescriptions and other basics. We can do better.
Canadians spend $25 billion a year on prescription drugs. There is no system to bulk buy drugs and drive down costs – a problem that comes with a ready solution. The Alternative Federal Budget proposes a national pharmacare plan that would cut costs by 44%, with most of the savings going to provincial health care budgets. The major upside is that Canadian seniors would never again have to pay for over the counter for drugs.
Budgets are inherently political, but they should always put the well-being of Canadians ahead of politics.
In this year’s budget, the choice will be between ‘security’ spending priorities such as increased military, fighter jet and prison spending or ensuring the financial security of the majority of Canadians.
The Alternative Federal Budget puts the needs of Canadians front and centre. To learn more about our Alternative Federal Budget, go to www.policyalternatives.ca.
David Macdonald is the coordinator of the Canadian Centre for Policy Alternatives’ Alternative Federal Budget.
Keywords: budget, seniors, poverty