CARP responds to Generation Squeeze study

Below is an article published on Yahoo Finance Canada on February 19, 2015. Click here to read the article.

If you’ve ever wondered exactly what your government thinks of you, take a closer look at the next federal, provincial or even municipal budget.

The numbers tell a revealing story of who and what we value, says Paul Kershaw, professorat the University of British Columbia’s School of Population and Public Health and author of a provocative new study examining the distribution of government spending by age.

By Kershaw’s calculations, seniors are, by far, a top government priority, securing, on average, up to four times the amount of social spending per person compared to the amount allocated to younger Canadians.

The study – published by Generation Squeeze, a fledgling lobby group for younger Canadians – found that governments spend between $33,000 and $40,000 annually on each person over the age of 65 years.

Canadians between 45 and 64 years are allotted about $14,000 to $15,000 each.

Those 44 and under receive less than $12,000 each.

The findings are based on total social spending per year by all three levels of government in categories including health care, education, social assistance, employment, recreation and culture, and housing. Consolidated spending in 2012 is estimated at $549.2 billion. Of that, $145.6 billion went to health care, a service largely absorbed by seniors, according to the report.

“We would expect spending per person age 65+ to be higher than spending for younger Canadians because it is a biological reality that we are more likely to become sick and require health care in our later decades,” the report states.

Kershaw says the study is not about pitting one generation against the other. Rather, the findings are meant to act as a wake-up call to younger Canadians who pay into social programming and yet benefit the least from the spending.

“It’s time we all ask our provincial and federal governments to budget accordingly,” he says.

Generation Squeeze was formed to lobby on behalf of the country’s younger citizens who are facing enormous financial and social challenges compared to their parents’ and grandparents’ generations.

Canadians age 55 and over currently enjoy increases in household income that surpass those under 45, who are struggling with lower earnings and high unemployment. Soaring housing prices andstudent debt also continue to weigh down younger generations with debt, while Boomers, on average, have never been richer.

Kershaw noted that older Canadians have been successfully lobbying government on important age-related issues for decades. The Canadian Association of Retired Persons (CARP) is one of the largest advocacy groups in the country with more than 300,000 members over the age of 50.

Younger generations must do the same if they hope to become a greater priority.

“Governments of all political stripes respond to those who organize and show up,” Kershaw says.  “We should learn from the wisdom of our elders.”

Michael Nicin, CARP’s director of policy, said the Generation Squeeze study sets a dangerous tone for policy discussion in Canada.

“It creates a sense that there are limited resources and that one group will necessarily win out at the expense of the other,” he said.

In reality, Nicin said, Canadians, regardless of age, share many of the same problems and financial pressures. Younger generations are worried their parents won’t be able to pay off the mortgage before they retire, while older people may be struggling to cope with taking care of aging parents and putting aside enough money to help their children through university or put money down on a home.

“Most Canadians don’t exist as individuals,” Nicin said. “We are all essentially in the same boat.”