Summary

Old Age Security (OAS) is a cornerstone of financial stability for Canadian seniors. However, CARP warns that OAS is under constant threat, with past attempts by governments to reduce benefits or raise eligibility. CARP successfully fought back the proposed increase of the OAS eligibility age from 65 to 67, a significant victory for retirees across the country. This post examines OAS’s importance in reducing senior poverty, highlights CARP’s advocacy, and reflects on former Finance Minister Paul Martin’s attempt to scrap OAS altogether, and Stephen Harper’s increase in age eligibility, providing a cautionary reminder of the risks to seniors’ income.

In addition to safeguarding the age of eligibility, CARP is now focused on securing fair treatment for all seniors when it comes to OAS payments. The federal government’s 2022 decision to increase OAS by 10% only for seniors over 75 has created a concerning divide, leaving those aged 65-75 without the same financial relief. CARP is advocating for a more equitable approach, emphasizing that all seniors are facing the pressures of inflation and rising costs, not just those over 75.

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I. The History and Importance of Old Age Security

Old Age Security (OAS) is Canada’s largest federal program aimed at providing financial support to seniors, introduced in 1952. OAS ensures a basic level of income for nearly all seniors over the age of 65, funded through general tax revenues rather than employment contributions like the Canada Pension Plan (CPP).

The effectiveness of OAS in reducing poverty among seniors has been well documented. According to Statistics Canada’s 2023 report, OAS payments contribute significantly to lowering poverty rates, particularly among women and single seniors, for whom the benefits are vital in covering essential living expenses. A 2023 study by RBC Economics shows that OAS payments account for 30-40% of income for the lowest-income retirees, making it a crucial tool in maintaining financial stability.

However, the financial challenges facing seniors today are exacerbated by inflation, healthcare costs, and housing expenses. While OAS remains an essential source of income, CARP has called attention to the need for it to be increased across the board. The government’s 2022 decision to raise OAS by 10%, but only for those over 75, has led to a growing disparity among seniors. CARP believes that this selective increase does not account for the fact that seniors aged 65-75 are facing similar financial pressures and should receive equal support.

II. CARP’s Fight Against the OAS Age Hike

In 2012, the Conservative government under Stephen Harper announced plans to raise the OAS eligibility age from 65 to 67, a move that would have delayed access to vital income for millions of seniors. CARP immediately recognized the harmful impact this would have, particularly on low-income seniors and those in physically demanding jobs who often cannot work beyond age 65.

CARP launched a nationwide advocacy campaign, rallying its members and meeting with policymakers to oppose the change. After a three-year battle, CARP secured a victory in 2015 when the newly elected Liberal government under Prime Minister Justin Trudeau reversed the decision, restoring the OAS eligibility age to 65. This reversal was a major success for CARP and ensured that seniors would not face undue financial hardship.

Now, CARP is applying the same vigor to its campaign against the unequal distribution of OAS increases. The decision to provide a 10% increase only to those over 75 ignores the reality that seniors aged 65-75 are equally affected by the same economic forces. By limiting the increase to a specific age group, the government has created an unfair divide among seniors, all of whom are dealing with rising costs of living. CARP is advocating for a unified approach, ensuring that all seniors receive the financial support they need as they age.

III. The Economic Impact of OAS on Canadian Seniors

Numerous economic analyses underscore the vital role OAS plays in reducing poverty among seniors. A 2022 report from the Fraser Institute found that without OAS, the poverty rate among seniors would double, disproportionately affecting women and single retirees. The Bank of Montreal (BMO) also notes that OAS provides an important buffer against rising healthcare and housing costs, both of which are major expenses for aging Canadians.

CARP has consistently argued that the government’s decision to limit the OAS increase to seniors over 75 ignores the broader financial stress that all retirees face. Inflationary pressures, rising healthcare costs, and housing instability are common challenges for seniors across age groups, and limiting financial relief to only one segment leaves many struggling. A 2023 report from the National Institute on Ageing (NIA) echoes CARP’s call for increased OAS benefits for all seniors to ensure economic security as they age.

IV. OAS Sustainability Through the Baby Boomer Wave

Concerns about the sustainability of OAS, particularly as the baby boomer generation enters retirement, have been addressed by multiple economic experts and federal actuaries. The 2023 Office of the Chief Actuary report confirms that while OAS expenditures will increase as the population ages, these costs will remain manageable within the federal budget. A 2022 report by TD Economics projects that the federal government will be able to maintain OAS benefits without requiring tax increases.

CARP recognizes that while OAS is sustainable, the government must not use fiscal pressures as an excuse to divide seniors based on age when distributing benefits. The program’s long-term sustainability does not justify leaving those aged 65-75 behind. CARP continues to push for an equitable solution, where all seniors benefit equally from OAS increases, and the pressures of aging are addressed without age-based discrimination.

V. CARP’s Ongoing Commitment to Defending OAS

CARP remains vigilant in its efforts to protect OAS from any potential cuts or eligibility changes. The organization continues to advocate for secure and sustainable OAS payments that ensure all Canadian seniors can retire with dignity. Through its ongoing work with policymakers, economists, and its large membership base, CARP is committed to ensuring that OAS remains a vital component of Canada’s social safety net.

CARP’s advocacy extends beyond simply maintaining OAS; it is fighting for the fair treatment of all seniors. The unequal distribution of the 2022 OAS increase highlights the ongoing need for advocacy to ensure that every senior, regardless of age, receives the financial support they deserve. CARP will continue to lead the charge in ensuring that OAS remains a stable, reliable source of income for all seniors, not just a select few.

Conclusion: A Legacy of Advocacy and Vigilance
Old Age Security has provided financial stability for millions of Canadian seniors for over 70 years. CARP’s successful campaign to restore the OAS eligibility age to 65 and its ongoing fight to secure equal benefits for all seniors highlight the organization’s unwavering commitment to defending this crucial program. However, as new voices call for cuts to OAS and as past attempts by Paul Martin and Stephen Harper have shown, OAS remains vulnerable and continued vigilance is necessary to protect it.

The sustainability of OAS, as confirmed by federal actuaries and leading financial institutions, is secure, but maintaining that security will require ongoing public advocacy. CARP will continue to advocate for equal OAS payments, ensuring that all seniors, regardless of age, receive the financial support they need as they navigate the financial challenges of retirement.

Call to Action: Join CARP and Advocate for Fair OAS Payments
CARP has successfully fought to protect Old Age Security in the past, but the fight is far from over. Join CARP today and become part of a powerful movement that ensures seniors’ voices are heard and their benefits are protected. Together, we can safeguard OAS from future threats and secure a better future for all Canadian seniors.

References:
Statistics Canada, “Senior Income and Poverty Report,” 2023.
RBC Economics, “OAS and Senior Poverty Reduction,” 2023.
Fraser Institute, “The Role of OAS and GIS in Reducing Poverty,” 2022.
TD Economics, “The Sustainability of OAS Through the Baby Boomer Wave,” 2022.
Office of the Chief Actuary, “OAS Sustainability Report,” 2023.
C.D. Howe Institute, “Securing Retirement for Canadians,” 2023.
BMO Financial Group, “OAS and Economic Stability,” 2023.
National Institute on Ageing (NIA), “Income Inequality and Seniors,” 2022.
CARP.ca, “CARP’s Campaign for OAS Equality,” 2022.
The Globe and Mail, “Seniors Benefit Plan Opposed by Advocates,” 1996.
Toronto Star, “Paul Martin’s Proposed OAS Cuts: A Step Too Far?” 1996.