The Harper government moved Monday to assure seniors that it is not going after their Old Age Security. Rather, the government is eyeing reforming the program for the medium and long-term, says Government House Leader Peter Van Loan.
He says changes need to be made today to ensure the program is sustainable in “10 years, 20 years and 30 years from now.”
Speaking to reporters Monday, Mr. Van Loan provided a few more details about the changes the government plans to OAS. Clearly, there has been some confusion and few details as to what the government has in mind since Prime Minister Stephen Harper dropped the reform bombshell during his speech to the World Economic Forum in Davos last week.
“All seniors should rest assured, those who collect OAS today will continue to collect it without any change,” Mr. Van Loan said. “Our focus is on the medium and long-term and ensuring the sustainability of the system ...”
He noted, too, that Finance Minister Jim Flaherty and Minister of State for Finance, Ted Menzies, have been working on the specifics of the reforms for quite awhile. These will be revealed in the “fullness of time,” allowed Mr. Van Loan.
It is shaping up to be a rocky session as MPs return to the Commons after a six-week Christmas break. The NDP’s finance critic Peter Julian talked to reporters, following Mr. Van Loan. He vowed his party will fight to protect the OAS and he doesn’t buy the hints that the government will do any consulting with Canadians on this issue.
There has been much speculation that the government is planning to raise the age at which a person can begin collecting OAS to 67 from 65. Mr. Van Loan did not get into those specifics. Instead, he repeated his reassurances to seniors and quoted statistics, which the government has been relying upon since the Prime Minister’s speech, to back up the need for reform.
Mr. Van Loan said that there are now four working people for every person collecting OAS. Twenty years from now, however, the amount spent on OAS will triple, and yet there will be only two people in the workforce for every retired person. The most recent actuarial report on OAS estimates the cost of the program will increase to $108-billion in 2030 from $36.5-billion in 2010.
Pensions and retirement security have been a dominant issue in the Commons since the May election. The government has also hinted that it will go after public service pensions and the so-called gold-plated MP pensions as part of cutting spending to balance the budget. The government is looking to cut between $4-billion and $8-billion, although most of the speculation is that it will go for the higher amount.
All of this is to be revealed in the upcoming budget, which is a big focus of MPs in this session. Mr. Van Loan, however, said he did not know the date when the budget will be delivered and he skirted around questions about reforming the so-called gold-plated MPs pensions as part of the cost-cutting.
Instead, he said government MPs sitting on the Board of Internal economy, which oversees management and spending of the House, have asked that the board “also do its fair share as part of the deficit reduction action plan.”
“We don’t think it’s right that we would be asking all of government and all Canadians to accept that we make savings across the board if we don’t do that ourselves,” he said, adding they are looking for “real action” from the board.