Imagine
turning 65. Where do you want to be? Maybe on a cruise through the Caribbean,
participating in a book club; maybe writing your own book … strolling through
your neighbourhood at sunset, and then coming home and making delicious little
pies? Retirement is meant to be a time to finally relax and enjoy life, a time when
your contributions to society have been appreciated and you are finally allowed
to give your mind and body a rest after the constant grind of subsistence
labour. In reality, though, at 65 you’ll probably be getting up every morning
to go to work, with no real end in sight, just like you are now.
One
in three retired Canadians have some form of consumer or mortgage debt, and two
thirds of working Canadians in the same age group (55 or older) are in debt,
with a median debt load of $40,000. Living comfortably when we grow old is
increasingly becoming a fantasy, with the average Canadian Old Age Security
(OAS) payment at only $510.21 per month.
The
current retirement age is 65 years old, but the Conservative majority
government has been outlining plans to initiate a series of cuts that will
directly affect retirement and pension plans. These plans include changing the
retirement age to 67 years old in order to keep citizens in the workforce for
longer so they provide more tax dollars, as well as lowering the amount of
beneficiaries.
The
number of seniors is expected to climb to 9.3 million by 2030, from the current
4.7 million, potentially costing $108 billion in pension payments. Harper
claims that those costs will be unaffordable, although experts counter that
when viewed as a ratio of Canada’s gross domestic product (GDP), there won’t be
a problem. The Parliamentary Budget Advisor also said that even if benefits were
increased slightly,
the pension system would continue to be sustainable. Canada already has one of
the smallest public pension systems, relative to the size of the economy, of
all the G7 countries.
Critics
of the Conservative pension cuts are saying that they favor only the
middle-income and rich Canadians at the expense of the poor. “For many
Canadians, turning 65 and receiving OAS is the difference between worrying
about their financial security every single day and suddenly being able to just
get by,” writes Bob Rae, interim leader of the Liberal party. “This is
especially true for people who receive the low income Guaranteed Income
Supplement which is directly tied to the OAS.”
Rae also points out that many people have structured their retirement plan for the age of 65, and that changing the rules now could be devastating: “Worse still, some provinces tie seniors’ benefits, such as prescription drug cards, to being an OAS recipient,” says Rae. “Waiting two more years for these benefits will be impossible for some people.”
The
government using dollar figures to justify cuts to the pension system is odd,
considering recent federal expenditures that seem less than essential. $9
billion has been budgeted for the purchase of new F-35 joint strike fighter
jets, which Harper has justified purchasing “so that we can protect against
foreign invasions.” The budget for Corrections Canada is also projected to rise
27 per cent this year, in conjunction with the omnibus crime legislation that
was recently passed, reaching $3.1 billion in federal funding. To put these
numbers into perspective, Environment Canada is seeing their budget being cut
from $242 million in 2010-2011 to $76 million in 2012-13, and Agriculture
Canada is projected to lose 42 per cent of their budget, dropping to $90
million.
The
callous spending of billions of tax dollars in the military and prison sectors
is disturbing, considering the puny budgets allocated to the environment,
agriculture, and public sectors in comparison. Are food, clean air, and the
welfare of senior citizens unimportant? Who is threatening to invade Canada,
and in that case, would 65 fighter jets even be enough to protect the entirety
of our vast nation? It seems as though the budget isn’t really in line with the
reality of Canada’s needs.
We
all like to think we’ll be in an ideal financial situation by the time we turn
65, and if your parents are in the middle class, it’s even easier to expect a
fairly similar situation for yourself. However, this isn’t always the case, as
evidenced by the high levels of seniors in debt – and a comfortable retirement
continues to seem more unlikely as an increasing number of Canadians find
themselves in poverty.
Currently
one in ten Canadians are living under the poverty line, with only a third of
those able to obtain employment, the others being single mothers, disabled
people, Aboriginal Canadians living in rural areas, and immigrants. B.C.
extensively cut funding to the welfare system, which wasn’t enough to lift
people out of poverty to begin with, and those cuts severely affected the
above-mentioned marginalized groups and contributed to B.C.’s high child
poverty rate (10.4 per cent). Rather than adapting a national strategy to
address the issue of poverty in Canada, the Harper Government said that “the
sustained employment of Canadians” was the best long-term plan, though many critics
have questioned if it is sufficient.
The
effects of poverty are not going to go away just by ignoring them. The more we
cut public spending, the more people will be forced to live under the poverty
line, particularly the most vulnerable members of our society. Taking care of
our senior citizens should be a top priority for the government. Everyone is
affected by poverty, and it’s not okay to buy fighter jets instead of funding
the pension system.
//Sarah Vitet, editor-in-chief
//Sarah Vitet, editor-in-chief
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