Is now the time to overhaul Canada’s Old Age Security? Why some urge yes
Global News
A 'think and change tank' is recommending the federal government overhaul its Old Age Security program, saying it could unlock billions in savings that could benefit those in need.
Ahead of the 2025 federal budget to be released this fall, some are raising a question that could be a third rail in Canadian politics: is it time to reform the Old Age Security program?
The founder of Generation Squeeze, which is a charitable “think and change tank” with a mandate to “champion generational fairness,” is urging the federal government to do just that and change up the retirement benefit, the cost of which is expected to soar over coming decades.
“OAS is the single largest growing part of the federal budget, and part of that reflects large subsidies for retirees with (combined) household incomes of $180,000. The $42 billion government deficit in 2025 was projected in the last fall economic statement, and it will now be much higher because of tax cuts and new NATO promises,” says Paul Kershaw, also a professor at University of British Columbia.
“You could spend our OAS money differently right now and achieve other goals without having to raise taxes. And you could do so, for instance, by asking more financially secure retirees to take slightly less.”
Generation Squeeze made the case in the group’s submission to the budget consultation process.
That’s where the federal government takes input and recommendations from stakeholders across the country on what should — or should not — be in the budget.
In addition to paying down the deficit, the group adds that trimming the amount given out through Old Age Security could be put towards economic supports for many Canadians living in poverty as the rising cost of living leads to more cases of personal debt, with those most impacted including young Canadians and lower-income retirees.
This may involve smaller payments made to more affluent retirees in order to free up more money for younger and/or lower-income Canadians to receive more funding and social supports.
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