Tuesday, May 15, 2012
House of Commons
Finance Committee Transcript
Liberal Finance Critic Scott Brison & Minister of Finance Jim Flaherty
Tuesday, May 15, 2012
Hon. Scott Brison (Kings—Hants, Lib.): Thank you, Mr. Chair.Minister, the OECD and the Parliamentary Budget Officer, and others, tell us that currently the OAS is sustainable. You're saying it's not sustainable in its current form but that the changes you're proposing will make it sustainable.As such, these changes you're making must have a figure attached to them in terms of what they will actually save the treasury, because you're saying that amount is going to make OAS sustainable. What would that figure be? What is the figure that your changes will make to save the treasury, to make OAS sustainable, according to your calculations?
Hon. Jim Flaherty: What we're doing, as you know, out in 2023, and gradually after that, is raising the eligibility age from age 65 to age 67. This is a recognition of the fact that we have an aging population that is relatively healthy. Most of the western economies are doing the same thing.
Hon. Scott Brison:Minister, what is the figure?
Hon. Jim Flaherty: The figure will be, then, the number of people who claim OAS. As you know, that figure changes from time to time. This is a social program. It is not a pension plan.
Hon. Scott Brison: So you can't tell us the figure of how much the government will save, but you'll tell us that the change will make OAS sustainable.
Hon. Jim Flaherty: I can tell you that—
Hon. Scott Brison: If you can't tell us the figure of how much it will save, how can you tell us it's unsustainable in its current form?
Hon. Jim Flaherty: I can tell you that most of the western economies are going in exactly the same direction because of the reality that the life expectancy of a male in Canada, when this plan was introduced, was about 69 years of age.
Hon. Scott Brison: So it's not based on sustainability in Canada
Hon. Jim Flaherty: Now it's about 79 years of age. The life expectancy of a woman, similarly, is now in the eighties.
Hon. Scott Brison: The baby boom generation and the whole demographic shift has been with us since the 1950s. You were probably aware of that during the election. If so, why didn't you speak about this change to OAS during the election?
Hon. Jim Flaherty: We made it clear during the election campaign that we would ensure we had long-term fiscal stability in Canada. That is our brand around the world, a brand Canadians can be quite proud of.
Hon. Scott Brison: Raising the OAS will also raise the age of qualification for the guaranteed income supplement, which helps the poorest of the poor in Canada. Will you consider amendments to exempt these most vulnerable Canadians, the people who get their guaranteed income supplement, from these changes?
Hon. Jim Flaherty: The question usually comes in another way, that this change might impose some burden on the provinces. We made it clear, explicitly, in the budget documents that we would compensate the provinces and territories for any increased social assistance costs they incur as a result of this change, which is many years away.
Hon. Scott Brison: You are saying that people can work longer today than they used to. That's true for a politician, lawyer, accountant but if you are a manual labourer, pipe fitter or carpenter or fish plant worker in physical labour that may not be the case. In fact many people in those roles their body actually needs a break at 65. Will you consider amendments to exempt some people in heavy physical labour for example from these changes?
Hon. Jim Flaherty: There's a very interesting program that is funded in the budget and it's called The Third Quarter. The Manitoba Chamber of Commerce created the program and it is an Internet program to match people 50 and their attributes and qualifications to available jobs. This has been very successful in Manitoba and we're going to fund its expansion across the country. One doesn't have to do the same job for one's entire life. Many people do not. In fact it would be more common in the future for people to have multiple and different jobs in their lifetimes than a single job
The Chair:So you don't think it's different for somebody for instance in heavy manual labour compared to somebody who is a professional and a sedentary worker as an example.Minister, one question
Hon. Jim Flaherty: I don't agree with what you just said but it's okay.
Hon. Scott Brison: Well you seem a little out of touch, Minister, with the challenges that average Canadian are facing.
Hon. Jim Flaherty:I certainly couldn't keep up with the hon. member.
Hon. Scott Brison: Minister, 38% of Canadian earn less than $20,000 a year and 40% of the people getting Old Age Security make less than $20,000. You're telling them it's no big deal, you've got 11 years and you can save a little more money, set a little more aside.How could you actually tell people making less than $20,000 that they just need to save more money? Don't you think that sounds a little out of touch with the challenges faced by low-income Canadians?
The Chair: If we could have a brief response, Minister.
Hon. Jim Flaherty: I think what's out of touch is not realizing that people in Canada are living longer and healthier lives.
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