Some Background Info on OAS and GIS....
The Old Age Security Act (OAS) (http://www.hrsdc.gc.ca/eng/isp/oas/oastoc.shtml) was put into place in 1952. This Act gives people over 65 years old a monthly income based on how many years they have lived in Canada since they turned 18 years old. It is not based on current income or past employment, but strictly based how the amount of years lived in Canada. This benefit is divided up into 40 “pieces of pie”. Those who have lived in Canada for 40 years or more after turning 18 get the full amount ($516.96)- all 40 pieces. Each year less than 40 represents the amount of pie they will receive per month. For example, if a senior has lived in Canada for 20 years after their 18th birthday, they will get half of the maximum monthly allowance ($258.48). This works all the way down to ten years in Canada after their 18th birthday, thus qualifying for a quarter of the maximum monthly benefit ($129.24). There is a minimum of ten years of residence in Canada in order to qualify for OAS.
The Guaranteed Income Supplement (GIS) (http://www.hrsdc.gc.ca/eng/isp/pub/oas/gismain.shtml) is a monthly benefit paid to those who qualify for any amount of OAS. GIS is reserved for seniors with little or no other sources of income. The amount of GIS is assessed based on the monthly income. If they have no income, they get the full amount ($652.51). Recipients must re-apply each year for GIS, and it is not subject to taxation.
Great- So What’s the problem...
Recently, Liberal MP Ruby Dhalla (http://www.youtube.com/watch?v=ZP7EvXYZXBg) has introduced a controversial private bill to amend OAS. Bill C-428 would lower residence requirements from a minimum of 10 years of living in Canada after your 18th birthday to a minimum of 3 years in order to qualify for OAS. This would mean that many recent immigrants would qualify for the benefit after living in Canada for only 3 years.
This has caused a lot of debate in both parliament and amongst Canadians in general (http://cnews.canoe.ca/CNEWS/Politics/2009/10/12/11376821-sun.html). Many people feel like they have lived in Canada for enough time and have earned their OAS, whereas newcomers can just walk in, and poof! after 3 years of sitting in their rocking chairs and not even necessarily working, they can qualify for a monthly government allowance they haven’t yet earned (http://www.nowpublic.com/world/what-liberal-party-have-store-canada-old-age-security). People are afraid immigrants will take advantage of our Canadian welfare system and move here specifically for the benefits. Some others are concerned that Bill C-428 will be too costly, potentially costing the Canadian Government up to $700 million.
Come on Canada!!! Is this what we’re really about? These newcomers can access our health care programs, disability programs, and housing programs which are the foundation of the Canadian welfare system and Canadian values and beliefs! Yet, they’re not able to access their portion of the OAS pie, which, by the way, after 3 years of living in Canada, would only be $38.77., hardly a huge expense. What people are really concerned about are these immigrants qualifying for GIS. We would like to remind you that people must be in a low income bracket in order to qualify, and GIS is allotted based on how much money they have or earn per year. In other words, they will get it if they need it, and only if they need it. Dhalla notes that immigrant seniors are more likely to fall into poverty than those born in Canada. Furthermore, OAS and GIS isn’t like the Canada Pension Plan, which people pay into in order to qualify for. It is a universal program for all of those who are over 65 and have lived in Canada (despite income based claw backs, which we aren’t going to get into).
The bigger question that comes up out of all of this is- aren’t we going to have to support our recent immigrants once they’ve entered into Canada one way or another? We can either give the assistance they need in the form of OAS and GIS before they get to the point where they’re accessing other, more cost draining systems, such as welfare programs, government housing programs, health care programs etc. or we can give them this minimum payment of OAS ($38.77/ month), and based on their income, give them access to GIS when needed, in order to prevent extreme poverty amongst our new elders. Maybe all of those who have a problem with this Bill should take it out on the immigration system and give MP Ruby Dhalla a break.
Final thoughts...
We often sit and muddle over what the future will bring for us. What kind of jobs are we going to get, where we’re going to live, and what we want out of life. But after reviewing this policy, instead of dreaming about what great things our future might bring, we’re starting to stress out about (not only exams and essays, but also..) private pensions through our work we haven’t even started yet, guarantees of a full time job once graduated, with benefits and extra perks upon retirement. Or we wonder if we should just start putting out money into an RSP now, even before our student debt is paid off???
The Old Age Security Act (OAS) (http://www.hrsdc.gc.ca/eng/isp/oas/oastoc.shtml) was put into place in 1952. This Act gives people over 65 years old a monthly income based on how many years they have lived in Canada since they turned 18 years old. It is not based on current income or past employment, but strictly based how the amount of years lived in Canada. This benefit is divided up into 40 “pieces of pie”. Those who have lived in Canada for 40 years or more after turning 18 get the full amount ($516.96)- all 40 pieces. Each year less than 40 represents the amount of pie they will receive per month. For example, if a senior has lived in Canada for 20 years after their 18th birthday, they will get half of the maximum monthly allowance ($258.48). This works all the way down to ten years in Canada after their 18th birthday, thus qualifying for a quarter of the maximum monthly benefit ($129.24). There is a minimum of ten years of residence in Canada in order to qualify for OAS.
The Guaranteed Income Supplement (GIS) (http://www.hrsdc.gc.ca/eng/isp/pub/oas/gismain.shtml) is a monthly benefit paid to those who qualify for any amount of OAS. GIS is reserved for seniors with little or no other sources of income. The amount of GIS is assessed based on the monthly income. If they have no income, they get the full amount ($652.51). Recipients must re-apply each year for GIS, and it is not subject to taxation.
Great- So What’s the problem...
Recently, Liberal MP Ruby Dhalla (http://www.youtube.com/watch?v=ZP7EvXYZXBg) has introduced a controversial private bill to amend OAS. Bill C-428 would lower residence requirements from a minimum of 10 years of living in Canada after your 18th birthday to a minimum of 3 years in order to qualify for OAS. This would mean that many recent immigrants would qualify for the benefit after living in Canada for only 3 years.
This has caused a lot of debate in both parliament and amongst Canadians in general (http://cnews.canoe.ca/CNEWS/Politics/2009/10/12/11376821-sun.html). Many people feel like they have lived in Canada for enough time and have earned their OAS, whereas newcomers can just walk in, and poof! after 3 years of sitting in their rocking chairs and not even necessarily working, they can qualify for a monthly government allowance they haven’t yet earned (http://www.nowpublic.com/world/what-liberal-party-have-store-canada-old-age-security). People are afraid immigrants will take advantage of our Canadian welfare system and move here specifically for the benefits. Some others are concerned that Bill C-428 will be too costly, potentially costing the Canadian Government up to $700 million.
Come on Canada!!! Is this what we’re really about? These newcomers can access our health care programs, disability programs, and housing programs which are the foundation of the Canadian welfare system and Canadian values and beliefs! Yet, they’re not able to access their portion of the OAS pie, which, by the way, after 3 years of living in Canada, would only be $38.77., hardly a huge expense. What people are really concerned about are these immigrants qualifying for GIS. We would like to remind you that people must be in a low income bracket in order to qualify, and GIS is allotted based on how much money they have or earn per year. In other words, they will get it if they need it, and only if they need it. Dhalla notes that immigrant seniors are more likely to fall into poverty than those born in Canada. Furthermore, OAS and GIS isn’t like the Canada Pension Plan, which people pay into in order to qualify for. It is a universal program for all of those who are over 65 and have lived in Canada (despite income based claw backs, which we aren’t going to get into).
The bigger question that comes up out of all of this is- aren’t we going to have to support our recent immigrants once they’ve entered into Canada one way or another? We can either give the assistance they need in the form of OAS and GIS before they get to the point where they’re accessing other, more cost draining systems, such as welfare programs, government housing programs, health care programs etc. or we can give them this minimum payment of OAS ($38.77/ month), and based on their income, give them access to GIS when needed, in order to prevent extreme poverty amongst our new elders. Maybe all of those who have a problem with this Bill should take it out on the immigration system and give MP Ruby Dhalla a break.
Final thoughts...
We often sit and muddle over what the future will bring for us. What kind of jobs are we going to get, where we’re going to live, and what we want out of life. But after reviewing this policy, instead of dreaming about what great things our future might bring, we’re starting to stress out about (not only exams and essays, but also..) private pensions through our work we haven’t even started yet, guarantees of a full time job once graduated, with benefits and extra perks upon retirement. Or we wonder if we should just start putting out money into an RSP now, even before our student debt is paid off???
