FACE TO FACE: Should the feds raise Canadians' pension eligibility to 67 years?
Prime Minister Stephen Harper sure did cause a big stir last week when he hinted that his government might raise the eligibility for Old Age Security to 67.
Fear-mongers (a.k.a. the liberal media) screeched that Harper was more interested in buying fighter jets and prisons than protecting seniors.
Despite the left-wing rhetoric, the move makes a lot of sense.
When Old Age Security was first introduced in the 1950s, the life expectancy for male Canadian men was about 66 years and for women, about 71. Today, it's 78.5 years for men and 83.1 for women.
And by 2031, average life expectancy in Canada is projected to climb to 81.9 years for men and 86 for women.
Consequently, the OAS system has been stretched to the limits by the combination of having to pay Canadian seniors for a longer period of time and the increasing number of Canadians receiving OAS payments.
Internal documents obtained by The Globe and Mail show the cost of providing OAS to Canadians 65 and over is on track to climb from $36.5 billion in 2010 to $48 billion in 2015 - an increase of 32% - before rising to more than $108 billion in 2030.
A responsible government with an eye on the future needs to develop policies to mitigate the growing costs associated with an aging population. Countries that don't will end up in dire financial trouble.
Other countries have already realized this. Last year, Nicolas Sarkozy's government raised France's retirement age from 60 to 62 (and those who want to claim full pension benefits must now wait until age 67 instead of 65). In 2000, the United States moved to raise its retirement age to 67. And, in 2007, the U.K. government pegged Britain's retirement age at 68.
Now, I know my colleague opposite likes to think that, in Canada, the money will magically appear. But unfortunately, we don't live in a fairy tale world. And no, you can't just increase the tax burden of businesses and hope it doesn't affect other areas of the economy (see the 1990s and the exodus of businesses, people and government revenues away from British Columbia).
It appears the government's change to OAS won't happen for five, 10, even 15 years, so that we, as individuals and as a society, have time to plan and time to transition.
It won't be an easy transition but it is necessary one.
Andy Radia is a Coquitlam resident and political columnist who writes for Yahoo! Canada News and Vancouver View Magazine. He has been politically active in the Tri-Cities, having been involved with election campaigns at all three levels of government, including running for Coquitlam city council in 2005.
