Good afternoon, everybody. I'm glad to see that everyone is here. We're going to start a few moments early, because there is a chance that we might be cut off by votes. Bells are apparently starting at 5:15.
Today, pursuant to Standing Order 108(2) we are doing a study of advancing inclusion and quality of life for Canadian seniors. I'm very excited to get this study under way.
We have Tammy Schirle, professor in the department of economics at Wilfrid Laurier University, appearing as an individual and coming to us from Guelph, Ontario.
Hello. I was born in Guelph, Ontario, so I'm very pleased to have you here today.
We also have, for the Canadian Association of Retired Persons, Wanda Morris, vice-president for advocacy, appearing by video conference from Surrey, British Columbia.
Appearing in person from the Council on Aging of Ottawa is Richard Shillington, adviser.
From HomEquity Bank we have Yvonne Ziomecki, executive vice-president.
From Prince George Council of Seniors we have Lola-Dawn Fennell, executive director.
Thank you all so much for being here today.
We have a very large panel, so we're going to get right to it. We're going to have opening remarks of about seven minutes. Once everybody has had an opportunity to speak, we'll have a series of questions from everybody here.
To start us off today, we're going to go to my birthplace—Guelph, Ontario.
You're up first, Tammy. The next seven minutes are yours.
I promised your translators that I would try not to speak too quickly. If I do, give me a flag.
I am a labour economist. For those not familiar with me, a lot of my work revolves around issues of poverty and inequality, and I like to work on policy that relates to both retirement and gender equity. That gives you a sense of what my background here is.
What I would like to do today is discuss ideas on how we might recreate our income security system to better help our most vulnerable seniors while maintaining, and possibly improving, support for a broad range of seniors.
The income security system we have for seniors was largely developed in the late 1960s and 1970s. Central to this system was the introduction of the Canada Pension Plan, the old age security pension, and the guaranteed income supplement, for which the eligibility age was reduced to 65 in 1967.
A patchwork of programs and tax expenditures further help select groups of seniors. For example, the allowance and survivor’s allowance help widows and married seniors as early as age 60. A non-refundable tax credit for the age amount reduces the tax liability for those over age 65 with modest incomes. The tax deductions for the pension income amount and pension income splitting benefit those with eligible pensions, particularly those who are married with high income. Also, various programs at the provincial level further supplement income and assist with the costs facing seniors. In Ontario, some examples are GAINS, which offers a small income supplement; the public transit tax credit for seniors; and a home renovation tax credit, among other programs.
With that, the rate of poverty among seniors is quite low, enviably so across OECD countries. Unfortunately, we lack a good measure for senior poverty in Canada, and I would recommend that this committee consider the merits of devoting resources to better measures. Using our existing measures of poverty, we see that the highest poverty rates are among single seniors. In 1976, unattached elderly women had a poverty rate at 68%. In 2015, this fell to only 13%. However, the poverty rate for women who are in “economic families”—who by and large are married—is only 1%. Where are the gaps?
First, the OAS and GIS combined do a good job of bringing the incomes of married couples closer to the poverty line. In fact, the GIS expansion in 2006 and 2007 brought married couples up to the after-tax low-income cut-off. GIS does less for unmarried individuals, whose maximum benefits remain $4,000 to $5,000 below the poverty line. Increases in 2016 to the single GIS amounts improved that situation but still fall short.
We also fail many seniors who are single in the 60-64 age range. If a person is divorced or simply not married, they are ineligible for the benefits available to otherwise equivalent married and widowed low-income seniors in that age range. I think this reflects the expectations for family structure and work that prevailed in the late 1960s and 1970s. It is not clear to me why this penalty for being divorced remains in place.
Moving forward, I think there is merit in pursuing a major review and reform of the income security system. We need to update our expectations for the roles of men and women in families, as breadwinners, caregivers, or even as spouses, with gender equity considerations prominent in that effort. We need to reconsider Canadians’ priorities for supporting vulnerable populations as opposed to entire demographic groups. We need to account for the changing nature of work among older populations.
For example, the key parameter for program eligibility has been stuck at 65 since 1967. Many seniors are able to work longer than before, given better health and higher life expectancy. Our research suggests that if our work habits kept up with life expectancy, men could, on average, work five years longer than they currently do. However, our research also shows large differences in the ability to work at older ages across the population. I am concerned that a universal increase in the eligibility age will harm the most vulnerable seniors.
We could consider bringing together the patchwork of benefits and tax expenditures to streamline the income security system. I would make it more transparent and accountable, offering direct benefits rather than tax expenditures.
I would use our resources to better target vulnerable populations. I would also design a program with seniors’ work incentives in mind, which for economists means spending time thinking about marginally effective tax rates.
Where are some places where work incentives matter?
First, consider the guaranteed income supplement. While many seniors who receive GIS benefits do not have the opportunity to work full time, they may be able to work part year or part time. Since 2008, we exempt up to $3,500 in employment earnings and also allow a general exemption of $2,000 for the lowest income seniors. However, for earnings beyond the exemptions, the GIS benefit is reduced by 75¢ for every dollar earned. At higher earnings, the clawback rate falls to 50¢ for every dollar earned.
This high tax on work for low-income seniors, on top of clawbacks in provincial or municipal programs, leaves employment rather unrewarding. As a solution, we could take a lot of the resources we currently put toward low- and middle-income seniors and create a similarly generous program with lower clawback rates, so that vulnerable seniors who work can get ahead.
Second, I would suggest moving away from age 65 as the focal point. For example, I would love to see an experiment—this is me being a researcher—in which we keep the existing structure of CPP benefits in every way, but refer to age 70 as the focal age for defining the basic benefit calculation, rather than age 65. If we simultaneously expanded opportunities to delay OAS take-up, I suspect we would see the spike in retirements at age 65 disappear.
There are many things we can do in our system of taxes and benefits to better help and support the seniors who need help. My main message for this committee is that it is worth spending some time rethinking how we deliver that system.
I thank you for the opportunity to be here today and appreciate any questions from the committee
I'm going to talk to you briefly about CARP. We are a 300,000-member advocacy organization with our primary membership in Ontario, followed by British Columbia, Alberta, and Nova Scotia.
I will also say that we are going to be in Ottawa on October 25, and I look forward to the chance to meet with many of you in person then.
I'm going to start by talking about the income issues; then, time permitting, I'll share my thoughts on other areas.
With respect to the question of how the government can improve income security for vulnerable seniors, the biggest challenge is to improve affordable housing. What we know is that many vulnerable seniors are vulnerable because by the time they've paid for their housing they can no longer pay for nutritious food, transportation, and medical care.
Seniors are impacted both directly and indirectly. Many seniors have helped their adult children and adult grandchildren buy homes, something that has significantly adversely affected, through the increase in housing prices, their retirement security.
As my colleague mentioned, the face of senior poverty is overwhelmingly female. The median income in 2013 for a senior woman was $21,900, compared with $32,300 for a man. We need to take steps to fix this.
One thing we can do is look at how we can support caregivers better. These caregivers are providing $26 billion annually of unpaid and informal care. We have a provision in the CPP to give child rearers, primarily women, a time out when they are raising children. We would love to see that extended to caregivers, but also, being aware that having other CPP contributors subsidize it would be a regressive tax, we look for something more innovative, such as government funding for those CPP premiums.
We'd also love to see more programs for caregivers, things such as respite care and adult day care centres, so that caregivers don't have to choose between working and staying at home and providing care.
We need to dramatically increase the uptake on the programs we currently offer. Estimates I've seen range between 100,000 and 150,000 for Canadians who are eligible for the guaranteed income supplement but aren't claiming it. This is unconscionable. We need to provide it automatically.
For example, in the U.K. most citizens don't file tax returns; it is done automatically on their behalf by the government. I think that's something that's well worth exploring, particularly for our lowest wage earners and lowest-income retirees. We need to make sure that if anybody is already filing a tax return, they automatically get their GIS paid and don't have to file additional and supplemental forms.
What I have heard anecdotally is that there are certain barriers in place for people to get GIS. We need to switch that around and make it as seamless as possible for people to get this support. We need to work with the local agencies that have already earned the trust of our most vulnerable seniors and enable them to help people get the benefits for which they qualify.
We also need to recognize that the Internet isn't a panacea for the older-years population. In 2013, the general social survey found that only 54% of senior women and 59% of senior men had used the Internet in the past 12 months. I'm sure those numbers are higher now than they were then, but there's still a significant cohort of our most senior seniors and also our most low-income seniors who do not have access to the Internet.
We need to tweak our income-support programs to better support low-income seniors and incent older Canadians to continue working. We need to reform our RRIF withdrawal policy so that people aren't incented to over-withdraw from their RRIFs, running out of funds before they run out of time.
CARP recommends an amnesty for RRIF withdrawals for our lowest-income seniors. Many individuals, through lack of financial literacy, have contributed to an RRSP when it wasn't in their best interests—when they were low-income earners—getting very little benefit from doing so and now facing GIS clawbacks when they withdraw.
We need to change our structure for CPP so that there are incentives to continue working not just to age 70 but beyond, and similarly for OAS.
There are a number of corporate pension plans that prevent individuals from continuing to gain from contributing past age 65. We need to try to change that. For some individuals, unless you take your CPP at 65, if you have already fully contributed there's no benefit to contributing beyond that. We need to change that. We need to make that equitable.
I concur with my colleague about making tax credits non-refundable. For example, caregiver tax credits need to go to our most vulnerable and those with the lowest income, those who aren't already paying taxes. We need to tackle the GIS clawback.
We need to take steps to protect those who have already taken steps to protect their own retirement. CARP is currently running a pension campaign to protect corporate pensioners, and that's what we'll be talking about on October 25.
We strongly support provincial governments to implement a best interest standard, to ban embedded fees, and to take steps to harmonize regulations so that investors are protected and we don't pay some of the highest fines in the world.
I will come with the final points.
We need to share tax information between different levels of government. In Ontario, for example, in determining who gets reduced copays on provincial drugs, the only information the province has is on who is eligible for GIS, so they have an artificially low cut-off. To share that information better, we need to coordinate relief programs between different levels of government, federal and provincial. Just as many people don't know about GIS, many people aren't aware of provincial benefits they can access—for example, energy reduction costs.
Finally, in talking about housing, municipalities could introduce progressive property taxes to tax at a higher rate more expensive houses but offset that against earned income, so that there's a disincentive for people to invest and leave homes vacant. To do that, though, would again require government coordination.
I'll stop there, but in question period I'm happy to provide responses to the first or third question, if time permits.
Thank you very much for this opportunity to discuss such an important and timely issue.
I am here on behalf of the Ottawa Council on Aging. I sit on a panel of income security experts, former ADMs, and the former chief actuary of CPP, who give advice to the council.
Our expert committee composed a recent report that the dependency ratio, the ratio of seniors to the working-age population, overstates the physical challenges posed by aging. The council has committees working on issues like housing, isolation, vulnerable seniors. If you have questions about that, through the clerk you could send them to the council. My expertise is mostly in income security, rather than housing and vulnerability.
I started concentrating on GIS in 2001, when I managed to make the press aware that there were 300,000 seniors in Canada eligible for GIS who weren't receiving it; and the HRSDC knew who they were. That situation has improved immensely, but there's still a great deal of room for improvement.
I recently published two papers on seniors, which the clerk will be familiar with. One was co-authored with Bob Baldwin, on the lack of policy analysis that accompanied the recent CPP enhancements. I also wrote a report on the economic circumstances of seniors and their income in retirement that was published a couple of years ago.
I'd like to draw attention to the Statistics Canada graph that I distributed to the committee. I was awestruck when I saw that. I'm a mathematician by training. You can see the poverty rate, on the whole, has changed very little, except for those people who happen to be between ages 65 and 85, where the proportion of the poor seems to have increased by something like 50%. Something substantial is going on.
The income of lower-income seniors, those without pensions, is completely determined by federal legislation. These people tend not to have pension plans. They don't have significant savings. Their income is old age security, federal legislation; GIS, federal legislation; Canada Pension Plan, federal-provincial legislation.
The average income of a single senior who doesn't have a pension plan is $18,000 to $19,000. We can debate whether or not they're poor, depending on what poverty lines you want to choose. It's not a lot of money. It's certainly not a lot of money in Ottawa, Vancouver, or Toronto. You basically say, “How do I survive?”
I will talk in turn about OAS and GIS.
Old age security is indexed to prices, to the CPI. It has been that way since it was created. Except for the indexation of prices, there has been no change to OAS since it was created.; it has had the same purchasing power for 50 years. Thus over time, of course, OAS has diminishing value as either income replacement or as an anti-poverty measure.
The last government announced that it was going to delay OAS by two years. This government has rescinded that, and we will have OAS at 65. I actually favour delaying OAS to 67, or even later over time, as long as you leave GIS where it is; or we could in fact debate moving GIS to age 60. You would, then, delay OAS for most seniors but keep in place income protections for seniors who are vulnerable from an income point of view.
We currently give OAS and GIS to some seniors—those who are married to somebody over 65 or who are a widow or widower—so there's a precedent for this. We also currently use GIS to replace any missing OAS for people who don't get full OAS. We do this for immigrants. We could, then, modify those programs, and there are precedents for doing so.
The guaranteed income supplement is one of those programs that help you up and hold you back. The GIS gives you money to increase your income and then claws back any income that you earn.
The program is impossibly complex. I challenge anybody to make a simple statement describing eligibility accurately. You will read that if your income is below $15,000 you're eligible; that's not true if you're an immigrant. That $15,000 excludes OAS; not everybody knows that.
It's different if you earn wages. Wages and paid employment are treated differently from self-employment. If you have dividend income, it's different. If you have capital gains income, it's different.
About one-third of seniors get GIS. About two-thirds of seniors without a pension plan get GIS. It's a very important program, and we still have many seniors not getting benefits they're entitled to receive, mostly because of the complexity.
We know now that seniors on GIS have a clawback rate—effectively a tax rate—that is at least 50%; for many of them it's 75%. When you combine it with some provincial top-ups, it's 100%. A good proportion of seniors live in social housing. Social housing charges you a rent in many places that is 30% of your income. That's another clawback on top of the other clawbacks. Many seniors have a tax rate of more than 100%.
This is not a surprise to anybody who understands these programs. The chief actuary just a couple of weeks ago had a report that said that many low-income seniors will not benefit from the enhancements to CPP benefits—the new program—because of GIS. This is not news to anybody who understands these programs.
You are going to be torn about the CPP program. It's critical for low-income seniors, but the enhancements that were announced are so minimal, and they are going to be phased in over 40 years.
Some years ago I wrote a report for the Task Force on Financial Literacy that asked for simple things: simplicity and transparency in the design of the income supports. I've been on the phone with many seniors who are missing out on benefits they're entitled to because they couldn't navigate the system or were not aware that they were eligible.
A major culprit is CPP. It's almost impossible to independently check that you're getting the CPP benefits you're entitled to receive. For income tax you can actually double-check the calculations that CRA does. I get a CPP cheque; they just said, this is what you're getting.
I'm good at this, and there's no way for me to verify that it's correct. When you get the new CPP enhancements, the enhancement rules are totally different from the rules for the CPP base. Good luck ever figuring out that you're getting what you're truly entitled to receive.
I'll make one quick comment about RRSPs: they're toxic for low-income Canadians. It's like having a mutual fund with a 50% back-end load, for people who know what that means. The banks are still doing a terrible job of giving individuals advice that says: you shouldn't be in an RSP; get yourself into a TFSA before you turn 65. They basically are not doing that.
I have some other things I'd like to say, but maybe there will be questions.
Good afternoon, Mr. Chair.
Thank you for the invitation to appear before this committee and for the opportunity to participate in this important dialogue on income security for vulnerable seniors. This is an incredibly important issue for our country. We hope that your study, once complete, will motivate the government and all of us here to transfer your recommendations into tangible actions and results.
HomEquity Bank is a federally regulated schedule 1 bank. We are the only bank in Canada that deals exclusively with seniors. We're proud partners of CARP, the Canadian Association of Retired Persons, as well as supporters of the Royal Canadian Legion.
I'm thrilled that Wanda Morris from CARP is also on this panel. She's a tremendous advocate and expert on these issues and she'll serve as an important resource for this committee.
HomEquity Bank's 30 years of front-line experience has provided us with a unique perspective and insight into the many issues that seniors, particularly vulnerable seniors, are facing today in Canada. As you know, this Sunday, October 1, was National Seniors Day in Canada. To acknowledge the day, we launched a series of conversational podcasts titled Mindful Money to bring awareness to many of the broader issues that affect the financial well-being of Canadian seniors: managing debt, health care options, tax planning, financial planning, real estate trends, and the impact of demographic shifts on the economy. As I'm sure this committee is well aware, these broader issues are particularly acute for vulnerable seniors.
It is also important to acknowledge the changing face of seniors and aging in Canada, particularly vulnerable seniors. A vulnerable senior is not always someone in dire and desperate circumstances. In fact, we have had many clients in vulnerable circumstances who appear seemingly normal to their family and friends because they don't want to burden them with their financial problems. That is why we have long encouraged a shift in the mindset of how families should ignite these discussions and why we commend the government for undertaking this study.
Let's recall some important contexts. Canadians are entering retirement with fewer savings and more debt than ever before. Seniors are living significantly longer than in the past and the average senior is likely to have cash flow concerns within 10 years of retirement. To add some hard numbers to this context, earlier this year HomEquity Bank released a report with data sourced from Equifax Canada titled The Home Stretch: A Review of Debt and Home Ownership Among Canadian Seniors. I have provided copies of the report to the clerk in both official languages.
The results of the national study outline increasingly troubling trends. As Canada's population ages, the ability to retain and maintain a home is progressively compromised by record household debt levels, modest long-term savings, the decline of defined benefit pensions, and extended life expectancies. The data indicates that 91% of Canadians over the age of 65 say that staying at home is important, while at the same time, only 78% have any savings and investments, with 40% of those having less than $100,000 set aside for retirement. Other relevant statistics from the study are: 77% say the Canada Pension Plan is their primary expected source of income, 73% will rely on old age security, 57% have RSPs to draw upon, 48% have a work pension, and 48% have savings.
As many economists and financial planners do, I believe that home ownership should play an important part in the discussion of income security for Canadians. While the family home is the single-largest asset for most Canadians, it has often been viewed as untouchable in the past. In 2017, especially in light of significant appreciation in residential real estate values, it increasingly makes sense to unlock the equity that has been accumulated over the decades. In doing so, a home can be transformed from a passive to an active asset.
It's imperative that we empower seniors by also transforming our understanding of primary residences from passive to active assets. Allowing seniors to take advantage of the value in their home, while preserving their ability to live independently, is but one of many ways to address retirement and income security challenges. The government plays a vital role in all of this. It can ignite important public policy discussions and use its convening power to coalesce stakeholder groups to provide tangible, real-life solutions. For HomEquity Bank, these solutions include continuing the ongoing proactive dialogue about the need for early financial retirement planning, providing greater access to information about government and private-sector tools and resources that can help vulnerable seniors plan and manage their money, continuing to educate Canadians—not just seniors—about the ways to manage debt and finances strategically, supporting and raising awareness about many of the grassroots organizations that help vulnerable seniors with income security issues, and reducing regulatory burdens and red tape on businesses and banks, particularly smaller businesses and smaller banks, trying to help vulnerable seniors.
We all know that the demographics of our country are changing. It is my hope that this study continues the needed awareness-building required for Canadians to plan early on for their retirement.
Moreover, I hope this committee continues its good work while harnessing the collective power and resources of the government and industry to develop and implement policies that directly help vulnerable seniors with income security issues.
HomEquity Bank appreciates the opportunity to provide context and contribute to this ongoing discussion.
I am here to talk to you about our seniors resource centre and experiences there.
The resource centre has been around since 2002. We are open six hours a day on weekdays, or about 1,500 hours annually. During those hours, we answer around 3,500 phone calls and assist over 3,000 walk-in clients. Some of our clients seek specific information and are quite able to follow up themselves. I've been around for over a decade, and when I came to this job, that was the norm. No longer. Today, the majority of our clients come to us in crisis—financially, as well as emotionally, psychologically, and physically. They don't know where to turn.
The Canadian census identifies that 45.1% of Prince George seniors, 65-plus, are low-income. These are our clients. We see frustration, anger, tears, and hopelessness, as well as shame, on a daily basis. These seniors, often single, are in crisis. They live month to month. Incomes are insufficient to keep up their homes.
Renters come to us owing back rent, and possibly facing eviction and homelessness. Rent leaves little to live on. Homeowners come to us when repairs, especially roofs and furnaces, are beyond their means. Routine maintenance, painting, cleaning eavestroughing, and snow removal are also beyond their means. Both renters and homeowners struggle with utilities. Each winter, we see more seniors falling behind, having utilities cut off, unable to scrape together amounts owed or deposits to have services reinstated.
Our clients want housing alternatives for physical and financial reasons, but most new housing in our area is out of their price league. They need assistance with housekeeping but cannot find affordable housekeepers. They struggle with caregiving responsibilities and cannot afford in-home help or respite.
You may not see these issues as particularly insurmountable, but when you are already stretched to your monthly income and emotional and physical limits, a broken-down furnace or a bill collection notice or one more hour of caregiving can become a last straw. Yes, we see suicidal seniors.
Our staff and volunteers are excellent listeners. Clients routinely express how they are unheard in this rushed, impersonal, and highly technological world. When we really listen, we often discover that their particular crisis is more complex than originally presented. They are isolated by depression and other mental illnesses, but they are still proud northerners. They always worked hard for their families and homes, they never accepted handouts, and they don't want charity now.
Despite these values, poverty erodes their health. Simple personal hygiene is a struggle when they cannot get in and out of a bathtub safely or cannot lift partners in and out. Laundry is a struggle when those facilities are downstairs. Diets are poor. They cannot physically manage transportation for grocery shopping or carrying groceries upstairs. Incomes necessitate inexpensive foods, and lack of teeth or dentures prevents adequate chewing. Healthy fruits and vegetables are the first items cut out.
Many have to choose which crucial prescriptions to fill and which to ignore each month. Lack of appropriate eyeglasses and hearing aids isolates them further. We also learn about literacy challenges, especially computer literacy.
We refer these clients to as many sources of assistance as possible. We explain benefits and help with applications. There are many examples of things that we can refer them to locally, provincially, and federally. They don't know about these things until they come to us, even simple things like OAS. We encourage clients to talk to utility companies, and sometimes we refer them to bankruptcy representatives.
Our efforts are seldom immediately helpful, and not very reassuring. SAFER, shelter aid for elderly renters, applications may take months to process. There are long waiting lists for subsidized housing. The Better at Home program has only two part-time housekeepers and one grocery assistance volunteer in our community.
There are wait-lists for health assessments, then additional wait-lists for those programs and services. Fair PharmaCare demands sizable deductibles before subsidizing. Our own denture program relies 100% on community donations, and those donations are shrinking.
I worry about increasing debt levels, seniors with maxed-out credit cards and payday loans with high interest rates as well as Canada Revenue Agency debts. I worry about assistance not keeping up with costs.
For example, since 2005, the maximum rent that qualifies for a SAFER subsidy in B.C. has increased 9%, while rents have increased 34%. The B.C. senior supplement has remained unchanged at $49.30 for the past 30 years.
I see more elder abuse as younger people also struggle. I worry about the technological gap between those with access to information and those without. I especially worry about the number of needy seniors whom we do not see.
I don't have solutions. I have more questions than solutions. I wish I could bring a busload of our clients here to share their own stories with you personally. Thank you for allowing me to witness on their behalf.
Thank you to all the witnesses for their presentations.
This is my first time on the committee, and I'm extremely pleased to be working on such an important study as it gets off the ground.
Mr. Shillington, you said earlier you didn't have any suggestions regarding housing or health services, but I'm still going to try my luck. Perhaps your experience will support my comments.
As the member for Ottawa—Vanier, I've been fortunate enough to see how hard the Council on Aging of Ottawa has been working to help seniors. What's more, I believe you strive to represent and serve seniors in both official languages or in a culturally sensitive manner.
My question is for Mr. Shillington but is open to the other witnesses if they have a relevant experience to share.
Can you share with us any specific issues affecting seniors in minority francophone communities, as compared with those in majority anglophone communities? In terms of income security, housing, or health services, are there any differences that programs and services aimed at francophone seniors should take into account?
The best way to protect vulnerable seniors is not to have any in the first place. If we can take steps right now to improve financial security and health for individuals to make sure that they reach retirement healthy and financially secure, that will greatly improve how things happen in the future—for example, making sure that we have affordable housing for everybody; that we have walkable cities; that we invest in world-class transit so that people can age in place; that we create building codes so that seniors don't have to relocate because they aren't able to age in their homes, but instead homes all have walk-in showers, corridors that are wide enough for strollers and wheelchairs, and for larger homes, large closets, so that elevators can be easily installed in later life.
We need to look at other programs, and certainly at the CPP enhancements. While CARP is very pleased that something has happened for CPP, it seems that more could be done; particularly the CPP coverage for our lowest-income seniors is something we could address.
We can take a look at incenting individuals to stay in the workforce longer. When people are close to retirement, often they're wondering, “Should I try to save more? Should I try to spend less? Should I work longer?”, when the only effective alternative is to work longer. Yet our CPP and OAS don't increase past age 70, and there are disincentives to work past age 65 for CPP, unless you aren't a full contributor. If somebody isn't pulling down RRIF income from an RRSP they've accumulated and is still working, there's a double-whammy of tax that we need to address.
I think there is fundamental legislation that we can put in place—certainly pension protection, certainly better investor protection. It makes no sense that Canadian investors pay some of the highest fees in the world.
Those are all fundamental changes that we could make to help Canadians reach retirement with more security.
One thing I think is critical is that we start to recognize that seniors aren't a homogenous group. There's a tremendous difference between young seniors at, say, 65 to 74, to middle seniors, to our most frail and elderly seniors. By looking at them as one group, we really miss the nuances of policy that are required. That's one thing we should consider separately.
A significant way that we could help some of our older seniors who are vulnerable is by making investments in assisted living. In B.C. there was a significant survey done of long-term care homes, and it uncovered that fully 40% of people in long-term care don't want to be there. That's consistent with the findings of CIHI, the Canadian Institute for Health Information, which found that about a third of people in long-term care don't need to be there, but family members want their elderly relatives to be in care.
What's happening is that people are losing their quality of life. They're going into care facilities that really aren't geared to giving them the stimulation and support they need because there are no assisted living alternatives. That's certainly something we can do.
We also could do much more with creative support in the communities. Right now, I think we are far too risk-averse and are not recognizing that seniors want to and should be allowed to take risks. People don't need to be pain-free, but they want to be living in their homes and coping with risk. They would rather do that than be 100% secure and be in a long-term care facility.
On a larger scale, we often build care facilities in places where we can make sure that they get fire engine access. They are thus in a brand new area far away from services, inaccessible to transit, but boy, if they had a fire we could get there quickly.
Instead, what seniors are telling us they want is to be right in the thick of things. They want to be near facilities and grocery stores and movie theatres.
Similarly, there is a huge, I believe, interest and need in communities to offer alternative types of care facilities—homes that could be upgraded to provide care for maybe four or five or six seniors. But by the time we ask those homeowners to install, for example, fireproof curtains, the cost has become so excessive that they're not able to do it.
I think we have to balance the costs that are involved against the benefits to seniors.
Thank you very much, everybody, for coming today.
It's a tough one, there's no question about it. The reason we're doing a national seniors strategy is exactly that. I don't think there's a question as to whether we are or are not going to do one. I think we are doing one; that's the whole point of this.
Lola, I just want to say that I come across the exact same thing in my riding with seniors who are struggling. They are not seniors who own homes, which to me is a problem. We tend to focus on people who have home ownership. There are many seniors who don't, who are paying a great amount of their money to rent. Tying this to a national housing strategy, I will say that if seniors were able to have an affordable home, they would be able to have a bit more money in their pockets.
One thing that concerns me is this. I'm a new MP and I see people coming in.... This is not something that has just popped up; people have been living like this for a long time. Seniors in their 70s.... We talked about CPP at 65 or 67. It really doesn't make a difference at this point, because they've already been living like this.
There are two things going on, then: how do we take care of our seniors now; and what's happening with the people who will become seniors in the next 10 years? Are they improving their situation?
I guess, Tammy, I want to direct my question to you. What does the picture look like for people who will become seniors in 10 years? Is it better? Are they more educated? Are they better prepared for retirement?
The short answer is yes. Things have changed a lot, and I think the biggest changes here are really for women. Women have gained much better access to independent incomes and to having pensions of their own. These types of resources are more clearly available to them.
Just to pick up on some of the things that have been said here, though, I think part of what has become more difficult is the complexity of what they're entering—trying to navigate that system. That's where, as a few people have pointed out, we really need feet on the ground.
I think of my own mom moving into retirement, very humbly. She has the benefit of having a daughter who has read the CPP act and the OAS act and can work this out for her, but other people need that person to come and see, to work through things with them.
That said, on average seniors are much better off today than they were 50 years ago. I think we could imagine this continuing as we move forward, both in terms of health and retirement income and the pensions that will be there. People are having to rethink how they think about pensions and retirement income for generation X and subsequent generations, but it's just a different picture rather than necessarily a worse picture.
I'm glad we brought up the issue of elder abuse, especially financial abuse. That was exactly the question I asked of the minister during question period.
When I was the minister for seniors, I travelled to all of the territories and provinces. I listened to seniors and advocacy groups and even went all the way to the north. I went to first nations reserves and listened to the concerns first nations had about health care and their inability to access health care in their native language. I definitely agree with all of the findings that our experts here have reported to us.
There are many issues I'd like to comment on, but I'd like to start by adding to my colleague's comments on elder abuse.
We have identified several different kinds of abusers, and unfortunately some of the abusers can be from a senior's own family, such as someone from a younger generation. They might say, sooner or later all of your property will be mine, so why can't I have it earlier? They use different ways to pressure their older parents or even grandparents to let go of their property.
The minute a senior signs off is the minute they get kicked out. Poor seniors say that the minute they sign over their property or whatever wealth they have, they are out the door. I've heard terrible stories about this.
I congratulate CARP for doing a great job working with me in former years to make sure that elder abuse is not overlooked.
My question to the panel, for whoever wants to comment on it, is: what more can be done to ensure that vulnerable seniors are better protected from financial abuse? I specifically want to ask what the role of education and outreach is.
If I may, I'll go first.
It sounds really simple, but it's not so simple. I think more education is absolutely required, but it's about more than just saying that we need education. We need to tell people what needs to be done and teach people how to have these conversations in their homes.
My parents live in a different country, Poland. They're 71 and 73. I work in the business, and I have a very difficult time holding conversations with them about their financial situation. I don't know how much money they have or who their trusted advisers are.
In terms of an education program, I think we also need to guide people on how to have these discussions. We need to have community programs so that people don't feel isolated at home and so that they know there are additional people they can talk to. We need to tell people who to talk to if they're nervous or if something is going on—to go to the bank, a priest, or a doctor, for instance. They need to know what the first line of defence is.
It's not just a question of telling people that they need to have these conversations. They need to have practical guidelines or “go to” strategies so that they know what to do if a nephew or a grandson shows up and pressures them to write a cheque for $10,000. They need to be prepared to say, “I don't know where my chequebook is. Can you come back next week?” Then in the meantime they can remedy the situation.
This education can occur maybe through workshops in libraries or other supports in smaller communities. When someone you're depending on is pressuring you for money, it's really hard to say no, because they will also threaten you with withholding visits or not helping with basic tasks. I'm sure you see this all the time.
We're in a business in which all of our clients have homes, but I don't think this is an issue of whether you have a home or not. If you have a home and you have a lot of equity, there may be many people who are interested in your money, but even if you have very little money, there may still be people who will want your last penny.
I think very practical programs, then, would make most sense.