The Canadian government will increase the Old Age Pension (OAS) starting next week, a move the feds say will be the first permanent pension increase in almost 50 years.
The initiative would result in a permanent 10 percent increase in OAS for seniors 75 and older.
A statement released by the federal government on Thursday said that, apart from adjustments for inflation, it would be the first permanent pension increase since 1973.
The federal Liberals mentioned the 10 percent OAS increase in their platform and later included the measure in the 2021 budget.
But the commitment dates back to the 2019 federal election, when Prime Minister Justin Trudeau made the announcement on the campaign trail.
“The permanent increase in the OAS pension will help provide older adults with greater financial security now and in the future,” Seniors Minister Kamal Khera said in the federal government’s statement Thursday.
“Younger seniors – and all Canadians – can enjoy greater peace of mind as they plan their retirement finances, knowing they’ll be able to count on more support from the OAS pension in their later years.”
The OAS pension is paid monthly to seniors 65 and older in Canada.
Full pensioners can expect to receive more than $800 in extra funds in the first year, the federal government said in a statement, with 3.3 million seniors benefiting.
The federal government offered a one-time payment of $500 in August 2021 to OAS-eligible seniors. This was also part of last year’s budget.
The increase comes after Canada’s inflation rate rose 8.1 per cent in June from a year earlier, making it the largest annual increase since January 1983.
Anthony Quinn, chief community officer for the Canadian Association of Retired Persons (CARP), told CTVNews.ca in a phone interview Friday that while the OAS increase is welcome, a 10-year group of adults between the ages of 65 and 75 still is still released.
“We’re glad the government is looking at OAS, but they’re missing out on a lot of older people who are in need,” Quinn said.
In May 2021, CARP, along with the National Association of Federal Retirees and Réseau FADOQ, called on the Trudeau government to increase OAS benefits by 10 percent for all eligible seniors, not just those 75 and older.
“This measure discriminates on the basis of age and risks setting a dangerous precedent by creating two classes of seniors,” the three organizations said in a statement.
Quinn said that although the OAS is reviewed quarterly and measured against the Consumer Price Index, what CARP members are telling him is that the indexation does not match the reality they experience when it comes to the cost of food, transportation , shelter and healthcare.
“Not just during the most immediate inflationary period, but overall those costs are going up, and seniors haven’t seen that reflected in the OAS indexation,” Quinn said.
With files from The Canadian Press
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