Thursday’s federal budget calls for a gradual increase to the age of eligibility for Old Age Security and Guaranteed Income Supplement benefits, going from 65 to 67.
Okanagan Coquihalla MP Dan Albas said in the 1950s when Old Age Security was first proposed, there was about seven working taxpayers for every one person collecting it.
“Today we only have four working taxpayers for every one person collecting and in 18 years that is going to reduce in half again to two,” said Albas.
The gradual introduction to the increase in the age of eligibility will start in April 2023, with full implementation by January 2029. It will not affect anyone who is 54 years of age or older as of March 31, 2012.
“We want to make sure first of all, Canadians who are receiving the benefits know they are going to continue receiving them and they aren’t going to lose a dime towards this change,” said Albas. “Our population will continue to get older, and so by sending out those signals to people that there are changes coming but they have significant enough time to make changes in their behaviour, that is appropriate.”
Another change to the benefits is allowing Canadians the option of deferring their OAS benefits to a later time. Should a person at retirement age decide to keep working, their benefits will actually increase when they finally do decide to retire. Starting on July 1, 2013, the government will allow for the voluntary deferral of the OAS pension for up to five years.
“In the Okanagan where we have many retirees who still continue to work, this will offer them that flexibility, so I’m happy to see that change,” said Albas.
Albas said Budget 2012 is about jobs, growth and long-term prosperity. Overall spending in this budget will be reduced by $5.2 billion. One effort to reduce spending includes the government’s plan to eliminate the penny, which actually costs taxpayers about a 1.5 cents to produce.
“We all know that many times pennies end up in some recess of your couch. We want to make sure we are being responsible to the taxpayer and making it easier to conduct business,” said Albas.
The government has also made changes that will affect Canadians who cross-border shop. Starting in June, Canadians who travel to the United States for 24 hours or more can bring back $200 worth of goods without paying tax or duty — this is up from the current $50 allowed. Those who travel to the United States for 48 hours or more will see that limit double from $400 to $800.