431-00299 (Social affairs and equality)

The Old Age Security (OAS) program is the first pillar of Canada’s retirement income system. The benefits under the OAS program include the OAS pension, which is paid to all persons aged 65 or over who meet the residence requirements, the Guaranteed Income Supplement (GIS) for low-income seniors, and the Allowances for low-income Canadians aged 60 to 64 who are the spouses or common-law partners of GIS recipients, or who are widows or widowers.

To ensure that they retain their value over time, OAS benefits are reviewed four times per year (in January, April, July and October) in accordance with changes in the Consumer Price Index (CPI). The CPI measures the price of a typical “basket” of goods and services, such as food, shelter, gas and clothing, commonly purchased by Canadian households. The quarterly indexation provides benefit increases to recipients when prices go up. In addition, the Old Age Security Act contains a guarantee ensuring that benefits can never go down, even in the event of a decline in the CPI.

The Government of Canada remains committed to improving the income security of seniors and continues to seek ways to strengthen the OAS program, as demonstrated by a broad range of measures taken since 2015:

• Budget 2016 restored the age of eligibility for the OAS pension and the GIS to 65 from 67 years, putting thousands of dollars back in the pockets of future Canadian seniors and preventing an estimated 100,000 future 65 and 66 year olds from falling into poverty.

• In July 2016, the GIS was increased by up to $947 per year for the lowest-income single seniors, benefiting close to 900,000 vulnerable seniors across Canada, and lifting an estimated 57,000 seniors out of poverty.

• In December 2017, the Government launched automatic enrolment to the GIS. This will apply for seniors who are already automatically enrolled for the OAS, meaning they will never have to do an application to get the benefits they are entitled to.

• Budget 2019 enhanced the GIS earnings exemption to further support low-income seniors who wish to work. As of July 2020, the earnings exemption will increase from $3,500 of annual earnings to $5,000, and eligibility has been extended to self-employment income. The enhancement also provides an additional 50% exemption on employment or self-employment income between $5,000 and $15,000. This measure will allow working low- income seniors to keep more of their employment or self-employment income before their GIS benefit is reduced.

• We reached a historic agreement with provinces in 2016 to strengthen the Canada Pension Plan and meaningfully reduce the risk of not saving enough for retirement. It enhanced the Canada Pension Plan’s maximum yearly benefit for future retirees by about 50 per cent. Increased CPP contributions are being slowly phased in over a seven-year period that began in 2019.

• Increased the Basic Personal Amount (BPA) to keep even more money in the pockets of seniors and other Canadians, helping make life more affordable. The BPA is the amount of money Canadians can earn before they have to pay federal income tax. The increase that came into effect on January 1, 2020 is the first step in the Government's proposal to increase the BPA to $15,000 by 2023. Once fully phased in, single individuals would save close to $300 in taxes every year, and families would save nearly $600 annually.

The Government’s COVID-19 Economic Response Plan invested $1.3 billion in a one-time special payment through the GST credit in April 2020. More than 4 million low- and middle-income seniors benefited from this top-up, which provided an average of $375 for low and middle-income single seniors and an average of $510 for low and middle- income senior couples. Eligible seniors did not have to apply for this benefit.

On May 12, the Government introduced a one-time tax-free payment of $300 for seniors eligible for the OAS pension, with an additional tax-free payment of $200 for seniors eligible for the GIS. This measure will provide a total of $500 to low-income seniors who receive both the OAS pension and the GIS. Allowance recipients will also receive $500. This $2.5 billion investment in financial support will help Canadian seniors cover increased costs due to the COVID-19 pandemic.

Altogether, these benefits provided about $1500 to a low-income senior couple.

This payment was issued during the week of July 6. Individuals who were in receipt of the OAS pension or the GIS in June 2020 had the one-time payment paid to their bank account if they were enrolled for direct deposit. Those who are not enrolled for direct deposit received a cheque.

To help protect seniors’ investment assets during a volatile market, the Government reduced the minimum withdrawals required from Registered Retirement Income Funds by 25 percent for 2020.

The deadline for filing 2019 taxes was June 1, 2020. The Government has put additional measures in place to ensure that GIS payments will continue without interruption even if a person's 2019 income information has not been received. This ensures that the most vulnerable seniors will continue to receive their benefits when they need them the most. Over 200,000 seniors benefited from this measure. Seniors are encouraged to submit their 2019 income information as soon as possible and no later than October 1, 2020. Further, the Canada Revenue Agency is working with volunteer organizations across Canada to help seniors with low and middle incomes complete and file their tax returns so they can continue to access benefits and credits to which they are entitled.

As we go through this unprecedented challenge of a global pandemic, our Government will continue to be there for Canadian seniors every step of the way.