Thank you very much.
CARP is a national, non-profit, non-partisan association. We have 350,000 members in 50 chapters across the country. We advocate for public policy changes that will improve our quality of life as all Canadians age. A top priority for us, of course, is our retirement security.
Canadians spend their working years building towards a secure and dignified retirement. As Canadians age, they want to provide for themselves and their families and to stay in their own homes as long as possible. For too many Canadians, this is a challenge they cannot meet alone. Government has a role to play. This was recognized in recent federal policy changes that top up the GIS to help the poorest seniors. The caregiver tax credit is certainly an important improvement in support for the estimated 2.7 million Canadians caring for loved ones at home. With regard to the pension reform proposals, we expect government leadership to help Canadians better save for their own retirement.
Nonetheless, we believe that each of these policy changes can be improved. The massive losses in retirement savings caused by the recession and concerns over the sustainability of the health care system require further government action to help Canadians help themselves to save for and maintain their standards of living in retirement, and to look after their own health and well-being in dignity. CARP therefore recommends the federal government target three major issues regarding retirement security.
The economic downturn has exacerbated fears of outliving our money. Hard-earned retirement savings have already been eroded in the market crash, and mandated RRIF withdrawals limit participation in the modest recovery. Claw-back rules punish those who try to help themselves, especially the most disadvantaged.
Income inequality in Canada has increased over the past 20 years. A recent Conference Board of Canada report on poverty identified seniors, especially women, as the most at risk of living in poverty. Between 2006 and 2009, nearly 128,000 more seniors became low-income. Of that number, an overwhelming 70% are women. Exacerbating the problems of single seniors is the fact that the OAS allowance for people aged 60 to 64 is not available to those who are single, divorced, separated, or married to someone who is not yet 65. Further, Statistics Canada reports that an astounding almost 160,000 eligible Canadians over 65 are not receiving their GIS. Effectively, almost 12% of those eligible are not receiving their GIS payments due in large part to the complexity of the process. We recommend auto-enrollment as a possible solution to that problem.
We recommend a comprehensive readjustment of tax and income support policies to facilitate and remove barriers to retirement security, including getting rid of the mandated RRIF withdrawals, certain OAS claw-back rules, improving the GIS eligibility rules, and providing an equivalent-to-spouse allowance for single seniors.
The second focus we have is on the retirement savings gap. Millions of Canadians without a workplace pension need access to a universally accessible and affordable retirement savings vehicle that will provide a reliable and adequate retirement income. A proposed pooled registered pension plan, PRPP, acknowledges that need and improves on the status quo but lacks important safeguards that will ensure an adequate retirement income. There is time and opportunity for us to learn from the negative experience of a similar system in Australia, and the positive example of the CPP.
CARP recommends that safeguards be implemented for the PRPPs, such as fee caps, and further consideration be given to providing target or defined benefits, such as through a supplementary CPP or a public option PRPP, to ensure Canadians have the best possible options to provide adequately for their own retirement.
Finally, I am in full support of the recommendations for providing a better aging-at-home strategy across Canada. We were pleased to provide our submission to the health committee last Monday. The one point I want to leave you with about home care, because it has been well covered, is that it presents a potential positive opportunity to divert a massive amount of demand on the health care system if we do home care properly.
Thank you very much.