Evidence of meeting #61 for Finance in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was transfer.
A recording is available from Parliament.
Chief, Social policy, Income Security, Department of Finance
We are always looking at all programs and the potential changes in the projected expenditures, so generally, I'd say yes.
NDP
Wayne Marston NDP Hamilton East—Stoney Creek, ON
Okay, from my point of view, it sounds as if this was a move that had been in the works for a period of time and was added to the budget.
It's still quite troubling. Different methods of analysis may or may not have been used, and when we try to compare it to the OECD and to the Parliamentary Budget Officer and we can't even find out if those were used by your department, it's quite a struggle to make the ultimate decision that maybe you're right. Maybe the government is right, but we don't know that, and many people in Canada today are calling into question whether there is genuinely a need for this.
I guess ATIP is going to be the only way we'll find out.
Thank you, Madam Chair.
Conservative
Shelly Glover Conservative Saint Boniface, MB
Thank you, Madam Chair.
Thank you for appearing here tonight.
I know that sometimes the questions are difficult ones. I have a specific interest in the proactive enrolment. I'm not sure if you even know this, and that's why I prefaced it. Some of them are tough questions. I'd like to know how many people who are eligible for OAS or GIS didn't get proactively enrolled and would now benefit from our proactive enrolment.
I guess it goes to Ms. Martel. Do you have that kind of information?
Director General, Seniors and Pensions Policy Secretariat, Department of Human Resources and Skills Development
Perhaps I should start before I let my colleague Madame Martel give you that precise information of the gaps and so on, and just explain what proactive enrolment is.
This initiative has two aspects to it. The bill would allow the Minister of HRSD to waive the necessity to submit an application. Right now, seniors have to submit an application. The minister could waive the necessity for an application where we have enough evidence that a Canadian has been in the country for x number of years, those basic requirements of the program. On automatic enrolment, in its first phase, we will be looking at people who are turning 65, who have 40 years of contribution to CPP, and who are actually receiving the Canada Pension. These people will receive a notice about six months before they turn 65 informing them that “Here's the information we have on you. If you do nothing, you will start receiving your OAS benefit.”
Given that we are also offering the possibility of deferring the benefit, seniors about to turn 65 will be able to indicate, “I don't want to receive it right now, I want to wait a little bit, accrue a larger benefit for the future, fully indexed, etc.”
Because these are lifelong benefits, they are expensive to distribute, so you want to be sure you are getting the right amount to the right person at the right time. Where we don't have enough information to satisfy our rigorous integrity standards, we will use the information to pre-fill the application and send it. We estimate that in many cases all that will be required is a signature and sending it back.
We have automatic enrolment and we have streamlined application, if you like. Those two things are called proactive enrolment and they will be done in a gradual fashion. This is new for us. So we will start with a very, very high degree of certainty and we will develop the tools and the information exchange with the Canada Revenue Agency and Citizenship and Immigration Canada. To get the full benefit, you need to have been in the country for 40 years. That's why we use 40 years of contribution to CPP. Other people are eligible for the partial OAS who have lived here less than that. But we want to have the information exchange with the CIC for that purpose.
So there you are. I think I'll leave it at that, and my colleague will answer your question of how many people are not getting it, etc.
Director, Old Age Security Policy, Department of Human Resources and Skills Development
Okay.
We expect that about 52% of new OAS clients turning 65 will benefit from automatic enrolment. In terms of numbers, we're talking about almost 200,000 people per year who will no longer need to fill in an application in order to receive their pension.
Conservative
Shelly Glover Conservative Saint Boniface, MB
Those are the ones who wouldn't have to fill out an application. But what about the ones who may not have been financially literate enough to know that they even had to do an application and were just passing their time, not knowing that they were entitled to a cheque? How many are there of those?
Director, Old Age Security Policy, Department of Human Resources and Skills Development
We don't have a number for that particular group of people, but those who will be automatically enrolled are those people for whom the government has sufficient data available in order to put these people in pay.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Mr. La Salle, it is quite clear that you are walking on eggshells right now, but I would like to reassure you: I don't think you have broken any yet.
I would like to return to a point that Mr. Marston raised. Earlier you talked about one measure, the number of workers required to support a person receiving Old Age Security. Another measure also used by the chief actuary is the program cost based on GDP.
Do you know the difference between what we are currently paying and what we will be paying as a percentage of GDP, of the country's output, by 2030?
Director General, Seniors and Pensions Policy Secretariat, Department of Human Resources and Skills Development
Those figures are in the actuary's ninth report. Ms. Vermaeten has those figures.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
This is important because they indicate the weight of the program relative to what we can afford to pay.
Director General, Seniors and Pensions Policy Secretariat, Department of Human Resources and Skills Development
Yes, indeed.
Director, Task Force, Special Projects, Department of Human Resources and Skills Development
Off the top of my head, and I'll look at my notes to make sure, I think it's increasing. By 2030 it will be 3.14% of GDP, and today I think it's 2.4%. But let me verify that number.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
All right, let's say approximately 2.4% to 3.1%.
Director, Task Force, Special Projects, Department of Human Resources and Skills Development
Pardon?
Director, Task Force, Special Projects, Department of Human Resources and Skills Development
Yes.
Director, Task Force, Special Projects, Department of Human Resources and Skills Development
Exactly.
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Can you tell me what will happen between now and then? I believe the chief actuary has a model that goes up to 2060.
Director General, Seniors and Pensions Policy Secretariat, Department of Human Resources and Skills Development
It goes further than that.
NDP
