Thank you, Mr. Chair.
Good afternoon.
Clause 156 amends the Old Age Security Act to enhance the guaranteed income supplement earnings exemption.
The guaranteed income supplement, or GIS, is a benefit paid to low-income seniors in addition to the old age security pension. The GIS is based on income to ensure that benefits are targeted to those most in need. The GIS earnings exemption currently allows low-income seniors to earn up to $3,500 per year in employment income without a reduction to their GIS. Income from self-employment does not currently qualify for the exemption.
The proposed amendments would increase the GIS earnings exemption from $3,500 to $5,000, extend the earnings exemption to self-employment income and provide an additional 50% exemption on up to $10,000 of employment or self-employment income beyond the $5,000 exemption.
This enhanced exemption would apply starting July 2020.
An estimated 330,000 low-income seniors would receive an increase in their benefits. The annual cost would amount to more than $460 million.
The average benefit increase for low-income seniors who are in the labour market is estimated at $1,400 a year.