Good afternoon. Thank you, Mr. Chair, and thank you for the opportunity to present CARP's pre-budget recommendations.
My name is Janet Gray. I am the chair of Ottawa's CARP chapter, one of the 60 chapters across Canada. CARP, for those of you who aren't aware, is a national, non-profit, non-partisan organization with 300,000 members.
Retirement security and health care are the top priorities for our members. However, retirement income insecurity, even poverty, is a reality for many older Canadians, despite working hard and contributing to the country throughout their working lives.
In the past 20 years, the poverty rate among seniors has tripled from 4% to 12%—between 1995 and 2012. This is worse for single seniors, especially single older women. Eighteen percent of single women over 65 live in poverty with incomes under $20,000 per year, and a critical mass lives well below the cut-off. Over 30% of single women between 45 and 64 are also low income, and 70% of them are part-time workers and 66% are minimum wage earners.
The combination of OAS and GIS is a determining factor in keeping older Canadians out of poverty, especially for single seniors, but it does not close the poverty gap entirely. There is a significant gap that needs to be bridged between the low-income measure and the current OAS and GIS benefits, a gap that is unlikely to be filled by savings and private pensions.
Therefore, CARP recommends the government restore the OAS eligibility back to age 65, increase the GIS especially for single, low-income seniors, increase the OAS and GIS to bridge the poverty gap, and introduce the seniors index tied to wage rates. Together these measures will help to prevent poverty in old age for all Canadians.
The retirement landscape has changed. Canadians are faced with financial challenges, disappearing workplace pensions, and uncertain economic times. Two-thirds of working Canadians, 12 million people, do not have workplace pension plans, and Canadians are increasingly unable to save sufficiently for their own retirement. The CPP currently provides Canadians, on average, only $7,000 in benefits annually. It replaces 25% of earnings up to $51,100, but falls short of the 70% of pre-retirement income needed for retirement. The government has an opportunity to help Canadians save better for their retirement.
CARP recommends the government fulfill its promise to work with the provinces to enhance the CPP, but a modest increase to CPP alone will not cover the 70% replacement income needed for retirement. Therefore, CARP also recommends a supplementary universal pension plan that would work like the CPP with mandatory enrolment, independent of government or single employers, using the existing payroll deduction mechanism, employing professional management, and focusing entirely on optimal performance.
Canadians expect the health care system to deliver appropriate care that is comprehensive and responsive to their needs across the full health care spectrum, from acute care to chronic care to end-of-life care. However, the health care system falls short of Canadians' expectations and needs.
One in four Canadians, just over eight million, provide care to a chronically ill or disabled loved one. They face various challenges including loss of income, caregiving and medical expenses, mental and emotional distress, and health decline. Three-quarters of caregivers provide care to a person aged 65 or older. As the population ages, more Canadians will become caregivers.
Home care is fragmented across the country. Often the programs are unavailable and national standards of care and access do not exist, creating wide variances in the amount, quality, and access to care between provinces and sometimes even within a province. On average, a person aged 65 or older uses six prescription drugs that can cost, out of pocket, thousands of dollars annually. Prescription drugs are necessary treatments to prevent deterioration, even death, but at present, they are an insurmountable financial burden for many Canadians.
CARP calls for a system-wide transformation of the health care system in which patient needs are prioritized, national standards of quality care exist, and timely access is available regardless of postal code.
As a first step, we recommend the government make the federal caregiver tax credit refundable to benefit those with modest or no taxable income, invest the promised $3 billion in home care, create national standards of care and access, and establish a national pharmacare plan that ensures accessible and affordable drugs.
The federal government identified retirement security and health care as priorities during the recent election. The 2016 budget is an opportunity for the government to fulfill its promises to Canadians, create a clear pathway to retirement income security, and transform health care for all Canadians.
Thank you.