Thank you. My name is Isobel Mackenzie, and I'm the seniors advocate for the Province of B.C. I was appointed by the government in March 2014. My office has a statutory mandate to monitor services to seniors in five key areas, including income, so I would like to thank the committee for inviting my office to provide our perspective on some matters that should be considered to address income security for seniors.
I recognize that the committee has heard from many of my colleagues at various levels of government and academia on the demographic projections, annual expenditures, and other technical and statistical information related to seniors, so I won't repeat those in the interests of time.
Income security for seniors means the ability to provide for all of life's necessities. I think we would all agree that only once this threshold has been met can we really talk about dignified aging and the quality of life. The challenge facing the federal government is how to ensure that all Canadians are guaranteed to achieve this threshold of income security, given the differences in costs across Canada for two of the most basic necessities, housing and health care.
As you have heard, the median personal income for a Canadian over the age of 65 is $26,000 a year. This tells us that at least 50% of Canadian seniors rely on OAS and CPP, with 30% adding in the GIS, to form a significant part of their retirement income. While these income supports are federally controlled, the expenses against the income are provincially controlled. Creating equality, therefore, is not just a function of income, the federal responsibility, but also controlling expenses, a provincial responsibility. If our goal is income security for a Canadian senior living in Vancouver to match that of a senior living in Charlottetown, we need to look at a more complex approach than just relying on universal income supports.
Health care costs are not something that figure into the budgets of most Canadians. We pay our taxes and we have the comfort of knowing that we don't need to bring our chequebook when we visit the doctor or the hospital, which is how most of us view health care. However, as we age, and as has been referenced by my predecessors, health care actually becomes a cost for many people. It can often exceed the cost of food and sometimes shelter. This is because as we age, help that was seen as a luxury when we were younger—someone to clean our house, cook our meals, cut our lawn—becomes a necessity as frailty and chronic disease impede our ability to engage in the independent activities of daily living without assistance.
Many types of the quote-unquote health care we need as we age are not covered by the Canada Health Act, so provinces are very different in what they provide. Hearing aids, walkers, eyeglasses, dentures, supplies for incontinence, nutritional supplements, help with bathing and keeping the house clean—none of this is covered through any federal program. Some provinces provide partial coverage for such things as mobility aids. Some provinces provide free housekeeping. Some provide dental care. Others provide nothing. No one provides it all.
Further complicating matters are those seniors who are covered by a benefits plan that they have either purchased or received as part of their workplace retirement benefits. My office recently surveyed B.C. seniors on this aspect, and we found that 65% of low-income seniors, or households under $30,000, had no supplemental benefits coverage. Paradoxically, our research showed that the higher your income, the more likely you were to be covered by the benefits plan and more able to pay.
To highlight the disparities, I'll use a bicoastal comparison of two 85-year-old single seniors, Margaret and Helen. They're both of sound mind. However, they have some frailty and require daily help in the morning to get up, washed, dressed, and check on their medications. They both have an annual income of $26,000 a year.
The one-bedroom apartment that Margaret rents in Charlottetown costs $696 a month, so she pays $8,300 a year in rent. In P.E.I. there's no copayment for her daily home support. The program includes housekeeping. In addition, Margaret worked for 15 years in the bank after her children left home, so she has a very small but indexed pension, ensuring that her $26,000 income will remain constant in real terms. She also has employer-paid retirement benefits covering her dental and extended health costs.
Now, compare Margaret with Helen, who lives in Vancouver. Helen rents her one-bedroom apartment for $1,054 a month and receives a shelter grant under SAFER, or shelter aid for elderly renters, of $90 a month.
This leaves Helen paying $11,500 a year in rent. In B.C., there's a copayment for her home support. Based on Helen's income, it's $12 a day, or $4,300 a year, for her daily home support, but in B.C. it doesn't include housekeeping. Currently, Helen's neighbour helps her with housecleaning, but she'll be moving soon, and Helen will need to hire someone.
Helen worked most of her life as a bookkeeper for small companies, so she has no company pension or benefits, just the RSP that she converted to a RRIF, which will be depleted at age 90. Then her income will drop by $5,000 a year. Helen pays about $2,000 a year for her dental and extended health benefits.
The result is that after rent and basic health care costs, these two Canadian seniors are left with vastly different incomes. In Charlottetown, Margaret has $16,600, or $1,400 a month, for all her other needs. Helen has $8,300, or $677 a month, for groceries, transportation, cable, clothing, haircuts, etc.
They are the same age and have the same income, same health care needs, same size of apartment, same citizenship, yet one is left with twice the income of the other after paying for very basic needs.
If the concomitant goals are income security and equality for all Canadian seniors, it will require that the federal government examine mandating standards for health care coverage among provinces and tackle the issue of vastly different housing costs for renters, in addition to the fluctuating incomes for seniors who are not covered by indexed workplace pensions or benefit plans. These are the very types of issues that need to be addressed in a national seniors strategy, and indeed the reason we need one. Hopefully, equality of access to health care and housing for all Canadian seniors will be at the forefront of deliberations.
Thank you for your time.