Mr. Speaker, I am very pleased to have an opportunity to speak on Bill C-54, an act to amend the Old Age Security Act, the Canada Pension Plan, the Children's Special Allowances Act and the Unemployment Insurance Act.
When I first had the chance to review the amendments contained in this bill it was immediately apparent that a good deal of time and effort have gone into determining ways in which the application rules for income security benefits could be made more flexible.
It is obvious that clients have complained about some of the application requirements and certain restrictions in the current legislation. Undoubtedly each of these requirements or restrictions had a reason for being at the time they were introduced. However, by listening to the public the government has found ways in which both the client and the integrity of the programs can both be well served.
I am pleased to have the opportunity to highlight some of the amendments where this is most obvious. Under the Old Age Security Act the 60 to 64-year old spouse of a low income old age security pensioner can, on application, receive the spouse's allowance benefit. Also eligible for this income tested benefit are low-income widowed persons in the same age group.
The only requirement for the spouse's allowance apart from age and income is that the younger spouse must have lived in Canada for a minimum of 10 years after age 18. Because residence is a qualifier for the spouse's allowance benefit, applicants for the allowance provide a history of their residence in Canada after age 18 and up to age 60.
When spouse's allowance recipients turn age 65 they become eligible for the old age security pension in their own right. However, the amount of their old age security pension is dependent on the total number of years they have lived in Canada after age 18. For those who were in Canada prior to July 1, 1976, 10 years of residence in Canada immediately prior to age 65 entitles them to payment of the full pension.
For those who came to Canada after July 1, 1976 the amount of their pension is equal to one-fortieth for each year they resided in Canada after age 18.
For the most part the administration knows from the information provided on the spouses allowance application combined with the payment history of the spouses allowance how many years of residence the client has at age 65. Therefore it is possible to calculate the old age security pension entitlement without going back to the client.
Currently, however, the client is required to apply for the basic old age security pension and to provide the administration with much of the same information and documentation that the individual provided with his or her spouses allowance application.
Given that in the majority of cases the administration already has the spouses allowance recipient's residence history in Canada the requirement that this individual apply for old age security is unnecessary.
Therefore I am pleased to see that this bill proposes to give the Minister of Human Resources Development discretion to deem an old age security application to have been made by the 64-year old recipient of spouse's allowance. In addition, given that the administration already has the income information it requires the income tested guaranteed income supplement form will also not be required for the remainder of the GIS payment year.
Approximately 20,000 recipients of the spouse's allowance turn 65 each year. As the majority of these clients have lived in Canada for the required number of years to receive a full old age security benefit, this amendment will benefit a great many people.
This automatic conversion from spouse's allowance to old age security is not a new concept. Currently under the Canada pension plan 64-year old disability recipients do not have to apply for their retirement pension to commence at age 65.
A Canada pension plan retirement application is deemed to have been received because the administration already has the information necessary to put a retirement pension into play.
I am pleased that we are now offering the same quality service to 64-year old spouse's allowance recipients.
Another provision of the Canada pension plan is also being mirrored in the amendment in this bill which recognizes that some individuals because of incapacity are unable to apply for their old age security benefits on time. Specifically, the minister will be able to deem an application to have been received earlier than it actually was received if the lateness is due to incapacity.
Benefit entitlement to the basic old age security pension and the income tested guaranteed income supplement and spouse's allowance is contingent on an application being made for these benefits.
If this bill becomes law retroactivity for all of these benefits will be a consistent 12 months. Therefore anyone applying more than 12 months after the first month in which they could have received benefits loses some benefits.
For the most part a limited period of retroactivity is considered fair.
Individuals have a certain responsibility to come forward in a timely manner to receive their correct benefit entitlement. However, there are cases in which the individual is mentally or physically incapacitated and this incapacity renders them incapable of making an application. Unless these individuals are fortunate enough to have someone who realizes that application can be made on behalf of such an incapacitated person, benefit entitlement can be lost.
The amendments in this bill would allow the minister to deem an application to have been made by or on behalf of an applicant. This would only apply if the applicant were at the time of application incapable of forming or expressing an intention to make an application.
As I noted earlier, the Canada pension plan already has such a provision and this important protection is now being proposed for old age security clients as well.
Another very interesting amendment contained in this bill would allow old age security pensioners to cancel their benefit entitlement. On the face of it one wonders why such an amendment is necessary. Surely if someone does not want the benefit all they have to do is not apply. For the small number of individuals who do not want to receive the old age security pension the majority do not make application. However, in some cases it is only after becoming a pensioner that an individual decides that he or she no longer wants to receive the old age security benefit. The current legislation, because it does not provide for benefit cancellation, cannot accede to these requests.
As I am sure most people will agree, someone should not be forced to take the application they do not want. Therefore this bill would allow individuals to cancel their benefit. However, recognizing that circumstances can change, the bill will also make provision for a cancelled benefit to be reinstated if the pensioner should subsequently change his or her mind. The reinstatement would be effective the month following the month the request for reinstatement was made. A pensioner would be reinstated on the same calculation of residence that had been used when application for the old age security pension was first made.
A very similar type of amendment is also being made to the Canada pension plan. Currently the Canada pension plan allows for an assignment of retirement pensions between spouses in an ongoing relationship. A Canada pension plan retirement beneficiary whose spouse is over 60 and receiving any retirement benefits he or she is entitled to under either the Canada or Quebec pension plans can apply for and receive a share of the retirement benefits they both earned during the course of the marriage.
The legislation currently provides that the assignment ceases on the death of either spouse, on the twelfth month following the month the couple separates, the month the non-contributing spouse becomes a contributor or the month a divorce or annulment of marriage is finalized. Therefore, even though pension assignment is done at the request of the couple, the couple who remains together cannot cancel the assignment.
While the administration has received very few requests for a pension assignment to be cancelled, there is absolutely no good reason this should not be allowed. Therefore, I am pleased that this bill provides for cancellation at the written request of both spouses.
This type of amendment emphasizes that the government is listening to what clients want and what they have every right to expect.
The last amendment I want to deal with is another obvious example of listening to the desires of clients. As I am sure we are all aware, the Canada pension plan was amended in 1977 to provide for a division of pension credits between spouses should the marriage end in divorce or annulment. While these provisions have been extended and improved over the years, the amendment I want to talk about has to do with limitations that only existed up until 1987.
Specifically because the administration had no experience with this type of provision in 1977 the division of pension credits earned by both spouses under the Canada pension plan during the course of the marriage was only allowed if very strict conditions were met. The marriage had to have lasted a minimum of three years. An application for a division of pension credits had to have been made within three years of the divorce or annulment.
This latter requirement was felt necessary so that divorced individuals would have some idea of what their retirement benefits were going to be when they reached retirement age. It was felt at the time that a CPP contributor should not be left in limbo. He or she had a right to know if the pension credits were going to be divided. In this way the individual could better plan for his or her retirement years.
Three years was considered to be long enough after the marriage was over for one of the spouses to make application for a division of pension credits. Unfortunately, what the original legislation did not provide was for an extension of the three-year time limit.
I am pleased to note that there are many divorced couples who hold no animosity toward each other. These individuals still want to ensure that their ex-spouses are treated fairly.
The administration has been approached by couples who were divorced prior to 1987 when the time limit was removed who would still like to have a division of pension credits. Such persons accept the fact that Canada pension plan contributions are a joint family asset to which both spouses contributed equally during the course of their marriage. Even though for the most part only the male partner made CPP contributions or at least consistently contributed to the plan during the course of the marriage, he recognizes that his ex-wife has as much right to these credits as he did.
The people who are coming forward do not want a three-year time limit to prevent them from dividing their pension credits with their ex-spouse. Therefore, an amendment contained in Bill C-54 will allow the three-year time limit to be waived where both spouses request this waiver in writing.
The Canada pension plan is an income security program that truly belongs to its clients. The plan is totally funded by the contributions that employers and their employees make and the investment of any moneys not immediately needed to pay benefits and expenses. Therefore, this plan should definitely listen to the people to whom it belongs and the waiver of the three-year time limit for spouses who divorced prior to 1987 is proof positive that this government is willing to both listen and act on what it hears.
This government has a commitment to improve the way it does business. This bill before us today exemplifies how this commitment can be acted upon.