Mr. Speaker, I would like to thank the hon. member for raising this issue in the House today. My colleague, like every member in the House, cares deeply about seniors and seniors' issues, especially the issues faced by seniors living in low income situations.
I would like to take this opportunity to discuss this government's actions with respect to seniors' issues, and we welcome any input from the opposition.
The good news is that Canada has one of the lowest poverty rates among seniors in the world. In fact, most Canadian seniors enjoy a high standard of living. Since 1980, the level of low income among Canadian seniors has dropped from just over 21% to about 6%, yet even this remarkable achievement leaves too many Canadian seniors living below the poverty line.
That is why this government continues to make the needs of low income seniors a priority, and that is why I welcome the opportunity to address the motion before the House today.
The motion proposes that the government review the old age security program with a view to achieving four main objectives. I would like to address each of these now.
First, the motion proposes that the government reduce operational costs in the old age security program by ceasing to pay benefits that subsequently have to be repaid.
Second, it proposes that any savings from these measures should then be allocated first to beneficiaries of the guaranteed income supplement, or the GIS, specifically elderly, single, divorced or widowed individuals.
It is exceedingly rare that the old age security program pays out a benefit that must later be repaid. Most of the overpayments result from errors in statements of income or a late notification of changes in marital status or death. Overpayments occur in less than one-third of 1% of all files and amount to about 1% of total benefits paid out annually.
Our government is working to eliminate even these rare instances of overpayment. Service Canada is working with the provinces to collect vital statistics in a more efficient and timely manner to eliminate the overpayments that occur due to late notifications of death or a change in marital status.
As a result of the government's successful modernization of this important program, the first two sections of this motion are unnecessary. In the very near future the savings to be made from overpayments will amount to mere fractions of pennies for each recipient.
The third provision calls on the government to improve GIS benefits for elderly, single, divorced and widowed individuals.
Under this government all seniors, including those groups mentioned in this motion, are receiving hundreds of more dollars in guaranteed income supplement and old age security benefits than under the previous Liberal government.
In fact, since we took office two years ago we have overseen two increases to the GIS.
Effective January 2006, we raised the GIS by 3.5% and we did again in January 2007. These measures are providing all single recipients with an additional $430 per year and $700 more per year per couple.
These increases will raise the total guaranteed income supplement benefit by more than $2.7 billion over the next five years and benefit more than 1.6 million GIS recipients, including more than 50,000 seniors who were not eligible under previous Liberal governments.
The fourth provision in the motion proposes to exempt 15 hours per week of earned income at minimum wage in the recipient's province of residence without penalty.
Given the range of minimum wage rates across the country, the income exemption would vary from just under $6,000 in Nova Scotia to just over $6,000 in Nunavut. Such a measure would raise serious equity concerns as seniors would receive different benefits depending on their province of residence.
The GIS is an important resource for low income seniors. It was never intended to supplement an individual's income. Rather, it was and is intended to ensure every pensioner has enough income from all sources, including the GIS, to maintain and improve the standard of living of Canada's seniors.
That said, we currently have an earned income exemption for GIS recipients of 20% of earned income above and beyond any benefits received from the government. This exemption is capped at $500, which is reached with an income of $2,500 per year.
Providing additional assistance to older workers and to seniors wishing to re-enter the workforce is a worthy goal, especially given the labour shortages that exist in so many sectors where seniors are likely to take a part time job. Let us examine the proposed solution for a few moments.
Recent statistics show that only about 4% of guaranteed income supplement recipients have earned income above and beyond the benefits provided to them. Many of those who have decided to enter the workforce have done so for personal reasons that are not financial, for example, to maintain social connections, to continue contributing to the community, to stay active, or just to be out of the house.
Then there are the real considerations. If all of these seniors were to take advantage of the 15-hour exemption, this would cost the GIS program almost a quarter billion dollars each year. This figure assumes no additional seniors would choose to enter the labour market. This translates into a large cost to taxpayers to benefit a very tiny percentage of seniors, and the seniors who could benefit are not likely to be the seniors most in need of additional assistance.
The government is committed to the financial well-being of Canadian seniors, especially those with low incomes. This is why we have done more for seniors in 24 months than the previous Liberal government did in 13 years.
We made it easier for seniors to apply for Canada pension and old age security benefits through the passage of Bill C-36.
We have reduced combined income taxes by allowing senior couples to split their pension income.
We have reduced the GST twice, which is often the only tax that low income seniors pay.
We have created the National Seniors Council to advise the government on matters related to seniors' well-being and quality of life.
We have committed $10 million to combat elder abuse through public awareness and education and upgrading of community buildings and equipment used by seniors.
We have also budgeted an additional $10 million per year to the new horizons for seniors program to encourage seniors to contribute to their communities.
As I said before, this government is serious about improving support for all seniors. That is why we have examined the provisions of this motion with particular attention.
Again, we thank the member for her concern for seniors. However, it is clear that despite its good intentions, the motion does not do what low income seniors might expect. It does not provide substantial and effective assistance of any kind to seniors, which this government has offered in the past and will continue to offer in the future.
For these reasons, I oppose the motion and urge all members of the House to join me in doing so.