The Prime Minister signalled in Davos, Switzerland this week that he’s prepared to use the front end of his majority government to tackle long-standing fiscal problems that have left previous governments running in fear.
The most politically challenging will be his effort to put Canada’s “retirement income system” on a sustainable footing. Given that he made clear he was not talking about the Canada Pension Plan, that leaves Old Age Security – an income stream for Canadians 65 and over.
The cost of the program is poised to soar as the baby boom generation retires, which is starting now.
Predictably, this is being labelled an attack on seniors by the opposition parties.
“Now, he’s threatening ... seems to be trying to precondition us to cuts to the OAS, which is there to help the lowest income Canadians,” charged Mr. Brison. “At a time when other global leaders at Davos are addressing income inequality not only is Harper ignoring it he’s threatening to make it worse.”
Mr. Brison asserted the OAS is “very important for low income seniors and one of the reasons why Canada is successful economically is because we are progressive socially and we help vulnerable people.”
“If Harper is hinting that he intends to cut benefits for low income seniors we will fight that every step of the way,” he said.
Mr. Julian suggested Mr. Harper is hinting that seniors would have to work two more years - until they are 67 - to qualify for OAS.
In addition, Mr. Julian remarked on the timing of Mr. Harper’s remarks, saying it’s “odd to hear a Prime Minister speaking to the world’s billionaires in Switzerland and talking about transformative change to our pension system even before holding that discussion here in Canada.”
If this is indeed Harper's intention, he's taking the bull by the horns by tackling what will probably be the most explosive aspect of pension reform. Should he be able to pull this off, whatever else he attempts on pension reform may be an easier sell.
There is one positive outcome to this proposed reform that I haven't seen expressed anywhere. It is that by making Canadians wait 2 extra years before drawing the OAS payment, it will make them pause and start to think about planning for their retirement. I believe that in itself would be beneficial in the long term.