People rarely have extra money to spend and this time of year, with holiday shopping and rising heating costs, many people struggle just to make ends meet. No one feels the strain of financial pressure more than our seniors. It is heart-breaking when I hear from seniors who have worked hard all their lives only to find themselves in poverty in their retirement. More often than not I hear from seniors, particularly women, who find themselves in that situation with incomes well below what is needed to live comfortably.
Unfortunately, there have been minimal or no increases to Canada Pension, Old Age Security or Guaranteed Income Supplement. A report which was released recently entitled “Campaign 2000” stated that there was a 25 percent increase in Canadian seniors living in poverty between 2007 and 2008. Now, the Harper Conservatives have made the situation for low-income seniors even worse by penalizing those collecting the Guaranteed Income Supplement if they withdraw a lump-sum from their retirement savings.
The Harper Government, without any consultation with our seniors or other Canadians, or Parliament, changed the rules for withdrawing money from a Registered Retirement Income Fund (RRIF). In May, the Conservative Government decided that anyone who withdrew a lump-sum from a RRIF, had the amount of money withdrawn counted as income for tax purposes. This meant that thousands of seniors could see their Guaranteed Income Supplement benefits reduced or even denied. To make matters worse, seniors would not even know about this claw back until they file their 2010 tax return. In many cases this money was withdrawn for emergencies and maybe even funeral expenses when a loved one passed away.
The issue is particularly important in Newfoundland and Labrador where seniors lose provincial prescription drug coverage if they are not eligible for the Guaranteed Income Supplement.
While the Conservatives have said they are reviewing the measure, the right thing to do would be to scrap it entirely. With poverty among seniors increasing, we should be finding ways to boost pension income for all seniors through the Canada Pension, Old Age Security and Guaranteed Income Supplement. Seniors deserve better than the under-handed tax grabs they get from this Harper government.
Judy M. Foote, MP
Judy M. Foote