Grey Power 41 — April 17, 2014

John
John Fryters
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On April 11, 2014, Finance Minister Jim Flaherty presented the 2014 Federal Budget.  While the initial reaction by opposition politicians and newspaper columnists (yes, newspaper columnists) was not positive (in fact some journalists called the budget “boring”), a closer look shows a different picture, particularly as it relates to the best interest of seniors today. 

This was strengthened by some political commentators by stating that the budget paid “too much attention” to the elderly rather than to the young people in this country.

Obviously, understanding the “flavour” of this Grey Power column (providing information for and about seniors), I simply could not ignore the good news.

On the other hand, another objective of Grey Power is to be somewhat of an advocacy tool for seniors.  Consequently, we are going to study the implications of this positive budget for seniors while, at the same time, we keep up the pressure....  Continue to speak to your political representatives (Randy Hoback, MP Prince Albert) and to anyone else who will listen. 

The growing elderly population can no longer be ignored, will be a powerful voting block in the next elections to come, and one budget is not going to address all the needs of senior citizens in this country.  Multiple budgets, attached to some careful and long-term strategic planning, with the direct input of seniors, will!!!

Our member of Parliament, Randy Hoback, provided us with very detailed excerpts out of Flaherty's 2014 Budget, and we will have the opportunity to look at many of those this week and next week.  Here is Part One of some of the highlights :

“We`ve reduced the federal deficit from approximately $37 billion in 2008 to $2.9 billion today.  Next year not only will we have a balanced budget, we'll have a surplus for sure -- and we've done that without cutting transfer payments to the provinces or without gutting our health care system.

 

Provincial Health and Social Transfer Increases

The overall increase in health and social transfers gives the provinces a greater ability to fund seniors` services and health care services.

 

Enhancing the New Horizons for Seniors Program

The Economic Action Plan 2014 proposes to increase funding for the New Horizons for Seniors Program by an additional $5 million per year.  The Government of Canada recognizes the important role community partners play in supporting seniors and building age-friendly communities. 

Through the New Horizons for Seniors Program, the Government provides funding to organizations that raise awareness of elder abuse and help ensure seniors can benefit from, and contribute to, the quality of life in their communities through active living and participation in social activities.

Economic Action Plan 2014 proposes to provide an additional $5 million annually to the New Horizons for Seniors Program. This funding can support municipalities, not-for-profits, social enterprises and other community partners to address the needs of seniors.

 

Supporting Caregivers as Labour Force Participants

The government is announcing that it will launch a Canadian Employers for Caregivers Plan to help maximize caregivers' labour market participation. The Government of Canada understands the sacrifice many Canadians make to care for their family members and the impact this has on both working caregivers and their employers.

The government will launch a Canadian Employers for Caregivers Plan to engage with employers on cost-effective workplace solutions to help maximize caregivers' labour market participation.

The plan will include the creation of an employer panel that would identify promising workplace practices that support caregivers.  Details will be announced by the Minister of State (Seniors) over the coming months.

 

Major Transfers to Persons

Major transfers to persons increase steadily over the forecast horizon, with spending expected to increase from $72.0 billion in 2013-14 to $88.3 billion in 2018-19.

 

Major transfers to persons consist of elderly, EI and children's benefits. Elderly benefits are comprised of Old Age Security, Guaranteed Income Supplement and Allowance payments to qualifying seniors, with Old Age Security payments representing approximately 75 per cent of these expenditures.  Elderly benefits are projected to grow from $41.8 billion in 2013-14 to $54.1 billion in 2018-19, or approximately 5.3 per cent per year - faster than nominal GDP, which is projected to grow on average by 4.3 per cent per year. This increase is due to consumer price inflation, to which benefits are fully indexed, and a projected increase in the seniors' population from 5.4 million in 2013-14 to 6.4 million in 2018-19, an average increase of 3.5 per cent per year.

 

Powers of Attorney

Some seniors may ask for help in managing their banking affairs and put arrangements in place for a power of attorney or joint account. In relying on others, seniors are more vulnerable to financial abuse if the power of attorney or joint account is not set up with care. 

As banks are often seen by seniors as a trusted authority, it is important to ensure that banks have appropriate and adequate processes and procedures for advising on these matters. The Government will require enhanced disclosure by banks on the costs and benefits of using powers of attorney or joint accounts and more robust bank processes and staff training.

 

Keeping Taxes Low for Seniors

Under the government's long-term agenda to keep taxes low, significant broad-based action has been taken to reduce taxes on savings, and to reduce taxes for all Canadians. 

For instance, the government has provided about $2.8 billion in additional annual targeted tax relief for seniors and pensioners by increasing the Age Credit amount by $2,000, doubling the Pension Income Credit amount to $2,000, raising from 69 to 71 the age limit for maturing savings in Registered Pension Plans and Registered Retirement Savings Plans (RRSPs) and introducing pension income splitting.

The government's actions to reduce the tax burden are leaving more hard-earned dollars in the pockets of seniors.   As a result of actions taken to date by the government, seniors and pensioners are receiving about $2.8 billion in additional annual targeted tax relief.  In particular, since 2006 the Government has:

• Increased the age credit amount by $2,000-$1,000 in 2006 and $1,000 in 2009.

• Doubled the maximum amount of income eligible for the Pension Income Credit to $2,000.

• Increased the age limit for maturing pensions and Registered Retirement Savings Plans to 71 from 69 years of age.

• Introduced pension income splitting.

In 2014, a single senior can earn at least $20,054 and a senior couple at least $40,108 before paying federal income tax.

Next week, we look at an additional number of tax initiatives by the Harper government.  And as stated above, keep up the pressure.  Grey Power is only starting ...

 

John Fryters is a 65-year-old senior citizen who wants to assist anyone in his peer group with information for and about seniors.  He can be reached at john_fryters@yahoo.com

Organizations: Grey Power, Old Age Security, Registered Retirement Savings Plans

Geographic location: New Horizons, Canada

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