Francine Van

— You never really retire, it is an illusion to get you to change jobs without pay for family…you become a babysitter, chauffeur, personal shopper, hairdresser, cleaning lady, etc. etc. …need I go on? Almost forgot ….. amidst all this I am trying to get my photography project off the ground!

— You cannot possibly take all the vitamins recommended for your age, (they will make you smell or give you gas).  Just take the hormones to stay out of jail

— Budget on the anti-aging creams and makeup …when they say too good to be true, they mean it …except get the strong hold hairspray for that spot called the ‘Aruba’ on the top back of your head, it shows now …did you notice!

— When you find yourself repeating a lot, remember when you are not talking to your parents or grandchildren

— When your mom says her lunch was a chocolate bar, it’s ok …she made it to over fifty
 
— Don’t drink all eight glasses of water recommended or you won’t get any sleep

— Exercise your butt, it flattens …hmmmm!
 
— The coffee shops become the place of choice rather than the bars, too much wine and no one picks you up when you fall off the bar stool.
 
And lastly, although I could go on, cancel all those over fifty joke emails, magazine subscriptions, and any reminders that are self-defeating. Denial is a wonderful thing and soon like your parents, you will forget. 

As Mark Twain so accurately put it:  “Against the assault of laughter nothing can stand.”  Shall look forward to your comments so that we can all remember laughing is great medicine to get us through life.

With recent statistics indicating there will be a slowing in the growth of the labour force there are serious concerns that the present pension system will not meet the needs of future retirees. Alarm bells about Canada’s fiscal health have been raised by Kevin Page, the current parliamentary budget officer, who “calculates that the provincial and federal governments’ fiscal structures aren’t sustainable over the long term due to an aging population and current economic trends.” The report presents a troubling financial picture for Canada in the long term if fiscal constraints are not put in place.
(Refer to http://business.financialpost.com/2011/09/29/budget-officer-warns-of-looming-%e2%80%98fiscal-gap%e2%80%99-in-canada)    

That the workforce will have to support a substantial number of older Canadians dependent on CPP benefits is cause for concern since that indicates our current pension system is clearly not sustainable in a fragile economy. A reduced workforce cannot  generate enough economic activity to cope with the pension needs of retirees. In a shrinking economy some seniors will  have to work past retirement age and compete for jobs with younger workers. Hence we have a scenario where many Canadians, whether retired or working, will undoubtedly experience a substantial drop in living standards. As deficits increase government spending will have to be curtailed and everyone, including seniors, will have to pay more taxes.

A pension option put forward during the last federal election by Federal Minister Jim Flaherty’s is a ‘pooled pension plan’. This option, however, has not gained much traction.  (Check this link for full details of the ‘pooled pensions plan: http://www.fin.gc.ca/activty/pubs/pension/prpp-irpac-eng.asp) Minister Flaherty’s model or theory  is not clearly understood or accepted by Canadians. This ‘pooled pension’ option will be controlled by private enterprise and also the banks.  There is concern that there will not be adequate banking and financial regulations in place to administer this type of pension plan. Concerns are driven by the recent economic turbulence that the absence of adequate regulations wrought on economies around the globe. That devastation is attributed mostly to a lack of proper regulations and oversight in the financial industry. It brings to mind the unfortunate situation of what happened to the pension benefits of many Nortel employees in Canada. There should not be a repeat of a Nortel type fiasco. It is also a necessary part of the equation that those in the labour force must earn a living wage to participate in this option. Will future workers have to rely on erratic and unstable income from their private pension plans and/or RRSPs with this ‘pooled pension plan’ option?

At the moment we are witness to storm clouds gathering on the horizon for many European countries and will have to accept that we in Canada are not immune to another economic downturn. Although many governments around the world are struggling to contain their deficits and stabilize their economies there is a strong possibility that most developed countries are about to sink back into a much deeper recession. There will be a  huge wealth gap as our middle class disappears. And if businesses are to survive in the long term proper planning should be in place for an organized transfer of skills and knowledge to younger workers as there will be a massive gap in skills and knowledge as seniors exit the labour force. A fragile economy will undoubtedly impact various services seniors depend on, the most important of which is health care.  And as the volume of our aging population increases we are likely to see the cost of health care services  along with other necessities rise dramatically in an economy that has a shrinking labour force.  Our governments have to recognize that serious economic and social problems will result if this combined challenge of a seniors tsunami and a fragile economy are not addressed in a calm, creative and balanced manner. A long term plan to address this serious challenge is imperative.

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Federal Government links:
a).  Is Canada Ready for an Aging Population?
 http://www.parl.gc.ca/40/2/parlbus/commbus/senate/com-e/agei-e/subsite-e/Aging_Report_Home-e.htm
 
b).  Canada’s Aging Population: Seizing the Opportunity”
http://www.parl.gc.ca/40/2/parlbus/commbus/senate/com-e/agei-e/rep-e/AgingFinalReport-e.pdf

This powerful and very inspiring quote is an accurate and eloquent interpretation of volunteerism.  It captures the essence of civic engagement and can serve to inspire those of us who have become disenchanted with politics and politicians. It emphasizes the idea that volunteering is one of the most selfless acts a person can perform. Volunteering is an act  of tremendous generosity that can have a positive impact on the quality of life of the recipients and also those who volunteer. It is also an act that reflects democracy in action at the simplest level of society.

With the significant increase in the ageing population, it appears that an unlikely opportunity is presenting itself in the area of volunteering. This demographic shift along with the willingness of older citizens to give back to society is a chance for this group to create a better society.  Seniors bring with them a lifetime of knowledge, skills, experience and wisdom that took years to acquire.  Given the continued uncertainty in economies around the globe, the gift of volunteerism by seniors is most welcome especially in this climate of fiscal cuts that are impacting so many deserving community projects. 

For most of us approaching retirement or those who are actually retired it is a time of great transition.  During this period of transition some seniors come to the realization it is critical that they engage in pre-planning before retirement. It is not only a prudent decision but a necessary one to set aside time to examine how to spend one’s retirement.

Retirees who engage in volunteering can enjoy intangible benefits. For example, good feelings for giving back to society and in many cases contributing to a more healthy lifestyle by keeping active both physically and emotionally. Even healthy retirees can be challenged by lack of social interaction, stimulation and loneliness which can lead to depression. Retirees can, and do benefit, from getting involved in various volunteer activities related to cultural, educational, health care or political interests. They can also consider reaching out to the disadvantaged or to charitable organizations, not to mention the growing interest in nature conservation  projects for the environmentally conscious seniors.

There are other compelling reasons for seniors and retirees to engage in volunteer activities as evidenced in research on this topic. In particular, those who have not made concrete plans on how to spend their time during retirement are encouraged to choose volunteerism.  Social isolation can be a serious risk factor to the physical and emotional wellbeing of seniors. As described above, seniors can reap many benefits during this phase of life.  According to results from research on volunteerism and seniors, there is clear evidence that ‘your brain can become sharper and you can live longer’.  These are wonderful benefits to contemplate if you are in good shape emotionally and physically and want to do volunteer work. Refer to this link for information on that study:  http://abcnews.go.com/Health/Healthday/story?id=7540441&page=1

Whether you are a senior of modest or comfortable financial means the act of volunteerism gives you an opportunity to make a generous contribution to your community while realizing great benefits to your own life. Retirees who want to give back to society or are seeking more meaning in their lives should consider volunteering. It is clear that there are compelling reasons to volunteer. The wonderful end result is that volunteerism can be instrumental in making democracy more of a reality in society.

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HERE ARE HELPFUL LINKS TO ENCOURAGE SENIORS TO VOLUNTEER

Recruiting Older Volunteers
http://communitysector.nl.ca/voluntary-sector-resources/volunteer-management/recruiting-older-volunteers

Strengthening the Capacity to Support Healthy Aging
http://www.phac-aspc.gc.ca/seniors-aines/publications/public/healthy-sante/phf-fsp/phf-fsp-04-eng.php

Work and Volunteering
http://www.seniors.gc.ca/s.2.1rchc.1t@.jsp?cat=604&lang=eng&font=0

Of course this was just a parody created especially for April Fools day but the underlying message a viewer got was that seniors’ issues and concerns should be central to the current political debate. For those of you who missed the airing of the spoof you may check this link for the podcast:
http://www.cbc.ca/thecurrent/shift/2011/04/01/new-federal-seniors-party/

While there was much light-hearted banter in this spoof it underscored the fact our politicians need to focus more on seniors’ issues and pension reform. A substantial number in this demographic, especially those without adequate pension incomes, will face significant challenges due to inflation and cost of living increases. Many retirees in this group were unable to purchase a significant amount of RRSPs due to their low earnings during their working lives. They are uncertain as to whether the various election promises on pension reforms will be adequate or sustainable. It is time for politicians to come clean and provide more details on how they plan to keep and fund their promises. The pension reform issue, along with major concerns about adequate health care and housing, are all important issues for this segment of the population that may well motivate and encourage them to go cast their vote.

The platform and promises of the various parties are largely identical. The differences are found in how to achieve what is being promised. Regrettably, but not surprising, information is not forthcoming on how to find the funding needed to realize these promises. This link provides a comparison of how the platforms of the major political parties stack up on ‘retirement security’:  http://www.canadianlabour.ca/news-room/publications/retirment-security-and-2011-federal-election.
(Refer to the links at the end for detailed information on where the political parties stand on various issues.)

As the election campaign is picking up steam our leaders are earnestly selling their plans for existing pensions and also future plans to ensure that future retirees will have pensions on which they can survive. More than ever pensioners on modest incomes are struggling to deal with increased cost of living as that impacts what their monthly ‘basket of goods’ will or will not include. While pensioners are concerned about what our politicians plan to do with CPP, OAS and GIS benefit many are very tuned into challenges faced by all Canadians in this uncertain economy.

We have a lot of shortcomings socially, culturally and economically that need to be addressed by whichever political party is in power. For example, there are challenges such as increased poverty levels, child care needs, homelessness and lack of affordable housing, women’s issues, First Nations issues, health care challenges, relief to caregivers of elders, a shrinking workforce, the environment…. and the list goes on. Yet we also recall that at the height of the recession generous bailouts were readily given to the very sectors of society that created the financial crisis in the first place, i.e. large corporations and the financial industry. Ordinary working people were not given similar consideration.

Pensioners and those about to retire need to become more engaged and better acquainted with the pension reforms being promoted by politicians. As a matter of fact we would be remiss if we don’t include younger workers in this conversation about pension reforms since many don’t have pension plans in place at their workplace. Think carefully about what all politicians are trying to sell with regard to pension reform.

Let us remind our politicians that they must look beyond the wishes or demands of the political lobbyists and corporate elites and instead develop policies to ensure all Canadians can look forward to retire with dignity and not see it as a ticket to the land of poverty!

…………………….

Below are links to individual party websites as well as some related media articles. These are listed alphabetically by political party:

BLOC QUEBECOIS – Gilles Duceppe
PLATFORM ÉLECTORALE  /  ELECTION PLATFORM
http://www.blocquebecois.org/dossiers/campagne-2011/documents/EnoncePolitique-Anglais.pdf
http://www.blocquebecois.org/dossiers/campagne-2011/documents/EnoncePolitique-Web.pdf
Abstract of the Electoral Platform
http://www.blocquebecois.org/fichiers_public/blq-depsyntese-anglo.pdf

CONSERVATIVE – Stephen Harper
PLATFORM 2011 – Here for Canada
http://www.conservative.ca/policy/platform_2011/
What’s the future of the CPP?
http://www.cbc.ca/news/business/taxseason/story/2011/02/22/f-taxseason-cpp-future.html
Tories in denial about pension woes, critics say
http://www.thestar.com/news/canada/article/793751–tories-in-denial-about-pension-woes-critics-say?bn=1

GREEN PARTY – Elizabeth May
Election 2011- Smart Economy, Strong Communities, True Democracy
http://greenparty.ca/
May sees Green future for Canada
http://www.vancouversun.com/technology/sees+Green+future+Canada/4580175/story.html

LIBERAL – Michael Ignatieff
Liberal priorities and where we stand on the issues
http://www.liberal.ca/issues/
Liberals push Big CPP as retirement saviour over Tories’ Pooled RPPs
http://opinion.financialpost.com/2011/03/30/liberals-push-big-cpp-as-retirement-saviour-over-tories-pooled-rpps/
Liberals propose supplementary public pension plan
http://www.thestar.com/news/canada/politics/article/965737–liberals-propose-supplementary-public-pension-plan?bn=1

NEW DEMOCRATIC PARTY – Jack Layton
Leadership you can trust to give your family a break
http://www.ndp.ca/platform
Layton announces plan to reform Canada’s pension systems
http://www.facebook.com/topic.php?uid=31385742311&topic=18490

Today I discussed the upcoming federal election with a friend of mine. We talked about the growing voter apathy and bounced around possible reasons for this most serious problem.

I am in the wine business, so taking a quick look at our current political parties and their leaders and compare them to common wine defects is just too much of a temptation to resist, so here goes:

Stephen Harper and the Conservatives remind me of  Rotten Eggs (wine fault H2S). Their term is up and it’s time to discard the lot.

Michael Ignatieff and the Liberals. Well, they share common traits with the wine fault Mercaptan, i.e. they project a very unpleasant odour of cooked cabbage or burnt rubber.  Unless they quickly find a way to remove the unpleasant compound by airing some truly new and exciting ideas and visions they, too, should be discarded.

Jack Layton and the NDP share traits with a wine that’s “Corked”, i.e. they have that same musty, mouldy smell. Jack just can’t seem to come up with anything new. Pity, because that deficiency might just end up keeping him bottled up!

So, it seems to me that we need a new party – the K.I.S.S. Party. The premise, as the name suggests, is to “Keep It Simple Stupid”. This party would be comprised of people who can communicate a  platform and vision for the country (vision is very important) in simple, easy-to-understand terms. That way the average voter might actually understand the issues and the impact they have on us. Anyone who starts or runs for such a party would certainly get my vote and, I suspect, that of many other disillusioned Canadians.

Honesty, integrity and the ability to keep promises made are MUST HAVE qualities and of paramount importance for being a member of the K.I.S.S. Party. As such, lawyers and economists would not be welcome as members of this party. They only convolute matters and make everything seem much too complicated. I suspect this is a trick they use to build ‘job security’. After all, if we, the average voter, cannot understand what they are really saying, how can we challenge them! Also, it would be more desirable to have fewer lawyers and economists in office in favour of more ordinary people (women?). The current electoral system and bureaucratic set-up seem to strongly work against that happening any day soon.

So, taking the discussion a step further, it seems to me that ONLY IF or WHEN our politicians can bring the issues down to earth and communicate to us, the electorate, in simple, easy-to-understand language, might we actually manage to connect and become more interested in both elections and issues. As it stands now, I suspect a lot of people either don’t understand or they feel disconnected from it all. Too removed and frightfully dis-empowered!

A new electoral system, e.g. some variation of Proportional Representation,  would make each vote more valuable and meaningful. We should have a system where each vote actually counts for something. Our current system First Past The Post, is flawed to the point of allowing a majority government on much less than 50% voter support. Wherein lies the democracy, I ask? Would it not be more democratic and fair if smaller parties, the Green Party being a case in point, were given equal opportunities of electing members to parliament and playing a role in forming coalition governments? Such governments have worked for years in many other democratic countries, especially around Europe. What are we afraid of here?

Such a scenario would also force the parties to work together in the interest of all Canadians. As it is now, I cannot help but feel there is too much partisanship at play, too much power in the PMO and too little true democracy.

For what they are worth, those are my thoughts on the political picture we are faced with. I know some readers will say that what I am proposing is totally unrealistic. I say to all of you: We can dream, can’t we? And work to make dreams come true!

There are several definitions of art therapy, but most of them fall into one of two general categories.  (Refer to http://en.wikipedia.org/wiki/Art_therapy) The first involves a belief in the inherent healing power of the creative process of art making. This view embraces the idea that the process of making art is therapeutic and this process is sometimes referred to as Art as Therapy.  Doing art is seen as an opportunity to express one’s self imaginatively, authentically, and spontaneously, an experience that can lead eventually to personal fulfillment, emotional reparation, and recovery. Some retirees may have problems dealing with difficult social realities due to neurological disorders. Art Therapy can be included in the treatment for these disorders. It can have the added dimension of boosting confidence during the transition from a hectic work life to a more subdued time at retirement.

The second definition of art therapy is based on the idea that art is a means of symbolic communication. This approach, often referred to as art psychotherapy, emphasizes the products—drawings, paintings, sculpture, handwork and other art expressions—as helpful in communicating issues, emotions, and conflicts. This approach can also be applied to various age groups suffering from neurological disorders.

 The expanding seniors population and increased longevity will bring into focus the number of seniors and retirees suffering from ailments associated with aging, namely physical and emotional distress.  Art Therapy has become an invaluable tool in helping those retirees afflicted by these health issues. Not many of those who are approaching retirement  envision a life suffering from ailments such as Alzheimer’s and other dementias, low self-esteem, depression, addictions, stress, anxiety or social isolation. Most, if not all of us, have to be prepared to deal with some of these health challenges in our golden years. 

Art Therapy healing is normally done by Art Therapists. Most Art Therapists are licensed professionals and are required to undergo several years of higher education that focuses on psychotherapy. They also have a solid background in various art forms and expression. They work with children, adolescents, and adults and provide services to individuals, couples, families, groups, and communities. In the case of retirees the Art Therapist can harness artistic skills and talents that they have been unaware of and have no clue how to use those talents and skills. It is here that the art therapist can contribute to the well-being of retirees or seniors if they are able to identify that these skills and talents exist. Art Therapists can play a significant role in improving the lives of clients they serve.

According to an article titled “Creative Rehabilitation: Art Therapy for the Elderly” published at Elder Caring  Inc. (http://www.eldercaring.ca/?p=460)

“The therapy, which began as treatment for severely emotionally disturbed children and adults, provides a safe and structured setting to help participants express their thoughts or feelings in a verbal or non-verbal way. Drawing, painting, or discussing art are a few examples of the therapeutic interventions. In a long-term-care setting, an art therapy program strives to improve the quality of life.”

The above article at Elder Caring Inc. accurately sums up the purpose and benefits of Art Therapy. Art Therapy can be a remedy or treatment to help in the rehabilitation of those suffering from some kind of trauma, illness or personal crisis in their golden years. These golden years are given more significance as retirees have to find ways to keep active both mentally and physically to enjoy this major milestone in life. More attention is being paid to the emotional health of retirees due to the rapidly growing seniors’ population and also increased longevity.

While art therapy may involve learning skills or art techniques, the emphasis is generally first on developing and expressing images that come from inside the person, rather than those he or she sees in the outside world. It is an experience that allows troubled seniors to connect with their inner feelings through any form of art. In particular, residents of long-term care facilities who suffer from neurological disorders can benefit from this therapy. Even healthy retirees without mental health issues can also benefit from Art Therapy especially if they have no activities planned for their transition to retirement. They have a lot of time on their hands and can find this period of life isolating, depressing and detached from the world around them.

For those seniors with neurological disorders, emotional and mental illness this is a challenging time both for them and their families. Art Therapy is being given greater consideration as an option to improve the quality of life for seniors suffering from ailments associated with ageing. This therapy is being embraced as it can be a useful tool in maintaining overall good health of seniors. Another positive aspect of Art Therapy for seniors is that it will minimize the strains on the health care system and other social services.

The intent of our post is to raise awareness about the emotional and neurological disorders that some retirees face and reassure them that there are options available to help them through what can be a difficult time.  It has to be acknowledged that each of us is unique and we age differently. One solution does not fit all. However, one of the accredited options for improving  the life of seniors is Art Therapy. Art Therapy could open up a new world for them outside of their ailments. And who knows? Some of the retirees in this category might turn out to be the next Picasso, Monet, Van Gogh, or modern day impressionist artist.

We will leave you with this memorable quote from Hillary Rodham Clinton:

“Some of our most powerful works of art have been produced by older Americans—by hands that have engaged in years of hard work, eyes that have witnessed decades of change, and hearts that have felt a lifetime of emotions. Our whole society benefits when older Americans use their talents and experiences to become involved in the arts as creators, teachers, mentors, volunteers, and audiences.”
http://www.artbeyondsight.org/handbook/az-seniors-veterans.shtml#programbasics

Nearly seven years ago I retired at age 60. I always enjoyed teaching. However dealing with the administrators had become unbearable because of recent changes in the school board and an all-female administration. I stopped teaching in the middle of the school year and I had been counting the days until my 60th birthday and retirement.

Ten years before retirement I developed a new hobby and passion – mineralogy. It involved going out on weekly excursions in mines and quarries to collect crystallized minerals. These minerals then needed to be cleaned, trimmed, sorted and identified with the naked eye or under the microscope. In order to gain access to collecting sites and information about all the activities involved in mineralogy, I joined a mineral club. A few years later I became a member of two other clubs. This allowed me to meet hundreds of people from all walks of life. I became good friends with mine workers and experts in mineralogy who wrote scientific articles on the subject. 

To pursue my passion I travelled to Nova Scotia where I became a guide to other Quebecers who wanted to look for minerals on the beaches of the Bay of Fundy. I camped there for periods extending up to three months. I also travelled to Ontario, New York, California, Texas, Maine, New Hampshire, Florida and Arizona, always with the purpose of finding minerals. I contacted various mineral clubs in those places and collected in mines and quarries with members of the local mineral clubs. I also visited several museums with extensive mineral collections. 

Françoise is on the left digging for glauberite with her friend Pat Rhodes at the old Bertram phosphate mine in Imperial County in the California desert. Pat Rhodes, is the head horticulturalist at the San Diego Wild Animal Park.

My age has not yet become a problem in pursuing this activity I walk for long distances and carry considerable weight in backpacks. Now I use a walking stick on the rocky beaches of the Bay of Fundy. Before retiring, I felt that my new hobby had completely taken over my life and that my work was getting in the way. Therefore I had two reasons to look forward to retirement:  getting away from a disagreeable work environment and devoting my new free time to mineralogy.

I have always been very adventurous. This hobby of mine has opened new avenues and brought new friends that share my passion. It has opened doors to a whole new field of knowledge which was foreign to me. I subscribe to two magazines on the subject and I trade information and specimens with friends as far away as Australia. It is a universal hobby that can provide opportunities for establishing enduring relationships with people all over the world especially if one is willing to make the new contacts. It also creates bridges between age groups where children can be enticed by old collectors to embrace this hobby which will keep them ‘physically active’ and ‘intellectually stimulated’. These two points are also very important as you reach the age of retirement. Mineralogy has kept me away from the couch and rocking chair. It has also helped to keep my mind active by forcing me to remember minerals and localities.

In spite of the uncertain economy and the financial challenges of surviving on a reduced income I plan to pursue this hobby as long as my legs will carry me. I can control the difficulties and will tackle only what I am able to do. I remember seeing in the Mont Saint-Hilaire quarry very old collectors using canes to get around, but they still carried the fire in them for mineralogy. Only a very serious illness stops us. In any case, once you have reached the age of retirement, you begin to lose family and friends usually to illnesses. It makes you realize that every day is precious and should be enjoyed as if there was no tomorrow. Mineralogy has allowed me to do just that.

Passions are the motor of one’s life at any age and if you have none, you are in trouble even before retirement. Your passion gives shape and colour to your life. Before retirement, take stock of your passions and have the courage and audacity to pursue one or more with more vigour than before. It can guarantee your physical and mental health.

For those of you who are retired or are contemplating retirement I will leave you with this inspiring quote:

“Happiness is a choice that requires effort at times” – Anon

 

Françoise is on a roadcut looking for tourmaline in San Diego County, California east of Escondido.

 

Old Age Security benefits, consisting of the basic pension, the Guaranteed Income Supplement (GIS) and the Allowances, are revised quarterly, in January, April, July and October, using the CPI for the previous quarter. OAS benefits will be increased by 0.3 percent from the last time the rates were adjusted which was in October 2008. In October 2008, OAS benefits were indexed by 2.2 percent in response to a significant increase in the CPI. In order for OAS benefits to be indexed again, the CPI needed to exceed the peak that occurred at that time. This has only happened now.

The CPI formula used by Statistics Canada to calculate CPP, OAS and GIS is complex and may not reflect the actual ‘basket of goods’ that pensioners purchase. We questioned the adequacy of using the CPI formula in an earlier post PENSION INDEXATION – is the current method adequate?

Currently the OAS average monthly benefit is $489.12 and the maximum monthly benefit is $518.51. Check this federal government link for details: http://www.servicecanada.gc.ca/eng/isp/oas/oasrates.shtml.  Although some pensioners have indicated they received a meagre increase of about $2 (more or less) per month in the OAS payment for the current quarter there doesn’t seem to be a ripple of discontent coming from that segment of our population.

Concerns about the accuracy of using the Consumer Price Index have also been raised in other countries. For example, an article on inflation at EDECON identifies a number of problems with the CPI measure.  These problems are certainly applicable to Canada. The first problem identified by EDECON should clearly resonate with fixed income pensioners: 

”CPI measures only the cost of living for an average household. The top and bottom 4% income brackets are not included; nor are pensioners.”

Other relevant concerns raised in the Edecon article have to do with the ‘sampling’ and also the predictable  ‘basket of goods’ used in the CPI formula. Although we are not economists we would like to suggest that the government focus more on tax relief measures for pensioners rather than using a flawed formula that does not reflect the actual cost of living expenses for this vulnerable group of citizens.

As noted above the annual increase in OAS benefit is derived from a formula used to calculate the Consumer Price Index (CPI). Given the concerns about the adequacy of this formula we need to ask some relevant questions with regard to the formula used in this calculation:  Is the ‘basket of goods’ used in the formula representative of the ‘basket of goods’ seniors consume? Is it possible that the formula is flawed hence the result is skewed?  Also, just how much is it costing the government bureaucracy/tax payers to process and distribute this paltry increase in the OAS benefit? Surely the bureaucratic cost of providing that service could be better spent by applying it to tax reduction for pensioners.

This conundrum of using the CPI to calculate the pension benefits is food for thought. Would it be more beneficial to pensioners on fixed incomes to have tax relief versus the using the CPI formula? We look forward to hearing your thoughts on the question of the accuracy of the CPI formula to calculate OAS benefits. We also are interested in your comments on the alternative of reducing the tax burden for pensioners by eliminating the bureaucracy employed to process and distribute this paltry increase every quarter.

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Useful links

An article questioning the adequacy of using the CPI formula that is worth checking can be accessed at this link: Budget alert:The dangers of using the Consumer Price Index rather than the Retail Price Index

This Service Canada link provides detailed information on tax allowances for seniors:
http://www.servicecanada.gc.ca/eng/isp/pub/oas/allowance.shtml

The need for social housing for this segment of our population is more pressing in some regions of Canada, especially in heavily populated areas where seniors have to wait years to be housed on account of very long waiting lists. We need to bear in mind that the supply of subsidized, or rent-geared-to income, housing for seniors varies by province and is the responsibility of the provincial and municipal levels of government. One part of the equation is the need for some real pension reform. The policies and regulations of the federal government impact the debate as they relate to a more fair and equitable pension system, allowing those on fixed incomes to properly keep up with the cost of living.

It is inexcusable that governments have not put in place a sustainable housing policy to meet the needs of this expanding segment of the population. The seniors in this demographic do not require ‘assisted living’ or ‘long term care’ accommodation. These seniors are healthy, can live independently but are challenged trying to survive on a fixed income. They do not have generous company pensions or personal savings. Seniors in lower income brackets never earned the kind of income that would have allowed them to create a nest-egg for their retirement. And in some instances retirees have seen their company pensions and personal savings evaporate due to the economic meltdown and corporate fraud. And those responsible for the economic fiasco were given a bailout… with our taxpayers dollars!  Seniors have to opt for ‘subsidized seniors housing’ rather than ‘market value seniors housing’ which is the more expensive option. Renters, whether pensioners or not, should not be paying more than 33% of their monthly income on rental costs. For seniors on fixed incomes it should be less.

In addition to the cost differential and maintenance issues in social housing, healthy seniors seeking subsidized housing also face a huge waiting list. Seniors in less populated regions do not have to contend with the formidable waiting lists that seniors in large cities are faced with. Other than the obvious cost difference between  ’subsidized seniors housing’ and ‘market value seniors housing’ there are also differences in maintenance standards and desirability of location.

It is well documented in the media that maintenance standards in social housing are sub-standard and unsatisfactory.  Many of the buildings designated as social housing for seniors and other rents are ageing and need retrofitting and upgrading. (NOTE -  Canada Mortgage and Housing Corporation (CMHC) has published information on the Renovation and Retrofit of Existing Social Housing project for social housing in Canada.)

At the provincial level another option should be given due consideration. That is, to offer a subsidy to healthy seniors currently residing in ‘market value’ buildings who have no wish to move. This was suggested in the article “Seniors and Looming Housing Crisis” by a tenants group in Ontario. Designating or allocating a certain number of units in market value buildings for social housing is a reasonable and sensible solution to the housing crunch faced by low-income seniors. Benefits range from affordability, stability, no disruption and stress related to having to move, to the comfort of being able to remain in a familiar and convenient environment. This option would ease the demand for affordable housing for low-income seniors who can live independently.

 The most effective option that has not been in the forefront of the debate is to increase the supply of affordable social housing for seniors by encouraging new construction. Why has there not been an increase in the construction of affordable seniors housing to meet the expanding population of seniors? We all recognize there has been an increase in demand for social housing due to the expanding population of seniors but there has not been an adequate response to meet the challenge. In the face of the changing demographics more government efforts should be invested in creating opportunities to increase the supply of social housing for needy seniors.

Clearly sustainable affordable housing for pensioners of modest incomes needs to have a higher priority on the agenda of governments. Government policy should encourage the construction of an adequate supply of social housing for seniors to meet the challenge. All levels of government need to cooperate in order to address this housing challenge to low-income seniors. With the increase in the senior population this issue will not go away. The outcome of finance minister Jim Flaherty’s public consultations on pension reform did not do much to address the concerns of seniors on modest incomes. (Refer to this link: http://www.cbc.ca/news/business/story/2010/03/24/flaherty-pensions.html)

In the absence of a more logical system for pension indexation, and with an inadequate supply of affordable housing for renters in this target group, we will continue the involuntary warehousing of a vulnerable segment of society. That is nothing to be proud of! Perhaps it’s time our governments take a good look at how other progressive countries are tackling this challenge and treating their senior citizens.

We need to become more knowledgeable about available long-term care facilities and services in the private and non-profit sectors. We need to know what options may be available to us. We need to acquire as much information on ‘assisted living’ options, be they short or long-term care, so that we can make informed choices about the kind of long-term care we would like for ourselves and also for elderly members of our family. We also need to consider the affordability of the choice we make.  This has particular relevance for those seniors who will have to survive on a modest pension income.

While seniors in higher income brackets can afford private care, seniors surviving on modest pension incomes can only afford services  offered by non-profit facilities and home care. Within recent years there have ongoing concerns expressed in the media about the quality of services at non-profit facilities and also the long waiting lists.

Given the fact that both the seniors demographic and life expectancy have been steadily increasing, we cannot ignore how this will impact long-term care. According to Statistics Canada’s publication A Portrait of Seniors in Canada, “the number of seniors in Canada is projected to increase from 4.2 million to 9.8 million between 2005 and 2036, and seniors’ share of the population is expected to almost double, increasing from 13.2% to 24.5%”.   Will there be sustainable government programs and adequate social services in place to deal with those of modest incomes in this expanding demographic?

Comprehensive information on Long-Term Facilities-Based Care  is available from Health Canada.  It  is specific to “people who require on-site delivery of 24 hour, 7 days a week supervised care, including professional health services, personal care and services such as meals, laundry and housekeeping.”  Information on government programs that is specific to a provincial or territorial jurisdiction can be obtained at the appropriate provincial or territorial Ministry of Health since the facilities and services offer will differ. Those of us who are close to that ageing demographic and who have health issues need to take time to educate ourselves about how to live that stage of life in reasonable comfort.

The challenge of educating ourselves is brought to the forefront by Patty Randall of Long Term Care Canada.  Based on her own experience with her elderly parents she has provided guidance and tips on managing the challenges associated with ageing. She is “out to educate Canadian boomers and young-seniors on the urgent need to plan for their care-years…while there is still time.” The advice from this advocate is sensible given the continued uncertainty of the world economic situation and the changing demographics. Even though many in the boomer cohort have maintained good health and should enjoy unprecedented longevity there is a need for proper planning if they are to live that vulnerable period of life in comfort and dignity.

We all have to accept that changing statistics will not only impact long-term care facilities and various social services but will place pressures on family members caring for elderly family members. Many family members who are caregivers make sacrifices to take care of the needs of their loved ones.  Whether we like to admit it or not most of the elderly population will develop health problems that will probably preclude an independent lifestyle. Most of us have come to accept that the ongoing unstable economic climate will impact our lifestyle irrespective of our age group.

Despite the current economic challenges we must not neglect this vulnerable segment of our society.  The elderly in our midst who have contributed much to the growth of our society should not be cast aside with indifference. If we don’t have an adequate long-term care system in place to meet the needs of our expanding elderly population then we have to ask just what kind of a society do we want if we cannot meet the basic needs of the frail and vulnerable.  The lesson here for all of us  is that while there is still time we all need to make viable plans for that vulnerable stage of life.

“A Dollar Today is Worth More Than a Dollar Tomorrow”… how many times have we heard this expression? From the perspective of today’s pensioners this expression has taken on a greater sense of urgency. Pensioners on fixed incomes (CPP and OAS) are faced with an ongoing struggle to afford their basic daily needs in the continuing tight economy. It has become evident that our government needs to reassure pensioners on fixed incomes that their buying power will continue to have the same purchasing power over the years.

The CPP and OAS rates are reached through a complex calculation termed ‘pension indexation’. Statistics Canada uses a formula based on the Consumer Price Index (CPI) average for a 12-month period ending in September to calculate the pension index. To explain further, the indexing method or adjustment is basically a compilation of price changes for goods and services we consume every day. For example, Statistics calculates CPP rate increases by taking the average Consumer Price Index (CPI) of a given year and compares it with the last year average CPI.  It then uses that difference to adjust our pensions benefit of the current year. With this adjustment retirees should be able to maintain the ability to purchase the same ‘basket of goods’ in future years.

In essence, what pension indexation is trying to do is to make sure that those on fixed incomes will be protected from inflation and cost of living increases. Hence, accurate indexation of pensions is critical to the pensioners’ survival. For more details on CPP and OAS rates check: Just the Facts – Pensions, Benefits and Seniors.

I personally think that, since prices of goods and services fluctuate at different rates, the composition of the goods and services in CPI determination may skew the average CPI one way or the other. Could there be an inherent problem with the CPI adjustment? Is the ‘basket of goods’ used in the calculation adequately reflecting the low-income pensioner’s basket of goods? I know of many low-income pensioners who express dismay and concern when they see noticeable fluctuations in their weekly grocery bill and other basic expenses. The ‘basket of goods’ used in the CPI formula may not be relevant to that of the pensioner.

Given the sober demographic forecast of an expanding seniors‘ population and the pressure that will be placed on pension funds I believe it is highly relevant to pose this question: Is the CPI adjustment sufficient for those on fixed income to sustain the market fluctuations and inflation? We need to address that question in the context of the serious economic downturn we are experiencing. We also need to take a closer look at the ‘basket of goods’ included in the formula and how the Guaranteed Income Supplement (GIS) is applied.

Low-income pensioners did not create the financial disaster and should not be cast aside casually after having made their contribution to our economy for decades. Pensioners do not have the same good fortune to receive a bailout as those in the financial industry and major corporations. Further, in future planning, our government should not ignore another challenging aspect of the changing demographics. That is, there is a serious need to undertake proper demographic planning in terms of immigration policy to increase the pool of younger workers. However, that poses a dilemma. Although encouraging immigration of younger workers should be given due consideration, that step would be more relevant when we have a healthier economy that generates sustainable employment opportunities.

To sum up, I would say that the current method used by Statistics Canada (CPI) to calculate indexation is logical. However, this method is inadequate as it fails to keep up with the increasing costs of the complete ‘basket of goods’ needed by many seniors surviving on modest incomes.

It should be of great concern to all of us that the government pension programs might not survive and, if they do, it will likely increase the tax burden. In addition, company pensions and retirement savings have been reduced or have disappeared due to corporate mismanagement, bankruptcy and also fraud. This means that many pensioners are facing bleak prospects in what is supposed to be their ‘golden years’.

The consequence of shrinking pension income is that a growing number of seniors are not only concerned about their ability to pay for basic needs but also dealing with unforeseen expenses related to their health care. As we are all aware, not all health care costs are covered by OHIP and this is of concern to seniors. Seniors with serious health issues will have to allocate more of their income to cover this cost. Vulnerable seniors would have some relief if pensions were properly indexed to keep up with cost of living increases.

As we age we have to accept that we will face a range of health issues associated with ageing. So any discussion of ‘enjoying our golden years’ should include the impact that changing demographics will have on Long Term Care. Seniors of modest incomes worry about the cost and level of care they will receive at Long Term Care and Assisted Living facilities and also home care services.  The challenge of meeting the needs of our seniors’ long term care will be addressed in a separate article.

The greatest positive impact on the lifestyle of vulnerable seniors would be for the Federal Government to re-visit the present income tax system as it is applies to low-income seniors. These seniors should not have to pay taxes on their pensions or on the modest savings they managed to put aside for retirement.  After all, seniors have contributed to the growth and success of our nation for most of their working lives.  Our politicians need to give a lot more consideration to pension reforms that will improve the lives of seniors struggling on meagre pensions. Otherwise, we are left to ponder this question: Is enjoying ‘golden years’ nothing but a myth?

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NOTE: The challenge of reforming Canada’s pension programs has been addressed in a publication by the CD Howe Institute.  That publication Benefactors Lecture 2009,  Pension Reform: How Canada Can Lead the World presents a comprehensive view of our present pension programs.  While it recommends what seems to be a workable alternative model to better manage the predicted pensions crisis, it is also somewhat critical of our government’s approach of ’saying’ and ‘not doing’ when it comes to pension reform.