“I didn’t know I was going to get old,” says Gayle, sitting on a wilted La-Z-Boy amongst her peers at Silver Threads Services’ Saanich activity centre.
At 4-foot-9 with a confident gaze, the 71-year-old lives off about $1,400 per month from mostly government funding.
Gayle is lucky enough to have paid for her condo outright, but a mid-life divorce and subsequent return to work in low-paying customer service jobs meant she was never able save for retirement.
I worked really, really hard,” she says. “But when you earn $800 a month, by the time you’ve lived, you can’t afford those kind of things.”
Gayle’s story is just one of thousands becoming more familiar as a new international report reveals divorced and widowed Canadian seniors, predominantly women, are being hit hardest by the rising cost of living accompanied by stagnant government support.
Canadians 65 and older are doing relatively well when compared with other seniors in advanced countries, according to a comprehensive study on pensions in 34 countries by the Organization for Economic Co-operation and Development. The senior poverty rate in Canada is among the 10 lowest in the OECD.
But more concerning is that while many senior poverty rates were falling between 2007 and 2010 in other countries, poverty amongst Canadian seniors increased by about two per cent during the same period.
“Higher poverty among older women reflects lower wages, more part-time work and careers gaps during women’s working lives,” said the OECD report, which also noted longer female life expectancy plays a role in inadequate retirement savings.
The report also found that public pension transfers in other advanced countries accounted 59 per cent of seniors’ gross income, while Canadian government transfers account for less than 39 per cent.
“Further reforms are needed that are both fiscally and socially responsible,” said OECD Secretary-General Angel Gurría. “We cannot risk a resurgence of old-age poverty in the future. This risk is heightened by growing earnings inequality in many countries, which will feed through into greater inequality in retirement.”
The increasing financial pressure on seniors is prompting the federal NDP and several provincial leaders to push for an immediate increase in Canadian Pension Plan transfer amounts. The CPP and Old Age Security transfers account for the vast majority of public transfers to seniors in Canada.
“You’ve got a huge advantage to put money into RRSPs, but less than 50 per cent of eligible people do it,” said Victoria MP and pensions critic Murray Rankin in a recent interview. Rankin will table a motion in the House of Commons Monday calling for public pension reform, but faces staunch opposition from the federal Conservatives.
“The State will have to intervene anyhow when this gets worse,” Rankin said. “We just don’t think it’s going to happen if we simply ask people to put money aside.”
Federal Finance Minister Jim Flaherty has indicated the Canadian economy is too fragile to consider any increases to CPP premiums or transfers, and the Canadian Federation of Independent Business is also opposed to higher premiums.
Edna, an 87-year-old expat from the U.K., lost her husband in 2012. While she’s able to afford semi-regular trips to see her family in Vancouver, she scoffs at the lack of affordable and subsidized housing for seniors on lean incomes.
“They keep putting up these buildings for seniors, but they’re just too expensive,” she says. “My husband and I applied for subsidized housing more than a decade ago in Vancouver, and they said they had 16,000 people on the waiting list. And it’s probably got worse now. I think a lot of seniors are suffering.”
But with OAS eligibility set to rise from 65 to 67 years of age beginning in 2023, the growing crisis of senior poverty doesn’t yet have a clear solution.
“You don’t expect the government to do it all, of course you have to make plans,” says Gayle, as the weekly seniors gathering comes to an end. “Where I live is a little over $500 between my taxes, fire insurance, maintenance fee and hydro. I don’t have Internet or a computer, I have an answering machine and a landline. … It’s not easy. If I didn’t get that little extra bit of lining from the government, I don’t know what I’d do.”