Seniors in Quebec have already gotten poorer each time their pensions have been linked to the cost of living. With inflation accelerating, the situation is worse than ever.
“It has a big impact. In Quebec, one in three seniors lives on $20,000 a year,” said Pierre Lynch, president of the Quebec Association for the Defense of the Rights of Retired and Pre-Retired Persons (AQDR).
When inflation was “normal” at 2%, the federal Old-Age Insurance (OAS) pension indexation formula allowed them to catch only part of the inflation.
“They were already getting poorer before inflation hit 6.8%, so imagine that now,” he says.
Consumer Price Index (CPI) inflation was 9% between February 2020 and April 2022, compared with 5.7% for the increase in the OAS ceiling, a new economic report yesterday showed Parliamentary Budget Officer (PBO) inflation. Ottawa.
For a senior earning $20,000 a year, we’re talking about a 3.3% loss in purchasing power, or $660.
“It may be for the federal government peanutsbut for someone who makes $20,000 a year, $5 or $10 is a lot,” recalls the AQDR President.
Indexed a year late
In April there were 1,729,689 people receiving the OAS pension in Quebec. Of that number, 664,631 (38.42%) also received the guaranteed income supplement offered to those whose annual income does not exceed $20,071.
OAS is indexed four times a year, but there is a lag. In principle, OAS is indexed with a delay of one year.
“I can understand the delays in Ottawa, but I dare to hope that there will be an additional payment for the next adjustment,” dreams Pierre Lynch.
As food prices and rent are skyrocketing, he says many seniors are having to choose between paying rent or paying for medication.
“It’s pushing a lot of people to go to CHSLDs, especially older women living alone who are the most vulnerable,” he adds.
The facts are piling up
A recent survey by Léger also found that 73% of Quebecers plan to reduce spending due to inflation.
And according to Saint-Léonard’s Concertation in Food Security, 60% of the “lower middle class” are currently giving up food because it’s too expensive.
This is consistent with the fact that, according to a survey conducted by Food Banks Canada just over three months ago, one in five Canadians said they had experienced hunger at least once between March 2020 and March 2022.
The organization consistently says that hunger and food insecurity are rising across the country and that low-income Canadians are hit hardest by inflation.