ca
http://umanitoba.ca/outreach/evidencenetwork/archives/4390
would be shifting costs to the provinces, in other words. To avoid hurting the poor, the government could offset the cut in OAS for those with lower incomes by increasing GIS benefits by a corresponding amount. But this change would dramatically reduce the fiscal savings for the federal government to about $500 million, taking into account changes in lost federal income tax and GST revenues. The provinces would still lose about $350 million because non-taxable GIS benefits would be substituted for taxable OAS benefits. So what is the federal government going to do? Will the cut in OAS save billions in federal spending, while shifting hundreds of millions in revenue losses to the provinces, and more than doubling the poverty rate among affected seniors? Thats what the 2011 hypothetical scenario indicates would happen. Or will the cut with a possible modified GIS protect the most vulnerable seniors, but save far less for the federal government, and still hit the provinces with large revenue losses? This would mean that the net effect on the fiscal balances of both levels of government combined what ultimately matters to taxpayers and the economy would be essentially nil. On March 29 th, the federal government will table the budget and we will see if and how crucial details of the OAS cuts will be addressed. Lets hope the government does not chose to reverse one of Canadas greatest social policy successes of the last half century and increase poverty rates among Canadas seniors. Lets also hope they dont choose to shift hundreds of millions of fiscal burdens to the provinces in the name of improving their own fiscal situation. And lets hope they will not approach public policy with a narrow focus that pays no attention to the realities of a shared jurisdiction and the complexity of programs forming Canadas retirement income system. Michael Wolfson is an expert advisor with EvidenceNetwork.ca, and Canada Research Chair in Population Health Modeling/Populomics at the University of Ottawa. He is a former Assistant Chief Statistician at Statistics Canada, and spent several periods during his career in the Federal Public Service developing and advising on pension policy.