In this July 3, 2017 file photo, a man and woman walk under trees down a path at Alta Plaza Park in San Francisco.Jeff Chiu/The Associated Press
Thomas Klassen is a professor in the School of Public Policy and Administration at York University.
Born between 1946 and 1965, and now in their late 50s to late 70s, baby boomers comprise nearly one-quarter of Canada’s population. Such a large cohort is bound to have an outsized impact on the economy and society.
During the 1950s and 1960s, suburbs mushroomed to house them, schools were built at breakneck speed to educate them, and the welfare state expanded to provide health care.
As adults, they lead various movements: for equal rights, environmental protection, for greater personal choice and freedom, and much more. Now as older Canadians, they continue to reshape the country.
It’s unfortunate that a typical story has emerged about baby boomers, many retired, that they are ruining the economy, draining government resources and hoarding wealth. This cannot be further from the truth.
Boomers continue to contribute more to the economy than any earlier generation. It is they who pressured governments some years ago to eliminate mandatory retirement at age 65. Today, they are working longer than the generation before them.
The average retirement age has increased by three years over the past two decades. Boomers retire, on average, at 65 with the self-employed working past age 68. Rather than embracing freedom 55, they are keen to keep earning employment income.
Before the boomers, retirement was binary: you’re either working full-time or retired and receiving a pension. Now, retirement is varied, with any number of ways to combine paid employment with pensions.
In some circumstances, a 65-year-old can earn income from full-time employment, receive Canada Pension Plan (CPP) payments, Old Age Security (OAS) payments, and pension benefits from a defined benefit plan while continuing to make further contributions to that same pension plan, as well as contributing to the CPP.
Alternatively, it is possible to retire, but delay receipt of the CPP and OAS to age 70. Or, to work past age 65, but no longer contribute to the CPP but receive OAS.
And contrary to popular belief, boomers in retirement are not huge beneficiaries of government largesse.
OAS payments, which the federal government pays to those 65 and older, require meeting eligibility criteria to receive the full amount: 40 years of residence in Canada, income of less than $82,000 and residence in the country for at least six months each year.
Those meeting these requirements receive $700 a month between ages 65 to 74, and somewhat more starting at age 75. Not meeting these requirements reduces payments or eliminates them altogether.
The Guaranteed Income Supplement (GIS) – Canada’s basic income for those 65 and older – is paid to people who receive OAS but have little or no other income. The supplement ensures that nearly all those Canadians have annual income of at least $20,900 for a single household.
For the CPP, Ottawa makes no contributions but merely sets the rules. Retirement provides no escape from taxes. All pension income, except GIS, is taxed. The only minor concession for those receiving an employer pension is a $2,000 income-tax credit that slightly reduces tax payable.
Most of the discounts offered to those 65 and older come not from governments, but from private businesses such as movie theaters, retail stores and restaurants. Retirement is a self-funded experience. Those heading for the cottage on Monday mornings, or to sunny destinations for several months in the winter, are doing so entirely from their own money.
Boomers are not draining public health care either. Other than being eligible for pharmacare at age 65, they generally have the same publicly funded health benefits as all other Canadians. If admitted to a nursing home, they must pay between $2,000 to $3,000 a month from their own pockets for accommodation and meals.
Nearly all older Canadians fend for themselves, financially and otherwise. They remain independent, relying on family, friends and neighbours as needed, until death or until they require intensive medical care.
As the oldest baby boomers begin to reach their 80s, most have the financial resources for continued independence. When they die, their remaining wealth will remain in the economy.
In the next several decades, government policies will shift to accommodate a larger percentage of older Canadians. Expect more ramps, elevators, efforts to extend working lives, and measures to increase home and community care services.
Although a small number of retirees will need targeted assistance from the state, there is no conceivable future in which boomers bankrupt governments or wreak havoc on the economy.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
VICTORIA – British Columbia is forecasting a record budget deficit and a rising debt of almost $129 billion less than two weeks before the start of a provincial election campaign where economic stability and future progress are expected to be major issues.
Finance Minister Katrine Conroy, who has announced her retirement and will not seek re-election in the Oct. 19 vote, said Tuesday her final budget update as minister predicts a deficit of $8.9 billion, up $1.1 billion from a forecast she made earlier this year.
Conroy said she acknowledges “challenges” facing B.C., including three consecutive deficit budgets, but expected improved economic growth where the province will start to “turn a corner.”
The $8.9 billion deficit forecast for 2024-2025 is followed by annual deficit projections of $6.7 billion and $6.1 billion in 2026-2027, Conroy said at a news conference outlining the government’s first quarterly financial update.
Conroy said lower corporate income tax and natural resource revenues and the increased cost of fighting wildfires have had some of the largest impacts on the budget.
“I want to acknowledge the economic uncertainties,” she said. “While global inflation is showing signs of easing and we’ve seen cuts to the Bank of Canada interest rates, we know that the challenges are not over.”
Conroy said wildfire response costs are expected to total $886 million this year, more than $650 million higher than originally forecast.
Corporate income tax revenue is forecast to be $638 million lower as a result of federal government updates and natural resource revenues are down $299 million due to lower prices for natural gas, lumber and electricity, she said.
Debt-servicing costs are also forecast to be $344 million higher due to the larger debt balance, the current interest rate and accelerated borrowing to ensure services and capital projects are maintained through the province’s election period, said Conroy.
B.C.’s economic growth is expected to strengthen over the next three years, but the timing of a return to a balanced budget will fall to another minister, said Conroy, who was addressing what likely would be her last news conference as Minister of Finance.
The election is expected to be called on Sept. 21, with the vote set for Oct. 19.
“While we are a strong province, people are facing challenges,” she said. “We have never shied away from taking those challenges head on, because we want to keep British Columbians secure and help them build good lives now and for the long term. With the investments we’re making and the actions we’re taking to support people and build a stronger economy, we’ve started to turn a corner.”
Premier David Eby said before the fiscal forecast was released Tuesday that the New Democrat government remains committed to providing services and supports for people in British Columbia and cuts are not on his agenda.
Eby said people have been hurt by high interest costs and the province is facing budget pressures connected to low resource prices, high wildfire costs and struggling global economies.
The premier said that now is not the time to reduce supports and services for people.
Last month’s year-end report for the 2023-2024 budget saw the province post a budget deficit of $5.035 billion, down from the previous forecast of $5.9 billion.
Eby said he expects government financial priorities to become a major issue during the upcoming election, with the NDP pledging to continue to fund services and the B.C. Conservatives looking to make cuts.
This report by The Canadian Press was first published Sept. 10, 2024.
Note to readers: This is a corrected story. A previous version said the debt would be going up to more than $129 billion. In fact, it will be almost $129 billion.
NANAIMO, B.C. – Former Bank of Canada governor Mark Carney says he’ll be advising the Liberal party to flip some the challenges posed by an increasingly divided and dangerous world into an economic opportunity for Canada.
But he won’t say what his specific advice will be on economic issues that are politically divisive in Canada, like the carbon tax.
He presented his vision for the Liberals’ economic policy at the party’s caucus retreat in Nanaimo, B.C. today, after he agreed to help the party prepare for the next election as chair of a Liberal task force on economic growth.
Carney has been touted as a possible leadership contender to replace Justin Trudeau, who has said he has tried to coax Carney into politics for years.
Carney says if the prime minister asks him to do something he will do it to the best of his ability, but won’t elaborate on whether the new adviser role could lead to him adding his name to a ballot in the next election.
Finance Minister Chrystia Freeland says she has been taking advice from Carney for years, and that his new position won’t infringe on her role.
This report by The Canadian Press was first published Sept. 10, 2024.
