Measures to assist seniors during COVID-19
Seniors who qualify for the Old Age Security (OAS) pension will receive $300. Individuals who also qualify for the Guaranteed Income Supplement (GIS) will receive another $200. Individuals receiving a spousal allowance will receive $500. All are tax-free one-time payments. PBO estimates total net cost of this measure to be $2,478 million in the 2020-21 fiscal year. This includes a cost of $2,015 million for the one-time OAS pension payments, $426 million for the one-time GIS payments, and $37 million for the one-time spousal allowance payments.
Seniors who qualify for the Old Age Security (OAS) pension will receive $300. Individuals who also qualify for the Guaranteed Income Supplement (GIS) will receive another $200. Individuals receiving a spousal allowance[^1] will receive $500. All are tax-free one-time payments.
PBO based its calculation of the net number of beneficiaries on the number of net beneficiaries of the OAS pension, GIS and spousal allowance in March 2020. Using projections from the PBO's April 30 Scenario Analysis Update, the growth rates of net beneficiaries of the OAS pension, GIS and spousal allowance from Q1 to Q2 2020 were calculated. These growth rates and the March 2020 data were used to estimate the net number of beneficiaries of the OAS pension, GIS and spousal allowance in June 2020. The net number of OAS pension beneficiaries was scaled up to estimate the gross number of OAS pension beneficiaries in June 2020.
Overall, PBO estimates that 6.7 million OAS gross beneficiaries will receive the one-time OAS pension top-up. Roughly 2.1 million people are estimated to receive the additional one-time GIS top-up, and approximately 74 thousand will receive the spousal allowance top-up.
PBO estimates total net cost of this measure to be $2,478 million in the 2020-21 fiscal year. This includes a cost of $2,015 million for the one-time OAS pension payments, $426 million for the one-time GIS payments, and $37 million for the one-time spousal allowance payments.
Any deviation from population projections would affect the number of people who qualify for age-related eligibility criteria of the OAS pension and the GIS in June 2020. The accuracy of the estimate of OAS pension gross beneficiaries depends on the accuracy of the projected percentage of seniors whose OAS pension benefits will be completely clawed back in 2020.
- Estimates are presented on an accrual basis as would appear in the budget and public accounts.
- A positive number implies a deterioration in the budgetary balance (lower revenues or higher spending). A negative number implies an improvement in the budgetary balance (higher revenues or lower spending).
- “-“ = PBO does not expect a financial cost