Government of Canada introduces legislation to support low-income seniors who received pandemic benefits
February 8, 2022 Gatineau, Quebec Employment and Social Development Canada
As the global pandemic continues in Canada, the Government will continue to support vulnerable, low-income seniors who are experiencing financial hardship due to COVID-19.
The Canada Emergency Response Benefit (CERB) and the Canada Recovery Benefit (CRB) were intended to support people who lost their job through the outset of the pandemic. However, the Government recognizes that some Guaranteed Income Supplement (GIS) and Allowance recipients may face lower benefit payments because of the income they received from the CERB and CRB.
As announced in the Economic and Fiscal Update, the Government will provide up to $742.4 million for one-time payments. These payments will alleviate the financial hardship of those seniors who qualified and received CERB and CRB in 2020 but who subsequently saw that they counted as income and impacted their GIS or Allowance benefits. This automatic, one-time payment will support those who saw a loss of GIS or Allowance by compensating them for the full, annualized loss amount. Seniors would not need to take any action to receive the one-time payment.
To ensure that this issue does not reoccur, Canada’s Minister of Seniors, Kamal Khera, introduced Bill C-12 in Parliament today. Bill C-12 would amend the Old Age Security Act to exclude any income received under CERB, CRB, the Canada Recovery Caregiving Benefit, the Canada Recovery Sickness Benefit, and the Canada Worker Lockdown Benefit for the purposes of calculating the amount of GIS and Allowance payable beginning in July 2022.
The Government will continue to provide support to seniors who need it most.
“Low-income seniors should not be penalized for accessing income support they needed during the pandemic crisis. We will be fully compensating those seniors who are now facing financial hardship as a result of receiving pandemic benefits in 2020. And, because we don’t want seniors to face this again, I have introduced legislation to make an important legislative fix so that pandemic benefits won’t affect their GIS or Allowance benefit amounts going forward. The Government of Canada continues to demonstrate its commitment to seniors who have more financial needs through real action.”
– Minister of Seniors, Kamal Khera
Seniors are the fastest-growing demographic age group in Canada. By 2030, the number of seniors is expected to reach 9.4 million, representing close to one quarter of Canada’s population.
Every year, tens of thousands of seniors have their Guaranteed Income Supplement (GIS) increased or decreased to reflect changes in their net income. This design ensures the benefits go to the most vulnerable seniors. As GIS benefits are calculated on the basis of the previous year’s income, any change in income in a given year will result in an adjustment of GIS benefits in the following July to June payment period.
The targeted, one-time payment is proposed to go to an estimated 183,000 GIS recipients and 21,000 Allowance recipients who received pandemic benefits in 2020, and who faced a reduction or loss of GIS benefits in July 2021.
The one-time payment will be calculated to compensate for the loss in benefits. Further details on the calculation and distribution of the proposed one-time payment will be announced shortly.
Seniors will not need to take any action to receive the one-time payment. They will automatically receive the payment in the same way they receive their GIS payments.
Since 2015, the Government has provided supports to seniors, such as:
- Increasing the GIS for nearly 900,000 low-income single seniors. As a result of this, and other Government initiatives, an estimated 45,000 seniors were lifted out of poverty.
- Putting thousands of dollars back in the pockets of future Canadian seniors by restoring the age of eligibility for the OAS pension and the GIS benefits to 65.
- Enhancing the GIS earnings exemption for working low-income seniors, to help them keep more of their benefits.
- Reducing income taxes through increases to the Basic Personal Amount. When these increases are fully implemented in 2023, 4.3 million seniors will benefit, 465,000 of whom will see their federal income tax reduced to zero. Every year, singles will save close to $300 and couples will save nearly $600.
- Issuing one-time, tax-free payments to help seniors with their extra costs during the pandemic, worth over $1,500 to a low-income couple. In April 2020, more than 4 million low- and middle-income seniors received a GST credit top-up—worth an average of $375 for individual seniors and $510 for senior couples. In July 2020, the Government provided a one-time tax-free payment of $300 to 6.7 million OAS pensioners and a further $200 to 2.2 million seniors eligible for the GIS.
- Moving forward with the plan to boost the OAS pension by 10% in July 2022 for seniors 75 and over, including a one-time payment of $500 in August 2021 to OAS pensioners who will be 75 or over as of June 30, 2022.
- Bill C-12: An Act to amend the Old Age Security Act (Guaranteed Income Supplement)
- Economic and Fiscal Update 2021
- Programs and services for seniors
- Minister Khera announces one time payment
- Prime Minister announces additional support for Canadian seniors
- Prime Minister announces support for vulnerable Canadians affected by COVID‑19
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