Old Age Security (OAS) is a subsidy the Government of Canada pays to seniors who are age 65 and older.

As of April 2025, individual seniors with up to $93,000 of annual income receive $9,000 annually in OAS cash benefits.

Senior couples with up to $182,000 in annual income can receive $18,000 annually in OAS benefits. Because seniors can rely on pension income splitting (which isn't available to other household types), they are able to maximize their OAS subsidies.

All seniors are eligible for OAS if they are Canadian citizens or legal residents, and if they have resided in Canada for at least 10 years since the age of 18. Employment history does not determine eligibility for OAS. Seniors can still receive the subsidy if they have never worked, or if they are still working.

Unlike the Canada Pension Plan, the money seniors get from OAS is not drawn from contributions they have historically made to the program. In other words, they have not 'pre-paid' for the benefits they receive. Instead, OAS is funded out of general government tax revenues, and is paid for by today’s taxpayers.

Under Canada’s current tax system, all Canadian seniors are also automatically eligible for the Pension Income Credit, and those with incomes up to $92,000 are also eligible for the Age Credit. These credits do not benefit the lowest income seniors.

When OAS was created in 1952, things looked pretty different in Canada. We didn't have the Canada Pension Plan. We didn't have as many tax shelters for retirees, like the Age Credit and the Pension Income Credit. People didn't expect to live for as many years post retirement. And we had 7 working age Canadians paying taxes to help support each retiree - today there are only 3 worker per retiree.

With all of the changes that have taken place between 1952 and today, it's no surprise that we're well past due on updating OAS. A 2024 report from the Auditor General confirmed that Ottawa doesn't know if the program is meeting its objectives. It's time to make sure OAS is fit for purpose in 2025. 

OAS is not the Canada Pension Plan (CPP). Today’s retirees have not paid into OAS in proportion to the benefits they now receive – even if they worked hard and paid taxes according to the rules of the day.

In anticipation of the baby boom cohort aging, the government changed CPP so Canadians could collect a benefit relatively proportionate to what they contributed. Sadly, Ottawa didn’t do the same for OAS. It remains a government subsidy paid to whomever is eligible – and eligibility rules are far more generous than for most other cash benefits. The generosity of OAS for affluent retirees is now a primary reason we leave 400,000 seniors in poverty, and rack up large deficits that our kids and future generations will inherit.

Our plan would affect the 1 in 5 retirees with household incomes above $100,000. We’re asking them to take about $3,000 from OAS - so that we can give more to those who don't enjoy this level of financial security.

If you think shifting OAS eligibility from $182,000 of household income to $100,000 would create financial hardship for seniors, think again. Seniors who would be personally affected by this change are telling us that it wouldn't have a big effect - and that they'd welcome seeing these funds go towards those who really need more support. You can also take a look at stories of seniors with millions in assets collecting OAS - they are profiled regularly in the Globe & Mail’s Financial Facelift column.  

An OAS threshold of $100,000 isn't stingy. It's still more generous than the $81,000 cut-off for the Canada Child Benefit, and is also well above Canada's median family income of $74,000.

After OAS, the Canada Child Benefit (CCB) is likely the best-known cash subsidy delivered by Ottawa. Families receiving the CCB don’t benefit from the same level of generosity extended to retirees.

Ottawa begins reducing the Canada Child Benefit when household income surpasses $81,000. By contrast, retired couples can have $182,000 in combined income before OAS payments are reduced. This disparity persists even though compared to young families, retirees have the lowest rates of poverty, the highest levels of wealth, and a great deal of housing security (since 70% are home owners).

Sadly, fewer than half of Canadians are aware that low-income families with kids receive smaller cash benefits than retirees. Younger age groups are somewhat more likely to be aware of the discrepancy, but just 31% of Canadians ag 65+ know that the cash benefits they receive exceed what’s available to families with kids.

OAS is the largest line item in the federal budget. Nearly one-fifth of all federal spending goes to OAS, and this amount is growing faster than most other expenditures put together.

It is impossible to restore balance to the federal budget without factoring in OAS. Politicians who say otherwise are trying to pull the wool over your eyes. There may be other things to cut – and reasonable people can disagree about what these are – but most are simply not big enough ticket items to fill our growing budget hole.

Liberal, Conservative and NDP governments across Canada are running large deficits. This trend is a threat to generational fairness, because younger and future generations will be saddled with the bills we leave unpaid today. To help understand why this is happening, we took a look at how income taxes have changed over the last 5 decades. Here’s what we found.

Income taxes are lower today than when baby boomers were young.

Because income tax rates are generally lower now than they were half a century ago.

Today’s retirees consume a larger share of the revenue governments collect via income taxes, compared to what we collectively spent on retirees when the baby boom generation was young.

Despite lower tax rates, more tax dollars go to retirees’ medical care and Old Age Security today than half a century ago. This is because the percentage of Canada’s population over age 65 has increased from 8% in 1976, to 19% in 2024.

A larger share of the tax dollars paid by younger people today goes to support retirees, compared to what retirees paid to support older generations when they were young.

The typical 35-year-old now pays around 20-40% more for boomers’ Old Age Security and medical care than boomers paid as young people to support the smaller number of seniors in their day.

Together, these trends result in governments having fewer funds to invest in younger generations — even though these age groups face greater financial insecurity and declining wellbeing. That’s not investing fairly in young and old alike.

Learn more in our full tax trends analysis.

The Guaranteed Income Supplement (GIS) is a component of Canada’s Old Age Security (OAS) system that delivers additional non-taxable financial support to retirees with low incomes.

As of May 2025, single retirees with incomes below $22,056 are eligible to receive the GIS. Retired couples are eligible if their combined income is below:

• $29,136 if a spouse/common-law partner receives full OAS benefits.
• $52,848 if a spouse/common-law partner does not receive OAS benefits.

The figures we use on federal government spending on OAS includes spending on GIS.

Our plan to eliminate seniors’ poverty could be implemented by increasing GIS benefits. At present, eligible single retirees can receive up to $1,087 per month, or $13,044 per year. The $5,000 increase we propose would increase this amount by over 38%.

When it comes to measuring seniors' poverty, there are 3 different measures. Two of these 3 show that seniors are less likely to be poor than other age groups. This includes Canada's official poverty measure, which informs the national poverty reduction plan. One measure shows that seniors' poverty is slightly higher than other age groups. No poverty measure accounts for wealth - like the housing wealth that many of the majority of seniors who own their homes have gained from rising prices. 

Canada’s official poverty line is the Market Basket Measure (MBM), which defines poverty based on the cost of a ‘basket’ of goods and services considered essential to have a modest standard of living. A household is considered poor if its income is insufficient to purchase this basket. The MBM is measured and reported by Statistics Canada.

According to the MBM, seniors have the lowest rate of poverty of all age groups. The most recent data for 2023 show that seniors are the only group for whom poverty has declined, to 5%.

The Material Deprivation Index (MDI) assesses whether a household can access 11 essential goods and services considered necessary for a ‘minimally acceptable’ standard of living. A household is considered poor if it cannot afford two or more of these 11 items. This measure was developed recently by Food Banks Canada and other partners.

According to the MDI, seniors have the lowest rate of poverty of all age groups. The 14% of seniors considered to be poor under the MDI is much higher than the 5% under the MBM.

The Low Income Measure (LIM) assesses poverty by comparing households to Canada’s median income. It is a relative measure of poverty, meaning that changes to median income can affect the number of households considered poor, even if the incomes of these households themselves remain the same. The LIM considers a household to be poor if its income is less than 50% of the median (adjusted for household size). The LIM is measured and reported by Statistics Canada.

According to the LIM, seniors have slightly higher rates of poverty than other age groups: 13.8% in 2023, compared to 13.2% for those under age 18 and 11.1% for those age 18-64.

The OAS reforms we propose would only impact financially secure senior couples with annual incomes between $100,000 and $300,000. There would be no change in OAS subsidies for retired couples with lower incomes, and some single seniors would receive higher OAS subsidies.

Right now, taxpayers send $14 billion every year to retirees with annual incomes above $100,000, while other seniors, families, and working adults live in poverty. That’s not a responsible use of public funds, and it’s inconsistent with Canadian values about helping those in need.

The original goal of OAS was to ensure that no senior lived her final years in deprivation – a laudable commitment to which we should live up. Yet today, the affluence of some retirees who collect OAS is on display every week in financial advice columns. OAS clearly has drifted too far from its aim. The reforms we propose are urgently needed to restore the integrity of this cornerstone of income security in Canada.