As part of our 2008 federal election coverage, Investment Executive explores the positions of the major federal political parties on the top issues affecting the financial services industry.

Here we look at where the parties stand on retirement issues.

In trying to win over voters, federal politicians have so far ignored Canada’s seniors, according to CARP, a national, non-partisan, non-profit organization for aging Canadians.

To date, the parties still haven’t answered any questions on senior concerns outlined in the CARP survey sent to their offices on September 25. Responses from the parties on issues such as pension security, forgoing the mandatory retirement age and better treatment for aging employees were due on October 1, the UN-designated International Day of Older Persons.

“They are ignoring the wishes of 62% of their voters,” said Susan Eng, vp of advocacy for Toronto-based CARP. According to Statistics Canada, of the 8.9 million Canadians who voted in the 2004 election, 62% of them were 45 and over.

While the parties have not been proactive in addressing the CARP survey, the Liberal Party of Canada proved themselves reactive October 3, after seeing CARP’s news release “Will Dion sacrifice pension income splitting to finance green shift scheme?”

Dan Braniff, chairman of CARP’s Georgian Bay Chapter in Ontario and the founder of the Common Front for Retirement Security, penned the release after watching a CBC commentary on the French election debate, where a Liberal spokesperson said pension income splitting was not on the Liberal platform, because it only benefits 12% of Canadians.

Putting this comment together with Liberal leader Stephane Dion’s statement during the English debate, where he said pension income splitting is costly and not the party’s priority, Braniff drew the conclusion the Liberals would be eliminating income splitting to fund their green shift. “Seniors are willing to do their part but they should not be sacrificed at the green shift altar,” the release stated.

“I don’t know what kind of game they are playing,” says Braniff. “Quite frankly, I think Mr. Dion is testing the waters to see how many of us old geezers will speak up.”

Quick to refute Braniff’s comments, Carolyn Bennett, incumbent Liberal candidate and critic for seniors, called Eng at noon the same day. She assured CARP the Liberals had no plans to reverse the pension income splitting policies, which were passed by the Conservative Party of Canada the previous year.

“It’s bad enough that none of the federal parties have proposed any real solution to the current market turmoil, without this added threat,” Eng said, in another CARP release on October 3, featuring her conversation with Bennett.

Out the four major parties, only the Green Party of Canada has confronted mandatory aging and retirement security head on. The party’s platform states it will work toward eliminating mandatory retirement, as well as provide flexible benefits for seniors, who want to continue working.

The Conservatives and the Liberals have focused on improvements for the Guaranteed Income Supplement (GIS), extra money for low-income seniors on top of their Old Age Security (OAS) pension.

All seniors receive $479.07 a month in OAS. However, if yearly income is below $15,000, an individual can receive an extra GIS supplement between 51¢ and $652.51 per month. As it stands, seniors have to reapply for the GIS every year. The Conservatives plan to pass new legislation, where seniors will not have to reapply year after year.

The Liberals plan to give low-income seniors an extra $600 in GIS per year, or $800 for couples. They will also change the Canada Pension Plan (CPP) disability requirements so that Canadians with multiple sclerosis can still work without jeopardizing their ability to collect CPP or Quebec Pension Plan benefits.

In addition, the Liberals propose to make the Disability Tax Credit refundable. For 2008, the Disability Tax Credit amount is $7,014. If an individual’s income is less than that, currently, they do not get the benefit of the difference refunded to them, says Alan Posner, a chartered accountant in Toronto. In theory, if the Liberals were to make the credit entirely refundable, according to Posner, a person making $4,000 a year would get a refund cheque of approximately $1,800 after submitting their income tax return.

“Only a portion of the credit may be refundable in the future,” says Posner. “No one knows if it will be fully refundable for sure.”

@page_break@Making changes to GIS supplements and disability tax credits will cost Canada a total of $2.52 billion, according to the Liberal’s platform budget. However, with the green shift, the Liberals project costs will drop to $250 million.

No changes to pension supplements are stated in the Green Party’s platform. They plan on raising awareness among seniors about the federal income supplements available to them, as well as providing them with more instruction during the application process.

The New Democratic Party of Canada has not taken a position on the mandatory retirement age or federal income supplements. However, the New Democrats have addressed the aging population through healthcare reforms.

These include contributing $200 million a year towards increasing the number of doctors and nurses being trained in the country, as well as forgiving student loans for graduating health care professionals who commit the first 10 years of their practice to family medicine.

IE