| Canada's public pension programs have raised seniors' incomes, but have not succeeded in lifting some, especially single women, above the Low Income Cut-Off. Old Age Security (OAS) may need structural reforms, due to its nearly universal nature and its use of an individual income test. Many single women rely on OAS as their main income source, though demographic trends may lead to reductions in the program. Relevant research around these issues is discussed and policy options are suggested. Each option is simulated using the Social Policy Simulation Database and Model and the distributional impacts are analyzed. Removing the income test would increase income inequality and low-income rates. Reducing the income threshold for the test would decrease these rates. Changing to a family income test is also examined. Given the costs involved, it would be difficult to make large improvements for single senior women by reforming OAS alone. |
