This year, OAS cost $410 million less than the government thought

The federal government overestimated old age security costs by hundreds of millions of dollars last year, the third time in four years the toll for the contentious program was lower than expected. From Postmedia:

A government report tabled in the House of Commons on Tuesday shows that while the government had anticipated paying out $29 billion in OAS during this fiscal year, the actual amount was $410 million less.

The report says the difference is because there were fewer beneficiaries than expected and the average payout per person was lower than projected. In addition, more beneficiaries paid back their benefits than anticipated.

The government also overestimated in 2010-11, doling out $356 million less than the initial projection of $28 billion, and in 2008-09, when it was off by $368 million.

With most of the commentariat consumed by the ongoing Robocon scandal, the National Post‘s Andrew Coyne took a break to opine on OAS on Tuesday. Exactly what he said is a bit hard to sum up. The gist, I think, is that OAS is a problem, but not a catastrophic one, and there are a number of ways in which the government could solve it.




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This year, OAS cost $410 million less than the government thought

  1. Actually, the serious economic issue presented by the retiring demographic will be a Labour Shortage, as more people retire than enter the work force.  This could result in extremely high inflation with stagnant real GDP growth.  However, if Canada prepares properly with investment in appropriate technology and training it will result in unprecedented prosperity.  These politically motivated forecasts of an unsustainable burden of retired people are detracting from the real issue.  Labour Shortage.  And how to prepare for the Labour Shortage.

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