Canada Ups Retirement Age in Bid to Balance Budget
April 4, 2012
Canada's center-right government called for the retirement age to be raised and for major public service cuts recently, in an austerity budget that aims to balance the books by 2016, says Yahoo! News.
Tackling unpopular measures that many industrialized countries are being forced to consider as their populations age, the Canadian government said its budget would help the country move a step ahead.
- Under the plan, Canada will cut its deficit this year through "moderate" spending cuts, as the economy grows by 2.1 percent.
- But much deeper cuts, including the laying off of 19,200 government staff, or 4.8 percent of the federal workforce, are planned for the coming years.
- Finance Minister Jim Flaherty said old age security and guaranteed income supplement benefits worth up to a total of C$15,000 and now paid out at age 65 would be offered only at age 67, starting in 2023.
The deficit was projected in the budget to fall to C$21.1 billion or 1.2 percent of the gross domestic product (GDP) for the fiscal year ending March 31, 2013, down from a revised C$24.9 billion last fiscal year.
While Canada's economy weathered the worst of the global economic crisis well, it has not been immune to the tumult that has circled the globe, particularly when it comes to public finances. According to Statistics Canada, the Canadian economy has created more than 610,000 jobs since mid-2009, but employment was flat in the first two months of this year.
Going forward, the Canadian economy is forecast to grow by a modest 2.4 percent annually, from 2013 to 2015.
Looking to the longer term, the minister outlined immigration reforms to attract more foreigners with skills and money to "strengthen Canada's economy," and a streamlining of the review process for major resource projects.
Source: Michel Comte, "Canada Ups Retirement Age in Bid to Balance Budget," Yahoo! News, March 30, 2012.
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