16th Actuarial Report Old Age Security Program as at 31 December 2018

Highlights

  • As a result of baby boomers gradually reaching age 65, the number of beneficiaries and expenditures are projected to steadily increase over the next four decades.
  • Expenditures are projected to increase from $60.8 billion in 2020 to $123.4 billion in 2035 and $243.4 billion by 2060.
  • The ratio of expenditures to the GDP is projected to be 2.77% in 2020.
  • Due to the population ageing, the ratio of expenditures to GDP is projected to reach a high of 3.1% by the mid-2030’s. Afterwards, this ratio is projected to gradually decrease to a level of 2.63% by 2060, mainly due to expected slower growth in inflation as compared to growth in GDP.
Chart 1 – OAS Program Expenditures (% of Gross Domestic Product)

Line chart showing the historical and projected total OAS program expenditures as a percentage of GDP for Canada. Y axis represents the percentage of GDP. X axis represents the year.

Total OAS program expenditures are 2.44% of GDP in 1990, increase to reach 2.65% in 1992, then decrease to 2.05% in 2008, and increase again to 2.46% in 2018. After 2018, the proportion is projected to increase to 3.14% in 2032, and then decrease to 2.63% in 2060.

Chart 2 – OAS Program Expenditures ($ billions)

Line chart showing the projected total OAS program expenditures in billions of dollars. Y axis represents the amount in billions of dollars. X axis represents the year.

Total OAS program expenditures are projected to increase from $60.8 billion in 2020 to $142.6 billion in 2040 and $243.4 billion in 2060.

Basic Pension

  • The number of beneficiaries of the basic pension is projected to increase by 53% over the period 2020 to 2035, growing from 6.6 million in 2020 to 10.1 million by 2035 and then reaches 12.7 million by 2060.
  • Basic pension annual expenditures are projected to increase from $46.3 billion in 2020 to $94.3 billion in 2035 and $195.5 billion by 2060.
Chart 3- Beneficiaries (millions) (Basic Pension)

Bar chart showing the projected number of OAS basic pension beneficiaries in millions. Y axis represents the number of beneficiaries in millions. X axis represents the year.

The total number of basic pension beneficiaries is projected to increase from 6.6 million in 2020 to 10.1 million in 2035 and 12.7 million in 2060.

Chart 4 – Expenditures ($ billions) (Basic Pension)

Bar chart showing the projected amount of OAS basic pension expenditures in billions of dollars. Y axis represents the amount in billions of dollars. X axis represents the year.

The total amount of basic pension expenditures is projected to increase from $46.3 billion in 2020 to $94.3 billion in 2035 and $195.5 billion in 2060.

Guaranteed Income Supplement (GIS) and Allowance

  • The number of GIS and Allowance beneficiaries is projected to increase by 52% over the period 2020 to 2035, growing from 2.3 million in 2020 to 3.5 million by 2035.
  • GIS and Allowance annual expenditures are projected to increase from $14.3 billion in 2020 to $28.6 billion in 2035 and $46.9 billion by 2060.
Chart 5- Beneficiaries (millions) (Guaranteed Income Supplement (GIS) and Allowance)

Bar chart showing the projected number of Guaranteed Income Supplement (GIS) and Allowance beneficiaries in millions. Y axis represents the number of beneficiaries in millions. X axis represents the year.

The total number of GIS and Allowance beneficiaries is projected to increase from 2.3 million in 2020 to 3.5 million in 2035, and also be 3.5 million in 2060.

Chart 6 – Expenditures ($ billions) (Guaranteed Income Supplement (GIS) and Allowance)

Bar chart showing the projected amount of Guaranteed Income Supplement (GIS) and Allowance expenditures in billions of dollars. Y axis represents the amount in billions of dollars. X axis represents the year.

The total amount of GIS and Allowance expenditures are projected to increase from $14.3 billion in 2020 to $28.6 billion in 2035 and $46.9 billion in 2060.

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