Articles

PENSION POVERTY

Life on $30 a month is a bitter dose for our aged. But to raise pensions from the slum level would cost plenty. Can we afford it?

HAROLD DINGMAN March 1 1949
Articles

PENSION POVERTY

Life on $30 a month is a bitter dose for our aged. But to raise pensions from the slum level would cost plenty. Can we afford it?

HAROLD DINGMAN March 1 1949

PENSION POVERTY

Life on $30 a month is a bitter dose for our aged. But to raise pensions from the slum level would cost plenty. Can we afford it?

HAROLD DINGMAN

HOW will you live when you are old? In a dark and cheerless room in downtown Toronto Miss Phoebe Grant, a tiny, wrinkled woman of 76, lives alone and almost friendless. She subsists on an old-age pension of $40 a month and her life is a prolonged nightmare of scrimping and cheap buying. All her bargain-hunting is devoted to food because she pays $24 of her pension for rent.

When she first became a pensioner at 70 she received only $28, but she was better off, she remembers. Rents were lower and food prices were such that she could buy liver, bacon, sausage, and fresh milk. Today she has no fresh milk, fruits or vegetables, and only the occasional bit of bacon or liver.

Like most old people she sleeps long hours—10 to 12 hours a night—and her food requirements are low. She buys tinned soups, sardines, milk; eggs and cheese; noodles and cereals.

New clothes? Her wrinkled face and her bright old eyes smile. “You’ve got to be foxy when you’re old,” she says. “I find people who will help me.” She has no radio, goes to no movies, and her only social life is at Wednesday and Sunday meetings in her church.

In a smelly tenement not far from her two old widowers, frail ghosts of men, pooled their pensions and rented two rooms, one of them unheated. They had first met in an old men’s hostel, where they lived in dormitories and ate in common dining rooms. They decided to strike out. for “independence.”

Frank Knight, 85, and Albert Storey, 80, receive pensions of $37 and $34 respectively. Although they live in the big city’s backwash, and although for them the hustle of life is done, these two men face the far end of their years with a sort of brittle cheer.

Even the sickness of old age, which forces one or the other to bed frequently (and which brings the Victorian Order of Nurses to help them), does not dismay them too much. “We get through all right,” says Storey, referring to the one subject of vital interest—how to balance a meagre budget.

Their rooms cost a total of $12.50 a month and

their gas bill runs to $7 a month for the heated room during the winter. From their combined pensions this leaves them $51.50 for food, clothing and tobacco, or less than $1 a day each. Storey, whose first pension was $20 a month 10 years ago, says he was better off then because food prices were low'er, and Knight, too, remembers better days when he received less money from the Government.

Everywhere across Canada these stories of oldage pensioners living on the edge of poverty are repeated, with thousands of small variations.

To thousands of the country’s 250,000 aged the monthly cheque is a kind and generous gift, which enables them to live out their lives in some peace and dignity. Thousands of others live a harsh life in stinking old buildings, in dirt and filth and squalor; friendless and hopeless and trapped.

This year Canada’s pensioners will receive slightly more than Continued on page 35

Pension Poverty

Continued from page 19

$100 millions in cash, of which the Federal Government will pay $68 millions and the provinces the balance. The addition of Newfoundland to the Canadian union will boost this figure, but Ottawa as yet has no accurate estimate of the amount. Newfoundland today pays $6 a month to single persons and $10 a month to a married couple.

For those Canadians who depend upon the pension for their living the monthly cheque is never enough. A simple accident to the cheque-mailing machinery in the Ontario Government pension office provided the clearest illustration of how near to destitution are the pensioners. When the machine broke down 1,500 cheques were exactly two days late in being mailed and were delivered on the third day. But on the second day more than 1,000 letters of complaint were in the office of the Pensions Commission. That meant that on the exact day the cheques were due in the homes (and were missing) more than 1,000 of the 1,500 pensioners sat down and wrote a protest.

By Federal statute and by agreements with the provinces the basicpension in Canada is $30 a month to persons without resources who are 70 and over. The Federal Government pays $22.50 and the provinces pay the balance, $7.50. Five provinces add cost-of-living bonuses varying from $1 to $10.

There is meanness as well as generosity in the handling of pension funds. Although the Government will permit a man or woman to have $2,000 in cash and still receive the basic pension, one seamstress has $2.18 deducted each mont h from her $30 total. In her means test she admitted she had an endow-

ment which brought her $26 per year and the Ontario Government therefore pays her only $27.82 per month. She manages to earn about $5 a week sewing.

In a rich suburban area of Ottawa a woman of 72 who lives in comparat ive luxury provided by her high-salaried son receives a pension of $26 a month. She lives in a prosperous home and has a maid to attend to her needs. She uses her $26 to pay her church dues, for occasional taxi rides to bridge parties and for other “necessities” in her comfortable life.

Why does she receive a pension at all? Because any Canadian citizen at the age of 70 without resources is entitled to t he pension. Why does she receive t IK* sum of $26? Because her total allowable income is $50 a month and because she pays her son $24 a month for her board and room. Thus the Government considers she has an income of $24 a month and generously gives her $26, the difference between what she “pays” for her board and the $50 allowed. The son is not permitted t o ask for a dependent ’s exemption for his mother in paying his income tax because he is, in theory at least, receiving money from the Federal Treasury—the $24 board money.

Better Off on Land

It is in the big cities, where living costs are highest, that pensioners suffer the most. In a squalid tenement a little woman of 76 nearly died of starvation and acute nervous anxiety because her pension cheque was late. She went almost without hot food and hot. drinks for three days, frantically begging and pleading from office to office for her cheque.

Her rent: was past due, her gas bill was due, she had not even a spoonful

of tea in her shabby room and each day she had to beg carfare from her landlady to reach the pension offices.

At the end of the third day, when she was near physical collapse, an official cut some red tape and gave her a cheque for $3.50 to carry her until her missing pension was located.

Pensioners who live in country districts are more comfortably fixed than those who live in the cities. Near the village of Manotick, 25 miles from Ottawa, there is an old couple who live on their own few acres of land. Between them they receive a total pension of $51.50 a month and, because they are still active, this allows them to live in modest comfort.

They have a tiny, three-room house with a dugout basement where they store the vegetables they grow in the summertime. Wood stoves in the three rooms provide heat, and the old man, although 75, is still able to chop some wood.

Shy and taciturn, this couple fears one thing in life—“old age,” when they will be unable to work about the garden or the house, and will be forced into the city and possibly an old folks’ “home.”

Pension authorities claim that at least half of Canada’s 250,000 pensioners live on farms or in rural districts, and that most of these live with relatives; and that these combined circumstances allow them a life of some comfort.

They also assert that a quarter of all pensioners live in cities with relatives, and have some ease and comfort.

Unfortunately these claims cannot be supported or disputed without exhaustive research in every province.

Everywhere in Canada there are old folks’ “homes” and, although they are crowded to capacity, there is surprising resistance to, and even hatred for, these institutions. The “homes” are supported by public and private charities (many are operated by churches) and in most the pensioner pays $25 of his $30 pension for food and bed.

A characteristic fairly common to them is that they separate man and wife, each to sleep in separate dormitories.

The institutions are disliked because of the discipline imposed—meals at given hours, lights out, and so on, and the general feeling of being herded and pushed.

In a Toronto tenement, which smells of age, of generations of people, of dead air and leaking gas, dirt and rancid food, live Mr. and Mrs. Alfred Harding. Their “home” is No. 24, a oneroom “apartment,” measuring perhaps 14 feet by 12, containing an ancient double bed with flat springs, and a twoburner gas range. It is cluttered with shabby furniture. The walls may once have been cream-colored but now they are a sickening dirty brown with great streaks of black. There is no bath, no toilet, no closet space, no refrigeration, no running water.

Alfred Harding is anex-teamster who lived comfortably enough before trucks forced most dray horses off Toronto’s streets. At 72 he receives the $30-amonth basic pension. The Ontario Government does not see fit to give Harding any supplementary allowance because his wife has $300 in the bank and is still of working age and in fair health. She is 59.

The $300 nest egg is disappearing quickly because Mrs. Harding’s savings buy much of their food. They pay $14 a month for rent and $2-plus for gas, leaving a balance of less than $14 for all their requirements. They have no children and get no help from relatives abroad.

“We’re not starving, you know,”

said Mrs. Harding, a frail woman standing not more than five feet in height and weighing perhaps 100 pounds. “We have fresh milk and bread, and on Sunday we have stewing beef.” They have had no roast, meat in more than a year.

“When I worked we used to live good,” said Harding, a thin gaunt man with a talkative, querulous interest in the world that is passing him by.

“I’ll be back at work when the money’s gone,” Mrs. Harding said, smiling fondly at Alfred. “That’s what worries me,” she added, “leaving Alfred at home alone. He’s got a bad heart.”

Harding collapsed in the street last summer and spent five weeks in a hospital ward. That illness depleted Mrs. Harding’s savings by the staggering sum of $185. One of the sorry anomalies of the Old-Age Pensions Act is that, although a pensioner is entitled to free medicine and free hospitalization (with limitations), in this particular case his wife’s surplus cash was regarded as joint income and therefore expendable. If she had been on the pension she would not have had to spend her cash.

“How long will your money last?”

“Less than a year,” she replied, “and less than that if either of us gets sick.” Both looked frail and grey.

She Can Still Scrub

The Hardings are London-born (tens of thousands of Canada’s pensioners are foreign-born) and came to this country as youngsters, he at 14, she a little older. Thus they both qualify easily for the pension which requires a 20year residence in Canada.

Mrs. Harding must work 11 more years before she is eligible and her only training is as a domestic. Until she is 70 she faces the dreary prospect of being a day laborer, scrubbing floors or doing other menial tasks.

How much a pensioner is paid is determined by his means and where he lives. If a person is living with a relative he does not actually have to take an oath that he is paying cash for board and lodgings. The Government investigators will arbitrarily determine that board and lodgings amount to so many dollars of income. And a pension may then be paid above that.

Surprising is the fact that a man may have as much as $2,000 in cash in the bank, or the equivalent in property, and still receive the full basic pension.

For people of 70 who have cash in the bank and who apply for a pension, it works this way: the Government arbitrarily assumes that the cash or property will be converted into Dominion Government annuities. For example, if a man of 70 had$l,000in cash and converted it to an annuity he would receive $102.35 from his annuity. He would be entitled to his full pension because the $102.35 plus pension would still be less than $600 a year. If he had $2,000 and invested it in an annuity he would receive $204.70 and still be eligible. If he had $3,000 he would receive $307.05 from his annuity. The pension he could receive would be the difference between that and $600 a year, or $292.95, amounting to about $24.40 a month.

How much a person receives of the basic pension is measured by the results of the “means test.” This is simply a thorough investigation to find out the private income or resources of the individual pensioner. The investigation enquires into every minute detail of a person’s life—how much he has earned in the past; how much he has saved, if any; how much property he owns, if any; how much it costs him to eat and sleep; how much he can

earn at part-time jobs; how much he receives in gifts.

A vital part of the legislation is that which states how much “extra”income a man may have. By Federal law he is paid up to $30 a month or $360 a year, but he may receive a total of $50 a month or $600 a year, including the pension. That is, he is permitted to have an extra allowance of up to $20 a month or $240 a year. If a man of 70 has an income of more than $600 a year from his own resources or otherwise he receives no Government pension.

The province where a pensioner lives is also a factor in his pension rate. Five of the provinces pay bonuses to help meet the inflated cost of living.

British Columbia pays the basic pension of $30 plus $10. Alberta pays $30 plus a bonus of $7, and Saskatchewan pays $30 plus $5.

-» Ontario pays a bonus of from $1 to $10 to “needy” cases and, although the province will not publish the number of persons receiving the bonus, it is estimated in Ottawa that 16% of Ontario’s 80,000 pensioners receive an extra allowance.

• East of Ontario only Nova Scotia has a bonus plan, and it is up to $5 per person. In none of the provinces is the pensioner allowed to have more than $600 a year, including bonus.

Obviously it would be pleasant if a pensioner in an eastern province could Wove to the warmer climate of British Columbia and receive a higher pension. He is free to move, but he would not receive the bigger amount. This is because the provinces pay all the bonus costs without Federal assistance and B. C. will not pay an extra $10 to every old person who decides he would like to live out there.

How do Canada’s present pensions compare with other nations? On the whole, favorably. No comparison is really valid unless an exhaustive study is made of various clauses in the pension statutes, but, in many respects, Canada’s laws are more generous than others.

The average old-age assistance paid in the U. S. in 1948 was $39.37 compared with $29.30 in Canada, but in the U. S. the state governments contribute a higher share than do Canada’s provincial governments.

Great Britain pays $22.75 per month for single pensioners and $36.83 for married pensioners. New Zealand pays a graduated scale not to exceed $39.39 per person per month. Australia pays a scale not to exceed about $30.

Vote-Seekers Raise Ante

Why doesn’t Canada give her poor old people more money? Why not $75 or $100 a month or enough to lift them out of the slums into some decent standard of living? This year, when they are anticipating a general election, all three major political parties in Canada are emphasizing social security measures, including their solutions to the problem of the aged.

The Progressive Conservatives offer a $40 pension at 65 years without a means test. If Canada had started paying this on June 1, 1948, the cost in the ensuing 12 months would total $461,136,000 on the basis of 960,700 citizens 65 years of age and over, compared to the $100 millions now being paid.

The CCF offers $50 a month at 60 years. In 1948 this would have cost $867,120,000, on the basis of there being 1,445,200 persons 60 and over.

How would working Canadians pay these huge expenditures? Byincreasing our personal income taxes? Supposing the Government arbitrarily declared a 10% surtax on your income tax this year (to pay higher pensions), it would

still only net the relatively small sum of $67.5 millions. This figure is based on the collections made in the abundant year 1946. How are we to raise the $400 millions the PC’s offer right away, or the $800 millions the CCF offers?

The Liberal Party first introduced old-age pensions back in 1927 ($20 a month) and has been responsible for all the major increases since then.

The Minister of National Welfare, Paul Martin, says contributory old-age insurance is the Liberal Party’s “early objective.”

Already the number of old-age pensioners is soaring in Canada, more particularly since the end of the war. Since March 31, 1945, the number of pensioners has increased from 187,500 to 250,000, or 62,500 new names on

the pay lists. Why? Two reasons: first, many old folk worked during the war or received assigned pay from sons or daughters and did not need the pension. Second, since early in 1947 many thousands more old people have been made eligible for a pension because of amendments to the Act.

While political leaders offer their solutions to the increasingly serious problem, most of the professional economists on Government payrolls shake their heads in doubt. The big problem, they say, is this: What social security can you legislate for today and still pay for 20 or 25 years from now?

The squeeze hits the man who is somewhere in the middle years—he must provide for the education of the young and the care of the old. ★