Old Age Security Benefit Rates to Increase on July 1, 2005

OTTAWA, June 29, 2005 — Social Development Canada today announced that Old Age Security (OAS) benefit rates will increase as of July 1, 2005 . Increases in OAS rates are based on changes in the average Consumer Price Index (CPI).

As of July 1, 2005 , the basic OAS pension, paid to people 65 years of age and over, will be $476.97 per month. This is an increase of 0.7 percent over the previous quarter. Since 1973, all OAS benefits have been adjusted quarterly (in January, April, July and October).

The maximum Guaranteed Income Supplement (GIS) and Allowance payments, which provide additional benefits to eligible low-income pensioners and their spouses or common-law partners , as well as to eligible survivors, will also increase by 0.7 percent.

The OAS program is funded through general tax revenues and provides a basic minimum income for Canadian seniors. It is the most widely accessible source of income for older Canadians, providing 4.1 million seniors with approximately $27 billion in 2003/2004.

The Canada Pension Plan (or the Quebec Pension Plan in Quebec ), is funded through contributions by Canadian workers and their employers and the self‑employed, as well as through earnings on investment of the Plan’s funds. In addition to retirement benefits, the Plan also provides disability benefits, death benefits, survivor benefits, and benefits for children.

Together, the CPP and the OAS program enhance the quality of life of Canada ’s seniors by providing a modest income base on which to build for retirement.

For more information, please contact:

Social Development Media Relations
Social Development Canada
(613) 941-1110

Website: http://www.sdc.gc.ca

This news release is available in alternative formats, on request. Call 1 800 788-8282 on a Touch-Tone phone or through a teletypewriter (TTY).

BACKGROUNDER

Maximum Old Age Security benefit rates as of July 1^st, 2005