Proceedings of the Special Senate Committee on Aging
Issue 5 - Evidence
OTTAWA, Monday, March 19, 2007
The Special Senate Committee on Aging met this day at 12:35 p.m. to examine and report upon the implications of an aging society in Canada.
Senator Sharon Carstairs (Chairman) in the chair.
[English]
The Chairman: Welcome to the Special Senate Committee on Aging. This committee is examining the implications of an aging society in Canada. We have organized two panels to help us gain an overview of the key issues, which are the themes of demographic changes and aging as a social process.
To help the committee better understand these issues, we have with us today Professor Jacques Légaré.
[Translation]
He is Professor Emeritus of Demography at the Université de Montréal, where for 16 years he was Director of the Demography Department. He is a member of the Royal Society of Canada and President of the think tank called Le pont entre les générations, or "The Bridge between Generations." Among other things, he has edited publications including Âge, générations et contrat social and L'État-providence face aux changements démographiques.
[English]
We also have Professor Marcel Mérette, Associate Professor in the Department of Economics and Vice-Dean of Research, Social Sciences, at the University of Ottawa. He has recently published papers on population aging and immigration, the interregional consequences of population aging in Canada, and intergenerational equity and growth in the context of population aging.
We welcome you both to the Senate of Canada. We appreciate that you will make short opening statements and then we will have a number of questions.
[Translation]
Jacques Légaré, Professor Emeritus of Demography, Université de Montréal, as an individual: First of all, I would like to thank the chair and the members of this committee for inviting me to talk to you about the demographic aspect of an aging population. I appreciate the fact that, before seeing me, you invited a number of my colleagues in the field, who gave you excellent information on the figures underlying the issue, because I do not intend to give you any figures.
The title I have given this brief is Au-delà des chiffres et des évidences qui sont parfois des mirages — looking beyond figures and evidence that are often misleading. I have read the report, as well as the briefs previously presented. On the whole, I agree fairly well with everything my colleagues have said. We will come back to some important details, but these are not details I will be presenting.
I will do this along the same lines as my colleague Byron Spencer. He had seven minutes for his brief, so he presented his comments under seven headings. I have also decided to condense my remarks into seven sections, each coming under a shocking statement.
The first statement: A new "golden age," which extends from retirement to old age. This is a concept invented by Peter Laslett, my mentor at Trinity College, Cambridge. Laslett clearly understood that we could no longer talk about the three phases of life, which were once youth, adulthood and old age. There are now four phases of life, youth, adulthood, and a new "golden age" which extends from retirement to old age, and old age, which has essentially been pushed back. That "golden age," which extends from retirement to old age, never existed in society before. It had to be invented for the group which retires from work but cannot be considered as belonging in the "old age" phase.
In traditional societies, one "retired" when one became old, and one became old when one retired. That notion is no longer applicable in modern society, and that is why we need what we call the "golden age."
Obviously, demographers are often interested in establishing specific thresholds, such as the exact age at which we retire, the exact age at which we become old, and so on. You talked about those thresholds a great deal, so we will not come back too much to the numbers, though they are important. My colleague Laurent Martel impressed you with his age thresholds of 65 and 81, because you come back to them sometimes. In our field, however, it is difficult to establish precise thresholds for retirement and old age, because retirement and old age are both processes, processes in which we transition gradually from one state to another. There is no precise moment at which we retire — at least, less and less so these days — and there is no precise moment when we become old. This means it is difficult to establish a specific threshold.
However, if we are to understand each other clearly, we do have to set out a procedure, and we must try to provide a genuine definition of old age. If we take an old definition by Furetière, dating back to the 17th century, old age is the age at which we become obsolescent. Men reach it at 60, and horses at 20. The word obsolescent is extremely important here. Why are horses not old at 60? You have to understand that the old age threshold is a function of the life expectancy of species and individuals. Thus, if your life expectancy increases, you cannot be considered old at the same age. That is something we need to remember.
So how do we define old age? In my opinion, old age is defined as dependency. Old age is not defined by age per se, but by the loss of independence or, in some cases, by ill health.
I do not feel we should be so afraid of saying "old." I know that it is not very politically correct to say "old," but I think it is in fact important to state that old people are indeed old. The others are retired people.
Dependency — which is not a very agreeable phase of life but is often the phase in which we all end up — can be measured. In general, we measure it by the loss of independence and by the degree of disability.
Generally, following studies that my colleagues and I have undertaken, we have come up with a figure of about 12 per cent — in other words, about 12 per cent of people are to some extent disabled. That figure remains fairly stable over time, and in projections made as populations change. That disability level is closely linked to many factors, in accordance with life path simulation models that you are very familiar with. I see that you are very well informed. Using this micro-simulation model, we can demonstrate that the disability rate will remain fairly stable over the next 30 to 40 years.
So some people might conclude there is nothing to worry about, and ask themselves why we are getting so concerned. But we should be somewhat concerned, because the number of disabled people will double in Canada, and that is not something we can manage in the same way. Even if the percentage remains stable, the actual number of disabled people will double. If that 12 per cent level remains the same, that is one thing; if the level improves, that is a different thing altogether, and we will come back to it. However, if we stay at that 12 per cent level, we must expect that the actual number of disabled people will increase or even double over the next few years.
Third statement: Make sure that the distinction between "curing" and "caring" is quite clear. As you saw in your proceedings, health is a very different thing from absence of illness. When we plan for health care costs, that definition of health is all too often ignored, both generally and in the debates held here. I think we have to make a very clear distinction between the medical aspect, which is "curing," and the social aspect, which is "caring." Those two aspects, or components, of health and health care should not be confused. Hospital care must be distinguished from home care. There is of course institutionalization beyond that, but the distinction I am concerned with must always be made clear.
Unfortunately, that distinction is generally not made, either in written documents or in verbal comments. In our society, priority is given to medical and hospital care, before being given to social care. As long as we continue to leave that approach uncorrected, I believe we are making a serious mistake in the way we manage our aging society.
Two university hospitals are slated to be built in Montreal. In the West Island, I noticed a billboard ad about McGill Hospital, which stated: "Support us, we will care for you." Personally, I think that ad is a lie, a lie that will have as much of a negative impact as the Freedom 55 ads or cigarette ads. But only cigarette ads ended up before the Supreme Court. I will let you think about that. In my view, university hospitals are not there to provide "caring," and are certainly not there to help older people. Older people need something other than university hospitals at the moment. To face the challenges of the 21st century, we will have to ask ourselves some serious questions about how and where we focus our health care spending.
Fourth statement: Is life expectancy necessarily going to increase in future? I believe that this is another subject many people have spoken about here. You have heard about life expectancy, from birth to age 65, covering all states of health. Generally, life expectancy is increasing, both at birth and at 65. However, things are a lot less clear when we talk about life expectancy in good health, life expectancy at 65 with no disability. Many people consider that everything will be for the best in the best of all worlds, that things can only improve. However, recent European studies have shown that, in many countries, though life expectancy is increasing regularly, disability-free life expectancy is in many cases remaining stable, and in a fair number of cases even declining. Those studies show a decline in life expectancy with good health in many European countries. Those were the results for women in Germany, Greece, Ireland, the Netherlands and Portugal. The figures also applied to men in Denmark and Sweden. Those countries are in principle not lagging in the battle against health problems.
I do acknowledge that state of health is quite complicated to measure. It is quite easy to determine whether someone is alive or dead, but it is much more difficult and more complicated to determine whether someone is in good health. A great deal more will have to be invested to gain a better understanding of the issue and the situations involved.
Fifth statement: Living longer or dying in good health — a societal choice. I think we have a major problem here. Life expectancy is continuing to increase, and we want it to increase, with some people dreaming of a society in which many people are aged over 100. At present, forecasts show that children born today will, on average, live for 100 years. And the average is not far from the median. The median would mean that half of them would live over 100 years. But I assure you, if we seriously consider that we will be living that many years in a state of well-being, social conditions will have to change.
I believe that the issue here is making choices as a society. We can live quite well with the life expectancy we have today. There are very few premature deaths in our society. There will always be such deaths, there will be premature deaths at birth and during an individual's life cycle, but those deaths occur less and less. As a society, we must in my view make a decision — the decision to live in good health rather than dying at a much more advanced age.
For example, that would mean eliminating extreme medical measures for older people. I think our country can set a good example there, because other countries are lagging behind us a great deal in extreme care and palliative care.
The most important factor is research strategy: so long as most of our research targets fatal diseases rather than non-fatal and chronic diseases, we will perforce extend our life expectancy, but we will not necessarily live those extra years with a correspondingly good quality of life.
Statement six focuses on future health care costs and on how to take into account all its aspects. There are many and varied interpretations of what people mean by health care costs. I do not want to accuse my economist colleagues, who often know much more than I do, because all I am looking at is the demographic aspect of health care costs.
On one hand, we have to be certain that we make a clear distinction between the public sector and the private sector to understand what is going on. On the other hand, we have to understand that "curing" costs increase relatively little with age, as opposed to "caring" costs, which increase enormously with age.
Yet all too often, health care cost assessments take into account only medical care, hospital care and drugs, leaving out the social component, which will become increasingly costly. And since we want to leave people at home as long as possible — that, I believe, is society's goal — those costs are unfortunately often ignored, both in statistics and in models. So as long as we fail to determine exactly what the caring costs and the curing costs amount to at every age, we will have problems assessing the real barriers we might encounter in the future. I should add the information is at present very difficult to obtain.
Lastly, my seventh statement, the funding of future health care spending. I am talking about a health fund that goes beyond the pay-as-you-go system. This is a very important consideration if we continue to allocate as large a percentage of our public spending to health, compared to other obligations of the state, and in particular compared to such areas as education. I think we are making a huge mistake, because we might well be establishing inter- generational inequity. That is something we should seek to avoid in this century.
There is no question that we — and Canada in particular — are experiencing a significant distortion of the age pyramid. The baby boomers represented a huge demographic bulge when they were born, and today still represent almost as large a bulge. They are still very numerous compared to the generations below and above them.
The bulge has to be taken into account when we establish a system based on a number of pillars. I think the retirement system has clearly seen that it was not only the government's responsibility to deal with the issue. There can be a number of ways of ensuring that retirees will have a decent income when they retire. But I do think we should draw inspiration from — and I do not say copy because there are significant differences — the pillars established in the retirement sector and apply them to some extent in the health sector.
After the baby boomer bulge has passed, generational groups will be only half as large. So we do not need to establish an immutable system to deal with the aging baby boomers. Once the last baby boomer has died, the next generation of old people will be only half as numerous. This is something we have to very careful about, because the error was made in the education sector. We should not repeat the error in providing services to older people.
Obviously, public resources are limited. If we want to be fair, we have to strike a balance between what we give this generation and the next. We can apply inter-generational accounting principles and ensure that our system is fair, while remaining sound. We need to strike a balance between soundness, or solidarity, and fairness.
That is a difficult topic in Canada, so I will finish with this statement, which I hope will be memorable: I find it unacceptable that, in a country like ours, it is easier to get care for your dog than to get care for you mother. That is unacceptable in a civilized society.
Marcel Mérette, Associate Professor of Economics, University of Ottawa, as an individual: Madam Chair, I would like to thank the honourable senators for having invited me to take part in this meeting of the Special Senate Committee on Aging. I have been interested in the aging of the population for some 10 years now, both as a researcher and as an economist. I am fascinated by the issue.
Basically, what I do is take the data that flows from our economy, and the data that flows from what happens during major changes like aging in the population, and translate that into mathematical equations, then into simulation models.
Those models tend to be aggregated along the life path, something you know more about now, but also take into account interdependent factors among different sectors, the economy and economic agents, governments, households, and so on. The result gives us an overview of economic impacts.
I recently read your preliminary report with great interest, and you will understand that the aging of the population has multi-dimensional effects. Obviously, the effects are felt in the labour market, the health sector, public finances, and a number of production sectors that will probably benefit from the aging population. For instance, the pharmaceutical sector and pharmacies. Other sectors could be affected as well. There is also an international dimension, to which I will come back in a few moments. These simulation models give us at the very least an opportunity to capture some aspects of these interrelationships.
I have prepared a brief for this presentation, but I would rather try to connect with the comments made by Professor Légaré, because I find them extremely interesting.
My first remark is on his sixth statement: future health care and caring costs. I under that, in your preliminary report, you wanted to focus on the delivery of services to seniors against the backdrop of an aging population. However, it is important that we observe future demographic changes in a global context, rather than with an approach that separates age categories. Otherwise, we might end up engendering more frustration than anything else.
Why should we not separate age categories? One reason is the "caring" aspect. It is quite true that the bracket of individuals who reach the 80-to-85-and-over age group is the bracket that will grow fastest in the years to come. Those people often have a partial or total loss of independence, and receive care that is sometimes official but often unofficial, and comes from family members or friends and workers who are in the 45 to 64 age bracket.
So when we talk about the aging population, I consider it very important that we take into account all age categories affected, particularly the ones I will call older workers.
One of the reasons I stress this is that we might ask those older workers to keep working longer — or at least wish that they would work longer — and extend their careers, or even postpone their decision to retire.
At the same time, however, we must understand that those same people will have responsibilities and be caring for parents who will be in the 80 to 85 age bracket.
We could easily miss the boat here. In other words, we might fail to take into account a potential source of natural caregivers. There will be difficult choices to make — does one stop working completely, or keep working part-time to take care of their father or mother. There are relationships that one cannot set aside. We must ensure that we do not forget other age brackets.
To my mind, the aging population is a major future phenomenon. The aging population, along with the environment, is a major economic issue for Canada's future. It affects all age brackets in our society, including future generations. Professor Légaré said that we should never lose sight of working towards a kind of inter-generational fairness, or equity. I believe he is absolutely right.
I agree with statement seven. It is to be expected that an aging population would have slightly negative ramifications economically speaking. I agree with your interim report. These effects can probably be managed. Nevertheless, it would be a very big mistake to concentrate, once again, on seniors. One way of offsetting an economic slowdown because of slowing growth in the labour market is to increase productivity. I think that Professor Spencer referred to this in his appearance. Enhanced productivity should basically flow from an investment in education, and what we call human capital. Let me reiterate, in any discussion about an aging population and services to seniors, it is important to make sure the level of economic growth is sufficient to pay for these services, and one way of doing this would probably be to continue to invest in education. Otherwise, you could end up not having enough money to provide the services you want.
There is not only bad news when it comes to the economy. There are opportunities on the horizon. You can expect, with an aging population and the labour shortage, that wages will be pushed higher. You can expect businesses to become even more competitive in an attempt to hold on to the employees they have. As a result of this, in all likelihood wages will rise more quickly in the future compared to the last 20 or 30 years. And that is good news. The message to the future generations of young people out there is that the labour market will probably get more dynamic, there will probably be more job opportunities, and better chances of being promoted. All this might also be dangerous. Demographic changes are slow, but powerful. Change will occur gradually. The tide will not turn overnight. Slowly but surely there will be new opportunities, especially over the long term.
It is possible that with a more dynamic labour market we may see young people join the workforce without having done post-secondary studies because companies will offer far more generous wages than they do now. If that were to happen, and if you come back to the notion of productivity, that could be a mistake, not only for individuals, but also for society. So in that respect, the government should make sure that information is getting through and that future generations of young people really understand that for their own personal interest it is crucial that they do post- secondary studies. This is especially the case if young people want to take full advantage of the opportunities resulting from an aging population in a context of globalization.
I partly agree with the preliminary reports about the overall economic impact. Canada is in quite good shape compared to many other countries when it comes to economic challenges posed by an aging population. Now let me nuance that statement a little bit. We know full well that the demographics of an aging population are not the same from one area of Canada to the next. It is far more pronounced in the east, the Atlantic region, and Quebec, compared to the rest of the country. Because of this, there is a likelihood that there will be a substantial increase in the revenue gap between regions. The simulation model that I have worked with indicates that there will be a disparity gap increase of 25 per cent between the Atlantic and Western provinces. Demographic effects alone are what cause this gap according to these models. Now, if you add to that the effects of globalization, the manufacturing sector which is having a hard time in Canada, the rising cost of raw materials, you see an economic boom spreading westward. Now, if you add the demographic changes to this trend whereby the economy is increasingly driven by activity in the west, you may end up having a situation where the regional disparities are virtually untenable. Overall, Canada may perform relatively well economically, but the fact remains that we may end up with quite serious problems in the regions.
Immigration is a world-wide issue. Canada is not the only country faced with an aging population. Most industrialized countries are in a similar position. Developing countries, on the other hand, are experiencing a demographic pay-off. The age bracket of working-age people is widening in relation to the general population. This is an opportunity to reduce the inequalities between rich and poor countries if you agree with the premise that an aging population will have an adverse effect on industrialized countries.
Perhaps this would be a good opportunity for Canada to consider, given the major demographic changes occurring in the world, whether it would not be in its best interest to diversify its trade partners. Potential trade opportunities are greater when the countries are different. One should also consider this is a potential opportunity not only to look at the goods and services trade but also to think about the flow of capital and labour mobility globally. With an aging population, we consume more health services and medication. We do not usually trade these non-trading goods with other countries; we usually buy these goods on the local market.
This is why focusing on free trade negotiations with other countries should not be our top priority. On the other hand, the flow of capital between rich countries and poor countries could to a large extent offset the adverse effects of Canada's aging population, in-so-far as this capital could perform better in the southern hemisphere than in the northern hemisphere. Now as a result of this, if it is easier to invest in southern countries, then both hemispheres may benefit.
Now, when it comes to labour mobility, migration could well become a major issue for Canada.
Since Canada is not the only country with an aging population, we need to be prepared for the fact that other countries will be competing for these immigrants. In view of that, Canada should perhaps consider the immigration strategies and policies it is going to adopt. I thought it was important to stress the international dimension of this issue.
Let us turn back to the elder workers and seniors of the future. There are still several key factors to consider. I am talking about the 45-to-64-year-olds that will need to be dealt with. According to statistics, the trend is for people to retire at anywhere from 50 to 70 years of age. The two peak retirement ages are somewhere around 60 and 65 years of age. There is nothing random about this. Pension programs pay out allowances to spouses when an early retirement is taken at the age of 60. The access to universal benefits is another incentive for 65-year-olds.
Clearly, institutional factors such as pension programs, or the official retirement age under the benefit transfer programs, influence the decision as to when one retires. In view of this, when you write your report, you should think about how any change to the retirement age will influence people's decision as to when they retire.
Moreover, if there is a substantial increase in the number of people 65 and over, this age group of workers will be affected. If you look at the number of workers who are about 10 years away from retiring, based on the average age, you will see an astronomical increase. About 10 per cent of people had reached this point about a decade ago. Today, 22 per cent of people roughly are there and even 25 per cent in some regions. This means that in those regions, virtually a quarter of all workers are getting ready to retire or will most likely retire in about 10 years' time. So there will be a lot of activity in the labour market. We cannot overlook this key consideration when we consider Canada's aging population and demographic changes.
The labour shortage will have an effect on wages — and we can already see this starting to happen. We need to bear in mind that workers from different age groups are not the perfect substitutes because they do not have the same attributes. Older workers have experience. But they are not always up-to-date with new technologies. They have skills which are different from younger workers. Younger workers, since they have recently graduated, are more familiar with new technology. However, they will not have as much experience.
If employers believe that these workers do not have the same qualifications the salary increases generally being observed across the labour market may not apply to older workers. These workers will provide services and qualifications that are quite specific. As there will be many of them, the average wage increase based on experience may be smaller than it will be for other age groups and other types of workers. Given this, it may be harder to keep these workers in the labour force.
In closing, I would be glad to see a department or organization look at demographic change and the aging population in general. I am not, however, in favour of an old age department. In my opinion, the aging population phenomenon affects everybody, including the future generations. I do not believe the situation would be helped if we were to divide people up according to age groups.
One of the key political issues is federal transfer payments. I am referring to the Canadian transfer payments for health care and social programs in general. These transfer payments are allocated based on an equal per capita amount within a given region. This does not make sense as far as the issue of an aging population goes. I understand that there is a desire to treat all provinces equally. But if you look at the health care transfer program, for example, you will notice that in some provinces or regions demographic aging is far more pronounced than in other regions. So, if the demographic makeup of different regions is not factored in, some regions will be treated unfairly when transfer payments are doled out.
We must not lose sight of the importance of education when it comes to an aging population. Having fewer young people gives us an opportunity to improve the quality of the education offered. We must seized that opportunity.
Let me conclude by saying that when it comes to taxes it seems quite appropriate, in the context of an aging population, that the focus should be on payroll tax relief rather than on consumption taxes. If you want people to really want to remain in the workforce, and if we really want to prevent labour shortages in a number of specialized sectors, well then we really need to make sure there is an incentive for people to stay.
[English]
The Chairman: It was interesting that you both raised the issue of disparities. Professor Mérette, you spoke of disparities among regions. Professor Légaré, you almost spoke of disparities among generations when you talked about what could become an intergenerational disparity if there is too much emphasis on health and not enough on education. In reality, we have already seen that. The percentage of dollars given in provincial budgets to education has been decreasing significantly while health care budgets have continued to increase.
Professor Mérette, you raised a question that has been of concern to me, which is the concept of per capita funding. Per capita funding has been going on since Confederation. As a university student, I saw a clear disparity. Nova Scotia had huge numbers of university students per capita, but a very low provincial population. Therefore, an extremely high amount of funding went to Newfoundland and Labrador while Nova Scotia received extremely low funding based on the per capita formula.
I believe that the same will happen with respect to seniors. If we provide funding for seniors on a per capita basis, the Atlantic, which has an aged population, will be significantly disadvantaged. Will you comment on that?
Mr. Mérette: It is exactly my point. I fully agree. I believe that the per capita basis was decided on because it is somewhat easier from an administrative point of view. If you have to manage these programs or these transfers in terms of calculations, it is probably easier than if you start to be more sophisticated.
Today we have the numbers and enough information — we have the last census, for instance — to be more intelligent regarding the transfers. You are absolutely right. We know that older people consume more medical and hospital services and we know that young people are seeking a university level of education.
It seems to me that it would not be difficult to change the system, and it would certainly be helpful for certain provinces to avoid inequities. At the moment the inequities are not so pronounced, except for Nova Scotia, but in the near future they will become more and more pronounced. If we do not attempt to solve the problem by a kind of rule, which I do not think would be difficult to implement, we will always face negotiation between the provinces and the federal government, resulting in a loss of time and energy. That would not be difficult to change. It would not be a revolution.
The Chairman: Professor Légaré, I was interested in your distinction between curing and caring. It seems to me that Canadians are extraordinarily devoted to having a universal health care system for the curing of Canadians. They seem less committed to that kind of universal programming for caring.
Many of our senior citizens are paying substantial sums of money to be cared for. For example, home care in some provinces is basically paid for, while in other provinces, if you cannot pay you do not get that service.
Is that a correct model? Should we be expecting senior citizens, who perhaps have more money than ever before, to be paying more of the costs of their care?
Mr. Légaré: Yes. I mentioned that there should be pillars. This is a good case for pillars. Funds should not come only from public money but also from the individual. This is what happened with the pension plan. Of course the state gives you money if you need money, if you do not have any. However, if you have had a good salary all your life, you have put money aside for yourself and saved money for retirement.
We should have the same mentality to save money for the health system and the caring system in old age. Unfortunately, in this country we are strict about our health care system. When we say the word "private," it creates a lot of problems. If there is a sector in which there is private funding, it is for the caring. It is important, as Mr. Mérette said, that the caring is done not only by professionals but also by the family.
My colleagues and I have analyzed the projection for families. In the future, families will be smaller and funds less available, so we will have to rely on a more formal system. However, if the formal system exists, does it have to be totally public? I do not think so. We do not like this in Canada, especially regarding curing. We do not talk about caring so much, and that is not fair. Both dimensions, caring and curing, are important in the health system. Especially in an aging society, the caring should have priority over the curing.
Senator Keon: Thank you both for your tremendously interesting presentations. You raise some truly interesting issues.
Continuing with you, Mr. Légaré, it seems to me that the social problem that is rising exponentially is the cost of caring for seniors. No matter how we look at that, whether it is home care programs or special accommodations in seniors complexes and so forth, this will be a tremendous problem.
To lead you down the garden path a bit, I have been a believer for many years that, as it relates to health, we should preserve the single payer for essential services, whether hospital, doctor, senior services or social services. However, I think it is totally unreasonable, as you mentioned, that you can have your dog treated tomorrow, but you cannot have your father treated tomorrow. That is not right. We have to look at that.
I would like you to expand on this idea of a single payer for the caring services and on the definitions of what is essential and should be paid for by the single payer and what should be paid for by the private individual and by the family.
Mr. Légaré: I return to what my colleague said regarding the universal program, that it looks equitable. If you have a pie and you divide it equally among four persons, most people think you are being equitable, but it is not necessarily the case. Some people do not like that pie, so they do not need to have a piece of pie. The division should be according to taste and according to whether people are hungry or not.
It is the same for the caring system. Those who can pay, those who need the service, eventually should be in a position to pay for it if they can afford it, especially when the family is not available. Even when the family is available, it is not said that the family should not be paid for the service provided to their older parents. There is a question of equity also in this direction. You can pay if it is someone from outside, but if it is your own daughter, and especially if she has to leave her paid work to help her mother, it is not fair. Even if it looks equitable, we do not want to spend the money within the family; we want to give it to the formal system. We do not question these issues as we should, because in this country, most of the time health relates to medical, hospitals and the pharmaceutical industry.
Senator Keon: Mr. Mérette, you raised a tremendously interesting dimension that I have raised with a few witnesses who came before the committee previously, the question of replacing our population with immigration. We are in a crisis now with 25 per cent of our population retiring and leaving the workforce.
I have asked previous witnesses whether they think there should be a carefully planned immigration boom to offset the baby boom, which you alluded to. In other words, we could have a policy that could have a sunset, so that we do not open the floodgates to immigration, but we open the floodgates for a time with a carefully planned immigration policy to compensate for this difficulty we are having at the present time with an aging population compounded by the baby boomers. Would you comment on that?
Mr. Mérette: Yes, I will, with pleasure. I have done some work, again a simulation exercise, regarding the impact of immigration in the context of aging, with the following results. Immigration is about 0.75 per cent of the population at the moment. If we increase immigration by 33 per cent, to 1 per cent of population growth, whatever immigrants we choose, the impact on the economy would not be much. It would be positive, but not much. However, if we are more selective — and perhaps this is where you are going — that is, if we select more skilled immigrants, then the impact can be greater. Actually, it can reduce the negative impact of aging on the GDP per capita by about 40 per cent. In other words, when we simulate the effect of aging on the GDP per capita we get a reduction of GDP per capita of about 10 per cent over a 30-year period, but if we increase immigration by 30 per cent and we are able to select skilled immigrants, that reduction, rather than being 10 per cent, would be only 6 per cent. It would have a huge impact.
I understand that there are many issues involved with immigration such as integration, selection and so on. One of the positive signs, which we see already, is that the unemployment rate is declining. It will be easier for the new immigrants to become integrated in Canadian society because it will probably be easier for them to find jobs.
There is a credential problem. If I were able to impose or suggest policy, we have many foreign students available in the universities in Canada. These are foreign people who are potentially skilled. They will obtain a degree from a Canadian institution. I do not understand why, as a policy, we are not more aggressive. Once they get their degree from a Canadian institution, we should offer them permanent residency in Canada. They are already here and there is potential.
Mr. Légaré: I will take the other side of the coin; I will look at the unskilled labour migrant. We must be very prudent on that. In Europe, many of these people were working in the caring system. That creates many problems. First, they are there because they provide cheap labour, and we do not value people caring for the elderly so we take foreigners, as in Europe. Most of the time, these people do not have the same values we have regarding life and death and regarding pain, and that may create problems.
What is the solution? Our education system must train people for the caring system and value those jobs. As long as the job involves cheap labour or volunteerism, we will not solve this issue, because many people will need some caring in old age.
The Chairman: If I could interject, it is not just in old age that they need help. It has always fascinated me that we would pay a kindergarten teacher to start at $35,000 a year, but we would pay a child care worker working with a child one year younger only $18,000 a year. I would suggest it is the same comparison, because they are caregivers and, therefore, not as valued as educators.
I will now turn to Senator Cordy, who is an educator.
Senator Cordy: I was also formerly a primary grade teacher.
Your presentations have been fascinating. Mr. Légaré, I liked the comment that there is no doorway to old age; it is a process. That is something we must keep in mind.
My question is to Mr. Mérette. You talked about a department or organization to look at demographic changes. I assume you mean within the federal government or nationally. A number of people who appeared before us have said that there should be a department for seniors. You have negated that in your comments because the various issues that seniors specifically deal with can be extremely confusing for them when looking for information or help when they are having to deal with municipal, provincial and federal governments and then, within each governmental branch, looking at a minister responsible for housing, health or education, and it could go on and on.
I am interested in your concept because it makes sense and follows on the comments of Mr. Légaré about its not being a doorway but rather a process. Could you expand on that and tell us how that would work without becoming totally cumbersome?
Mr. Mérette: I understand that the motivation for having a department of seniors is to offer more rapid and efficient services and, for those who need them, to facilitate their search for information. I do not like the idea because the aging and demographic changes involve many issues that touch not only seniors but also the other age categories of the population, including future generations. I do not mind having a department that would look more deeply into the effect of the aging of the population, and that may include services to seniors. It is important to have singles. We do not want to consider aging as something that belongs to seniors. Aging belongs to all generations, including future generations. If we have a limited perspective on that, we will make many mistakes.
I will give you an idea. We can become too concerned about the political economy aspect of aging. We understand that with aging, the number of voters among the elderly will increase. From a political and democratic point of view, a government or political party may be interested in favouring this category of population over the others. If you have a department of seniors, that may be one of the results you will get. You will focus only on one category, because you know there are a large number of voters within that category. You may take measures that will neglect education, for example, which is very important. If we want to face aging, education is more important than ever. With globalization, if we in Canada are not skilled it will be hard to compete with emerging countries. Education is one of the solutions of an aging population.
Immigration is also one of the solutions of an aging population. To face population aging, we do not have one good solution; we should have options for different things. We cannot increase immigration forever; it is somewhat limited. We have to invest in education. There are many other things that we can do. It would be a mistake to concentrate only on seniors. To ensure that they have access to the correct programs and get the correct information rapidly is fine. I do not mind having a sub-department within the big department that offers those services, but I consider aging as important as the environment. If you have a department or minister of environment, I do not mind a department of aging or demographic change.
It is a huge change, and it is a challenge. I do not think it is catastrophic, but we must look at it very carefully and we must coordinate different actions better. That makes sense. Also, it is there for a long period of time. It is a long transition. It is it there until 2050. If you create something like that, it will not be opportunistic in the sense that this is something we must deal with now as well as in 10 or 20 years from now.
Mr. Légaré: I fully support the initiative of my colleague to have a department of demographic change. We must remember that the theme of the Madrid conference was "a society for all ages." It was not only for seniors. We must keep that in mind.
Another thing to keep in mind is that in many countries, in Europe especially, you have a minister responsible for youth, seniors and women. The problem is that most of the time they are separate departments under the directorship of one minister. If it is well integrated, then the trade-offs are easy, but if it is separated, it could create problems. In this country, for example, we had a department of health and welfare. The day that it became the health department only and welfare was dropped somewhere else, the trade-off in the large domain of health was no longer there because the health department was for the medical and biological sciences only and the social side was mixed with many other things that were not necessarily related to the social dimension of health. It was a mistake at the federal level to split health and welfare. In Quebec, although not necessarily more successful, we have kept health and social services together. That is the type of thing we should do for the seniors. Seniors, youth and all ages should be within the same department. Then the trade-off between health and education that we should make in public spending could be done within a department and not necessarily between ministers.
Senator Cordy: We should make sure that we do not have silos within the department, which often happens.
I would like to discuss the age-based eligibility that we have in Canada for seniors programs, specifically the Canada pension which you can receive at the age of 60 and old age pension at the age of 65. A number of people have said that we should move away from that. I understand the rationale behind that, and I think I agree with it. The only fear I have is that it could also become punitive to those who do not want to stay in the workforce beyond the age of 60 or 65 years.
You talked today about people who want to stay beyond the age of 60 or 65; other people have told us that, too. However, their examples are people who are well educated or in business. My husband is retired, but he is still doing contract work for the firm from which he retired.
However, there is the case of a physically demanding job and unskilled labour. I am from Cape Breton, so I grew up with a lot of coal minors and steel workers who were counting down the days until they reached the age of 65. Many had been in the workforce between 40 and 50 years. They started working there at the age of 16 or 17. I would like to hear your comments on whether we should change age-based eligibility and, if we do that, how we would balance the flexibility of the program without allowing it to become punitive to those who, for physical reasons, do not want to stay in the workforce.
Mr. Légaré: I think the information you have received that in some countries the retirement age is linked to life expectancy is good, but not if you keep it universal. I believe that the life expectancy of the worker that you talk about is not the same as that of the university professor. We need some flexibility there. That means that eligibility age should be linked, in my opinion, to the life expectancy but according to professions, economic status and so forth. That is more complicated to handle, but it is fairer. I would go beyond that, however. The retirement age or the day you quit the labour force without penalty should be linked to your life expectancy in good health. That is the only fair thing, in my mind. If the university professor is entitled to 10 years in good health after his retirement, the miner should also be entitled to 10 years in good health after he retires, and that could mean he would retire at age 45, if you want to be equitable to every citizen so that they all have 10 years in good health after retirement. Those are new ideas. It is not universal. It requires flexibility. It is against rigidity, but we like to work in rigidity most of the time. However, if we can send a man to the moon, we can handle this type of problem.
Mr. Mérette: I like the idea. My only concern is that it might be difficult to manage. If you start going by professions, we know that sometimes people change professions during their lifetime. When the decision about eligibility is made depending on what profession the person has, I am not sure about that. There may be other options for solutions.
First, if we change the age-based eligibility for pensions and so on, it should be gradual and announced well in advance. For example, if we want change in a few years from now, we should announce it now so that people can adjust.
You are right about miners and even high school professors who may not be able to reach the new age eligibility. That should be taken care of not by the pensions program but by the employment insurance program. That is not the case now, but we do recognize that for some professions it is harder to benefit from those 10 years of health after work. That should not be the business of pensions. The business of pensions is to give the right signals about what we expect: If you want to plan your retirement period, this is what you should expect in terms of pension benefits and this is what you should think about savings, and everything else. That is why I would look at what employment insurance would do, especially in the context of aging where they expect the unemployment rate to decline in the years to come. It seems there are enough large surpluses at the moment that we might find something for those people.
Senator Cordy: It might be challenging for any government in power to say that you can receive your pension at the age of 50 because you are only expected to live until age 60. From a political perspective that might be a bit of a challenge, but it is interesting to look at different perspectives.
[Translation]
Senator Chaput: It is fascinating to listen to both of you. Mr. Mérette mentioned that we should try hard not to divide people up into age groups, and Mr. Légaré defined aging as more of a loss of independence and human beings' increasing dependency as they get older.
If, along the same lines, we were to stop using the word "old" and define older workers according to their level of dependency or loss of independence, we could shift our focus to the decrease in these workers' productivity.
Since this would be a new way of seeing things and as we need to think in terms of policies and programs, what do you think the most important issue that we need to start with is? What would be the basis of this new philosophy, if I can call it that? Where would you start, if you had a magic wand, Mr. Légaré?
Mr. Légaré: I would start with prevention. Prevention is the key to good health as you get older. If you lived a healthy lifestyle throughout your entire life — as a teenager, an adult, and a retiree — you will not be old as long. The whole idea behind this system is for late middle age to stretch out as long as possible and for old age to be as short as possible. Regardless of the cost. We are talking about quality of life here and the quality of life of many very old people is often quite low. Some people will tell you that despite being disabled they enjoy some level of quality of life, and I am sure they do. But generally speaking, I find that people are often very incapacitated, and because of this they do not enjoy the quality of life that a human being would expect, even at such an advanced age.
So, prevention is the key. We are increasingly conscious of the obesity problem in this continent. We are told that the elderly people of tomorrow may be a lot less healthy than today's — "a lot less" should be put in context — because many people will have led a lifestyle causing them to become obese. We know that obese people have health problems at all ages, but especially when they are very old. This is an example of prevention where we need to change the whole culture associated with being healthy.
When it comes to our health, and health care budgets, we often think of doctors, hospitals, and so on, but I think that we need to change our mentality and consider a new system, as you put it, based on prevention and leading a healthy lifestyle throughout one's entire life. The whole issue of eating, in relation to obesity, is also relevant when it comes to schools. Food choices at schools are such that obesity is on the rise and this may affect the quality of life of these young people as they get older.
Mr. Mérette: I would like to see more of what I call the inter-generational transfer when it comes to aging populations, and by this I mean the links established between generations. As I mentioned earlier, there are a lot of people who will be retiring in the upcoming years and I think that it would be both beneficial to young people and retirees if there was a way to maintain some sort of connection, and to transfer knowledge or experience.
There will be a need for this. But how will it manifest itself? I am not sure. I think it would be beneficial for the younger generations to help keep these people, who decide to make the transition into retirement, interested and active.
Mr. Légaré: That is not an insurmountable task. Canada's success in fighting smoking, for example, shows us that where there is a will, there is a way. Obviously, if you reach retirement age, and you have not smoked all your life, then you will probably be more healthy. And this means a better quality of life. Eventually, hopefully the same will be true with regard to obesity, which now seems to be the new challenge.
[English]
The Chairman: Thank you both very much for your presentations and replies to our questions. You have contributed to our lifelong learning.
The first part of this session will come to an end. We need to work on a budget for a brief period of time.
The summary of expenditures is $96,050. If you look at research services, they are attributed to Michelle MacDonald primarily, although we will be hiring a student to do some work as well. The rest is straightforward.
The largest expenditure is conferencing. That is because I want you to consider seriously whether you would like to go to Switzerland next September to attend the premier international conference on aging. I have already been, so I have no interest in attending again. However, I think other senators might be interested.
Rather than send the entire committee, I think it would be wise if we allow individual senators to decide whether they would like to go or not. As soon as we receive the schedule for that conference, we will make it available to you. At that point, you can decide whether you would like to go. That is why the budget is so large, as a result of national and international conferences.
I will need a senator to move that this committee concur in the following budget application for the purpose of its special study on aging, and that the chair submit said budget to the Standing Committee on Internal Economy, Budgets and Administration for approval:
Professional and Other Services: $ 47,750
Transportation and Communication: 45,800
All Other Expenditures: 2,500
Total: $ 96,050
Senator Keon: I so move.
The Chairman: Moved by Senator Keon. Thank you. Any objections? Carried.
We have another bit of business to deal with. We have been invited to observe the work on aging completed by the Élizabeth Bruyère Health Centre. Being cognizant of all of your other responsibilities, I will make the following suggestion: I will go with at least one of our researchers and look at what they are doing and report back to you. I will let you know the time, date and place. If you want to join us, then do so, but I do not want you to feel under any particular obligation to attend. Do not feel that you are letting the committee down by not being able to attend that session, because I know some of you cannot arrange the time.
Senator Keon: I will certainly attend with you, if I possibly can. I am familiar with the place.
The Chairman: We will let you know about that as soon as possible.
Our other witnesses are ready for us. We have with us this afternoon, by way of video conferencing, from the University of Victoria, Professor Neena L. Chappell, a Canada Research Chair in Social Gerontology and Professor of Sociology, Centre on Aging at the University of Victoria. She was the founding director of the Centre on Aging at the University of Manitoba and, up to 2002, the first director of the Centre on Aging at the University of Victoria. For over 25 years she has been focusing on three areas: quality of life for seniors, care giving and the health care system and related policy.
We will also hear from Professor Gloria Gutman, Professor of Gerontology at Simon Fraser University and Director of the Dr. Tong Louie Living Laboratory. She has served on a number of federal-provincial task forces related to the needs of the elderly and is a former president of the Canadian Association on Gerontology as well as of the International Association of Gerontology. She is the director of the International Institute on Ageing of the United Nations and a member of the World Health Organization's Expert Advisory Panel on Ageing and Health.
Welcome to the Senate of Canada. We are very much looking forward to your obvious expertise in this field.
Neena L. Chappell, Canada Research Chair in Social Gerontology and Professor, Sociology, Centre on Aging, University of Victoria, as an individual: Thank you very much for the invitation. I apologize for not being there in person but, as it turns out, it is winter break and all of the flights are booked.
I was very interested reading your first interim report. I was impressed with the perspective demonstrated there. I strongly support your life course approach and healthy aging, active aging approach.
I noted that you recognize the need not to forget those in need. I would like to underline that. It is always a balancing act, and I support the approach you are taking, but the danger in that approach is that we forget the minority of those who really do need our help.
In my opening remarks, I want to talk about two areas, primarily one that deals with caregivers and informal care in an aging society, and then if I have time I will comment about diversity, particularly about ethnic minority seniors. In terms of formal care, I want to talk about the fact that Canada's health care system is not organized for an aging society.
Like most health care systems in industrialized countries, our system is based on medical care. Our medicare covers physicians and acute care hospitals, but the needs of an aging society fall primarily in chronic conditions and the need for long-term community care, also known as home care. This is very relevant not only to all of us as we age and those of us who are younger who have illness and disabilities but also to family members who are the mainstay of care for us when we become ill and disabled.
I have sent a paper which I have been told is too long for you to read, so I have asked them to give you the abstract, which reports published research on the cost effectiveness of long-term community care for keeping ill and disabled individuals within their own homes, which is overwhelmingly the place where people want to stay.
I would note that long-term community care falls outside of medicare and, as such, was totally missed in the Romanow report. I would give the Romanow report kudos, though, for spending an entire chapter discussing the free trade agreement and how Canadians would have to, at every opportunity, note that our health care services lie outside of such agreements. The problem as I see it is that that can be interpreted to mean only medicare. Social services within the community are now much more likely to be provided by the for-profit firms and therefore represent a different tier of health care services within our society.
The question I believe that underlies all of this is the following: Whose responsibility is it to pay for social services that are medically necessary? By default, given what is happening in health reform, the answer is that it is the responsibility of the private individual, and I would ask that you would look at this closely.
I would also note that Asian countries and other developing countries around the world have largely rejected our style of medicare and that embraced in other industrialized countries as too expensive. If you are looking at other countries, Japan has, in an exemplary way, universally and formally embraced long-term community care as the appropriate health care system for an aging society.
Within the realm of community care, we have to examine not only the needs of those who are sick and disabled but also the needs of family and caregivers to assist them with this task.
Switching topics, I want to touch quickly on the issue of diversity and the ethnic minority members of Canadian society. There seems to be good awareness and good coverage of Aboriginals in your interim report, so I will deal with other ethnic groups.
Clearly there is great heterogeneity between different ethnic minority groups. They are not all the same. However, they do tend to share low socioeconomic status, if you measure objective characteristics. This is true in all industrialized countries, not just Canada. I have just completed a scan of the literature on this worldwide, which shows clearly that despite their socioeconomic disadvantage, they tend to be either equal or better on social embeddedness and quality of life when compared to the host society and majority members in Canada — to Caucasians.
The issue of ethnic minorities is complex. It is wrong for us for us to assume, as governments have in the past, that their families will necessarily provide care and do not want to access our services. In fact, we are hosting a symposium in Vancouver in two or three weeks that examines access to formal care for ethnic minority seniors. My concern is that we do have to take into account their cultural uniqueness. We have to be very careful on whatever policies we design not to throw out the baby with the bath water.
I would like to touch briefly on the role of seniors in society. I am talking about older adults here, particularly considering that you are looking at whether or not we should redefine a different age for mandatory retirement. I am sure you know there are only three provinces in Canada that still embrace mandatory retirement. That will likely go quickly in B.C.; we are expecting legislation this spring.
It raises a couple of issues for me. Earlier this morning you were talking about what will happen to those individuals who do not have the economic choice to retire, if there is no set age for retirement. That is a big question, and I do not have the answer. How can we devise policy so that we do not end up with a situation in which those who are not well educated or who are not professionals have to work until their grave because there is no other option for them to support themselves?
Whether we continue with mandatory retirement, raise the age of mandatory retirement or whatever we do, the role of seniors in our society will still be an issue. We all know the figures: we know we have increased life expectancy and we have added years without illness and disability, which is wonderful. However, society as a whole does not have options for what we are supposed to do when we retire that gives meaning and a sense of value and dignity to older persons, so that they feel they are still contributing.
We want to allow them choice and autonomy. If we simply get rid of mandatory retirement or we move the mark for mandatory retirement so that we now all work until we are 70 or 75 years old, we are saying that we all have a similar view of the life course and we are simply extending the middle years to a time where we are just going to work longer.
That is a valuable option to provide for people. However, I would like to ensure that there are other options as well for people who want to change course from their paid work life. There should be options they can choose where they feel they are still contributing, because it is when we feel valued as members of society that we maintain our self-esteem.
The Chairman: Thank you very much. I will make sure the long report is distributed to all senators.
Gloria Gutman, Professor, Gerontology, Simon Fraser University, and Director, Dr. Tong Louie Living Laboratory, as an individual: Like Professor Chappell, I would like to congratulate you on the first report. I have read through it and you have covered many of the key issues.
You have a number of the key facts before you, so I would like to address some of the questions that are on the document I was sent about the second phase, beginning with the issue of defining seniors. I would like to speak from my perspective as a citizen of Canada and also from my work with the World Health Organization and the International Association of Gerontology.
From the point of view of being able to compare our policies and programs and our seniors with others, it makes great sense to continue using age 65 as the marker. The World Health Organization, WHO, uses age 60 for developing countries in particular, on the assumption that their population aged more slowly in the past. The number of countries that have a high proportion of seniors has been small in the developing world, but that is changing. I would imagine that in a very short period of time, WHO will move to using age 65 as the marker as well.
There are a couple of key things to remember about age 65. The faculty association at the University of British Columbia, which has been fighting mandatory retirement, has said to remember that it is an age, not an expiry date. Too many people seem to look on age 65 as being an expiry date, where somehow one's abilities, one's physical and mental faculties, one's perceptions change dramatically. For many of us, that simply is not true. What has caused considerable problems is the linking or the supposition that somehow the age of eligibility for benefits and the age for mandatory retirement must be one and the same thing.
In terms of policies and programs, I would urge you to look at the province of Quebec, which did away with mandatory retirement some time ago. I would urge you to look at the United States and Australia. Many countries have done away with it and the country did not go down the tubes. There were not huge problems. I have argued that this is not new; it is not rocket science and we should benefit from the experience of those countries that have done away with it and continued to thrive, rather than spending hours and hours thinking about what terrible things might happen if people who wish to continue to work are permitted to do so.
Those of us who are strong advocates for the removal of mandatory retirement at the same time recognize the importance of choice. Those who wish to retire earlier should have the ability to do so. Much of that depends on knowing that there is a particular age of eligibility for benefits, so that those who wish to access them can plan for and do so.
Regarding the questions you raise in your document about gender, women, for example, are disadvantaged by mandatory retirement. Many of us, myself included, were held back in the beginning in the early years of our career; we spent time raising a family and perhaps worked part-time. When we finally got into the labour force we were older. Some of us are not tired or bored and are literally at the peak of our careers, but have been forced out on the argument that if we do not maintain mandatory retirement what will happen to poor old Joe who has been slipping but whom we have been holding onto so as not to hurt his feelings. It is not fair that I should be penalized for that.
We must ask the question: Do we want someone incompetent doing the job regardless of age? Eligibility to continue to work should be based on competency, not on some magical age.
With regard to issues of diversity of seniors and questions about the National Framework on Aging, I am familiar with that document, having done consultation work with Health Canada at the time that it was being drafted. That document is very useful in terms of the five principles of dignity and so on that should be incorporated in all policy for seniors and because the framework is based on a determinants of health model. Many of us in the area of health promotion would strongly support continuation of that kind of approach, which fits very nicely with the WHO's active aging program.
The WHO's active aging model and their determinants of health are very similar to Canada's 12 determinants of health; they just combine them a bit differently. The major difference between the models is that the WHO model has two overriding variables: culture and gender. If we were to tinker with our model, my recommendation would be that two cost-cutting variables are gender and culture and then in any policy that is developed you must always ask the following questions: Does it apply in the same way to males and females? Does it apply in the same way to different cultural and subcultural groups within our country? If those questions are addressed we should avoid the trap of developing policies that are inappropriate for some groups. I think that would address some of the questions you have raised.
I should also like to make a comment on the federal government role and the provincial role. I would like to argue strongly that every province should have an office on aging. In most provinces we have designations, but it is not as clear as it might be that in each province there is one single group that is responsible for seniors and to which seniors can address their concerns and also where there are designated staff to deal with issues of seniors.
If in the future seniors are going to represent some 20 per cent of our population — and that is when the baby boomers are fully retired — we should have a voice for them in our provinces. I also would strongly support the idea of having a minister within the federal government responsible for seniors. We did have several of them and they, working together when being advised by the National Advisory Council on Aging, NACA, were very useful to the country and certainly from the point of view of seniors' organizations as well as geriatric organizations made it very clear what the lines were to be able to have some input.
I find it interesting that recently NACA was dissolved and that a new committee will be appointed shortly that will advise the federal government. One would hope it will have very good representation and will have as beneficial an effect as NACA has had. NACA was a respected organization throughout the country and I would like to give credit to it.
Those are the primary remarks I would like to make at the outset. One final comment, in response to an earlier question, would be to argue for the idea of one-stop shopping and ways that seniors can access municipal, provincial and federal policies and programs at the same time. Some of us were invited to an event held in Brockville about a year and half or two years ago at which just that kind of a model had been developed. I have not heard any follow-up on that and would urge your committee to look at the results of that particular initiative.
The Chairman: Thank you very much. We are delighted to have had your presentation this afternoon.
Professor Chappell, I am interested in your comments about the role of seniors in society and mandatory retirement. Would you have any disagreement with any of the positions that have been put forward by Professor Gutman, or would your views be more or less the same as hers with respect to the issue of mandatory retirement?
Ms. Chappell: I think they are more or less the same. I was a bit confused with her comments about the WHO using the age of 60, because developing countries are moving away from that. Japan is clearly moving away from that, as are Hong Kong and Mainland China; I am sure the WHO will catch up.
What I do agree with is choice. Are you asking whether I agree with keeping age 65 or do I think it should be moved upward?
The Chairman: No. I agree with you that we will do away with mandatory retirement right across the country, so I was interested in whether you believe we should ensure that, in doing away with mandatory retirement, the concepts of choice in terms of pensions are absolute.
Ms. Chappell: I believe so, yes. The only other part I would add to that, which I think Professor Gutman did not address, is the idea of choice for those who are not professionals and who do not have a lot of money. I can see that there is clearly a choice for people who are wealthy and clearly a choice for professionals in a university; they can choose to retire whenever they want. What happens to the working-class person who does not have a good pension? That is my concern.
Senator Cordy: Before I move on to the role of a coordinated effort, I would like to follow up on this again. I agree with you that there should be choice, because many examples we have been given are professionals who find it easier to stay within the workforce or who want to retire at age 60 or 65 because they are fortunate to have set aside money for retirement. Not everyone, however, is in that position. I will ask you the question I asked of our earlier panel: How do we have flexibility and choice without being punitive to those who really do not have much choice in the matter of retirement?
Ms. Chappell: If you leave the age of eligibility at 65, why can you not allow people who are low income or who have disabilities to access their pensions at an earlier age? I do not see why you cannot leave the age of eligibility just as it is, and simply allow people to choose.
Ms. Chappell: I think one of the reasons we are both sympathetic to the working man is because I am a Cape Bretoner too and grew up with coal miners.
Senator Cordy: I am also. Thank you.
Ms. Chappell: If you want to have choice, then you have to ensure that you have social programs that allow for choice. If we are talking about working-class people who do not have a good pension system with the employer, then they have choice only if there are reasonable social programs. Have they been able to pay into the Canada Pension Plan? If they have not and if they did not have enough money to have any savings, then what do they live on? They live on OAS and GIS, right? The conversation, then, is really about the adequacy of those programs for those people. If those programs are adequate, they would have choice.
I strongly suspect that politically the question turns to the whole argument that when Bismarck started pensions at age 70, most people did not live to that age, or even to age 65. The question, then, is when does society as a whole start paying for those social benefits. That is where the argument comes in. Do we now move the age up to 67, 69 or 70, or is society prepared to pay for people to have that choice when they are still healthy and can still work?
Given life expectancy today, you can make an argument that they can work another five years and still have 10 or 15 years of retirement ahead of them.
Senator Cordy: Before making any suggestions, we have to look at the implications regarding all workers in the workplace. I thank you for your comments.
I would like to get back to the one-stop shopping idea. I was on another committee in earlier years looking at seniors. Many of the seniors who appeared before us were absolutely frustrated by the challenges of working through the maze of government bureaucracy. I found it quite frustrating looking at the maze and wondering how I would get through it. With the technology that we have now, you make a phone call and you are given a voice message that says if you want this push 1, if you want something else push 2 and for something else, push 3. I have actually gone through one government department myself because I heard about the frustrations. I got to the bottom and thought, at last I will get to talk to a real person. The line rang busy and a person came on and said you will have to try your call again. The second time obviously I pushed a different number because different responses came up. I wonder how I would function if I were hard of hearing or if English or French were not my first language.
You both indicated that a federal minister of seniors would go a long way to helping seniors have the one-stop shopping. Could you expand on that a bit and explain how it would be beneficial? I think someone said that in the past we have had federal ministers of seniors and it has worked very well. Could you comment on whether or not that should be one of our recommendations?
Ms. Gutman: Monique Vézina was the Minister of State Responsible for Seniors and before her was a gentlemen whose name at the moment I cannot remember. They were very visible. They had input from the various departments of the federal government that had policies and programs that impacted upon seniors. Particularly now, with the Division of Aging and Seniors within the Public Health Agency of Canada and a section within Human Resources and Social Development Canada that is responsible for other aspects of seniors than health, it is very important that those two major players, plus the focal points on aging within the other ministries, have some visible point where all of the information comes together. Otherwise, we will continue with a system of silos, where we have different departments and ministries not knowing what the others are doing.
To me, it is very important. Plus, it means that there is a visible champion for seniors within the governmental system.
Ms. Chappell: I did not comment earlier on this but I agree. Aging, like gender and culture issues, should be cross- cutting. All ministries and departments, when they develop policies, should look across the board and ask how this affects different age groups differently. Unfortunately there always seems to be a downside to every option, and the danger here is that it is a balancing act. As soon as you set up a minister responsible for aging, you give an opportunity to a variety of units to say, "That is not our problem; someone else is looking after it. That is not our issue to deal with."
You must be careful when setting it up that the mandate within this area is one that ensures the minister responsible is cross-cutting and that all departments and ministries understand that that is part of their responsibility as well. I do agree with the idea.
I have difficulty with the current phrase "aging and seniors" because it implies that seniors do not age. However, we know that regardless of when you say old age starts, at 55, 60 or 70 years of age, there are many more years, and seniors also age.
Senator Keon: Thank you very much, both of you. I want to bring you back to some of the problems with mandatory retirement. I had to deal with it in my past life for 35 years.
It is all very fine to say that you can assess competency and base retirement on competency. In most cases, you can do that. However, it is difficult, especially when age enters the equation. It is much more difficult to assess excellence. You are both academics. I would ask you this: If your departments became departments of people over age 65, do you think you would be doing justice to the students you tutor and to the constituents you serve?
Ms. Chappell: That is an interesting question. I have two or three points to make in response. First, the likelihood of departments becoming housed with professors who are only 65 years of age and over is highly unlikely. In fact, one of the motivations for the provinces' finally ending mandatory retirement is the clear demographic projection that we will have a labour force shortage. Even if professors are more likely to stay on than other kinds of workers, although no research is available showing that that is likely to be the case, and even if mandatory retirement goes in universities, we will have a shortage and have to hire younger workers.
Second, there is no good evidence to suggest that people aged 65 and over are less productive, less creative or less innovative than younger faculty members. I do not have the evidence to back this, but I would suggest that the proportion of us in the professoriate who are age 65 and over and who are truly creative and excellent is probably the same proportion as exists amongst those in any other age group. No one has actually looked at it in that way.
I know of some research from a while back that looked at acknowledged great discoveries amongst the professoriate and they were not age-related. What are considered to be the most important discoveries by academic scientists often occurred in later years. Universities put forward the argument all the time that if we do not have mandatory retirement, we cannot get rid of the dead wood. I would counter that if universities had been using their performance evaluations in the way that they should have been all a long, they would not end up with dead wood at age 65. The value is not in simply keeping people who are excellent. The issue is to ask why the dead wood is allowed to stay in these positions until they are 65 years of age.
I will quit there, for now.
Ms. Gutman: I would like to pick up on the labour shortage issue. Simply, there are not enough babies being made anywhere in the world. Currently in Canada, we are at an all-time low in terms of fertility levels at 1.5. In parts of Asia and in Korea, they are down to 1.2. There are not enough babies being born. The days of women having the litters that they had in the past are gone forever. We might see some countries that have been smart enough to put in programs for child care to facilitate families having more children while allowing women to be productive within the workforce should they choose to do so. If we are smart enough to do that, then we might see, as in the Scandinavian countries, the birthrate go back up to replacement level. The fact of the matter is that whether we like it or not, as Tim Horton's in Calgary and the City of Calgary itself have recognized, there is a need to institute policies that will entice workers to stay on.
We do not have to look only at the professoriate. I was invited by a group in Calgary called the Talent Pool to assist them in keeping older workers on the job. I will have another speaking engagement soon with human resources leaders who will ask the same question. We need to think about how to keep, or encourage to stay on, those seniors who have the smarts and who have the desire to stay on. This is up and down the labour force — not only at the top — because we need them at the bottom as well.
Ms. Chappell: To add to that, the committee might want to look into the experience in the United States, where the retirement age was moved up a number of years ago. The U.S. found that not everyone wants to stay on and, in fact, the majority do not want to stay on. Ms. Gutman might have those figures. I believe that it is around 20 per cent to 25 per cent. Approximately the same proportion are still opting for early retirement, which is defined as retirement before age 65. We have some real examples of what is likely to happen in this area.
Senator Keon: However, there is still mandatory retirement in a large number of institutions in the U.S under their own bylaws.
Ms. Chappell: Yes.
Senator Keon: I realize that mandatory retirement is dead in the water and gone but we have not replaced it with the necessary tools to deal with those who want to continue in their positions. It is all well and good to say glibly that if the assessment tools are proper, there will be no dead wood. Well, someone could spend a great deal of time in court by taking that route. Assessment tools are blunt instruments when it comes to this kind of thing.
What I am trying to tease out of both of you is what you see as a replacement for mandatory retirement to deal with that situation. I accept that mandatory retirement is gone but I am deeply concerned that the reason universities and institutions adopted this over the years was to deal with this problem. We have dismissed this and have not put anything much in place to deal with the problem.
Ms. Gutman: Dr. Jonathan Kesselman, an economist from Simon Fraser University, has been working in this area for some time. His projections and arguments show that the marketplace is large enough to incorporate virtually all of those who want to work and that it has some elasticity to it. I would urge the committee to consult with him on this subject. That is one point I would like to make.
The other point is why should it be that much more difficult to evaluate a person at age 61 and three days than at age 64? There are still various kinds of performance indices in any industry, whether widget production or academia, where the evaluations occur, when all is said and done, on the basis of publications and grants. It is simply a matter of adding those up to know quickly whether the person is acceptable. Many people have argued that it will be too difficult to evaluate and use that as an excuse for not developing or for not seeing if the usual kinds of indices still work.
Ms. Chappell: I would agree with that. You might want some specific ideas on the issue of people being allowed to transition to retirement. That area needs to be looked at seriously. In the agreement from last year at the University of Toronto, for example, beginning at age 60, I believe, people can negotiate individually whether to continue to work. They can continue to work at 100 per cent; or they can reduce it to 75 per cent over the next year or two years for a couple of years; or reduce it further to 50 per cent. They have options and flexibility in the matter of transitioning to retirement.
Retirement experts such as Lynn McDonald may have spoken to you about one of the issues in the retirement literature, which involves working full time one day and the next day nothing. The issue of transition is very important in there.
It is not my area of research, but my son is taking a master's degree at SFU with Dr. Kesselman and his thesis is on retirement at universities. I have been his editor so I know more about this than I care to. The issue of companies who are interested in providing incentives to encourage their employees to continue to retire at age 65 is quite big and I know is being discussed within the universities.
I spent a long time at the University of Manitoba, which does not have mandatory retirement. They negotiated with the faculty association that if one has not retired before age 69, from then on he or she will retire completely or, if they continue to work, it will be only half time. After that, it is not an option to work full time. That has been negotiated within the organization.
In B.C. universities, which are now expecting mandatory retirement to end, much more serious conversation is taking place about faculty who have reached the later stages of middle age and their research output is not as strong as the norm has become. They are not publishing as much. There is now very serious consideration to allowing those faculty members the option of a teaching route, which some other countries allow but which has not been popular in Canadian universities to date. Thus, different options are emerging so that these faculty members can continue to contribute and work full time by doubling their teaching load and not be evaluated on research any more.
In this area, the details are starting to emerge as mandatory retirement is falling by the way.
Senator Keon: I want to repeat the first commandment of academia that I heard a number of years ago: When you are too old to perform, you teach.
Ms. Chappell: I did not think that came from academia; I thought it came from the arts.
The Chairman: It is a given that mandatory retirement will no longer be a force in Canada but, as Senator Keon has indicated, there are certainly some occupations in which attention to eyesight, hearing and other things that may begin to fail much more rapidly after age 60 or 70 has to be taken into consideration. It is fine to be a senator and to wear double hearing aids; it may not be as useful if one is in an operating room where one is also gowned and masked and those hearing aids may not be as functional as they are in the Senate of Canada.
I think we must all be concerned with the safety issues. I am reassured that it seems some progress is being made in terms of evaluation. I spent 20 years as a teacher. I have to say that there was dead wood — not much, but there was some. We did not get rid of those people. They stayed until they reached the mandatory retirement age. It distressed me as a colleague but it distressed me more as a mother of children who might be educated by that particular individual. I am somewhat reassured that you think that these tools will now work their way to the fore.
I would like to speak to Professor Gutman specifically about the cross-cutting issues she talked about, in terms of gender analysis and cultural analysis. We have started, in a modest way, looking at budgets through a gender lens. We talk about gender analysis being done to budget making. However, I do not think we have at all looked at budgets with respect to the cross-cultural issues. Do you think it is possible that attitudes to analysis of such things as budgetary documents will change in the future?
Ms. Gutman: I think they will have to. As we become more and more a multicultural society, we have to take into account for example immigrants and our Aboriginal population in Canada who have historically been in a different position from the rest of the population, in the same way that we look at whether a given policy is the same for males and for females. It may takes more work but it should be possible to do that.
In many departments, the idea of cultural sensitivity has begun to permeate. We are not starting from square one.
The Chairman: That is interesting. On another committee on which I sit, we have been doing a study that would indicate that the government has failed — and this is not partisan because all governments have failed — to recognize the visible minority population within our public service. It is just not represented in adequate numbers. One reason I think this cross-cutting cultural analysis is not taking place is that the people who would be demanding such an analysis are not there.
Ms. Gutman: Where I am coming from is closer to the ground. Within the delivery of health care, and particularly long-term care, we see that there are different cultural groups. We recognize that when people have developed dementia, if they are from another country and English is not their first language, they may lose their English but still be able to communicate in their foreign language. One of the advantages of cultural groups having developed their own care facilities and having maintained their culture is so that people can function in that kind of setting.
Sensitivity training is being spoken about a lot. As Dr. Chappell said, there is a conference coming up in Vancouver that will deal with ensuring that the minority populations can access those services and that there is sensitivity. If it has not permeated the public service, that is unfortunate. Maybe this is a case of a bottom-up effect as opposed to a top- down effect.
Ms. Chappell: It seems that the whole issue of cultural minorities is, in a sense, not at the point where gender awareness is. I agree with Ms. Gutman in terms of where it is on the ground, but at another level it is not yet politically correct. It is still a politically sensitive issue. For example, we have already developed ways to measure the care that is being provided to people with dementia in long-term care institutions. It is nurse's aids who provide 80 per cent of the hands-on care to these people. In British Columbia, those care aids tend to be, first, Filipino; second, East Indian, particularly Punjabi; and third, Chinese.
I wanted to write a grant proposal to have these measures translated into those languages and to test their scientific validity so that we can do research with these people in their own language and they can participate in our research. Government does not collect these data. Why? Because it is too politically sensitive, and we are asked to please go away.
I am conducting research in 20 nursing homes in B.C. When my data collectors go to the directors of nursing and ask for a ballpark estimate of the ethnic mix of their workers, there is no problem. I acquired enough data to write a proposal.
We are talking about a level of awareness or sensitivity akin perhaps to where gender was in the women's movement many years ago. I think your committee has a role in promoting the importance of the cultural awareness at this other level. While we would not expect governments to suddenly change on the basis of your recommendation — we would like them to, but they probably will not — it is another step along that journey of awareness to getting to the stage where we have the type of awareness around cultural issues that we currently have around gender issues.
The Chairman: My final question is also to Professor Chappell. In the beginning, you discussed caregivers, both formal and informal, but you quickly moved on to other issues. I would like you to elaborate a bit more about the informal caregiving aspect of the delivery of services to seniors and what you think the future holds. I am concerned that there will be fewer and fewer of these informal caregivers, which means the care will simply not be there.
Ms. Chappell: Yes, it is an issue. Canadian research exists that shows projections of availability of informal caregivers. Janice Keefe, from Nova Scotia, has done a lot of that research. Projections show that we will have fewer informal caregivers. There is some optimistic news, however. Men's life expectancy is slowly creeping up to women's, so we expect husbands to be around a bit longer to provide informal care. We know that, in fact, men do provide care if their wives need it; it is just that usually men's health tends to fail first.
We know that informal caregivers provide approximately 75 per cent of all care to seniors. I have fought long and hard, and quite unsuccessfully, for long-term home care and community care as the way to go for an aging society. However, of course, for many seniors, to stay in their own home and receive home care is dependent upon having an informal caregiver there.
In light of these projections, I would like to see governments do more to promote alternative ways for seniors to come together to look after themselves and others in their informal network, because that is what seniors want. Contrary to the concern of so many government officials, the floodgates will not be opened if we look at this notion of long-term care seriously. Seniors, by and large, go to the formal care system as a last resort.
We want governments to support alternative arrangements like Abbeyfield Houses Society of Canada, which I think some of you know about; if not, we can provide material on that. We can do more to support communities through not-for-profit agencies and volunteer organizations. I support the development of medicare, but Canada went through a phase that academics call the development of the welfare state, where it was assumed, although perhaps not stated bluntly, that governments and professionals know best, and the not-for-profit voluntary organizations got left out. Starting in the 1990s and beyond, governments have officially re-recognized these other sectors. However, in the interim these sectors lost their infrastructure and they need some help to get back up to speed, to take on a type of involvement within the community that historically they had.
The Chairman: We have heard something about encouraging volunteerism by those seniors who have retired and left the workforce. Is there any literature that you are aware of or any encouragement about tax incentives for people who are active in the volunteer field that may provide people with some additional income? We seem to have almost an eleventh commandment in this country, that you shall not get paid for looking after someone you love. It is all right to look after the person you hate, but do not look after the person you love.
Is there anything we should do in the community and in the tax system to make changes in that regard?
Ms. Gutman: I would argue yes, most definitely. Tax incentives have been tried in some countries and they do work to some extent. In this country, there have not been enough opportunities, but why not try it? Certainly it might help.
The daughter who leaves the workforce to go look after her mom needs to have some incentives so that she is not penalized by having that dropout period. In the same way that people can drop out for child care, they should be able to drop out for elder care and not be penalized for having done so, and even to have some incentive.
Ms. Chappell: I agree that there are things that can be done, and there has been a bit of movement over the last year or two in this area. One thing you hear a lot from caregivers and volunteers is that even to have their out-of-pocket expenses reimbursed, if not their time and labour, would go a long way.
If you have not already done so, you may want to look at the Veterans Affairs program in this area. They have a modest program that pays caregivers.
Norway stands out as a country that has had a program for a long time. Sweden used to have a program but no longer does. In Norway, family caregivers can apply, and the government will put them through the same training they provide to their formal home care workers for caring for frail people. They will put family members through the training and pay them the same wage that they would pay home care workers to look after that family member. Norway is the only country I am aware of that has such a home care program.
This is a legitimate area of concern, and I advise the committee to have a look at it.
Senator Keon: I want to return to Dr. Chappell. You talked about essential services and you broke them down into social and medical, which are difficult to differentiate with seniors.
We have done badly, whether we look at social services or medical services, when it comes to defining what is essential and what is not essential. We just do not seem to have a good mechanism for doing this. Consequently, people are being left out in the cold in both the medical and the social areas.
Have you any experience with any body who is doing this well? Have you any suggestions for our report in regards to areas in Canada that are doing this well?
Ms. Chappell: I thank you for coming back to this topic, because it is close to my heart. Quebec is probably doing it as well or better than most parts of the country. If you looked at some of the models in Quebec, that would be helpful. If you have not already heard from François Béland or Howard Bergman, who tend to do research together, I think you could learn a lot from their reports and publications. It is precisely in this area where individuals, usually seniors, you would probably get consensus, have a medical need, but they do not need expensive medical services or a home nursing. They need social services.
I am concerned that when this debate goes on or when decisions are made without the debate going on, there does not seem to be a recognition that the home care system has in place assessors. There are reasons for that. If they are not making the right assessments, then we can train them differently, but we have a system in place for it not to be abused. Often, particularly if you look at the area of prevention, if you send a home care worker into the senior's home to do their heavy house work, which everyone agrees is not a medical service but because of medical reasons the senior cannot do it, then you will prevent that senior from trying to do it alone and breaking a hip and then making an expensive claim on the health care system.
There is not a lot of rigorous research on the preventive area, but there is some, and I can send that to you. If you want to combine the medical and the social, I would go to Quebec.
The Chairman: Again, thank you both for joining us this afternoon. It has been a pleasure.
The committee adjourned.