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Old Age Pensions and Policy-Making in Canada

Old Age Pensions and Policy-Making in Canada

Copyright Date: 1974
Pages: 275
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  • Book Info
    Old Age Pensions and Policy-Making in Canada
    Book Description:

    Old age pensions have been a recurring issue in Canadian politics since the beginning of the twentieth century and now have more government resources devoted to them than to any other single public program. For these reasons the author has selected old age pensions as a case study on the politics of income redistribution. Professor Bryden analyses the development of public pension policy against the background of two opposing forces: the social and economic needs of an emerging urban-industrial society and the influence of a deep-rooted set of cultural values referred to as the market ethos which reinforces dominant economic interests. In particular he shows how the impact of the two forces - the one demanding the other resisting, income redistribution - affected the choice and later revisions of means test pensions in 1927, universal pensions in 1951, and contributory pensions in 1965. The features of these three pension plans are examined in detail, as are the conditions which brought the pension Issue to the top of the government agenda in each case; the alternative plans which were discussed; and the influence of individual members of parliament, political parties, the trade union movement, other interest groups, and provincial governments on the shape or revision of each new program. The expansion of pension programs brought about large increases in public expenditure. Regressive taxes and "contributions" were built into the policy designs and were justified in terms of the market ethos-prospective beneficiaries, it was argued, should be required to contribute to their own pensions. Professor Bryden examines the reality of the taxes and concludes that those in the lower middle income range and below have been required to assume a disproportionate share of the burden of providing income maintenance for the aged. In short, accommodations to the market ethos were an integral part of public pension policy.

    eISBN: 978-0-7735-6066-6
    Subjects: Management & Organizational Behavior

Table of Contents

  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-viii)
  3. Preface
    (pp. ix-x)
  4. Chapter One Framework of the Study
    (pp. 1-18)

    This book is a case study on the politics of income redistribution, the focus being on income maintenance for the aged in Canada. As a result of the high degree of urbanization and industrialization in Canada in the past century, powerful pressures arose for public policies guaranteeing economic security for the growing urban work force, including old age pensions. Resistance to such income redistribution was grounded in a deep-rooted set of cultural values, referred to as the market ethos, which reinforced dominant economic interests. The central theme of this book is that public pension policy in Canada has been the...

  5. Chapter Two Market Ethos versus Environmental Want
    (pp. 19-44)

    The market ethos is the cultural expression of the market economy which has moulded Canadian social, economic, and political development. Deriving originally from Europe and especially from England, the first country to emerge into the market economy, that ethos was adapted to the particular conditions of Canada. Its unifying principle was what Macpherson called “possessive individualism.”¹ Society was seen as an atomized collection of individuals engaged in endless competition for material possessions. They were motivated to participate in productive processes by an innate drive to maximize their individual utilities. This they did by exchanges on the market. Those with no...

  6. Chapter Three Early Pressures for Public Pensions and the Government Annuities Plan
    (pp. 45-60)

    Public contributory pensions for specific occupational groups date back to 1791 when France established invalidity pensions for seamen. Not until 1889, however, was the first plan with broad coverage adopted. In that year Germany instituted a contributory plan for all wage earners and lower paid salaried employees. It applied to both old age and disability and was financed by tripartite contributions. Denmark established a means-test plan for the aged in 1891, and New Zealand adopted this type of plan in 1898. The Australian states of New South Wales and Victoria followed New Zealand’s example in 1901, and in 1908 the...

  7. Chapter Four Means-Test Pensions, 1927
    (pp. 61-80)

    In 1915 an observer stated that public pensions were for all practical purposes dead as a political issue in Canada: “The agitation for old age pensions has persisted in spite of the establishment of the government annuity system; but it is an agitation kept up by a few enthusiasts, aided by partisans, and has no grip on the public mind.”¹ This was not an unreasonable inference at the time. However, forces were already gathering that led to the establishment of Canada’s first public plan twelve years later. Section 1 describes the design of that plan, and subsequent sections, the circumstances...

  8. Chapter Five Implementation of the 1927 Plan
    (pp. 81-102)

    The 1927 old age pensions act remained on the statute books for twenty-four years until 1951. Three main problem areas arose during that period. First, it was nearly a decade before all provinces accepted the plan. Second, rising living costs immediately before and after the outbreak of World War II gave rise to a politically significant demand for increased benefits. Third, since administration was exclusively in provincial hands, discrepancies arose among provinces.

    In terms of the adoption of the plan, the nine provinces of the time divide neatly into two groups on the basis of both geography and chronology. In...

  9. Chapter Six Universal Pensions, 1951
    (pp. 103-128)

    Many of the trade unions, private members of parliament, and others who had been pressing for public pensions did not regard the 1927 plan as satisfactory, and it was not long before they were advocating changes in it. Reduction of the age of eligibility was a leading objective of reformers in the 1930s. Such reduction was seen both as providing some security for the many workers who were being forced into retirement before seventy and as an inducement to older workers to retire voluntarily and make jobs available for younger people. Other features of the plan which came in for...

  10. Chapter Seven Contributory Pensions, 1965
    (pp. 129-146)

    The 1951 decision to institute a universal plan, though made with some reluctance by the government of the day, proved to be irreversible. Proposals were made occasionally in subsequent years to substitute contributory pensions, but they did not arouse noticeable public interest. It was not practical politics to abandon a plan which guaranteed to everyone a basic measure of income security in old age in favour of a quite different kind of plan of which Canadians had had no experience. On the other hand, the idea of relating pension benefits to earnings (which almost necessarily involved a contributory plan) began...

  11. Chapter Eight Shaping the 1965 Design
    (pp. 147-182)

    Though an enormous amount of technical work remained to be done, the government undoubtedly believed that the 1963 resolution and explanatory statement contained all the essentials of a program which could be implemented. In fact, the bill eventually placed before Parliament (Bill C-75) and the accompanyingCanada Pension Plan: White Papercontained important revisions of the original proposal. Even the revised proposal, however, was inadequate to accommodate the varied and complex pressures bearing upon the government,¹ and a new bill (C-136) was substituted for Bill C-75. Bill C-136 was a far cry from the 1963 formulation: yet, as originally introduced,...

  12. Chapter Nine Public Pensions and the Policy Spiral
    (pp. 183-212)

    As a result of the environmental changes outlined in chapter 2, three main “groups” emerged in Canada with an interest in public pensions. There were, first, those who had reached or were approaching the age of seriously reduced earning capacity; second, the children of such people who, in traditional thinking, were responsible for maintaining their aged parents but were increasingly unable or unwilling to do so; and third, those whose sympathies were engaged by the plight in which many of the aged found themselves. These were groups only in the categoric sense of the term—diffuse collectivities with certain common...

  13. Notes
    (pp. 213-252)
  14. Index
    (pp. 253-264)