Take-up of Government Benefits
A research report titled Financial Literacy and Take-up of Government Benefits submitted to the Task Force on Financial Literacy contains fascinating information on what percentage of Canadians actually take advantage of Government benefit programs that they are eligible for.
- 4% of eligible seniors are not receiving OAS payments; this rate represents about 160,000 seniors and accounts for almost $1 billion of pre-tax benefits.
- It is estimated that 135,000 to 150,000 senious do not receive a GIS to which they are entitled. 80% of those who miss out on the GIS are women, particularly those who are very elderly.
- 55,000 eligible Canadians representing about 1.8% of the beneficiaries were missing out on CPP retirement benefits (HRSDC data from 1999).
- 95% of eligible families with children receive the Child Tax Benefit.
- Only 16% of children eligible for the Canada Learning Bond ($500 in the first year and $100 thereafter) receive it.
- The take-up of the Canada Education Savings Grant is reported to be 39.3%.
- Only 50% of households headed by individuals aged 55-64 and without an employer pension have an RRSP.
- In 2007, only 31% of eligible tax payers made use of their RRSP contribution room. The median contribution was just $2,780 — representing about 6% of total eligible room available.
- In the first year of the TFSA, 4.7 million tax payers contributed $15.8B.
The report praises the Quebec Government for the close to 100% take-up rate for the Quebec Pension Plan. Officials in Quebec identify eligible seniors who are not receiving benefits to which they are entitled through databases and proactively phone or even visit them to ensure that they apply for their benefits. It is disheartening to see so many Canadians missing out on many hundreds of millions of dollars in benefits.