Revised GIS rules 'cancelled,' Finley insists

Share

Leaked government documents are raising questions as to how federal bureaucrats are interpreting the Harper government's pledge to scrap a controversial change to the Guaranteed Income Supplement for low-income seniors.

Liberals accused Human Resources Minister Diane Finley of lying to Parliament over her repeated claims that the policy is dead.

"The House has been given false information," Liberal MP Gerry Byrne said Thursday as he asked Ms. Finley about the documents in the House of Commons.

Ms. Finley insists that it is Mr. Byrne who has his facts wrong and repeated her claim that the policy has been cancelled.

At issue are technical notes sent to staff in Ms. Finley's department on Nov. 30 - four days after the minister announced the policy was being put on hold. Ms. Finley's office insists the directives are in line with her pledge to scrap the change, but Mr. Byrne disagrees.

The original policy change - which was made in May and did not become public until a Globe and Mail report on Nov. 26 - ended an "option" that allowed seniors collecting the Guaranteed Income Supplement (GIS), which is targeted to seniors earning less than $15,815.99 a year, to have Ottawa calculate their income based on a projection for the coming year, rather than the year before. Seniors would take advantage of this option to avoid having a withdrawal from a Registered Retirement Income Fund - which is what a Registered Retirement Savings Plan becomes in retirement - counted as income and thereby disqualifying them for GIS.

The move was controversial because it was made without notice and potentially affects tens of thousands of seniors who are already struggling to make ends meet. As an example, seniors earning $10,000 a year who withdrew everything from their RRIF for any reason and the amount bumped their income above $15,815.99, would not find out until payments are reset in July, 2011 that they no longer qualifies for a key part of their monthly income.

The morning of the Globe report, Ms. Finley said she was "disturbed" by the information and would be putting the change on hold.

A few days later, on Dec. 1, Prime Minister Stephen Harper went further in the House of Commons, stating that "the minister has made clear that she has cancelled those changes."

Ms. Finley stood by that position Thursday, insisting no one will be caught up by the rule change this year. "We have cancelled this change," she said.

"We have cancelled it, we have cancelled it, we have cancelled it. Can I be more clear about that? We want to make sure that Canadians who need their GIS do get it."

On Nov. 30 - four days after the minister announced the change was on hold - an internal memo was circulated stating GIS rules were updated in November to "confirm that the option provision can no longer be invoked for GIS clients who suffered a loss or reduction of pension income due to a discretionary withdrawal from their Registered Retirement Income Fund."

That line, plus a reference to continue other GIS applications related to RRIF information "as per existing procedures," suggests nothing has changed, said Gerard Lee, a retired Service Canada employee who would have received such guidelines.

"Why aren't the documents just saying use the old policy and process the claims?" he asked.

But the memo also notes that as of Nov. 26, 2010, requests for such options "were placed on hold pending further notice."

Ms. Finley's spokesman, Ryan Sparrow, says that shows the memo is in line with the minister's announcement. He said the reason claims are on hold rather than being processed is because technical details need to be worked out.

Mr. Byrne said it is now incumbent on the minister to ensure her department crafts rules that clearly align with what she is saying and that these rules be tabled in Parliament.