OPSEU/SEFPO

A Message from the Chair

Last week the Federal Minister of Finance, Joe Oliver, brought down his budget and as to be expected there was no help for the average taxpayer whatsoever. The team of Oliver and Harper once again have set out to help the wealthy at the expense of everyone else.

The increasing of the ceiling on tax free saving accounts, supposedly designed to help all of us create more savings, is a joke since the average person does not have $10,000 sitting around to put into savings.  Most of those don’t even have the $5,500 that was allowed before this budget.

The income splitting sounds great on paper, but realistically is far and away more beneficial to the husband making $100,000 or more and whose wife is, a “stay at home” Mom; than it is to the couple whose joint income is $60,000 to $70,000. It does not help the folks who are both working minimum wage jobs, at all.

The 15 per cent refundable income credit for home renovations for the elderly and infirmed is a nice gesture, but a decent increase in the CPP would have gone a lot further. Reducing the amount that has to come out of your RRIF’s is once again, only beneficial to those that have the situation where they don’t need every bit of money they can get, just to keep their heads above water.

And so here we are again. We are stuck with a government that does nothing about income inequality or child poverty or climate change and instead enhances the old adage “the rich get richer and the poor get poorer”. It is unfathomable that the Conservative’s would introduce yet another perk for the rich, and that is income splitting. By cancelling this program, this government would save $2 billion a year that could be used to greatly improve the lot of the average Canadian.

Ed Faulknor, Chair
OPSEU Retired Members Division

The most important economic problem faced by Canadians today is not government deficits, and solutions are not to be found in returning to balanced budgets too quickly.

The most pressing problems faced by Canadians are a sluggish economic recovery, a stalled jobs market, and record-high levels of household debt, along with inadequate employment insurance coverage and lack of retirement security.

The Canadian Labour Congress believes balanced budgets (even budget surpluses) alone can’t solve these problems. Action is what’s needed and those actions need plans to be effective. Planning comes from a will to act in the first place. And the will to act is what’s missing in Ottawa today.

“Canadians expect their federal government to tackle the big problems in their lives. They are living the reality of an economic recovery that is not as good as they are being told. They see too many young people giving up on finding a job. They see full-time jobs getting replaced with part-time jobs. Most of them think they can never afford to retire. Rather than invest in training or creating jobs, employers choose to sit on $650 billion in dead money. But everything is fine, you see – Joe Oliver has balanced the books,” says Hassan Yussuff.

“I say to Mr. Oliver: you’ve balanced the books, good – now do something to get the economy and job market working for Canadians again,” he adds.

Despite rosy government rhetoric, the overall labour force participation rate and the employment rate have still not recovered to their pre-recession levels. On the contrary, they have stagnated since mid-2012.

The Bank of Canada’s labour market indicator shows that labour market slack is larger than the unemployment rate illustrates. Many economists are concerned about elevated levels of long-term unemployment and involuntary part-time work, as well as high levels of unemployment among vulnerable groups, such as new Canadians and racialized workers.

What can government do to spur economic growth and good jobs? The International Monetary Fund’s (IMF)World Economic Outlook, published in October 2014, suggests that the time is right to make some much needed infrastructure investments. They even go so far as to suggest that clearly identified infrastructure needs could be financed through borrowing without increasing debt-to-GDP ratios, since public infrastructure investment increases growth in both the short term and the long term.

All of the conditions that the IMF identifies as ideal for public investment are present in our economy right now. We are experiencing an extended period of labour market slack and low business investment. Canada has a very low level of public debt, borrowing costs for the federal government are and will remain very low, and needed public investments would yield a high rate of return in terms of immediate job creation, public benefits, and growth of private sector productivity.

Skills training and apprenticeship programs are key components of creating good jobs. Canada falls well below the OECD average in the average hours of job-related, non-formal skills training for employees, and in employer investment in skills training for employees. Lifelong learning is critical to a high-skills knowledge economy, and is essential for Canada to remain competitive in the global marketplace.

Instead, this government has slowly strangled public services. Spending cuts announced on an incremental basis add up to a substantial amount – $90 billion between 2012 and 2017.

As long as business and government fail to invest in our economy and well-being, our potential output declines. Rather than laying the groundwork for a more prosperous future that we can all share in, this government has chosen to shrink the federal government and business has decided to hoard profits. This is a no-win situation for Canadians.

This article taken from the Canadian Labour Congress website.

Ontario’s New Estate Process

At some point, we are all going to end up either being an Executor or needing an Executor. For this reason, it is important to understand the recent changes to Ontario’s Estate Administration Tax which came in to effect January 2015.

The good news is the fee schedule did not change – it is still calculated as $5/$1,000 for the first $50,000 of assets and $15/$1,000 or 1.5% thereafter in Ontario. The bad news is the government intends to collect a lot more of this tax, by requiring anyone who receives a Certificate of Estate Trustee to file a new 7 page Estate Information Return (EIR) with the Ministry of Finance.

The new legislation is an effort to ensure the Province receives its fair share of estate tax, which it believes it has been shortchanged in the past, due to conservative or significantly understated estate values. Since the old system did not have any form of ‘checks and balances’, there was no way for the province to know if the values reported were correct, or even enforce compliance. In short – the old system was a joke, the new system has teeth.

The first two steps of the ‘Probate’ process remain unchanged, where persons seeking to be appointed by the Court as the Estate Trustee (commonly known as the Executor) first need to file an application with the Superior Court of Justice and submit the last known Will of the deceased. This application is made to the Court where the deceased had permanent residence. This initial application requires the named Executor and /or the lawyer to locate and list the known assets of the Estate and their value and attach payment to the Court of 1.5% of the estate value. This is now referred to as the ‘deposit paid’ toward the Estate Administration Tax . . .hint . . . hint.

Secondly, if the Court finds the Will to be in good order and the most recent, they will go ahead and issue a Certificate of Appointment of Estate Trustee, so the Executor now has the legal authority to act on behalf of the estate and administer the provisions of the deceased’s Will.

It is the third step that is new, which requires any person(s) appointed an Estate Trustee must file the new Estate Information Return within 90 days from the date the Certificate of Appointment of Estate Trustee was issued. It is very important to be aware of this new third step, since this is the step that is punishable by a minimum fine of $1,000 and up to twice the amount of the tax payable by the estate if missed. Failure to file this new EIR or intentionally reporting false information can also result in up to two years of jail time for the Executor.

Step three also comes with a 4 year reassessment period, meaning the Minister of Finance can audit the Estate Information Return at any time from the date of filing and up to four years after. If no EIR is filed, there is no statute of limitation. Dying intestate (without a Will) is not the answer either, as practically all estates are expected to file this return. It used to be common practice that if an Estate had less than $10,000 in reportable assets it didn’t need to be probated. That dollar value has now been brought down to $1,000 of estate value.

So what information will the Executor have to provide on this new EIR you ask? The Ministry of Finance would like to know some personal details about the deceased and where they lived, as well as personal contact details for the Estate Representative (the Executor). Next the Ministry wants to know about all real estate owned by the deceased in Ontario, as well as its fair market value and the deceased’s percentage of ownership. The value can be decreased by any outstanding encumbrances registered against the property.

With many seniors having put their adult children on title of their home or bank accounts to avoid probate, this can now be a tricky area to navigate without the guidance of a lawyer. On one hand the EIR Guide states not to list any property the deceased owned as a joint tenant, but on the other hand it states to include any property the deceased had a beneficial interest in. Ownership is at two levels, legal and beneficial. If the deceased still lived in the home or still had beneficial access to their bank account – these assets will most likely now be subject to Estate Administration Tax.

The Executor will also have to provide details about the deceased’s bank accounts and the balances at the date of death, the value of all investment accounts (except those which pass outside the Estate by way of a beneficiary designation, such as a RRIF or RRSP or any Segregated Funds with a named beneficiary) and the value of all vehicles and vessels the deceased owned at the time of their passing and their fair market value. Lastly the Ministry of Finance wants to know about any other property the deceased owned, such as business interests, copyrights, patents, household contents, art, jewelry, etc. If there were any assets insured under a rider on the home insurance policy, be sure to list these items on the Return.

The totals of each section are transferred to the last page which calculates the total Estate Administration Tax owing, minus any deposit already submitted.

The details reported in the Estate Information Return will be used as the basis for any future audits, within the 4 year period. Since the valuations reported can be disputed by the Ministry, it is wise to obtain professional appraisals and the Executor should hold back some funds in the estate account until the 4 year audit cycle has passed, as they could be held personally liable for additional Estate Administration Tax owing.

Not only are the new rules more complex and designed to increase the amount of EAT collected, they are also expected to increase the costs associated with Estates. These additional costs could include legal fees (up to 5% of reported estate value), accounting fees (2-5% of estate value or $250/hr), appraisal costs, costs of disposition and fees paid to other professionals.

There is no doubt this new process has turned the position of an Executor from one of honour, to one of avoidance. Nevertheless, it is an important step in the circle of life and one we must go through if a loved one has requested it of us. It is the last thing we can do for them and we want to do a good job honouring their wishes.

Fortunately there are some proactive, yet simple steps you can take to prepare your eventual estate for your Executor and minimize the tribulation. Structured properly, most savings and investment assets can bypass the probate process/fees and be paid directly to named beneficiaries, avoiding the estate all together. Since joint ownership is no longer the simple solution, now may be a good time to revisit your estate expectations with a Certified Financial Planner and discuss the merits of Segregated Funds and their ability to bypass the estate. As they say, “an ounce of prevention is worth a pound of cure” and with the acronym EAT, you know the province wants to take its bite out of your estate.

For more detailed information visit the Ontario Ministry of Finance / Estate Administration Tax / FAQ: http://www.fin.gov.on.ca/en/tax/eat/faq.html

and the Ontario Ministry of the Attorney General’s Estates page: http://www.attorneygeneral.jus.gov.on.ca/english/estates/estates-FAQ.asp

by: Léony deGraaf Hastings, CFP, EPC

The above article is provided for general educational purposes and not to be construed as personalized financial, tax or legal advice.

Léony deGraaf Hastings, CFP, EPC 905-632-9900
Certified Financial Planner 1-800-775-7047
Retirement & Estate Planning Specialist www.dgfs.ca

Seniors Vote

To all Ministers of Finance and Opposition Finance Critics

Seniors Vote is a collaboration of seniors, retirees, professional and advocacy groups raising common concerns which particularly resonate with older Canadians – financial security in retirement and healthcare reform. The attached details the recommendations for the upcoming federal budget and our priority issues for the 2015 federal election.

It is now common knowledge that older Canadians are the most committed voters; 65% or more of older voters turnout to vote regularly. Older Canadians are also among the most politically engaged voters whose past party loyalty cannot be taken for granted. This has led all political parties to ask:

“What do seniors want?”

And the answer has been the call for the kind of transformative change in our public systems that will make life better for all Canadians as they age. Many such reforms will only benefit future generations. Seniors Vote calls for pension reform to ensure that people will not outlive their money by expanding access to pension savings and increasing income support.

The call for healthcare reform demands that Canadians not be treated as health consumers or merely patients, but rather as “healthcare citizens” who pay for the system and expect it to serve the broad values set out in the Canada Health Act – universality, accessibility and comprehensiveness. To do this, the healthcare system must undergo transformative change and centre itself around the needs and expectations of the healthcare citizen, to not only provide medical intervention but also support prevention and social determinants of health, the family caregiver and end of life care Seniors want to stay in their own homes but too often programs like homecare are not there for them to do so. There is a need for a national housing strategy that includes seniors housing. Access to affordable and suitable housing is a major determinant of health, an instrument to reduce poverty and a critical component of age-friendly communities.

Income inequality is growing in Canada. More seniors are falling below the poverty line. Seniors are also concerned that too many of their children and grandchildren are facing precarious work and a bleak future.

It is clear that Seniors indeed vote. This sets out what Seniors will vote for. Today’s ballot questions are the blueprint for our children’s tomorrow.

1. Income and Retirement Security

Achieving income security in working life and retirement is increasingly difficult for Canadians of all ages.

• Nearly 5 million Canadians live in poverty
• 12 percent of seniors still live in poverty, amounting to more 600,000 people
• 1 in 6 single seniors live in poverty, most of whom are women
• Twelve million working Canadians do not have workplace pension plans and significant numbers of Canadians will face a substantial drop in their standard of living on retirement
• Younger working Canadians will have especially limited access to workplace pensions

Seniors Vote calls on the federal government to:

• Work with provinces to increase the CPP
• Strengthen income support by
  • Restoring the OAS eligibility age to 65 from 67
  • Increase the exempt earnings band for GIS
  • Increasing the amount of OAS and GIS for low income seniors
• Increase income supports for low-income single older Canadians not yet eligible for OAS by creating an equivalent to the OAS spousal allowance
• Prohibit retroactive erosion of earned pension benefits

2. Federal Leadership on Healthcare Transformation

Healthcare remains the highest priority for Canadians who are calling for transformative change.

• Older Canadians and their families find the system inadequate to the task of meeting their post-acute and chronic care needs, very difficult to navigate, and incomplete
• Over 8 million caregivers provide invaluable support to family members and the formal health system, without adequate support from employers and government
• Poverty, social isolation, a poor physical environment, and inadequate housing leads to poor health outcomes. Investments in prevention and in the social determinants of health could save the system money and produce better health outcomes for Canadians
• Transforming the healthcare system to better work for all Canadians requires federal leadership

Seniors Vote calls on the federal government to:

• Work with the provinces to create a national pharmacare plan, with an ultimate goal of first dollar coverage for all Canadians
• Work with the provinces to fund and set standards to improve access, affordability, and quality of post-acute and chronic care, in the home and in the community, with particular focus on dementia care
• Increase financial support and provide workplace protection for caregivers
• Work with the provinces to ensure every Canadian has access to housing appropriate to need, including affordable and supportive housing, and assisted living services

It takes a community; What you might not know about Shelter House

Guest Column by Patty Hajdu
Posted: Tuesday, February 17, 2015 12:00 am

One of our staff retired last summer after 12 years of service. We held a retirement celebration for him, and we lamented the loss of this man who could help even the most distressed and angry person calm down within minutes.

Recently, he returned to Shelter House as a part-time cleaner, saying that he still had more to give. We gratefully welcomed him with open arms. It’s really through our incredible team of staff members that this difficult, humbling and essential work is done.

Shelter House is a unionized workplace, and we work closely with members and stewards on our common goals of creating a safe, supportive and equitable workplace. Shelter House offers a stable job, good benefits and an opportunity to be part of a team that makes a fundamental difference in our community. And OPSEU, our union, contributes back to Shelter House through donations of money, volunteer time and goods.

Recently, the OPSEU Sisters of Seven noted that we were always running out of plates during their monthly soup kitchen volunteering. They worked with Russell Foods (a local supplier from whom Shelter House purchases much of our kitchen needs) and together, donated sturdy dishware for the kitchen.

Shelter House purchases supplies locally whenever possible. We use local contractors for maintenance work, we buy our meat locally, and we rely on local businesses that just like Russell Foods, often donate money, time and goods to help further our goals. It is through these mutually supportive relationships that community is built.

Last year, Shelter House was selected by Safeway Canada to collect all of their food donations. Each day, volunteer drivers collect from all three stores the produce, breads and pastries donated for use in our kitchen.

Seven days a week, people eat at our two free meals benefit from the nutritional boost that this donation provides. But Safeway is only one of the donors that the van stops at. We receive food from a variety of bakeries, small grocery shops and pizza places, as well as many other donations that are delivered to our door, all of which we either serve or share with other feeding programs in the city.

Much of the media that surrounds us focuses on funding efforts, requests, successes or setbacks that our organization faces. But Shelter House is proud of what we contribute back to Thunder Bay. We are one of the largest employers in the downtown south core with 60 full-time, part-time and casual staff. We have built strong relationships with the business community.

Over 30 years ago, faith leaders from different churches worked together to respond to homelessness and hunger in our city. That spirit of collaboration is what keeps us going to this day.  Patty Hajdu is executive director of Shelter House in Thunder Bay.

OPTrust Delivers 12% Return in 2014

April 23, 2015

Net assets grow to $17.5 billion as OPTrust celebrates 20th anniversary

Toronto, April 23, 2015 /CNW/ – OPTrust, one of Canada's major public pension plans, today reported 2014 investment results of 12.0%, net of external management fees, significantly outperforming its benchmark return of 6.2%.

Net investment income for 2014 was $1.8 billion, and after collecting contributions of $515 million and paying $798 million in benefits, the Plan's net assets increased to $17.5 billion at year-end ($16.0 billion as at December 31, 2013). On average, 76 cents of every pension dollar paid by the Plan is generated by investment returns with the other 24 cents being funded by member and employer contributions. The Plan's costs in 2014 were 53 basis points.

"As OPTrust celebrates its 20th anniversary, we continue to deliver investment results that allow us to pay pensions today and preserve pensions for tomorrow," said Hugh O'Reilly, President and CEO of OPTrust. "Exceptional returns in our infrastructure portfolio, complemented by solid performance in real estate and public equities, offset challenging market conditions such as this year's steep decline in energy prices. The results also validate our ongoing commitment to strengthening the relationship between assets and liabilities in our investment strategy."

OPTrust's investment returns in 2014 reinforced its sustained, stable funding position. The Plan continued to be fully-funded during a year in which it took meaningful steps to support its long-term funding health by further strengthening its mortality and economic assumptions.

The Plan's 2014 funding target was 6.15%, and over its 20-year history, the Plan's investment portfolio has realized an average annual return of 8.4% net of internal and external investment expenses, exceeding its 7.11% average funding target return for the same period.

Investment results by portfolio

OPTrust's infrastructure portfolio led performance in 2014, with a return of 48%. These exceptional results were driven in large part by a significant investment in European infrastructure. The Plan's real estate portfolio delivered a strong return of 10%.

The Plan's equity investments had a solid year in 2014. The public equities portfolio returned 11.8%, supported by its global equity exposure. The private equity portfolio returned 11.3% in a year in which OPTrust made 12 new commitments to both fund and direct investments.

Challenged by volatility in the energy sector and declining oil prices, the energy commodities portfolio delivered a return of negative 36.2%, consistent with market performance for this asset class. The Plan's fixed income portfolio posted a return of 7.5%.

Funding position

In 2014, OPTrust remained fully-funded while strengthening its mortality and economic assumptions, for the second year running, to enhance the long-term funding health of the Plan.

The valuation also identified $1.2 billion in deferred investment gains, compared to $811 million at the end of 2013. These gains will be recognized between 2015 and 2018, further improving the Plan's funded status.

More detailed information about OPTrust's 2014 investment results, funding position and other activities will be available in its annual report, to be released later this spring.

About OPTrust

With assets of $17.5 billion, the OPSEU Pension Trust (OPTrust) invests and manages one of Canada's largest pension funds and administers the OPSEU Pension Plan, a defined benefit plan with over 86,000 members and retirees. OPTrust was established to give plan members and the Government of Ontario an equal voice in the administration of the Plan and the investment of its assets, through joint trusteeship. OPTrust is governed by a 10-member Board of Trustees, five of whom are appointed by OPSEU and five by the Government of Ontario. www.optrust.com

Source OPSEU Pension Trust (OPTrust)

For further information: contact OPTrust Communications:

• Karen Danylak, Director, Communications, 416-681-6784, kdanylak@optrust.com;
• Samantha Gileno, Manager, Communications, 416-681-4507, sgileno@optrust.com  

Two policemen call the station on the radio. "Hello. Is that you Sarge?" 
"Yes?"
"We have a case here. A woman has shot her husband for stepping on the floor she had just mopped clean." 
"Have you arrested the woman?" 
"No sir. The floor is still wet."

Once when I was lost, I saw a policeman, and asked him to help me find my parents. I said to him, "Do you think we'll ever find them?" He said, "I don't know kid. There's so many places they can hide." 

Healthy Eating and Regular Physical Activity: A Winning Combination for Older Adults

by Shanthi Johnson, PhD, RD, FDC, FACSM

Sometimes people assume that falls and injuries, cancer, and chronic diseases such as diabetes and heart disease are a natural part of growing older. But research tells us that these conditions might occur because we are not active enough or are not eating a healthy diet. If we choose to be active and eat a healthy diet, in combination, we can slow down the progress of diabetes, heart diseases and some cancers. They also help to prevent falls and injuries.

Healthy eating as we age

As we get older, we need fewer calories, but our need for nutrients remains the same and even increases in some cases. This makes meal planning important. Here are some tips on eating well:

Eat balanced meals from the four food groups every day.

Canada’s Food Guide defines the four food groups as:

• milk and alternatives
• grain products
• vegetables and fruits
• meat and alternatives.

Eat a variety of foods within each food group. For instance, eat different kinds of grain products such as whole grain breads, rice, pasta, bagels, and so on. You should also think variety in terms of type of food (fresh, canned, frozen) colour, flavour, texture, and method of preparation.

Enjoy breakfast every day. It may help control hunger cravings later in the day.

Eat less sugar

Try to limit foods like granola bars, cakes, pastries, cookies, chocolates, doughnuts, ice-cream, frozen desserts, sports and energy drinks. Some of these items are marketed as healthful, but they are loaded with sugar.

Eat less fat and salt

• Choose lower-fat milk products.
• Choose leaner meats, poultry, and fish.
• Choose meat alternatives such as peas, beans, and lentils.

Choose whole grain and fresh fruit and vegetables.

Whole grain foods are good as they provide many nutrients. Fruits and vegetables are packed with nutrients (generally low in fat). Choose dark green and orange vegetables.         

Active living as we age

The Canadian Physical Activity Guidelines for Older Adults 65 Years and Older recommends that older adults:

• take part in endurance (aerobic) activities, such as brisk walking and cycling) at least 150 minutes per week, in sessions of 10 minutes or more
• do activities that improve strength at least two days per week
• do exercises or activities that enhance balance and flexibility.

Being active every day is a step towards better health and a desirable body weight. Be active in a way that suits you. This will help ensure that you are active on a regular basis. Here are some more tips:

• Your aerobic (endurance) activities should be moderate to vigorous in intensity. Examples are brisk walking, swimming, dancing, aerobics, bicycling, and cross-country skiing. Try to take the stairs or walk whenever and wherever possible.
• Do activities that increase strength and involve the major muscle groups at least twice each week. Examples are lifting weights or household items such as laundry or groceries, climbing stairs, and doing wall push-ups.
• Do activities to improve your balance every day, to help prevent falls. Examples include reaching and bending, Yoga, and Tai Chi.

This article is taken from ALCOA website Silver Times Publication

Eye Health & Exam Frequency – Adults

For adults, a regular eye exam is an important part of maintaining your overall health and making your vision last a lifetime. Without an eye exam, critical health issues can be overlooked until it’s too late.

Our eyes change as we age. In particular, people over the age of 40 may be at an increased risk for age-related eye conditions, some of which may have no visible symptoms until the condition is advanced and difficult, or even impossible, to treat.

The most common eye problems among adults include:

• Presbyopia: a natural effect of aging in which the ability to focus on close objects decreases over time. Presbyopia can cause headaches, blurred vision, a