While the rise in the cost of living continues to break records, voices are increasingly being raised regarding the fate reserved for retirees, whom many consider among the main collateral victims of the surge in inflation.
“Their great drama, to them, is that it happens at a time in their lives when they can no longer recover,” explains the coordinator of the Retirement Observatory, François L’Italien.
“Young people can choose to work overtime, opt for a better-paying career, or even find a side job while they adjust to the situation. But the oldest unfortunately do not have this luxury. »
Special advisor for government relations of the Réseau FADOQ, the largest group of seniors in the country with more than half a million members, Philippe Poirier-Monette confirms this. “Without indexation of their pensions, most retirees have no choice but to helplessly watch the rapid erosion of their purchasing power. »
The recent surges in inflation have affected them all the more since the pension plan set up by the federal and provincial governments originally relied on contributions from the plans set up by employers.
However, for two decades, deplores Serge Cadieux, first vice-president of savings market development at the Solidarity Fund QFL, employers who offered generous defined benefit plans have become increasingly rare.
And plans that have managed to escape the wave of conversion to less binding systems, known as defined contributions, have almost no more indexation clauses to protect themselves once morest inflation.
Result: even if the contributions of the public Old Age Security, Guaranteed Income Supplement and Quebec Pension Plan plans remain indexed, the savings income of retirees – often accounting for more than 50% of their pension – remain vulnerable to the rising cost of living.
At what point ? According to researcher Riel Michaud-Beaudry of the Retirement Observatory, the payment of the same amount of pension, over a period of 30 years, tends to see its true value decline in doing so by approximately 35%.
