November 15, 1951

LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

These amendments will provide for amendment to existing contracts at the discretion of the minister. I can see no objection to the proposition put forth by my hon. friend, but I would not like my answer to be taken as being definite and final. I would assume that the power given by the amendments to amend contracts or even to substitute new contracts for those already existing would provide for the proposition mentioned by my hon. friend.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles:

If for a contract in existence prior to April 19, 1948, there is substituted a new contract, will the new contract be on the basis of the old or new rates?

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

I would not care to give a definite answer. I would ask my hon. friend to let his question stand until we reach the committee stage.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles:

I will do that, as I appreciate the position the parliamentary assistant is in. Are the mortality tables used in computing the annuity rates which the parliamentary assistant placed on Hansard a little while ago the same tables provided for by the order in council passed on April 19, 1948?

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

The mortality tables are those which were set up in 1948.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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CCF

Percy Ellis Wright

Co-operative Commonwealth Federation (C.C.F.)

Mr. Wright:

Where a person has a contract for $100 per month which he wishes to

Government Annuities Act increase to $200 a month, will he be allowed to increase it at the same rates as applied to the old contract?

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

No. Any addition to the coverage provided by any such contract would be at the rates prevailing at the time of the addition.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Robert Fair

Social Credit

Mr. Fair:

Is the parliamentary assistant sure of that? I understood that if a person bought an annuity at the old rate of 4 per cent and wished to increase it at a later date, he could do so at the old rate. Surely he would not have to come under the 3 per cent rate, or whatever it may be. I understood definitely from the officials that the rate would continue at 4 per cent even if a person wished to increase the amount of the annuity.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Charles Edward Johnston

Social Credit

Mr. Johnston:

I think this point should be cleared up right now. I visited the annuities office when we were discussing this matter and it was pointed out to me most clearly that if a contract was taken out at the 4 per cent rate, it could be increased at any time in the future and still bear that rate. If the parliamentary assistant is claiming that is not the case, we should know about it now because that would be a violation of a contract already entered into.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

My hon. friend is right with regard to any increase up to the maximum amount permissible under a contract already in existence, but I was referring to the new maximum of $2,400 which will be provided by the amendments. If my hon. friend is going to go into technicalities I suggest that he wait until we are in committee when the officials of the department will be able to give more precise answers.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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CCF

Stanley Howard Knowles (Whip of the Co-operative Commonwealth Federation)

Co-operative Commonwealth Federation (C.C.F.)

Mr. Knowles:

As I said before, I appreciate the position in which the parliamentary assistant finds himself with respect to some of these questions, and I shall not press them at this time. However, it might be useful if some of the questions were placed on the record so the officials would know what answers to dig up. I would be interested in learning at some stage whether the cash surrender privilege will apply only to contracts issued after these amendments go into effect, or will that apply to contracts already in effect.

Referring to the special contracts that can be taken out for a limited period up to twenty years, it would be interesting to know if there is any starting or ending date or whether they are just for old age periods? I was wondering whether they could be taken out to meet the educational requirements of one's children.

Government Annuities Act

The other night the minister said that it would be possible to take out an annuity payable to one person during his lifetime, and then have it transferred to some other person for his lifetime. Is there any restriction upon the class of persons that might be included! in such a contract? I had some other questions but they relate more to the interest rates and to what consideration might have been given that matter. In view of the suggestion made by the parliamentary assistant I shall leave these until later.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell (Greenwood):

Would the parliamentary assistant repeat what he said about the reduction in the premium which would be occasioned by the old age pension coming into effect at age 70? I understood him to say that it would involve a one-third reduction in the premium.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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PC

Charles Delmar Coyle

Progressive Conservative

Mr. Cole (Verdun-La Salle):

I placed on Hansard a table which showed in concrete form the effect on the premiums of this co-ordination of the old age security scheme, which is to come into effect on January 1, and an annuity contract. It gives the premiums and the proportion of reduction in premiums in three categories of annuities, $75, $100 and $125 per month.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Charles Edward Johnston

Social Credit

Mr. Johnston:

Taken out at what age?

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

Each i's reduced by $40 at age 70. In these categories the premium of course is much lower than if the annuitant took an ordinary life annuity of $75, $100 or $125.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Charles Edward Johnston

Social Credit

Mr. Johnston:

But they all start at the age of 20 years.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

Yes, those are the figures I am giving.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Charles Edward Johnston

Social Credit

Mr. Johnston:

They will not come into effect for years.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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LIB

Paul-Émile Côté (Parliamentary Assistant to the Minister of Labour)

Liberal

Mr. Cote (Verdun-La Salle):

I have others starting at ages 30 and 40.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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SC

Charles Edward Johnston

Social Credit

Mr. Johnston:

They will not become effective for another fifty years. What about those people who are 40 or 45 years old? It will cost them a lot more than you indicated a moment ago.

Topic:   A FEW EXAMPLES SHOWING THE MONTHLY PREMIUM REQUIRED TO PURCHASE A LEVEL ANNUITY FOR LIFE COMMENCING AT AGE 65 MALES, 60 FEMALES, COMPARED WITH THE MONTHLY PREMIUM NECESSARY TO PRODUCE ANNUITIES OF THE SAME AMOUNT BUT WHICH REDUCE AT AGE 70 BY THE AMOUNT OF THE OLD AGE SECURITY ($40 PER MONTH.
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November 15, 1951