In the years between Confederation and the First World War, pensions were reserved for a select few. The majority of Canadians continued working into old age, and when that was no longer possible, they relied on personal resources or family and community for support. Those seniors without work or support could avoid destitution by turning to public poor relief or private charity, if available. However, these forms of assistance were meagre and dispensed only after applicants were subjected to demeaning eligibility tests intended to weed out the "undeserving".
In the 19th century, the proportion of seniors in the total population was not as large as it is now, and people did not live as long. At the same time, poverty amongst seniors was not a very visible problem until expanding industrialization brought a concentration of people to urban centres, where living conditions could be harsh, economic survival precarious, and traditional social support systems strained.
The idea of a state-sponsored system of pensions for seniors did not come easily. Nineteenth century ideology stressed the importance of individual self-reliance, even in old age. Poverty was believed to result from character deficiency or lack of foresight and self-discipline, and care for the poor and vulnerable members of society, including the aged, was seen as a family and community responsibility. It was not thought to be the role of government to interfere or to assume this obligation. Only those with nowhere else to turn were to be recipients of limited state help. The "poor relief" traditions that Canada had inherited from Britain complemented this philosophy well, with their stress on local and municipal responsibility for the poor and their attempts to discriminate between "worthy" and "unworthy" supplicants.
The importance of the Roman Catholic Church's role in poor relief in Quebec distinguished Quebec's social welfare system from those of other provinces in this period and well into the 20th century. This is because beginning in 1774, when the British Parliament enacted the Quebec Act, the Catholic Church's prominent role in many aspects of social policy-making in that province, including education and relief for the poor, was protected.
Early Church doctrine viewed poverty not merely as an inevitable component of a hierarchical society, but as a blessed condition which enabled one to be nearer to God, for "a rich man shall hardly enter into the kingdom of heaven" (Matthew 19: 23). At the same time the Gospels pointed to the need for charity, which assumes a certain level of material wealth. While the Church retained this core belief, in the centuries that followed it placed increased emphasis on using one's material possessions to benefit those less fortunate. Still later, in part as the various Christian denominations re-examined and re-shaped their philosophies, and in part in response to the appearance of socialist ideas, the betterment of the human condition during life acquired even greater importance. It came to be recognized that the State, through a coherent and sustained programme, could play a legitimate role in meeting social needs for which individual or institutional charity were insufficient.
Even if the federal government had wished to establish an old age pension system, there were constitutional impediments. The British North America Act of 1867 gave the provinces sole jurisdiction over social welfare within their domains. There were also financial considerations. Provincial and federal government revenues were limited. The federal government had the greater resources, but they were not as extensive as they would later become. Income tax, for instance, was not introduced until the First World War. The priorities for the Dominion government were economic development and the building of a viable transcontinental nation.
However, by the early 20th century, industrialization and urbanization had brought changes in work and family patterns. These changes resulted in more and more seniors ending their lives in poorhouses, or "old age homes" as they had come to be known.
Influenced by developments in other Western countries, where industrialization and its social costs had been experienced earlier, and convinced that the elderly poor should receive special consideration, Canadian social reformers advocated replacing existing practices with a national old age pension program. The Dominion government balked at the suggestion, and in 1908 instituted a Government Annuities program instead, for those who could afford it. Never widely popular, the Government Annuities program stopped selling new annuities in 1975. Nevertheless, payments from this virtually forgotten scheme continue to be paid by Human Resources Development Canada, an example of the very long time frame within which pension provisions must operate.
The creation of the Annuities program changed little. It would be nearly twenty years before the first meaningful step was taken towards replacing grudging charity for indigents with an acknowledgement of the right of older citizens to a minimum level of support from society.