What Canadians Received
Old age pensions evolved relatively slowly in Canada. Between Confederation and the First World War there was some activity in the area of retirement benefits, but the majority of the new Dominion's seniors remained unaffected. Constitutional arrangements that gave the provinces jurisdiction over social welfare limited federal revenue potential in a time before income taxes, and administrative constraints were partly responsible. So was the prevailing ideology that economic security in old age was the responsibility of individuals, their families, parishes or congregations, and eleemosynary institutions. Pensions were not considered to be an entitlement, and only gradually did the problem of the aged poor grow in the public consciousness.
Some Canadians in this period could look forward to a degree of income replacement in old age. A few received discretionary gratuity settlements for long service to an employer. Others benefited from membership in private employment-based pension plans such as those instituted by the Grand Trunk Railway in 1874 and the Canadian Pacific Railway in 1903.
The federal government of Canada, with constitutional jurisdiction over military and federal employees, passed a Superannuation Act in 1870 introducing contributory pensions for federal civil servants. In 1904, it enacted legislation to reverse an alarming desertion rate in the Canadian army by raising military pay and awarding a retirement pension of about $110 per year to troopers who served twenty years. In 1905, the Dominion authorities gave Privy Councillors and Cabinet Ministers pensions of $3,500 per year.
This was a great deal of money at the time. The Bank of Canada's Inflation Calculator gives an idea of just how much it was. The Calculator only goes back to 1914, but a sense of the value of a Cabinet Minister's pension in 1905 can be gained by knowing that $3,500 in 1914 would be equivalent to $55,408.45 in the year 2000.
At the provincial level, a civil service pension plan was established in Quebec in 1876.
For most people, though, savings, property, family and community remained the only sources of support when they were no longer able to work. Seniors lacking these options could find themselves in the poorhouse or even forced to seek refuge in jails. For those who did not require special care and could remain in their own homes, there might be a little cash relief or the provision of basic necessities like food and clothing. Widows could be particularly vulnerable, as women tended to be financially dependent. Even if a woman's husband had a work-related pension plan, there would be no spousal benefits, and an older woman's opportunities for paid employment were restricted.
People with disabilities who could not work and who did not receive support from their family or community would have little option but to turn to charity, poor relief or institutionalization. Those whose disability resulted from an injury sustained in the course of employment had very limited recourse for compensation, as the first workers' compensation legislation was not passed until 1914. Although child welfare was receiving increased attention by the late 19th century, the children of disabled people no longer able to work, and of widows left without a spouse to support them, were not able to get the financial help that is available today through private and public pension program benefits.
With provincial responsibility for welfare falling largely on the shoulders of municipalities and ecclesiastical and private charity organizations, and no overriding national legislation or policy for the alleviation of poverty, the availability and standard of assistance varied from one location to another across the country.
All forms of assistance, public or private, provided subsistence at most, and involved intense scrutiny of applicants' lives and family circumstances. Relief officials attempted to make families accept responsibility for their own members. Seniors who moved to public institutions lost their voting rights. Moreover, municipalities often made claims on the estates of seniors who entered public institutions to ensure they paid the cost of the care they received.
By the turn of the century, industrialization had created an urban working class that was increasingly dependent on poorly paid and often seasonal wage work. Struggling to survive on meagre and uncertain incomes, a growing number of people found it difficult to support their aged relatives or to provide for their own old age. Moved by their plight, social reform and labour movements, including Social Gospel proponents like the Moral and Social Reform Council and the Trades and Labour Congress of Canada, brought the question of a national pension program for the poorest seniors to the attention of the federal government. Fearing the cost, and still convinced that the right savings plan and a little self-discipline on the part of workers would solve the problem, the Dominion authorities passed aGovernment Annuities Actin 1908, providing for the sale of government annuities of up to $600.
Contributions were voluntary, payment schedules could be adapted to suit the individual, and the terms were better than those offered in the private sector. At a specified age the purchaser would begin to receive fixed yearly amounts in benefits. Few were sold, however, and the majority of benefits went to people who were not the most vulnerable anyway. The very poor could not save for contributions to a plan like this; many could barely survive.