Pensioners stuck with inflation error caused by federal agency - The Daily News (Nanaimo) - January 11, 2010

By: Darrell Bellaart, The Daily News

Seniors will not be reimbursed for federal government pension shortfalls caused by an error in how Statistics Canada calculated the rate of inflation.

The federal government has no plan to correct the error, which resulted in a slight underestimation of the consumer price index between 2001 and 2006.

A.J. Murch, a 75-year-old Nanaimo pensioner, got that news in a letter from the office of Nanaimo-Alberni MP James Lunney.

The letter arrived in November, but she wanted to be clear on its meaning before going public with it. Since then she's spoken to Lunney's office and wants to raise awareness of the problem.

Lunney was in Israel and could not be reached for comment.

Seniors raised the issue about three years ago, when the flaw was first uncovered.

The error was in the traveller accommodation portion of the index, worth 0.1% of the total paid out over the six-year period.

Lurch's letter from Lunney's office says that Statistics Canada, "never retroactively revises the (index), given the wide use of the data."

Doing so would affect "a myriad of contracts, collective agreements, private and public pension programs, welfare rates and other arrangements," the letter says.

The Canada Pension Plan paid, on average, between $6,200 and $6,300 to each recipient between 2001-'06, so each pensioner lost about $6.25 a year, not including interest.

"This is something that needled at me," she said. She started looking for answers several years ago, after reading a newspaper story about Eva Richardson's e-mailed attempts to persuade Prime Minister Stephen Harper to reimburse the difference owing on Canada Pension Plan, Old Age Security and Guaranteed Income supplement cheques.

Richardson, 82, and living in Parksville, has since given up.

"I never really got anything good from (Lunney)," Richardson said. "I'm disappointed."

Federal Opposition parties have raised the issue repeatedly in Parliament, but the item "sort of went below the radar" once government acknowledged the error in the House, said Nanaimo-Cowichan New Democrat MP Jean Crowder.

Still, Crowder considers it a "serious" issue, since the index is used not only to adjust pensions but welfare and other payments.

She called it "ironic" that taxpayers must pay up immediately when they make a mistake, yet government can just ignore its own errors.

Murch said she's run out of options dealing with bureaucrats and MPs. She hopes going public will pressure government to take the complaint seriously.

"If we don't make it public we are condoning what's happening," she said. "It's just the same as people who don't vote: they are voting by staying home, so I think that we are supporting dishonesty if we don't call them on it."

Hamilton MP Chris Charlton, the federal NDP seniors and pensions critic, pushed the issue for some time, but without widespread public support, the issue could easily just go away, especially as seniors affected by it grow older and some die.

"There isn't a mechanism for us to force them to reverse their decision. What will change it is public pressure," Crowder said.