Photo: Interior Health

A mandatory review of the country's largest seniors benefit program is predicting all-time highs in spending over the coming years with waves of baby boomer retirements — spending levels that could have been even higher if not for changes to the public pension program.

The report is the first glimpse into how the CPP expansion, phased in over the next 40 years, will affect old age security.

The country's chief actuary writes in his report that program spending is projected to hit about $247 billion by 2060, an almost five-fold increase from planned spending this year, as more Canadians hit retirement and live longer, meaning more beneficiaries drawing payments for longer periods of time.

The projected increase is expected to be cushioned by ongoing economic growth.

Over the same projection period, Canada Pension Plan benefits will increase.

The extra money to be doled out through CPP, funded by an increase in employee and employer premiums, is expected to reduce the number of low-income seniors — meaning $3 billion less in spending on the guaranteed income supplement in 2060 — and reduce overall spending on old age security benefits, which are scaled back as incomes rise.

Paul Kershaw, an associate professor in the school of population and public health at the University of British Columbia, said the report shows that the country is expecting younger adults to rely less on old age security down the road by paying more into CPP, while simultaneously asking them to pay for increases in spending for today's aging population, noting they are often parents and grandparents.

"Younger generations will (hopefully) gladly do this. But they will be much happier doing so if their aging parents and grandparents contribute to an honest conversation about the fact that today's aging population didn't prepay for OAS like they did for their CPP, and that this is having substantial implications for the public resources that are available to spend on all age groups — including their kids and grandchildren," Kershaw, the founder of the group "Generation Squeeze," which seeks to engage young people in politics, said an email.

The most recent census figures showed the ranks of seniors grew by the fastest rate in 70 years, with Statistics Canada projecting there could be 12 million seniors by 2061. Declining birth rates mean that without increases in immigration levels, there will be fewer younger workers to replace coming waves of retirees.