Sure, but in practice how do you determine this for benefit eligibility unless, for the 45 or so years ahead of OAS eligibility, you have the government able to determine if someone is living a non-squandering life, or has some ‘good enough’ excuse for why they weren’t working.
And from a practical standpoint, let’s say government decides some portion of elderly ‘squandered’ their working years and cuts them off from OAS. Ok. So now what? Out of desperation you’ll see some pretty awful stuff that will likely end up with higher downstream costs in healthcare, law enforcement, corrections etc. The rational and defensible policy objectives of OAS is basically a guaranteed minimum income for seniors to try to ease the worst poverty. Maximum OAS and GIS is $1,845.52 a month. $22,146.22 a year. Not exactly lavish. There are lots of places where there’s no way that covers rent, groceries, and bare necessary expenses.
IMO we’re paying far too much OAS at the wealthier end, and could stand to bump GIS somewhat at the dirt poor end.