Winnipeg Free Press - PRINT EDITION

Gold-plated MP pensions cut to silver

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Members of Parliament deserve a reasonable pension for the risk they take in leaving the regular workforce for electoral politics, but the gold-plated retirement package they have enjoyed for decades was out of line with Canadian values and ordinary decency.

The Harper government has decided to tighten up pension plans for MPs and public servants, a move that became more paramount following the government's decision to raise the age of eligibility for the Old Age Supplement to 67 from 65. The government could not ask Canadians to take a hit, while allowing elected officials and public servants to conduct business as usual.

Under the new terms, MPs will pay 50 per cent of contributions to their pensions by 2017, or $39,000 a year compared to $11,000 now. They won't be able to collect a full pension until age 65, as opposed to 55 today.

After just six years of service, MPs are eligible to receive one of the richest pensions in the country, courtesy of taxpayers, who have been contributing $24 for every $1 an MP puts into the program, according to the Canadian Taxpayers Federation. Current MPs with six years' service will be able to collect an average pension of $54,693 a year, indexed for inflation. Cabinet ministers fare even better. Harper will be eligible to receive a pension of $223,500 a year by 2015, the federation says.

These benefits are unavailable to any other Canadian, except perhaps to the top executives of the country's biggest private-sector firms. Members of Parliament, moreover, are well-paid with a base salary of $157,000, so they can afford to boost their retirement savings if the government allowance is not adequate for their needs.

The Opposition has called the reforms a ploy to distract attention from the omnibus budget bill, a wide-ranging piece of legislation. The government has abused the omnibus process, which effectively prevents proper scrutiny by Parliament and watchdog groups, but most opposition MPs knew better than to attack the pension reform package itself.

The taxpayers federation says that under the new plan, MPs elected after 2017 will be eligible for a $101,000 pension after three-terms. He or she would have contributed nearly $589,000 towards that pension.

The federation says it means taxpayers will have contributed $1.62 for every $1 contributed by an MP, far less than one-for-one ratio it was seeking, but still fairer than the present system.

The pension plan is still rich by the standards of most Canadians, but the reforms have trimmed the sails of those politicians who may have come to believe politics is a career, rather than a public service.

Editorials are the consensus view of the Winnipeg Free Press’ editorial board, comprising Gerald Flood, Catherine Mitchell, David O’Brien and Paul Samyn.

Republished from the Winnipeg Free Press print edition October 19, 2012 A12

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