FREDERICTON – Taxpayers in New Brunswick should have a say in setting the salaries and pension benefits of members of the Legislative Assembly, says the head of a citizens group dedicated to lower taxes.
Kevin Gaudet, the federal director of the Canadian Taxpayers Association, says the province should put in place a citizen’s panel to review MLAs’ compensation, which increased two years ago.
“It’s a better approach than letting politicians approve their own benefits,” he said Monday. “These sorts of citizens’ panels often come up with reasonable and fair recommendations.”
In April 2008, MLAs voted to increase their base salary to $85,000 from $45,347.
At the same time, however, MLAs terminated two tax-free allowances used to supplement their incomes. These allowances were calculated to be worth about $35,000 for each representative, which would have brought the original compensation package to more than $80,000.
As a result, the changes were originally downplayed as revenue neutral, or roughly equal to a three-per-cent bonus.
The increase of the total compensation package has spurred a significant boost to pension benefits.
Politicians can now receive a pension of about $30,000 a year after eight years of service, up from $16,500 or $76,000 after 20 years, up from $41,000.
“How many New Brunswickers have a job for only eight years and then enjoy a pension like that?” said Charles Cirtwill, president and CEO of the Atlantic Institute for Market Studies. “Nobody enjoys gold-plated benefits like that. The compensation package needs to be overhauled to be fairer to taxpayers.”
Fewer than half of the 53 members in the legislature qualify for a pension.
For example, only 10 of the 32 Liberal MLAs are currently eligible for a pension. The remaining 22 will receive no pension benefits unless they are re-elected this fall.
The retirement outlook is slightly rosier for Progressive Conservative MLAs, however, with 15 currently eligible for a pension.
In addition, the pension benefits kick in only when a former MLA turns 60. They can also begin receiving a pension at 55, but there is a penalty.
Despite the relatively few MLAs who will receive a pension, Green party leader Jack MacDougall said the increase to MLA pension benefits is “shockingly sad.”
“In a time when they’ve run up the biggest deficit in the history of this province “_ to give themselves this obscene increase is so disheartening to the people of New Brunswick,” MacDougall said. “And imagine doing it at a time when there is flooding going on and nobody can pay attention to the news and it just slipped by. They totally exploited that.”
The vote was held in the spring of 2008 as many New Brunswickers were busy cleaning up from one of the worst floods in the province’s history.
Justice Patrick Ryan, New Brunswick’s conflict of interest commissioner, recommended the changes to MLA compensation as part of an independent review launched in 2007.
But Ryan also recommended an outside review of MLA pensions to evaluate the changes, which has not taken place.
“When I gave my report two years ago, I considered it an important part of the compensation package,” said Ryan on Monday referring to the independent review. “But, insofar as their salary is concerned, they are the masters in their own house. If they choose not to accept my recommendation, there is nothing further that I can do.”
In his report, Ryan said “adjusting compensation internally and without scrutiny gives, rightly or wrongly, the impression of maladjustment. Transparency is the keyword, accountability its companion.”
Cirtwill said one of the greatest challenges surrounding MLA compensation is openness.
“Everybody should know how much your elected representatives are paid, including the base salary and perks and everything,” he said. “But you can never seem to get a direct answer, and that’s a huge problem.”